MCCORMICK & CO INC
For the period ended Feb 28, 2026. Filed Mar 31, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Feb 28, 2026 · Filed Mar 31, 2026
MKC-V$48.77-2.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-08-31; filed 2025-10-07.
0000063754-25-000065
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSCurrent report: 10-Q
Period ended 2026-02-28; filed 2026-03-31.
0000063754-26-000192
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONSThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 123 previous paragraphs and 121 current paragraphs.
53 unchanged; 42 reworded; 25 added; 25 removed; 3 previous and 1 current paragraphs rearranged.
Tables are not compared: 21 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (25)
Current report
Recent Events
Current report
On February 20, 2026 the U.S. Supreme Court ruled that certain tariffs imposed under the International Emergency Economic Powers Act (IEEPA) by the executive branch are not lawful, but did not provide guidance on how importers may claim refunds of IEEPA tariffs previously paid. On March 4, 2026, the Court of International Trade (CIT) ordered U.S. Customs and Border Protection (CBP) to begin the refund process for all importers who were subject to IEEPA duties. The situation continues to evolve, and further legislative, regulatory, or judicial developments may affect the ultimate outcome and the availability or timing of any refunds. We are currently evaluating the impact that the ruling may have on our consolidated financial statements.
Current report
On March 31, 2026, we entered into an Agreement and Plan of Merger with Unilever PLC (the “Merger Agreement”), pursuant to which Unilever will separate its Unilever Foods business, excluding its food businesses in India, Nepal and Portugal, and Unilever Foods will merge with a wholly owned subsidiary of McCormick in a transaction intended to qualify as a Reverse Morris Trust transaction. The transaction is generally expected to be tax-free to Unilever’s shareholders for U.S. federal income tax purposes, except to the extent that cash is paid to Unilever’s shareholders in lieu of fractional shares and provided that Unilever does not make the U.S. Asset Sale Election.
Current report
Under the terms of the Merger Agreement, we will issue voting and non-voting securities to Unilever shareholders and Unilever in the same proportion as is currently held by our shareholders. The transactions contemplated by the Merger Agreement are expected to result in current Unilever shareholders owning approximately 55.1% of the combined company, our current shareholders owning approximately 35.0% of the combined company, and Unilever retaining approximately 9.9% of the total outstanding equity of the combined company, assuming Unilever does not elect under the Merger Agreement to dispose of such interest. The proposed transaction is subject to the satisfaction or waiver of certain customary closing conditions, including shareholder and regulatory approvals. For additional information regarding the proposed transaction, see Note 12 of the notes to our accompanying condensed consolidated financial statements.
Current report
•The impact of our acquisition of McCormick de Mexico contributed 12.4% of our net sales growth.
Current report
Diluted earnings per share was $3.77 and $0.60 in the first quarters of 2026 and 2025, respectively. The gain on remeasurement of our previously held equity interest in McCormick de Mexico increased diluted earnings per share by $3.22 and special charges, including transaction and integration costs, lowered diluted earnings per share by $0.11. Excluding the effects of the remeasurement gain and special charges, adjusted diluted earnings per share was $0.66 and $0.60 in the first quarters of 2026 and 2025, respectively. The increase in adjusted diluted earnings per share was driven by favorable operating income, partially offset by an increase in the effective tax rate, higher income attributable to noncontrolling interests and a decrease in other income.
Current report
Our fiscal 2026 outlook continues to reflect prioritized investments in key categories to sustain our volume trends and drive long-term profitable growth while appreciating the uncertainty of the consumer and macro environment, including global trade policies. Our CCI program is continuing to fuel growth investments while also driving operating margin expansion. Our fiscal 2026 outlook also reflects meaningful contributions from the acquisition of a controlling interest in McCormick de Mexico, which closed on January 2, 2026. Amounts are rounded with percentages calculated from the underlying amounts.
Current report
Our outlook for 2026 adjusted operating income and adjusted earnings per share are non-GAAP financial measures that exclude or otherwise adjust for items impacting comparability of financial results. We are unable to reconcile projected adjusted operating income to projected reported operating income because we cannot reasonably predict the amount of special charges, including transaction and integration expenses, during this time period. We are unable to reconcile projected adjusted earnings per share to projected reported earnings per share due to the same factors affecting reported operating income.
Current report
Interest expense decreased by $1.2 million in the first quarter of 2026 as compared to the same period in 2025 driven by the effects of lower interest rates, partially offset by the impact of higher average borrowing levels.
