Anixter International Inc. Financial Statement Analysis
ANIXTER INTERNATIONAL INC.
Undistributed earnings of our foreign subsidiaries amounted to approximately $680.0 million at January 3, 2020. The Act
converted the U.S. system of taxing foreign earnings from a worldwide system to a territorial system. Future distributions of
foreign earnings by our affiliates abroad will no longer result in U.S. taxation. In converting to a territorial system, the Act
levied a one-time transition tax on deferred foreign earnings as of 2017. We have calculated the net combined U.S. tax impact
on this deemed repatriation to be approximately $47.2 million and plan to elect to pay the federal portion of this tax liability in
installments over 8 years. Despite the conversion to a territorial system, we consider the undistributed earnings of our foreign
subsidiaries to be indefinitely reinvested. Upon distribution of those earnings in the form of dividends or otherwise, we may be
subject to withholding taxes payable to the various foreign countries. With respect to the countries that have undistributed
earnings as of January 3, 2020, according to the foreign laws and treaties in place at that time, estimated foreign jurisdiction
withholding taxes of approximately $37.6 million would be payable upon the remittance of all earnings at January 3, 2020.
The Act reduced the U.S. corporate tax rate to 21%, which resulted in an adjustment to our U.S. deferred tax assets and
liabilities. This adjustment increased our earnings for 2017 by $14.4 million. The impact was revised and a deferred tax
adjustment of $0.7 million was recorded as a decrease in earnings for the quarter ending December 28, 2018.
EBITDA and Adjusted EBITDA
2019 EBITDA and Adjusted EBITDA by Segment:
(In millions)
Net income (loss)
Interest expense
Income taxes
Depreciation
Amortization of intangible assets
EBITDA
NSS
EES
Year Ended January 3, 2020
UPS
Corporate
Total
$
325.5
139.5 $
83.5 $
(285.6) $
262.9
77.1
77.1
30.5
30.5
9.4
7.3
3.7
16.8
37.2
16.4
5.4
13.2
35.0
$
351.3 $
152.2 $
100.4 $
(161.2) $
442.7
0.5 $
(0.1) $
12.1
$
12.5
(3.0)
(3.0)
2.7
$
354.0
$
1.8
0.6
154.5 $ 100.9 $
14.9
(137.2) $
20.0
472.2
(a)
Total of items impacting operating income
Foreign exchange and other non-operating (income)
$
Stock-based compensation
Adjusted EBITDA
(a) Items impacting operating income excludes amortization of intangible assets in the calculation of adjusted EBITDA as
amortization is already added back in the EBITDA calculation.
2018 EBITDA and Adjusted EBITDA by Segment:
(In millions)
Net income (loss)
Interest expense
Income taxes
Depreciation
Amortization of intangible assets
EBITDA
Total of items impacting operating income
Foreign exchange and other non-operating expense
(a)
Stock-based compensation
Adjusted EBITDA
NSS
Year Ended December 28, 2018
EES
UPS
$
272.2
132.3 $
75.4
$
Corporate
(323.6) $
Total
156.3
76.3
76.3
66.9
66.9
3.8
2.4
3.6
21.9
31.7
$
17.0
293.0 $
7.0
13.3
37.3
141.7
$
92.3 $
(158.5) $
368.5
4.9 $
2.1
0.7 $
5.6 $
13.3
10.2
10.2
$
1.8
299.7 $ 145.2 $
1.4
0.6
15.1
93.6 $ (127.6) $
18.9
410.9
(a)
Items impacting operating income excludes amortization of intangible assets and CEO retirement agreement expense in the
calculation of adjusted EBITDA as amortization is already added back in the EBITDA calculation and CEO retirement
agreement expense is added back as part of stock-based compensation.
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