XML 57 R24.htm IDEA: XBRL DOCUMENT
v3.19.1

Income taxes | 12 Months Ended
--- | ---
Dec. 31, 2018
Income Tax Disclosure [Abstract] |
Income taxes | Income taxes The Company’s operations are conducted by its foreign subsidiaries in Latin America and the Caribbean. The foreign subsidiaries are incorporated under the laws of their respective countries and as such the Company is taxed in such foreign countries. Statutory tax rates in the countries in which the Company operates for fiscal years 2018, 2017 and 2016 were as follows:
|  | 2018 |  | 2017 |  | 2016
Puerto Rico |  | 20% |  | 20% |  | 20%
Martinique, French Guyana, Guadeloupe |  | 33% |  | 35% |  | 35%
St Croix, St. Thomas |  | 23% |  | 35% |  | 35%
Aruba |  | 25% |  | 35% |  | 35%
Curacao |  | 22% |  | 35% |  | 35%
Argentina |  | 30% |  | 35% |  | 35%
Brazil and Venezuela |  | 34% |  | 34% |  | 34%
Colombia |  | 37% |  | 40% |  | 40%
Peru |  | 30% |  | 30% |  | 28%
Costa Rica and Mexico |  | 30% |  | 30% |  | 30%
Panamá, Uruguay, Trinidad and Tobago and Netherlands |  | 25% |  | 25% |  | 25%
Ecuador |  | 28% |  | 25% |  | 25%
Chile |  | 27% |  | 26% |  | 24%
Income tax expense for fiscal years 2018, 2017 and 2016 consisted of the following:
|  | 2018 |  | 2017 |  | 2016
Current income tax expense |  | $ | 47,488 |  |  | $ | 51,215 |  |  | $ | 54,142 |
Deferred income tax expense |  | 648 |  |  | 2,099 |  |  | 5,499 |
Income tax expense |  | $ | 48,136 |  |  | $ | 53,314 |  |  | $ | 59,641 |
Income tax expense for fiscal years 2018, 2017 and 2016 differed from the amounts computed by applying the Company’s weighted-average statutory income tax rate to pre-tax income as a result of the following:
|  | 2018 |  | 2017 |  | 2016
Pre-tax income |  | $ | 85,169 |  |  | $ | 182,813 |  |  | $ | 138,629 |
Weighted-average statutory income tax rate (i) |  | 42.7 | % |  | 35.5 | % |  | 35.4 | %
Income tax expense at weighted-average statutory tax rate on pre-tax income |  | 36,354 |  |  | 64,901 |  |  | 49,030 |
Permanent differences: |  |  |  |  |  |
Change in valuation allowance (ii) |  | (24,307 | ) |  | (21,241 | ) |  | (19,217 | )
Expiration and changes in tax loss carryforwards (iii) |  | 18,599 |  |  | 12,785 |  |  | 18,234 |
Venezuelan remeasurement and inflationary impacts (iv) |  | 16,857 |  |  | 2,683 |  |  | 4,368 |
Non-taxable income and non-deductible expenses |  | 8,406 |  |  | 10,157 |  |  | 12,915 |
Tax benefits, including Brazil and other |  | (11,403 | ) |  | (10,744 | ) |  | (14,437 | )
Income taxes withholdings on intercompany transactions (v) |  | 7,723 |  |  | 6,804 |  |  | 22,379 |
Differences including exchange rate, inflation adjustment and filing differences |  | (2,815 | ) |  | (11,909 | ) |  | (13,002 | )
Alternative Taxes |  | (1,283 | ) |  | 156 |  |  | (114 | )
Others |  | 5 |  |  | (278 | ) |  | (515 | )
Income tax expense |  | $ | 48,136 |  |  | $ | 53,314 |  |  | $ | 59,641 |
(i) | Weighted-average statutory income tax rate is calculated based on the aggregated amount of the income before taxes by country multiplied by the prevailing statutory income tax rate, divided by the consolidated income before taxes.
(ii) | Comprises net changes in valuation allowances for the year, mainly related to Non-Operating Losses (NOLs).
(iii) | Expiration of loss tax carryforwards are mainly generated by Holding legal entities and the Caribbean division.
(iv) | Comprises changes in valuation allowance during 2018, 2017 and 2016 for $304, $2,108 and $2,180, respectively.
(v) | Comprises income tax withheld on the payment of interest on intercompany loans. In 2016 this item also includes the withholding income tax of $18.2 million due the repayment of the Company’s 2016 Notes.
