Amer Sports in a statement said it estimates that the US federal tax rate reduction from 35 percent to 21 percent will have a positive impact on the company’s effective tax rate and cash taxes from 2018 onwards.
However, as the company has deferred tax assets of approximately $40 million in the U.S., the value of the company`s net deferred tax assets is expected to be reduced by approximately $13 million due to the federal tax rate change. The reduction will be recorded as a write-down of deferred tax assets in the income tax line in the 2017 financial statements. This one-off item will have no cash flow impact. Additionally, the change in the deferred tax assets does not impact the time frame when the deferred tax assets are expected to be utilized.
Amer Sports includes Salomon, Wilson Sporting Goods, Atomic Skis, Arc’teryx, Mavic, Suunto, ENVE Composites, and Precor.