Current report
Other income, net, decreased by $5.0 million in the first quarter of 2026 as compared to the same period in 2025 due to a lower level of interest income driven primarily by the impact of the acquisition of McCormick de Mexico on our average cash balance during the period.
Current report
Income tax expense for the three months ended February 28, 2026 was not impacted by discrete tax items. In addition to the effect of lower discrete tax items compared to the prior year period, the increase in effective tax rate was impacted by a change in the geographic mix of pre-tax earnings following the acquisition of McCormick de Mexico, resulting in a greater proportion of income generated in jurisdictions with higher income tax rates.
Current report
Income from unconsolidated operations increased by $867.5 million in the first quarter of 2026 compared to the same period of 2025. This increase was primarily driven by a gain of $866.8 million on the remeasurement of our previously held equity interest in McCormick de Mexico, which is described in more detail in Note 2 of the notes to our accompanying condensed consolidated financial statements.
Current report
Net income attributable to noncontrolling interests increased by $5.0 million in the first quarter of 2026 compared to the same period in 2025. This increase was driven by the net income attributable to our noncontrolling interest in McCormick de Mexico.
Current report
In the first quarter of 2026, sales of our Consumer segment increased by 24.5% compared to the first quarter of 2025 and increased by 1.8% on an organic basis. The acquisition of McCormick de Mexico increased sales by 19.8%. Unfavorable volume and product mix decreased sales by 0.4%, driven by declines in the Americas region which were partially offset by growth in the EMEA and APAC regions. Favorable pricing impacted sales by 2.2% primarily driven by pricing actions in the Americas region. The favorable impact of foreign currency rates increased sales by 2.9%.
Current report
In the EMEA region, Consumer segment sales increased by 15.5% in the first quarter of 2026 compared to the same quarter of 2025 and increased by 3.7% on an organic basis. Favorable volume and product mix increased sales by 2.4%, driven by higher sales of our core products in France. Favorable pricing impacted sales by 1.3%. The favorable impact from foreign currency rates increased sales by 11.8%.
Current report
In the APAC region, Consumer segment sales increased by 6.2% in the first quarter of 2026 compared to the same quarter of 2025 and increased by 2.2% on an organic basis. Favorable volume and product mix increased sales by 2.1%, driven by higher sales in China. Favorable pricing impacted sales by 0.1%. The favorable impact from foreign currency rates increased sales by 4.0%.
Current report
The following table sets forth the notional values and unrealized net gain (loss) of our commodity contracts:
Current report
•Gain on remeasurement of previously held equity interest - On January 2, 2026, we completed the acquisition of an additional 25% ownership interest in McCormick de Mexico which increased our ownership to a 75% controlling interest. Prior to the acquisition of the additional ownership interest, we accounted for our 50% ownership interest as an equity method investment. The acquisition of the additional ownership interest resulted in the consolidation of McCormick de Mexico's financial results. As a result of the consolidation, the carrying value of our previously held 50% ownership interest was remeasured to fair value resulting in a gain.
Current report
Details with respect to the composition of special charges, including transaction and integration expenses, set forth below are included in Note 3 of the notes to our accompanying condensed consolidated financial statements. Details with respect to our gain on the revaluation of a previously held equity interest in McCormick de Mexico are included in Note 2 of the notes to our accompanying condensed consolidated financial statements.
Current report
In the first quarter of 2026 the increase in short-term borrowings was principally to fund investing cash requirements. We repaid $502.2 million of long-term debt, including the $500 million, 0.90% notes that matured in February 2026. We also issued $500 million of 4.150% notes due 2029, with net proceeds received of $497.1 million.
Current report
In February 2026, we issued $500 million aggregate principal amount of 4.150% unsecured senior notes due 2029. Interest is payable semiannually in February and August of each year. The net proceeds received from the issuances of these notes of $497.1 million were used to repay a portion of the outstanding $500 million, 0.90% notes due in February 2026.
