| Schedule of reconciliation of income tax (expense) benefit |
| Schedule of reconciliation of income tax (expense) benefit |
|
|
|
| |
2025 |
2024 |
2023 |
| Income (loss) before income tax |
331,749 |
(71,851) |
(296,084) |
| Luxembourg statutory income tax rate (i) |
23.87% |
24.94% |
24.94% |
| |
|
|
|
| Expected income tax benefit (expense) at statutory rate |
(79,188) |
17,920 |
73,843 |
| Tax effects of translation of non-monetary assets/liabilities to functional currency |
53,683 |
(1,323) |
13,686 |
| Uncertain income tax treatment (ii) |
23,221 |
(94,764) |
(5,194) |
| Special mining levy and special mining tax |
(22,133) |
(7,868) |
(5,366) |
| Difference in tax rate of subsidiaries outside Luxembourg |
(23,480) |
12,591 |
24,665 |
| Unrecognized deferred tax on net operating losses(iii) |
(48,226) |
(25,515) |
(52,091) |
| Other tax differences |
(12,482) |
(16,597) |
(45,269) |
| Income tax (expense) benefit |
(108,605) |
(115,556) |
4,274 |
| |
|
|
|
| Current |
(106,415) |
(205,674) |
(80,935) |
| Deferred |
(2,190) |
90,118 |
85,209 |
| Income tax (expense) benefit |
(108,605) |
(115,556) |
4,274 |
(i) On December 11, 2024, the Luxembourg Parliament approved
a reduction in the aggregate corporate income tax rate from 24.94% to 23.87%, effective January 1, 2025. As NEXA’s standalone net
operating losses do not meet the recognition criteria, no deferred tax assets were recognized. Therefore, the tax rate reduction has no
impact on the consolidated interim income statement.
(ii) Primarily related to income tax provision of Cerro
Lindo Stability Agreement for the years 2014 to 2021. For further details, please refer to note 11 (d).
(iii) As of December 31, 2025, the Company did not record
deferred tax assets on USD 188,087 net operating losses (2024: USD 93,385) after an assessment made by management considering the future
recoverability of these net operating losses. As of December 31, 2025, the Company has an accumulated amount of USD 1,166,839 not recognized
as deferred taxes on net operating losses. From the total amount of unused tax losses, USD 106 have an expiration
limit of 5 years, USD 884,617 of 17 years, USD 14,907 of 20 years, and USD 267,209 can be carried forward indefinitely.
|
| Schedule of changes on deferred tax income tax assets and liabilities |
| Schedule
of changes on deferred tax income tax assets and liabilities |
|
|
|
| |
2025 |
2024 |
2023 |
| Balance at the beginning of the year |
104,352 |
68,667 |
(24,886) |
| Effect on income (loss) for the year |
(2,190) |
90,118 |
85,209 |
| Effect on other comprehensive income – fair value adjustment |
110 |
535 |
198 |
| Effect on other comprehensive loss – hedge accounting |
1,349 |
981 |
(1,269) |
| Effects of consolidation of acquired subsidiary – note 4(iii) |
1,997 |
- |
- |
| Effect on other comprehensive income (loss) – translation effect included in cumulative translation adjustment |
23,730 |
(50,565) |
9,415 |
| Others |
- |
(5,384) |
- |
| Balance at the end of year |
129,348 |
104,352 |
68,667 |
|
| Schedule of analysis of deferred income tax assets and liabilities |
| Schedule
of analysis of deferred income tax assets and liabilities |
|
|
|
|
| |
|
2025 |
|
2024 |
| Tax credits on net operating losses |
|
320,929 |
|
242,278 |
| |
|
|
|
|
| Tax credits on temporary differences |
|
|
|
|
| Asset retirement obligations |
|
25,556 |
|
22,498 |
| Foreign exchange gains |
|
22,159 |
|
14,222 |
| Inventory provisions |
|
15,268 |
|
10,903 |
| Environmental liabilities |
|
12,108 |
|
10,847 |
| Tax, labor and civil provisions |
|
11,169 |
|
7,886 |
| Provision for employee benefits |
|
6,910 |
|
5,196 |
| Revaluation of derivative financial instruments |
|
1,913 |
|
36 |
| Others |
|
13,756 |
|
10,773 |
| |
|
|
|
|
| Tax debits on temporary differences |
|
|
|
|
| Capitalized interest |
|
(18,085) |
|
(17,054) |
| Depreciation, amortization and asset impairment |
|
(129,435) |
|
(70,985) |
| Added value of assets (i) |
|
(134,916) |
|
(131,663) |
| Others |
|
(17,984) |
|
(585) |
| |
|
129,348 |
|
104,352 |
| |
|
|
|
|
| Deferred income tax assets |
|
307,293 |
|
236,887 |
| Deferred income tax liabilities |
|
(177,945) |
|
(132,535) |
| |
|
129,348 |
|
104,352 |
(i) This tax debit balance mainly relates to the value
added on the acquisition of mining rights from Nexa Peru and its subsidiaries. While the underlying assets are amortizable for accounting
purposes, the related amortization is not deductible for tax purposes.
|