v3.26.1
Income Taxes
 12 Months Ended
Mar. 31, 2026
Income Tax Disclosure [Abstract]  
Income Taxes Income Taxes
United States income (loss) before income tax expense was $(162,297,000), $(44,297,000), and $20,464,000 for the years ended March 31, 2026, 2025, and 2024, respectively. Income (loss) before income tax expense also includes foreign subsidiary income of $(44,210,000), $38,791,000, and $41,063,000 for the years ended March 31, 2026, 2025, and 2024, respectively.
The provision for income tax expense (benefit) consisted of the following:
 Year Ended March 31,
 202620252024
Current income tax expense (benefit):
United States Federal$15,648 $6,843 $15,375 
State taxes4,401 850 2,715 
Foreign13,416 12,226 12,097 
Deferred income tax expense (benefit):
United States866 (17,411)(12,451)
Foreign(11,401)(2,875)(2,834)
 $22,930 $(367)$14,902 

Income taxes paid (net of refunds received):
Year Ended March 31,
202620252024
Federal$24,674 $2,568 $15,536 
State and Local$5,218 $1,999 $2,134 
Foreign
Germany$5,680 $7,339 $3,550 
Hungary$— $1,568 $— 
Mexico$— $— $1,948 
Netherlands$— $1,386 $— 
United Kingdom$— $1,286 $— 
Other$10,277 $4,375 $5,200 
Total net income tax payments$45,850 $20,520 $28,369 

Effective March 31, 2026, the Company adopted ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Taxes Disclosures retrospectively. Under ASU No. 2023-09, entities are required to disclose in their rate reconciliation table additional categories of information about federal, state, and foreign income taxes and provide more details about the reconciling items in some categories if the items meet a quantitative threshold.
The provision for income taxes differs from the amount computed by applying the statutory federal income tax rate to income from continuing operations before income tax expense. The sources and tax effects of the differences were as follows:
Year Ended March 31,
202620252024
US Federal Statutory Rate$(43,367)21 %$(1,156)21 %$12,918 21 %
State and Local Income Taxes, Net of Federal Income Tax Effect*$3,550 (2)%$(514)9 %$652 1 %
Foreign Tax Effects
Germany:
State and local income taxes$— —$486 (9)%$972 2 %
Enacted changes in tax laws or rates$(2,387)1 %$— —$— —
Goodwill impairment$13,318 (6)%$— —$— —
Other$(740)0 %$3 0 %$64 0 %
Hungary:
Statutory rate difference between Hungary and United States$— —$(1,718)31 %$(1,538)(3)%
Other$— —$294 (5)%$528 1 %
Mexico:
Valuation allowance$— —$445 (8)%$— —
Other$— —$794 (14)%$383 1 %
China$— —$315 (6)%$— —
Panama$— —$(348)6 %$— —
Other Jurisdictions$1,038 (1)%$271 (5)%$955 2 %
Effect of Cross Border Tax Laws
US benefit on foreign derived income$— —$— —$(1,604)(3)%
Subpart F$— —$— —$427 1 %
GILTI$— —$— —$879 1 %
Other$(17)0 %$68 (1)%$— —
Tax Credits
Research & development tax credits$— —$(946)17 %$(986)(2)%
Other$(540)0 %$— —$— —
Changes in Valuation Allowances$3,455 (2)%$5 0 %$(45)0 %
Nontaxable or Nondeductible Items
Employee benefits$— —$483 (9)%$1,347 2 %
Goodwill impairment$37,640 (18)%$— —$— —
Transaction costs$9,514 (5)%$— —$525 1 %
Other$714 0 %$68 (1)%$141 0 %
Changes in Unrecognized Tax Benefits$121 0 %$600 (11)%$(811)(1)%
Other Adjustments
Interest income from tax refunds$— —$(505)9 %$— —
Stranded tax effects$— —$962 (17)%$— —
Other$631 0 %$27 0 %$93 0 %
Effective Tax Rate$22,930 (11)%$(367)7 %$14,902 24 %
*In FY26 State taxes in Wisconsin, Oklahoma, Illinois, and Texas made up the majority (greater than 50%) of the tax effect in this category. In FY25 Illinois, Michigan, California, Georgia, and Indiana, and in FY24 Massachusetts, Texas, New Jersey, Pennsylvania, California, and Georgia made up the majority (greater than 50%) of the tax effect in this category.
During fiscal year 2026, income tax was favorably impacted by the Act for an Immediate Tax Investment Program to Strengthen Germany as a Business Location (the "New German Tax Law"). The New German Tax Law enacted in July 2025 will lower the German corporate income tax rate from 15% to 10% by 2032. The associated revaluation of the Company’s German net deferred tax liabilities results in an income tax benefit disclosed in the effective tax rate table above.
On July 4, 2025, H.R.1, also known as the "One Big Beautiful Bill Act" ("OBBBA") was enacted into law in the United States, with many of its provisions taking effect during the Company's 2026 fiscal year. The income tax expense and effective tax rate calculated for fiscal 2026 reflect the considerations of the OBBBA.