Current report
Business Combinations
Current report
We use the acquisition method in accounting for acquired businesses. Under the acquisition method, our financial statements reflect the operations of an acquired business starting from the closing of the acquisition. The assets acquired and liabilities assumed are recorded at their respective estimated fair values at the date of the acquisition. The fair value of any noncontrolling interest is estimated based on the implied value derived from the consideration transferred adjusted for any control premium. Any excess of the purchase consideration over the estimated fair values of the identifiable net assets acquired is recorded as goodwill. Significant judgment is often required in estimating the fair value of assets acquired, particularly intangible assets, and noncontrolling interest. We generally obtain the assistance of a third-party valuation specialist in estimating fair values of tangible and intangible assets as well estimating the fair value of any noncontrolling interest. The fair value estimates are based on available historical information and on expectations and assumptions about the future, considering the perspective of marketplace participants. While management believes those expectations and assumptions are reasonable, they are inherently uncertain. Unanticipated market or macroeconomic events and circumstances may occur, which could affect the accuracy or validity of the estimates and assumptions.
Current report
Determining the useful lives of intangible assets also requires judgment. Certain intangibles are expected to have indefinite lives, including brand intangibles based on their history and our plans to continue to support and build the acquired brands, and reacquired rights based on their ability to contribute cash flows for the foreseeable future without substantive limiting factors. Other acquired intangible assets such as customer relationships are expected to have determinable useful lives. Our estimates of the useful lives of definite-lived intangible assets are primarily based upon historical experience, the competitive and macroeconomic environment, and our operating plans. The costs of definite-lived intangibles are amortized to expense over their estimated life.
Current report
Foods or McCormick related to the transaction; and other risks as described herein under Part II, Item 1A “Risk Factors—Risks Relating to the Proposed Transaction”; and other risks described in the Company's filings with the Securities and Exchange Commission.
Removed paragraphs (25)
Previous report
Recent Event
Previous report
Diluted earnings per share was $0.84 and $0.83 in the third quarters of 2025 and 2024, respectively. Special charges, including transaction and integration expenses, lowered earnings per share by $0.01 in the third quarter of 2025. Excluding the effects of special charges, diluted earnings per share was $0.85 and $0.83 in the third quarters of 2025 and 2024, respectively. Favorable operating income and lower interest expense were partially offset by lower interest income.
Previous report
Our fiscal 2025 outlook reflects plans to mitigate costs related to tariffs, which are currently in place. Our actions to mitigate the impact of tariff costs include sourcing plans supported by advanced analytics, cost savings initiatives, and revenue growth management. Due to the ongoing uncertainty around potential new U.S. import tariffs or retaliatory tariffs put in place by other countries, our outlook is based on tariffs currently in place and does not factor in any potential actions that may arise during the remainder of 2025.
Previous report
We expect our 2025 gross profit margin to be flat or comparable to the 38.5% gross profit margin reported in 2024. We expect our gross margin to be impacted by increased commodity costs due to the global trade uncertainty and tariffs currently in place.
Previous report
We expect income from unconsolidated operations will decline by a high single digit percentage rate from the 2024 level driven by our largest joint venture, McCormick de Mexico, due to the unfavorable impacts from foreign currency partially offset by continued strength in the underlying performance of the business.
Previous report
Sales for the nine months ended August 31, 2025 increased by 1.3% from the same period in 2024 and increased by 1.8% on an organic basis. Pricing favorably impacted sales by 0.3%. Favorable volume and product mix increased sales by 1.5%, driven by growth across all three regions in our Consumer segment. Foreign currency rates decreased sales by 0.5%.
Previous report
Gross profit for the nine months ended August 31, 2025 increased by $3.1 million, or 0.2%, from the same period in 2024. Our gross profit margin was 37.5%, a decrease of 40 basis points, driven by unfavorable customer mix and increased conversion costs including costs to support increased capacity for future growth, partially offset by favorable pricing and CCI-led cost savings. Excluding the impact of special charges related to the step up of acquired inventory included in cost of goods sold, adjusted gross margin was 37.5% for the nine months ended August 31, 2025.
Previous report
SG&A decreased by $11.3 million in the nine months ended August 31, 2025 as compared to the same period in 2024, driven primarily by lower performance-based employee incentive expense and CCI-led cost savings including the impact of SG&A streamlining actions, partially offset by increased selling and marketing expense. SG&A as a percentage of net sales decreased by 60 basis points as compared to the prior year period.
Previous report
During the three months ended August 31, 2024, we recorded $1.9 million of special charges, consisting principally of $0.7 million associated with our Global Operating Effectiveness (GOE) program and $1.2 million associated with the transition of a manufacturing facility in Europe, Middle East, and Africa (EMEA).
Previous report
During the nine months ended August 31, 2024, we recorded $7.9 million of special charges, consisting principally of $5.3 million associated with our GOE program, and $2.6 million associated with the transition of a manufacturing facility in EMEA.