The tax effects of temporary differences and carryforwards that comprise significant portions of deferred tax assets and liabilities at December 31, 2018 and 2017 are presented below:
|  | 2018 |  | 2017
Tax loss carryforwards (i) |  | $ | 178,993 |  |  | $ | 238,082 |
Purchase price allocation adjustment |  | 17,006 |  |  | 24,437 |
Property and equipment, tax inflation |  | 38,588 |  |  | 37,577 |
Other accrued payroll and other liabilities |  | 30,300 |  |  | 30,730 |
Share-based compensation |  | 2,591 |  |  | 3,850 |
Provision for contingencies |  | 2,708 |  |  | 2,478 |
Other deferred tax assets (ii) |  | 26,193 |  |  | 21,528 |
Other deferred tax liabilities (iii) |  | (7,979 | ) |  | (10,670 | )
Property and equipment - difference in depreciation rates |  | (11,103 | ) |  | (12,639 | )
Valuation allowance (iv) |  | (219,920 | ) |  | (271,651 | )
Net deferred tax asset |  | $ | 57,377 |  |  | $ | 63,722 |
(i) | As of December 31, 2018, the Company and its subsidiaries has accumulated operating tax loss carryforwards amounting to $649,312. The Company has operating tax loss carryforwards amounting to $151,343, expiring between 2019 and 2023. In addition, the Company has operating tax loss carryforwards amounting to $211,043 expiring after 2023 and operating tax loss carryforwards amounting to $286,926 that do no expire. Changes in tax loss carryforwards for the year relate to the use of NOLs, mainly in Brazil, Colombia and Chile, and the expiration of tax loss carryforwards in other markets.
(ii) | Other deferred tax assets reflect the net tax effects of temporary differences between the carrying amounts of assets for financial reporting purposes (accounting base) and the amounts used for income tax purposes (tax base). For the fiscal year ended December 31, 2018, this item includes: bad debt reserve in Puerto Rico for $4,967, provision for regular expenses for $10,458, mainly corresponding to Brazil, Mexico and Colombia; and foreign currency exchange differences in Argentina and Brazil for $4,736. For the fiscal year ended December 31, 2017 this item includes regular expenses provisions for $9,824, for Brazil, Mexico and Colombia; $698 related to foreign currency exchange differences in Venezuela and $3,782 in Puerto Rico, related to bad debt reserve.
(iii) | Primarily related to intangible assets and accelerated depreciation of fixed assets.
(iv) | In assessing the realization of deferred income tax assets, the Company considers whether it is more likely than not that some portion or all of the deferred income tax assets will not be realized.
The total amount of $57,377 for the year ended December 31, 2018, is presented in the consolidated balance sheet as non-current asset and non-current liability amounting to $58,334 and $957, respectively. The total amount of $63,722 for the year ended December 31, 2017, is presented in the consolidated balance sheet as non-current asset and non-current liability amounting to $74,299 and $10,577, respectively. Deferred income taxes have not been recorded for temporary differences related to investments in certain foreign subsidiaries. These temporary differences, comprise undistributed earnings considered permanently invested in subsidiaries amounted to $141,431 at December 31, 2018. Determination of the deferred income tax liability on these unremitted earnings is not practicable because such liability, if any, is dependent on circumstances existing if and when remittance occurs. As of December 31, 2018, and 2017, the Company has no t identified unrecognized tax benefits that would favorably affect the effective tax rate if resolved in the Company’s favor. The Company account for uncertain tax positions by determining the minimum recognition threshold that a tax position is required to meet before being recognized in the financial statements. This determination requires the use of significant judgment in evaluating the tax positions and assessing the timing and amounts of deductible and taxable items. The Company is regularly under audit in multiple tax jurisdictions and is currently under examination in several jurisdictions. The Company is generally no longer subject to income tax examinations by tax authorities for years prior to 2012. As of December 31, 2018, there are certain matters related to the interpretation of income tax laws for which there is a possibility that a loss may have been incurred, as of the date of the financial statements in accordance with ASC 740 in an amount of $181 million, related to assessments for the fiscal years 2009 to 2014. No formal claim has been made for fiscal years within the statute of limitation by Tax authorities in any of the mentioned matters, however those years are still subject to audit and claims may be asserted in the future. It is reasonably possible that, as a result of audit progression within the next 12 months, there may be new information that causes the Company to reassess the tax positions because the outcome of tax audits cannot be predicted with certainty. While the Company cannot estimate the impact that new information may have on their unrecognized tax benefit balance, it believes that the liabilities recorded are appropriate and adequate as determined under ASC 740.

X
- References No definition available. + Details
Name: | us-gaap_IncomeTaxDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 740 -URI http://asc.fasb.org/topic&trid=2144680 + Details
Name: | us-gaap_IncomeTaxDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration