Company: ICUI
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0000883984-25-000035
Chunk: 14

Company: ICU MEDICAL INC/DE
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 2
Chunk 14
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 gain from the disposal of a 60% ownership interest in the joint venture, a $19.4 million gain from the difference between the fair value of our retained 40% ownership interest in the joint venture and our carrying value of that same proportionate ownership interest, and a $20.2 million unfavorable contract loss (see Note 4: Assets Held For Sale and Disposal of Business to our accompanying condensed consolidated financial statements).

Income Taxes 

For the three and nine months ended September 30, 2025 and 2024, income taxes were accrued at an estimated effective tax rate of 26% and 25%, respectively, as compared to (84)% and (26)% for the three and nine months ended September 30, 2024, respectively.

The effective tax rate for the three and nine months ended September 30, 2025 differs from the federal statutory rate of 21% principally because of the effect of the mix of U.S. and foreign incomes, section 162(m) excess compensation, federal and state valuation allowance, and tax credits. The effective tax rate during the three and nine months ended September 30, 2025 included a discrete tax expense of $0.0 million and $6.1 million, respectively, related to the sale of a 60% interest of our IV solutions business.  Additionally, there were unrecognized tax benefits released as a result of the expiration of statute of limitations during the three and nine months ended September 30, 2025 of $0.0 million and $5.0 million, respectively.  Furthermore, U.S. return-to-provision adjustments net of related tax reserves for the year ended December 31, 2024 resulted in a tax benefit of $12.0 million for both the three and nine months ended September 30, 2025.  The adjustments related primarily to a decrease to the U.S. valuation allowance. 

The Company regularly assesses the realizability of deferred tax assets and records a valuation allowance to reduce the deferred tax assets to the amount that is more likely than not to be realized. In assessing the realizability of our deferred tax assets, we weigh all available positive and negative evidence. This evidence includes, but is not limited to, historical earnings, scheduled reversal of taxable temporary differences, tax planning strategies and projected future taxable income. Due to the weight of objectively verifiable negative evidence, the Company recorded a change to the valuation allowance against certain U.S. federal and state deferred tax assets, resulting in a $