Income taxes (Tables)

12 Months Ended

Feb. 01, 2020



(in millions)	Fiscal 2020		Fiscal 2019			Fiscal 2018
Income (loss) before income taxes:
– US	$	32.3	$	(1,135.8	)	$	202.2
– Foreign	97.4		333.2			325.0
Total income (loss) before income taxes	$	129.7	$	(802.6	)	$	527.2

Current taxation:
– US	$	3.0	$	(55.2	)	$	35.9
– Foreign	1.9		15.8			6.1
Deferred taxation:
– US	17.0		(85.8		)	(34.8		)
– Foreign	2.3		(20.0		)	0.7
Total income tax expense (benefit)	$	24.2	$	(145.2	)	$	7.9

Reconciliation of Effective Tax Rate

As the statutory rate of corporation tax in Bermuda is 0%, the differences between the US federal income tax rate and the effective tax rates for Signet have been presented below:



	Fiscal 2020		Fiscal 2019		Fiscal 2018
US federal income tax rates	21.0	%	21.0	%	35.0	%
US state income taxes	3.1	%	2.3	%	1.9	%
Differences between US federal and foreign statutory income tax rates	1.3	%	0.3	%	(1.0	)%
Expenditures permanently disallowable for tax purposes, net of permanent tax benefits	3.3	%	(0.8	)%	1.4	%
Impact of global reinsurance arrangements	(20.3	)%	3.1	%	(8.1	)%
Impact of global financing arrangements	—	%	4.2	%	(11.4	)%
Benefit in current taxes - the TCJ Act	—	%	—	%	(4.1	)%
Remeasurement of deferred taxes - the TCJ Act	—	%	—	%	(12.3	)%
Impairment of goodwill	7.5	%	(13.4	)%	—	%
Out of period adjustment	—	%	1.4	%	—	%
Other items	2.8	%	—	%	0.1	%
Effective tax rate	18.7	%	18.1	%	1.5	%

Schedule of Deferred Tax Assets and Liabilities

Deferred tax assets (liabilities) consisted of the following:



	February 1, 2020									February 2, 2019
(in millions)	Assets			(Liabilities)			Total			Assets			(Liabilities)			Total
Intangible assets	$	—		$	(63.0	)	$	(63.0	)	$	—		$	(63.8	)	$	(63.8	)
US property, plant and equipment	—			(55.4		)	(55.4		)	—			(68.2		)	(68.2		)
Foreign property, plant and equipment	6.5			—			6.5			6.5			—			6.5
Inventory valuation	—			(203.1		)	(203.1		)	—			(179.1		)	(179.1		)
Revenue deferral	102.5			—			102.5			122.0			—			122.0
Derivative instruments	—			(4.3		)	(4.3		)	—			(1.3		)	(1.3		)
Lease assets	—			(358.2		)	(358.2		)	—			—			—
Lease liabilities	380.6			—			380.6			26.2			—			26.2
Deferred compensation	7.3			—			7.3			7.5			—			7.5
Retirement benefit obligations	—			(6.7		)	(6.7		)	—			(5.8		)	(5.8		)
Share-based compensation	4.1			—			4.1			3.5			—			3.5
Other temporary differences	77.7			—			77.7			46.7			—			46.7
Net operating losses and foreign tax credits	137.0			—			137.0			151.8			—			151.8
Value of capital losses	12.9			—			12.9			13.9			—			13.9
Total gross deferred tax assets (liabilities)	$	728.6		$	(690.7	)	$	37.9		$	378.1		$	(318.2	)	$	59.9
Valuation allowance	(38.4		)	—			(38.4		)	(38.9		)	—			(38.9		)
Deferred tax assets (liabilities)	$	690.2		$	(690.7	)	$	(0.5	)	$	339.2		$	(318.2	)	$	21.0

Disclosed as:
Non-current assets							$	4.7								$	21.0
Non-current liabilities							(5.2		)							—
Deferred tax assets (liabilities)							$	(0.5	)							$	21.0

Summary of Activity Related to Unrecognized Tax Benefits

The following table summarizes the activity related to the Company’s unrecognized tax benefits for US federal, US state and non-US tax jurisdictions:



(in millions)	Fiscal 2020			Fiscal 2019			Fiscal 2018
Unrecognized tax benefits, beginning of period	$	18.1		$	12.0		$	12.0
Increases related to current year tax positions	2.0			2.5			2.3
Increases related to prior year tax positions	6.0			6.2			—
Lapse of statute of limitations	(2.6		)	(2.4		)	(2.4		)
Difference on foreign currency translation	—			(0.2		)	0.1
Unrecognized tax benefits, end of period	$	23.5		$	18.1		$	12.0