Income Taxes

9 Months Ended

Oct. 31, 2024

Income Tax Disclosure [Abstract]

Income Taxes

NOTE 10 – INCOME TAXES

The Company recorded an income tax provision of $2.5 million and $4.5 million for the three months ended October 31, 2024 and 2023, respectively.

The effective tax rate was 31.5% and 20.4% for the three months ended October 31, 2024 and 2023, respectively. The significant components of the effective tax rate changed primarily due to the tax consequences of a foreign currency gain related to an extraordinary intercompany dividend, an increase in valuation allowances against certain foreign losses and a limitation on a portion of the foreign tax credits and deductions related to the tax on Global Intangible Low-Taxed Income ("GILTI").

The Company recorded an income tax provision of $5.7 million and $9.9 million for the nine months ended October 31, 2024 and 2023, respectively.

The effective tax rate was 31.7% and 22.0% for the nine months ended October 31, 2024 and 2023, respectively. The significant components of the effective tax rate changed primarily due to the tax consequences on a foreign currency gain related to an extraordinary intercompany dividend, a limitation on a portion of the foreign tax credits and deductions related to the tax on GILTI and an increase in valuation allowances against certain foreign losses.

At October 31, 2024, the Company had no deferred tax liability for substantially all of the undistributed foreign earnings of approximately $246.5 million because the Company intends to permanently reinvest such earnings in its foreign operations. It is not practicable to estimate the tax liability related to a future distribution of these permanently reinvested foreign earnings.