COMPX INTERNATIONAL INC Income Taxes Disclosure
Note 7 – Income taxes:
The provision for income taxes and the difference between such provision for income taxes and the amount that would be expected using the U.S. federal statutory income tax rate of 21% are presented below. All of our pre-tax income relates to operations in the United States.
Years ended December 31, | ||||||||||||||||||
| 2023 | | 2024 | 2025 | ||||||||||||||
(In thousands) | ||||||||||||||||||
Amount | Percent | Amount |
| Percent | Amount |
| Percent | |||||||||||
U.S. federal statutory tax rate | $ | 6,217 | 21.0 | % | $ | 4,565 |
| 21.0 | % | $ | 5,425 |
| 21.0 | % | ||||
State income taxes, net of federal income tax effect* | 786 | 2.7 | 571 | 2.6 | 892 | 3.5 | ||||||||||||
Other adjustments | 7 | — | 14 | .1 | 38 | .1 | ||||||||||||
Income tax expense | $ | 7,010 | 23.7 | $ | 5,150 | 23.7 | $ | 6,355 | 24.6 | % | ||||||||
* The majority of state income taxes relate to Illinois.
Years ended December 31, | |||||||||
2023 | | 2024 | | 2025 | |||||
(In thousands) | |||||||||
Components of income tax expense: | |
| |
| | ||||
Current income tax expense: | |||||||||
U.S. federal | $ | 6,627 | $ | 4,827 | $ | 5,824 | |||
State |
| 1,103 |
| 763 |
| 1,225 | |||
7,730 | 5,590 | 7,049 | |||||||
Deferred income tax benefit: | |||||||||
U.S. federal | (609) | (398) | (597) | ||||||
State | (111) | (42) | (97) | ||||||
(720) | (440) | (694) | |||||||
Income tax expense | $ | 7,010 | $ | 5,150 | $ | 6,355 | |||
The components of the net deferred tax liability are summarized below.
December 31, | ||||||
| 2024 | | 2025 | |||
(In thousands) | ||||||
Tax effect of temporary differences related to: |
| |
| | ||
Inventories | $ | 394 | $ | 417 | ||
Property and equipment |
| (1,005) |
| (529) | ||
Accrued liabilities and other deductible differences |
| 47 |
| 62 | ||
Accrued employee benefits |
| 1,225 |
| 1,402 | ||
Goodwill |
| (1,693) |
| (1,693) | ||
Other taxable differences |
| (35) |
| (35) | ||
Net noncurrent deferred tax liability | $ | (1,067) | $ | (376) | ||
Noncurrent deferred tax asset | $ | — | $ | 29 | ||
Noncurrent deferred tax liability |
| (1,067) |
| (405) | ||
Net noncurrent deferred tax liability | $ | (1,067) | $ | (376) | ||
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed into law in the United States. The OBBBA, among other provisions, provides for bonus depreciation of qualified property, permanently modifies the interest expense deduction to use an adjusted taxable income based on a calculation similar to EBITDA, and makes changes to international tax provisions including Foreign-Derived Intangible Income (“FDII”) (renamed Foreign-Derived Deduction Eligible Income (“FDDEI”)). The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The OBBBA did not have a material impact on our 2025 consolidated financial statements, and we are in the process of evaluating the impact to future years as additional provisions take effect.
We and Contran file income tax returns in U.S. federal and various state and local jurisdictions. Our income tax returns prior to 2022 are generally considered closed to examination by applicable tax authorities.
The following table shows our net tax payments made in 2023, 2024 and 2025 disaggregated by taxing jurisdiction.
Years ended December 31, | |||||||||
2023 | | 2024 | | 2025 | |||||
(In thousands) | |||||||||
U.S. federal | $ | 6,102 | $ | 5,159 | $ | 5,349 | |||
State | |||||||||
Illinois | 635 | 507 | 671 | ||||||
Other | 570 | 587 | 95 | ||||||
Income tax payments | $ | 7,307 | $ | 6,253 | $ | 6,115 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 4, 2026 | Showing above |
| 2024 | Mar 5, 2025 | |
| 2018 | Feb 27, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Mar 1, 2017 | |
| 2015 | Mar 3, 2016 | |
About Income Taxes Disclosures
The income tax disclosure reveals how much a company actually pays in taxes versus what the statutory rate would predict. Analysts focus on the effective tax rate (ETR) reconciliation, which breaks down every item driving the gap between the 21% federal rate and the company's reported ETR — including R&D credits, foreign rate differentials, and state taxes. Deferred tax assets (DTAs) and their valuation allowances signal management's confidence in future profitability: a rising allowance suggests the company doubts it can use accumulated tax benefits. Uncertain tax benefit (UTB) reserves quantify exposure to IRS challenges on aggressive positions.
Key signals to watch: sudden ETR drops without clear operational reasons, large increases in valuation allowances, growing UTB balances, and significant unremitted foreign earnings. Post-TCJA, pay attention to GILTI and BEAT provisions that affect multinational tax structures. Compare the cash taxes paid (from the cash flow statement) against the income tax provision to gauge earnings quality.