Company: SBH
Filing Date: 2025-11-13
Form Type: 10-K
Source: 0001193125-25-280122
Chunk: 73

Company: Sally Beauty Holdings, Inc.
Filing Date: 2025-11-13
Form: 10-K
Item: Item 6
Chunk 73
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         Net deferred tax liability
          
         $
         57,225

         $
         69,959

       The deferred taxes noted above are classified as follows in the Company's Consolidated Balance Sheets (in thousands):

         September 30,

         2025

         2024

         Balance sheet classification:

         Assets

            Other assets
          
         $
         22,264

         $
         21,799

         Liabilities

            Deferred income tax liabilities, net

         79,489

         91,758

            Net deferred tax liability
          
         $
         57,225

         $
         69,959

       We believe that it is more-likely-than-not that the results of future operations will generate sufficient taxable income to realize the deferred tax assets, net of the valuation allowance. During fiscal year 2025, existing valuation allowances were decreased by approximately $6.9 million, primarily for net operating loss carry-forwards of various members of the affiliated group in foreign jurisdictions. We continue to record a valuation allowance to account for uncertainties 

F-27

Sally Beauty Holdings, Inc. and SubsidiariesNotes to Consolidated Financial StatementsFiscal Years ended September 30, 2025, 2024, and 2023 

regarding recoverability of certain deferred tax assets, primarily foreign loss carry-forwards and tax credit carry-forwards.Domestic earnings before provision for income taxes were $246.1 million, $175.2 million, and $217.7 million in the fiscal years 2025, 2024 and 2023, respectively. Foreign earnings before provision for income taxes were $17.3 million, $31.1 million, and $34.4 million in the fiscal years 2025, 2024 and 2023, respectively. Tax reserves are evaluated and adjusted as appropriate, while taking into account the progress of audits by various taxing jurisdictions and other changes in relevant facts and circumstances evident at each balance sheet date. We do not expect the outcome of current or future tax audits to have a material adverse effect on our consolidated financial condition, results of operations or cash flow.Applicable deferred tax liabilities have been provided for undistributed foreign earnings in excess of foreign working capital and cash requirements. As a result of U.S. Tax Reform, the repatriation of cash to the U.S. is generally no longer taxable for federal income tax purposes but could be subject to