Previous report
Interest expense decreased by $3.3 million and $7.0 million for the three and nine months ended August 31, 2025, respectively, compared to the prior year periods. These decreases were driven by the effects of lower average borrowing levels and lower interest rates.
Previous report
Other income, net, decreased by $3.8 million and $7.7 million for the three and nine months ended August 31, 2025, respectively, compared to prior periods primarily due to a lower level of interest income driven by lower interest rates and unfavorable impacts of foreign exchange rates and lower non-service cost income associated with our pension and postretirement benefit plans.
Previous report
Income tax expense for the three months ended August 31, 2025 included $20.0 million of net discrete tax benefits consisting principally of the following: (i) $8.7 million of tax benefits from the reversal of certain reserves for unrecognized tax benefits and related interest, including $4.4 million associated with the expiration of statutes of limitations, (ii) $8.1 million of tax benefits resulting from state tax matters, and related deferred taxes, and (iii) $3.5 million of tax benefits resulting from an adjustment to a prior year tax accrual, and related deferred taxes, based on the final returns filed.
Previous report
Income tax expense for the three months ended August 31, 2024 included $16.3 million of net discrete tax benefits consisting principally of the following: (i) $5.5 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the expiration of statutes of limitations, (ii) $5.5 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the effective settlement from conclusion of a tax examination, (iii) $8.3 million of tax benefits resulting from state tax matters, and related deferred taxes, (iv) $1.5 million of tax benefits resulting from an adjustment to a prior year tax accrual, and related deferred taxes, based on the final returns filed, and (v) $4.6 million of tax expense associated with the adjustment of a valuation allowance due to changes in judgment about the realizability of the deferred tax asset.
Previous report
Income tax expense for the nine months ended August 31, 2024 included $34.9 million of net discrete tax benefits consisting principally of the following: (i) $19.4 million of tax benefits associated with the recognition of a deferred tax asset related to an international legal entity reorganization, (ii) $6.8 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the expiration of statutes of limitations, (iii) $5.5 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the effective settlement from conclusion of a tax examination, (iv) $6.4 million of tax benefits resulting from state tax matters, and related deferred taxes, (v) $1.5 million of tax benefits resulting from an adjustment to a prior year tax accrual, and related deferred taxes, based on the final returns filed, and (vi) $4.6 million of tax expense associated with the adjustment of a valuation allowance due to changes in judgment about the realizability of the deferred tax asset.
Previous report
On July 4, 2025, legislation known as the One Big Beautiful Bill Act (OBBBA) was signed into law. The OBBBA makes changes to the United States corporate income tax system, including, among other provisions, the immediate expensing of research and development expenditures, and 100 percent bonus depreciation on qualified property. While we expect certain provisions of the OBBBA to change the timing of cash tax payments in the current fiscal year and future year periods, we do not expect the legislation to have a material impact on our consolidated financial statements.
Previous report
Income from unconsolidated operations, which is presented net of the elimination of earnings attributable to non-controlling interests, decreased by $1.0 million for the three months ended August 31, 2025, driven by the results of our largest joint venture, McCormick de Mexico, where unfavorable impacts from foreign exchange rates were partially offset by improved operating results.
Previous report
Income from unconsolidated operations decreased by $2.0 million for the nine months ended August 31, 2025, driven by the results of our largest joint venture, McCormick de Mexico, which included unfavorable impacts from foreign exchange rates, which was partially offset by the overall favorable results from our other unconsolidated entities.
Previous report
In the third quarter of 2025, sales of our Consumer segment increased by 3.8% compared to the third quarter of 2024 and increased by 2.6% on an organic basis. Higher volume and product mix increased sales by 2.2%, driven by growth in the Americas and EMEA regions, partially offset by unfavorable volume and product mix in the APAC region. Pricing actions favorably impacted sales by 0.4%. The favorable impact of foreign currency rates increased sales by 1.2% and is excluded from our measure of sales growth of 2.6% on an organic basis.
Previous report
In the Americas region, Consumer segment sales increased by 2.7% in the third quarter of 2025 compared to the same quarter of 2024 on both a reported and an organic basis. Favorable volume and product mix increased sales by 2.7% driven by growth across core categories. Pricing was comparable. The impact of foreign currency rates was flat and is excluded from our measure of sales growth of 2.7% on an organic basis.
Previous report
In the APAC region, Consumer segment sales in the third quarter of 2025 were comparable to the same quarter of 2024 and decreased by 0.8% on an organic basis. Unfavorable volume and product mix decreased sales by 0.6%, driven by lower sales to foodservice customers in China. Unfavorable pricing impacted sales by 0.2%. The favorable impact from foreign currency rates increased sales by 0.8% and is excluded from our measure of sales decline of 0.8% on an organic basis.
Previous report
For the nine months ended August 31, 2025, sales of our Consumer segment increased 2.2% as compared to the same period in 2024 and increased by 2.3% on an organic basis. Higher volume and product mix increased sales by 2.7%, driven by growth in all regions. Unfavorable pricing impacted sales by 0.4%. The unfavorable impact from foreign currency rates decreased sales by 0.1% and is excluded from our measure of sales growth of 2.3% on an organic basis.
Previous report
Segment operating income for our Consumer segment for the third quarter of 2025 increased by $7.0 million, or 3.7%, compared to the same period in 2024, driven by an increase in gross profit and a decrease in SG&A expense. The increase in gross profit was driven by higher net sales, partially offset by increased conversion cost including costs to support increased capacity for future growth, and increased commodity costs including the impact of tariffs. The decrease in SG&A expense was driven by the items described in the consolidated discussion. On a constant currency basis, segment operating income increased by 3.2%.
Previous report
For the nine months ended August 31, 2025, sales of our Flavor Solutions segment increased 0.2% as compared to the same period in 2024 and increased by 1.2% on an organic basis. Favorable volume and product mix increased sales by 0.1% driven by growth in the APAC region mostly offset by unfavorability in the Americas and EMEA regions. Favorable pricing increased sales by 1.1%, driven by the Americas regions partially offset by unfavorable pricing in the EMEA and APAC regions. The unfavorable impact of foreign currency rates decreased segment sales by 1.0% and is excluded from our measure of sales growth of 1.2% on an organic basis.
Previous report
Segment operating income for our Flavor Solutions segment for the third quarter of 2025 decreased by $1.8 million, or 1.8%, compared to the same period in 2024, driven by a decrease in gross profit partially offset by lower SG&A expense. The decrease in gross profit was driven by increased commodity costs including the impact of tariffs, unfavorable product mix and increased conversion costs including costs to support increased capacity for future growth, partially offset by favorable pricing. The decrease in SG&A expense was driven by the items described in the consolidated discussion. Segment operating margin decreased by 40 basis points to 13.3%. On a constant currency basis, segment operating income decreased by 1.6%.
Reworded paragraphs (42)
Previous wording
McCormick is a global leader in flavor. We manufacture, market, and distribute spices, seasoning mixes, condiments, and other flavorful products to the entire food industry–retailers, food manufacturers, and the foodservice business. In fiscal year 2024, approximately 39% of our sales were generated outside of the U.S. We also are partners in a number of joint ventures involved in the manufacture and sale of flavorful products, the most significant of which is McCormick de Mexico. We manage our business in two business segments, Consumer and Flavor Solutions.
Current wording
McCormick is a global leader in flavor. We manufacture, market, and distribute spices, seasoning mixes, condiments, and other flavorful products to the entire food and beverage industry–retailers, food manufacturers, and the foodservice business. In fiscal year 2025, approximately 39% of our sales were generated outside of the U.S. We also are partners in a number of joint ventures involved in the manufacture and sale of flavorful products. We manage our business in two business segments, Consumer and Flavor Solutions.
Previous wording
On August 21, 2025, we signed a definitive agreement, subject to customary closing and regulatory conditions, with Grupo Herdez to acquire an additional 25% ownership interest in McCormick de Mexico, for a purchase price of $750 million, which would increase our ownership in the joint venture to a controlling 75%. The transaction is expected to be completed early in the fiscal year ending November 30, 2026. We believe the acquisition creates opportunities for further growth in the Mexican market and provides a strategic platform for further expansion in Latin America. McCormick de Mexico is a prominent food company in Mexico, with a broad portfolio, including mayonnaise, spices, marmalades, mustard, hot sauce, and tea, sold under McCormick brands.
Current wording
On January 2, 2026 we acquired an additional 25% ownership interest in McCormick de Mexico for a purchase price of $750 million, which increased our ownership to a 75% controlling interest. We believe the acquisition creates opportunities for further growth in the Mexican market and provides a strategic platform for further expansion in Latin America. McCormick de Mexico is a prominent food company in Mexico, with a broad portfolio, including mayonnaise, spices, marmalades, mustard, hot sauce, and tea, sold under McCormick brands. The acquisition is described in detail in Note 2 of the notes to our accompanying condensed consolidated financial statements.
