Flex Ltd.: financial statements

The company paid 23.0% in tax on its profit, 6.0 points above the statutory rate it starts from (17.0%). Below, the reasons it gives.

One point is 1% of profit before tax. The lines are as the company states them in the notes to its annual report. The filing

Where the change in earnings per share came from

Diluted earnings per share went from $2.11 in the fiscal year to Mar 31, 2025 to $2.33 in the year to Mar 31, 2026, a change of +$0.22.

Measured by size, 50.4% of the movement came from outside sales and operating margin: interest and other items, the tax rate, what went to others and the share count.

Sales

+$0.20

Operating margin

+$0.20

Interest and other items

-$0.16

Tax rate

-$0.14

Share count

+$0.11

Earnings per share is split as sales times operating margin, plus interest and other items, after tax, times the part that goes to the common shareholders, divided by the diluted share count. Each source's part is its average effect over every order in which the six can change, so the parts add up exactly to the change. From the annual reports; net income over the diluted count matches the earnings per share the company filed within 2%.

Receivables and inventory against sales

In the quarter to Sep 25, 2026, sales were +24.8% on the same quarter a year earlier, and receivables +49.8%. Inventory was +39.0%, against +24.0% for the cost of sales.

• Days of sales in receivables rose more than at nine in ten S&P 500 companies.

Days of sales in receivablesa year earlier 51 days

61 days

Days of cost in inventorya year earlier 77 days

86 days

Balances at Sep 25, 2026 and Sep 26, 2025, against the sales and cost of sales of the quarter ending on each date; a fourth quarter is the fiscal year less its first nine months. Same quarter against same quarter, so the season is the same.

Allowance for doubtful accounts

The allowance for receivables that may not be collected was 0.1% of gross receivables at Sep 25, 2026, against 0.2% a year earlier.

At last year's share it would be $5.5M larger. A smaller allowance means a smaller charge for bad debts in profit.

Allowancea year earlier $9.0M

$8.0M

Taxes: deferred and paid

The deferred part was 14.5% of the tax charge in the year to Mar 31, 2026. The rows show the last 2 years.

Cash taxes paid were 143.6% of the current tax charge in the year to Mar 31, 2026.

Deferred share, year to Mar 31, 2026$38M of $263M

14.5%

Deferred share, year to Mar 31, 2025$55M of $185M

29.7%

Cash taxes paid against current tax$323M paid, $225M current

143.6%

When profit in the accounts runs ahead of taxable profit, the deferred part grows. It also moves for reasons unrelated to how earnings are booked: tax-law changes, the use of past losses, and the US rule since 2022 that spreads research costs over five years. Where the notes report it, the tax-rate bridge under Debt and obligations shows how the rate gets from the statutory one to the effective one.