v3.25.4
Income Taxes
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Income Taxes

Note 13. Income Taxes

The components of loss before income taxes for the years ended December 31, 2025, 2024 and 2023 were as follows:

 

For the Year Ended December 31,

 

 

2025

 

 

2024

 

 

2023

 

U.S.

$

(120,255

)

 

$

(80,257

)

 

$

(69,116

)

Foreign

 

(390,956

)

 

 

(6,658

)

 

 

(200,707

)

 

$

(511,211

)

 

$

(86,915

)

 

$

(269,823

)

 

Income tax recovery recognized in the Consolidated Statements of Operations for the years ended December 31, 2025, 2024 and 2023 was comprised of the following:

 

For the Year Ended December 31,

 

 

2025

 

 

2024

 

 

2023

 

Current income tax recovery (provision)

 

 

 

 

 

 

 

 

U.S. Federal

$

(21

)

 

 

 

 

 

 

U.S. State

 

(30

)

 

 

 

 

 

 

U.S.

 

(51

)

 

$

(640

)

 

$

1,564

 

Foreign

 

2,055

 

 

 

(33,307

)

 

 

(10,189

)

Total current income tax recovery (provision)

$

2,004

 

 

$

(33,947

)

 

$

(8,625

)

 

 

 

 

 

 

 

 

 

Deferred income tax recovery (provision)

 

 

 

 

 

 

 

 

Foreign

$

11,318

 

 

$

35,721

 

 

$

36,392

 

 

 

 

 

 

 

 

 

 

Total income tax recovery (provision)

 

 

 

 

 

 

 

 

U.S. Federal

$

(21

)

 

 

 

 

 

 

U.S. State

 

(30

)

 

 

 

 

 

 

U.S.

 

(51

)

 

$

(640

)

 

$

1,564

 

Foreign

 

13,373

 

 

 

2,414

 

 

 

26,203

 

Total income tax recovery

$

13,322

 

 

$

1,774

 

 

$

27,767

 

For the years ended December 31, 2025, 2024 and 2023, the foreign current income tax provision (recovery) was primarily for German entities.

The Company’s effective income tax rate can be affected by many factors, including but not limited to, changes in the mix of earnings in tax jurisdictions with differing statutory rates, changes in corporate structure, changes in the valuation of deferred tax assets and liabilities, the result of audit examinations of previously filed tax returns and changes in tax laws and rates. The asset and liability approach is used to recognize deferred tax assets and liabilities for the expected future tax consequences of temporary differences between the carrying amounts and the tax bases of assets and liabilities.

The Company and/or one or more of its subsidiaries file income tax returns in the U.S., Germany, Canada and Australia. Currently, the Company does not anticipate that the expiration of the statute of limitations or the completion of audits in the next fiscal year will result in liabilities for uncertain income tax positions that are materially different than the amounts accrued or disclosed as of December 31, 2025. However, this could change as tax years are examined by taxing authorities, the timing of which are uncertain at this time. The German tax authorities have completed examinations up to and including the 2021 tax year for all but one German entity which had its examination completed up to and including the 2019 tax year. The Company is generally not subject to U.S. or Canadian income tax examinations for tax years before 2022 and 2021, respectively. The Company believes that it has adequately provided for any reasonably foreseeable outcomes related to its tax audits and that any settlement will not have a material adverse effect on its consolidated results.

The liability in the Consolidated Balance Sheets related to unrecognized tax benefits was $nil as of December 31, 2025 (2024 – $nil). The Company recognizes interest and penalties related to unrecognized tax benefits in “Income tax recovery” in the Consolidated Statements of Operations. During the years ended December 31, 2025, 2024 and 2023, the Company did not record any interest and penalties related to unrecognized tax benefits.

The difference between the U.S. Federal statutory and the Company’s effective rate for the year ended December 31, 2025 was as follows:

 

 

 

For the Year Ended December 31,

 

Amount

 

%

Income tax recovery using U.S. Federal statutory rate on loss before income taxes

$

107,354

 

21.0%

U.S. Federal

 

 

 

Changes in valuation allowances

 

(20,435

)

(4.0%)

Other (a)

 

(4,424

)

(0.9%)

U.S. state income taxes, net of federal income tax effect (b)

 

(30

)

(0.0%)

Foreign tax effects

 

 

 

Germany

 

 

 

Trade taxes

 

10,689

 

2.1%

Changes in valuation allowances

 

(13,515

)

(2.6%)

Other (a)

 

(223

)

(0.0%)

Canada

 

 

 

Statutory income tax rate differential

 

(18,365

)

(3.6%)

Provincial taxes

 

25,989

 

5.1%

Changes in valuation allowances

 

(72,747

)

(14.2%)

Other (a)

 

(557

)

(0.1%)

Australia

 

 

 

Changes in valuation allowances

 

(7,201

)

(1.4%)

Prior year true-up: Non-capital loss and others

 

6,610

 

1.3%

Other (a)

 

177

 

0.0%

Income tax recovery and effective tax rate

$

13,322

 

2.6%
(a)
Primarily includes return-to-provision adjustments, non-taxable government subsidies, tax benefit of partnership structure and the effect of statutory tax rate changes enacted during the period.
(b)
In 2025, state income taxes in Maryland and Louisiana comprise the majority of the U.S. state income taxes, net of federal income tax effect category.