Previous wording
In the third quarter of 2025, we achieved net sales growth of 2.7% as compared to the third quarter of 2024, due to the following factors:
Current wording
In the first quarter of 2026, we achieved net sales growth of 16.7% as compared to the same quarter of 2025, due to the following factors:
Previous wording
•Volume and product mix favorably impacted net sales by 1.2%. The Consumer segment experienced favorable volume and product mix of 2.2% and the Flavor Solutions segment experienced unfavorable volume and product mix of 0.3%.
Current wording
•Volume and product mix unfavorably impacted net sales by 0.7%. The Consumer segment experienced unfavorable volume and product mix of 0.4% and the Flavor Solutions segment experienced unfavorable volume and product mix of 1.0%.
Previous wording
•Fluctuations in currency rates positively impacted net sales by 0.9%, increasing sales growth by 1.2% in our Consumer segment and 0.6% in our Flavor Solutions segment.
Current wording
•Fluctuations in currency rates positively impacted net sales by 3.1%. Fluctuations in currency rates positively impacted our Consumer segment sales growth by 2.9% and our Flavor Solutions segment sales growth by 3.3%.
Previous wording
Operating income was $288.7 million in the third quarter of 2025, compared to $286.5 million in the same period of 2024, reflecting an increase of 0.8%. Our gross profit margin decreased by 130 basis points primarily driven by increased commodity costs including the impact of tariffs, and increased conversion costs including costs to support capacity for future growth, partially offset by CCI-led cost savings. Excluding the effects of special charges included in cost of goods sold, our adjusted gross profit margin decreased by 120 basis points. Selling, general, and administrative (SG&A) expense as a percentage of sales decreased by 100 basis points, primarily driven by lower performance-based employee incentive expense and CCI-led cost savings, including SG&A streamlining initiatives. Excluding special charges, adjusted operating income was $293.6 million in the third quarter of 2025, reflecting an increase of 1.8% compared to $288.4 million in the 2024 period. In constant currency, adjusted operating income increased by 1.6%.
Current wording
Operating income was $227.5 million in the first quarter of 2026, compared to $225.2 million in the same period of 2025, reflecting an increase of 1.0%. Our gross profit margin increased by 20 basis points driven by the impact of the McCormick de Mexico acquisition, which included a step-up of acquired inventory recognized as special charges in cost of goods sold as the related inventory was sold, favorable pricing, and cost savings from the Company's Comprehensive Continuous Improvement (CCI) program, partially offset by increased commodity costs driven primarily by the impact of tariffs. Excluding the effects of special charges included in cost of goods sold, our adjusted gross profit margin increased by 100 basis points. Selling, general, and administrative (SG&A) expense as a percentage of sales increased by 70 basis points, primarily driven by increased investments in technology and increased brand marketing expense. Excluding special charges, adjusted operating income was $267.6 million in the first quarter of 2026, reflecting an increase of 18.8% compared to $225.2 million in the 2025 period, primarily driven by the impact of the acquisition of McCormick de Mexico. In constant currency, adjusted operating income increased by 16.0%.
Previous wording
A detailed review of our performance during the three and nine month periods ended August 31, 2025 compared to the same periods in fiscal year 2024 appears in the section titled “Results of Operations – Company” and “Results of Operations – Segments.” For a reconciliation of non-GAAP to reported amounts, see the subsequent discussion under the heading “Non-GAAP Financial Measures.”
Current wording
A detailed review of our first quarter 2026 performance compared to the first quarter of fiscal 2025 appears in the section titled “Results of Operations – Company” and “Results of Operations – Segments.” For a reconciliation of non-GAAP to reported amounts, see the subsequent discussion under the heading “Non-GAAP Financial Measures.”
Previous wording
In 2025, we expect net sales to grow between 0% and 2% compared to our 2024 net sales, including a 1% unfavorable impact from foreign currency rates, or to grow from 1% to 3% on an organic basis. We anticipate that sales in 2025 will benefit primarily from favorable volume and product mix.
Current wording
In 2026, we expect net sales to grow between 13% and 17% compared to 2025, including an 11% to 13% increase as a result of the acquisition of a controlling interest in McCormick de Mexico and a 1% favorable impact from foreign currency rates, or to grow from 1% to 3% on an organic basis. We anticipate that net sales will benefit from favorable volume and product mix and pricing.