The Company applies the liability method of accounting for income taxes as required by ASC Topic 740, “Income Taxes.” The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are as follows:
 March 31,
 20262025
Deferred tax assets:
Federal net operating loss carryforwards$34,197 $10,649 
State and foreign tax loss and credit carryforwards34,043 8,992 
Employee benefit plans11,744 9,624 
Inventory5,015 4,243 
Insurance reserves3,576 3,060 
Accrued vacation and incentive costs5,554 2,943 
Federal tax credit carryforwards17,885 12,080 
ASC 842 Lease Liability21,695 19,996 
Equity compensation6,061 5,309 
Capitalized Research and Development Costs1,220 15,069 
Interest Carryforwards95,909 10,411 
Unrealized Losses3,755 — 
Other Reserves9,098 — 
Other1,456 341 
Valuation allowance(65,908)(15,802)
Deferred tax assets after valuation allowance185,300 86,915 
Deferred tax liabilities:
Property, plant, and equipment(54,018)(5,909)
ASC 842 Right-of-Use Asset(18,604)(16,807)
Intangible Assets(414,406)(88,275)
Deferred Revenue(5,657)— 
Unremitted Earnings(14,868)(1,322)
Total deferred tax liabilities(507,553)(112,313)
Net deferred tax assets (liabilities)$(322,253)$(25,398)


The valuation allowance includes $17,951,000 and $1,151,000 primarily related to foreign net operating losses and $3,112,000 and $0 for federal net operating losses at March 31, 2026 and 2025, respectively. The valuation allowance also includes $1,962,000 and $2,571,000 for state net operating losses at March 31, 2026 and 2025, respectively. The valuation allowance also includes $24,736,000 and $0 related to interest deduction carryforwards at March 31, 2026 and 2025, respectively. The remaining valuation allowance of $18,148,000 and $12,080,000 for the years ended March 31, 2026 and 2025, respectively, primarily relates to foreign tax credits which the Company believes it will not utilize.

The Company’s foreign subsidiaries have tax-effected net operating loss carryforwards of $23,066,118 that expire in periods ranging from three years to indefinite. Gross federal net operating loss carryforwards of $45,334,000 remain from the acquisition of Magnetek and gross federal net operating loss carryforwards of $117,508,000 remain from the acquisition of Kito Crosby; these carryforwards have expiration dates ranging from fiscal 2027 through indefinite. Gross state net operating losses of $48,092,000 either have indefinite carryforward periods or have expiration dates ranging from fiscal 2027 through 2041. The federal tax credits have expiration dates ranging from fiscal 2029 to 2034. Included in the State and foreign net operating loss and credit carryforwards
category above are $445,000 of state tax credit carryforwards. These state tax credit carryforwards have expiration dates ranging from fiscal 2027 to 2037.

Deferred income taxes are classified within the consolidated balance sheets based on the following breakdown:

 March 31,
 20262025
Net non-current deferred tax assets$2,064 $2,904 
Net non-current deferred tax liabilities(324,317)(28,302)
Net deferred tax assets (liabilities)$(322,253)$(25,398)

Net non-current deferred tax liabilities are included in other non-current liabilities.

As of March 31, 2026, the Company has determined that certain foreign amounts, which can be distributed tax efficiently, are not permanently reinvested where earned. As of March 31, 2026, a tax liability of approximately $14,868,000 has been accrued for taxes that would be incurred upon repatriation of the earnings that are not permanently reinvested. As of March 31, 2026, $95,291,000 of unremitted earnings of other subsidiaries and outside basis differences other than unremitted earnings are intended to be permanently reinvested.  It is not practicable to calculate the amount of unrecognized deferred tax related to these basis differences.
 
Changes in the Company’s uncertain income tax positions, excluding the related accrual for interest and penalties, are as follows:
 202620252024
Beginning balance$999 $411 $411 
Additions for prior year tax positions1,478 563 — 
Foreign currency translation49 25 — 
Ending balance$2,526 $999 $411 

The Company had $143,000, $96,000, and $76,000 accrued for the payment of interest and penalties at March 31, 2026, 2025, and 2024 respectively. The Company recognizes interest expense or penalties related to uncertain tax positions as a part of income tax expense in its consolidated statements of operations. $2,526,000 of the unrecognized tax benefits as of March 31, 2026 would impact the effective tax rate if recognized. It is reasonably possible that the amount of unrecognized tax benefits could change in the next 12 months, however an estimate of the change cannot be made.

The Company and its subsidiaries file income tax returns in the U.S., various state, local, and foreign jurisdictions. The Company’s major tax jurisdictions are the United States and Germany.  With few exceptions, the Company is no longer subject to tax examinations by tax authorities in the United States for tax years prior to March 31, 2023 and in Germany for tax years prior to March 31, 2012. The Company has a current tax examination in Germany underway for fiscal years 2012 through 2021. The Company periodically responds to audit requests in less material jurisdictions.