Quarterly report pursuant to Section 13 or 15(d)

Note 12 - Income Taxes

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Note 12 - Income Taxes
 9 Months Ended
Jul. 31, 2024
Notes to Financial Statements  
Income Tax Disclosure [Text Block]

Note 12. Income Taxes

 

The following table summarizes income before income taxes and income tax expense for the three and nine months ended July 31, 2024 and 2023:

 

   

Three Months Ended July 31,

    

Nine Months Ended July 31,

  

(in thousands)

  

2024

    

2023

    

2024

    

2023

  
                                 

Income before income taxes

   $ 10,641     $ 13,654     $ 11,030     $ 27,826  
                                 

Income tax expense

   $ 3,081     $ 3,318     $ 4,250     $ 5,427  

 

For the three months ended July 31, 2024 and 2023, the Company’s effective tax rate was 29.0% and 24.3%, respectively. The comparability of effective tax rates between both periods was primarily impacted by (1) increases in the UK corporate income tax rate to 25% and (2) the warrants fair value activity in the three months ended July 31, 2023, as it is not recognized for tax purposes. For the nine months ended July 31, 2024 and 2023, the Company’s effective tax rate was 38.5% and 19.5%, respectively. The comparability of effective tax rates between both periods was primarily impacted by (1) higher excess tax deficiencies from share-based compensation exercise and vesting activity in the nine months ended July 31, 2024, (2) the warrants fair value activity in the nine months ended July 31, 2023, as it is not recognized for tax purposes, (3) increases in the UK corporate income tax rate to 25% and (4) the expiration of the capital allowances super deduction in the UK in fiscal 2024.