Previous wording
For 2025, we anticipate an increase in operating income of 1% to 3% over the 2024 level, including a 1% unfavorable impact from foreign currency rates. This anticipated increase in operating income reflects the impact of savings from our CCI program including SG&A streamlining actions, partially offset by investments aimed at driving volume growth, particularly in brand marketing and digital. We project our brand marketing investments in 2025 to rise by mid-single digits compared to 2024. Additionally, we expect approximately $20 million in special charges related to previously announced organizational and streamlining actions and transaction and integration expenses primarily associated with a second quarter 2025 acquisition. In 2024, special charges totaled $9.5 million. Excluding these special charges, we expect adjusted operating income in 2025 to increase by 2% to 4%, which includes a 1% unfavorable impact from foreign currency rates, or to increase by 3% to 5% on a constant currency basis.
Current wording
In 2026, we expect an increase in adjusted operating income of 16% to 20% compared to 2025, including a 1% favorable impact from foreign currency rates, or to increase by 15% to 19% on a constant currency basis. This anticipated increase in adjusted operating income reflects recovery of adjusted gross margin, accretion from the acquisition of the controlling interest in McCormick de Mexico and cost savings from our CCI program, partially offset by increased commodity costs and an increase in SG&A expense, including increased investments in technology, performance-based employee compensation expenses and investments aimed at driving volume growth, particularly in brand marketing. We project our brand marketing investments in 2026 to rise by low to mid-teens digits, including the impact from the acquisition of the controlling interest in McCormick de Mexico, compared to 2025.
Previous wording
We estimate our 2025 effective tax rate, including the net favorable impact of anticipated discrete tax items, although at a lower amount than in 2024, to be 22% as compared to 20.5% in 2024. Excluding projected taxes associated with special charges, we estimate our adjusted effective tax rate to also be approximately 22% to 23% in 2025, as compared to an adjusted effective tax rate of 20.5% in 2024.
Current wording
We estimate that our 2026 adjusted effective tax rate, including the net favorable impact of anticipated discrete tax items, although at a lower amount than in 2025, will be 24.0% as compared to 21.5% in 2025.
Previous wording
Diluted earnings per share was $2.92 in 2024. Diluted earnings per share for 2025 is projected to range from $2.95 to $3.00. Excluding the per share impact of special charges, adjusted diluted earnings per share was $2.95 in 2024. Adjusted diluted earnings per share, excluding an estimated per share impact from special charges of $0.05, is projected to range from $3.00 to $3.05 in 2025. We expect adjusted diluted earnings per share to increase by 2% to 4%, which includes a 2% unfavorable impact from currency rates, or to increase by 4% to 6% on a constant currency basis over adjusted diluted earnings per share of $2.95 in 2024.
Current wording
Excluding the per share impact of special charges, adjusted diluted earnings per share was $3.00 in 2025. Adjusted diluted earnings per share is projected to range from $3.05 to $3.13 in 2026. We expect adjusted diluted earnings per share to increase by 2% to 5%, which includes a 1% favorable impact from currency rates, or to increase by 1% to 4% on a constant currency basis.
Previous wording
Sales for the third quarter of 2025 increased by 2.7% from the same period in 2024 and increased by 1.8% on an organic basis (that is, excluding the impact of divestitures and foreign currency exchange as more fully described under the caption, Non-GAAP Financial Measures). Pricing favorably impacted sales by 0.6%. Favorable volume and product mix increased sales by 1.2% driven by favorable volume and product mix from our Consumer segment of 2.2% offset by unfavorable volume and product mix from our Flavor Solutions segment of 0.3%. Foreign currency rates increased sales by 0.9%.
Current wording
Sales for the first quarter of 2026 increased by 16.7% from the same period in 2025 and increased by 1.2% on an organic basis (that is, excluding the impact of acquisitions and foreign currency exchange as more fully described under the caption, Non-GAAP Financial Measures). The acquisition of McCormick de Mexico added 12.4% to net sales. Pricing favorably impacted sales by 1.9% with favorable pricing from our Consumer and Flavor Solutions segments of 2.2% and 1.5%, respectively. Unfavorable volume and product mix decreased sales by 0.7% with unfavorable volume and product mix from our Flavor Solutions and Consumer segments of 1.0% and 0.4%, respectively. Foreign currency rates increased sales by 3.1%.