Differences between the U.S. Federal statutory and the Company’s effective rates for the years ended December 31, 2024 and 2023 were as follows:

 

For the Year Ended December 31,

 

 

2024

 

 

2023

 

U.S. Federal statutory rate

21%

 

 

21%

 

 

 

 

 

 

 

Income tax recovery using U.S. Federal statutory rate on loss before income taxes

$

18,252

 

 

$

56,663

 

Tax differential on foreign income (loss)

 

(1,243

)

 

 

9,049

 

Effect of foreign earnings (a)

 

(5,169

)

 

 

—

 

Valuation allowance

 

(2,392

)

 

 

(39,810

)

Tax benefit of partnership structure

 

1,479

 

 

 

3,132

 

Non-taxable foreign subsidies

 

2,332

 

 

 

3,297

 

Non-deductible goodwill impairment

 

(10,039

)

 

 

—

 

True-up of prior year taxes

 

(363

)

 

 

(4,553

)

Other

 

(1,083

)

 

 

(11

)

Income tax recovery

$

1,774

 

 

$

27,767

 
(a)
Primarily due to the impact of the global intangible low-taxed income provision in the Tax Cuts and Jobs Act of 2017.

Deferred income tax assets and liabilities as of December 31, 2025 and December 31, 2024 were comprised of the following:

 

December 31,

 

2025

 

 

2024

 

German tax loss carryforwards

$

20,090

 

 

$

18,843

 

U.S. tax loss carryforwards and credits

 

88,205

 

 

 

61,318

 

Canadian tax loss carryforwards

 

56,886

 

 

 

34,758

 

Australian tax loss carryforwards

 

9,047

 

 

 

5,544

 

Basis difference between income tax and financial reporting with respect to operating sites

 

(51,025

)

 

 

(109,550

)

Amortizable intangible assets

 

(822

)

 

 

(6,973

)

Accounts payable and accrued expenses

 

4,020

 

 

 

3,100

 

Finance leases

 

9,883

 

 

 

10,799

 

Scientific research and experimental development investment tax credit and expenditure pool

 

8,076

 

 

 

6,390

 

Other

 

3,958

 

 

 

575

 

 

 

148,318

 

 

 

24,804

 

Valuation allowance

 

(198,777

)

 

 

(81,798

)

Net deferred income tax liability

$

(50,459

)

 

$

(56,994

)

 

 

 

 

Comprised of:

 

 

 

 

 

Deferred income tax asset

$

7,839

 

 

$

17,778

 

Deferred income tax liability

 

(58,298

)

 

 

(74,772

)

Net deferred income tax liability

$

(50,459

)

 

$

(56,994

)

 

The following table details the scheduled expiration dates of the Company’s net operating loss, interest, investment tax credit and other tax attributes carryforwards as of December 31, 2025:

Amount

 

 

Expiration

U.S.

 

 

 

 

Net operating loss

$

76,800

 

 

Indefinite

Interest

$

343,200

 

 

Indefinite

Germany

 

 

 

 

Corporate and trade tax loss

$

101,300

 

 

Indefinite

Interest

$

24,800

 

 

Indefinite

Canada

 

 

 

 

Net operating loss

$

174,100

 

 

2036 – 2044

Interest

$

51,500

 

 

Indefinite

Scientific research and experimental development investment tax credit

$

6,800

 

 

2030 – 2044

Australia

 

 

 

 

Net operating loss

$

30,200

 

 

Indefinite

At each reporting period, the Company assesses whether it is more likely than not that the deferred tax assets will be realized, based on the review of all available positive and negative evidence, including future reversals of existing taxable temporary differences, estimates of future taxable income, past operating results and prudent and feasible tax planning strategies. The carrying value of the Company’s deferred tax assets reflects its expected ability to generate sufficient future taxable income in certain tax jurisdictions to utilize these deferred income tax benefits. Significant judgment is required when evaluating this positive and negative evidence.

Changes in valuation allowances related to net deferred tax assets for the years ended December 31, 2025 and 2024 were as follows:

 

December 31,

 

 

2025

 

 

2024

 

Beginning of year balance

$

81,798

 

 

$

78,689

 

Additions (reversals)

 

 

 

 

 

U.S.

 

20,435

 

 

 

8,727

 

Germany

 

13,515

 

 

 

—

 

Canada

 

72,747

 

 

 

(7,815

)

Australia

 

7,201

 

 

 

610

 

The impact of changes in foreign exchange rates

 

3,081

 

 

 

1,587

 

End of year balance

$

198,777

 

 

$

81,798

 

As of December 31, 2025, the Company has a full valuation allowance against the net deferred tax assets of its U.S., Canadian and certain German entities.

The Company has not recognized a tax liability on the undistributed earnings of its foreign subsidiaries as of December 31, 2025 because these earnings are expected to be permanently reinvested outside the U.S. or repatriated without incurring a tax liability.

 

 

 

 

 

Income tax payments (net of refunds) by jurisdiction for the year ended December 31, 2025 were as follows:

 

 

For the Year Ended

 

 

December 31, 2025

 

U.S. state

$

548

 

Foreign

 

 

Germany Federal

 

2,828

 

Germany state and local

 

 

Thuringia

 

6,610

 

Saalburg-Ebersdorf

 

6,478

 

Arneburg

 

3,753

 

Rosenthal

 

3,576

 

Torgau

 

1,482

 

Other

 

743

 

Total

$

26,018

 

Global Corporate Minimum Tax Rate

 

In 2021, the Organisation for Economic Co-operation and Development proposed a global corporate minimum tax rate of 15% (the “Pillar Two” rules). As of December 31, 2025, Germany, Canada and Australia have enacted laws to conform with the Pillar Two rules, but the U.S. has not. The enacted Pillar Two rules have not had a material impact to the Company's effective tax rates and tax liabilities as of December 31, 2025. The Company will continue to monitor the impact of proposed and enacted legislative changes in the geographic regions in which we operate.