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Income Taxes
9 Months Ended
Jun. 30, 2016
Income Taxes [Abstract]  
Income Taxes

(8)Income Taxes



The effective tax rates for the three months ended June 30, 2016 and 2015 were 31.3% and 10.4%, respectively. The increase in the effective tax rate was primarily due to an overall increase in quarterly pre-tax book income relating to the sale of the Medical Products business which decreased the rate benefit for the realization of an unrecognized tax benefit.  Also driving the rate increase was the mix of earnings between taxing jurisdictions.  The effective tax rates for the nine months ended June 30, 2016 and 2015 were 31.2% and 21.0%, respectively.  The increase in the effective tax rate was primarily due to higher permanent differences related to foreign dividends, the mix of earnings between jurisdictions with differing tax rates and increased pre-tax book income relating to the sale of the Medical Products business.  The Company believes it is reasonably possible that $698 of unrecognized tax benefits will be realized in fiscal year 2017.



The May 2016 sale of the Medical Products business, comprised of IZI Medical Products, LLC (“IZI”) and Ilumark GmbH (“Ilumark”), resulted in an ordinary tax loss on the sale of IZI and a capital tax loss on the sale of Ilumark.  The ordinary loss on IZI is largely driven by the loss on disposal of intangibles, which converted into a net operating loss carryforward of approximately $50.0 to $60.0 million ($17.5 to $21.0 million tax effected).  The Company expects to fully utilize the net operating loss as an offset to future ordinary income.  The sale of Ilumark generated an estimated capital loss carryforward of approximately $600  ($210 net of tax) which can be offset against future capital gains.  The Company does not expect to have any significant capital gains in the next five years, the carryforward period for capital losses, and has recorded a valuation allowance through its third quarter of fiscal 2016 annual estimated tax rate.