Foundation Building Materials Provides Preliminary Update Regarding Its Tax Receivable Agreement
04 Janeiro 2018 - 10:00AM
Business Wire
Foundation Building Materials, Inc. (NYSE: FBM), one of the
largest specialty distributors of wallboard, suspended ceiling
systems and mechanical insulation in North America, today is
providing preliminary estimates regarding its Tax Receivable
Agreement (the “TRA”) with its controlling shareholder due to the
passage of recent tax legislation.
On December 22, 2017, President Trump signed the Tax Cut and
Jobs Act of 2017 (the “Act”). The Act reduced the maximum federal
corporate income tax rate from 35% to 21%, effective January 1,
2018. The passage of this legislation is expected to significantly
reduce the Company’s liability under the TRA. In the Company’s most
recent Quarterly Report on Form 10-Q filed with the Securities and
Exchange Commission, the Company disclosed that its undiscounted
liability as of September 30, 2017 under the TRA was $203.8
million. Due to the decrease in the federal corporate income tax
rate, the Company now expects that as of December 31, 2017, the
undiscounted liability of the TRA will be between $130.0 million
and $145.0 million, and the discounted present value of the TRA
will be between $85.0 million and $100.0 million.
The decrease in the undiscounted value of the TRA will be
recorded in the consolidated statement of operations for the year
ended December 31, 2017, and we estimate earnings per share for the
fourth quarter to be positively impacted by a range of $1.37 to
$1.72 due to this adjustment.
The Company is currently evaluating the overall impact of the
Act on other items, including but not limited to, its deferred tax
assets and overall effective tax rate, and will provide an update
in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2017. The impact of the Act may differ from this
estimate, possibly materially, due to, among other things, changes
in interpretation and assumptions the Company has made, regulatory
guidance that may be issued, and actions the Company may take
because of the Act.
Further information regarding the TRA can be found in the
Company’s filings with the SEC, which can be found in the investor
relations section of our website (www.fbmsales.com) or the SEC’s
web portal at www.sec.gov.
About Foundation Building
Materials
Foundation Building Materials is a specialty distributor of
wallboard, suspended ceiling systems, and mechanical insulation
throughout the U.S. and Canada. Based in Tustin, California, the
Company employs more than 3,500 people and operates more than 220
branches across the U.S. and Canada.
Forward-Looking
Statements
This press release contains “forward-looking statements” as that
term is defined in the Private Securities Litigation Reform Act of
1995. Forward-looking statements include, without limitation, any
statement that may predict, forecast, indicate or imply future
results, performance or achievements, and may contain words such as
“believe,” “anticipate,” “expect,” “estimate,” “intend,” “project,”
“plan,” or words or phrases with similar meaning. Forward-looking
statements should not be read as a guarantee of future performance
or results, and will not necessarily be accurate indications of the
times at, or by, which such performance or results will be
achieved. Forward-looking statements are based on current
expectations, forecasts and assumptions that involve risks and
uncertainties, including, but not limited to, economic,
competitive, governmental and technological factors outside of our
control, that may cause our business, strategy or actual results to
differ materially from the forward-looking statements. We do not
intend, and undertake no obligation, to update any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as may be required by applicable law.
Investors are referred to our filings with the Securities and
Exchange Commission, including our Annual Report on Form 10-K and
our Quarterly Reports on Form 10-Q for additional information
regarding the risks and uncertainties that may cause actual results
to differ materially from those expressed in any forward-looking
statement.
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version on businesswire.com: http://www.businesswire.com/news/home/20180104005421/en/
Investor Relations:Foundation Building MaterialsJohn Moten,
657-900-3213VP Investor Relationsjohn.moten@fbmsales.comorMedia
Relations:Joele Frank, Wilkinson Brimmer KatcherJed Repko or Ed
Trissel, 212-355-4449
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