Previous wording
Gross profit for the third quarter of 2025 decreased by $4.8 million, or 0.7%, from the same period in 2024. Our gross profit margin was 37.4%, a decrease of 130 basis points, driven by increased commodity costs including the impact of tariffs, and increased conversion cost including costs to support increased capacity for future growth, partially offset by Comprehensive Continuous Improvement (CCI) program-led cost savings. Also, gross profit was impacted by unfavorable customer mix that was offset by the effects of favorable pricing. Excluding the impact of special charges related to the step up of acquired inventory included in cost of goods sold, adjusted gross margin was 37.5% for the third quarter of 2025.
Current wording
Gross profit for the first quarter of 2026 increased by $104.9 million, or 17.4%, from the same period of 2025. Our gross profit margin was 37.8%, an increase of 20 basis points, driven by the impact of the McCormick de Mexico acquisition, which included a step-up of acquired inventory recognized as special charges in cost of goods sold as the related inventory was sold, favorable pricing, and CCI-led cost savings, partially offset by increased commodity costs driven primarily by the impact of tariffs. Excluding the impact of special charges included in cost of goods sold, adjusted gross margin was 38.6% for the first quarter of 2026, or an increase of 100 basis points.
Previous wording
SG&A expense decreased by $9.0 million in the third quarter of 2025 as compared to the same period in 2024, driven primarily by lower performance-based employee incentive expense and CCI-led cost savings including the impact of SG&A streamlining actions. SG&A as a percentage of net sales decreased by 100 basis points.
Current wording
SG&A expense increased by $77.5 million in the first quarter of 2026 as compared to the same period in 2025, driven primarily by the impact of the McCormick de Mexico acquisition, increased investments in technology, and increased brand marketing expense. SG&A as a percentage of net sales increased by 70 basis points.
Previous wording
During the three months ended August 31, 2025, we recorded $3.9 million of special charges, including transaction and integration expenses. Those expenses consisted of $1.3 million associated with employee severance and related benefits associated with our SG&A streamlining actions, $1.7 million associated with other actions and $0.9 million of transaction and integration costs.
Current wording
During the three months ended February 28, 2026, we recorded $25.1 million of special charges, including transaction and integration expenses. Those expenses consisted of $16.2 million associated with employee severance and related benefits associated with our SG&A streamlining actions, $7.9 million of transaction and integration costs, and $1.0 million associated with other actions.
Previous wording
Income tax expense for the nine months ended August 31, 2025 included $27.6 million of net discrete tax benefits consisting principally of the following: (i) $10.2 million of tax benefits from the reversal of certain reserves for unrecognized tax benefits and related interest, including $5.9 million associated with the expiration of statutes of limitations, (ii) $8.0 million of tax benefits resulting from state tax matters, and related deferred taxes, (iii) a $5.0 million tax benefit resulting from the revaluation of deferred taxes associated with enacted legislation, (iv) $3.5 million of tax benefits resulting from an adjustment to a prior year tax accrual, and related deferred taxes, based on the final return filed, and (v) $1.0 million of excess tax benefits associated with stock compensation.
Current wording
Income tax expense for the three months ended February 28, 2025, included $5.2 million of net discrete tax benefits consisting principally of a $5.0 million net tax benefit resulting from the revaluation of deferred taxes associated with enacted legislation.
Previous wording
In the EMEA region, Consumer segment sales increased by 11.4% in the third quarter of 2025 compared to the same quarter of 2024 and increased by 4.4% on an organic basis. Favorable volume and product mix increased sales by 1.6%. Favorable pricing impacted sales by 2.8%. The favorable impact from foreign currency rates increased sales by 7.0% and is excluded from our measure of sales growth of 4.4% on an organic basis.
Current wording
In the Americas region, Consumer segment sales increased by 30.4% in the first quarter of 2026 compared to the same quarter of 2025 and increased by 1.2% on an organic basis. The acquisition of McCormick de Mexico increased sales by 28.9%. Unfavorable volume and product mix decreased sales by 1.6%, which included the unfavorable impact of price elasticity. Favorable pricing impacted sales by 2.8%. The favorable impact of foreign currency rates increased sales by 0.3%.
Previous wording
Segment operating income for our Consumer segment for the nine months ended August 31, 2025 decreased by $8.3 million, or 1.6%, as compared to the same period in 2024, driven a decrease in gross profit, partially offset by a decrease in SG&A expense. The decrease in gross profit was driven by unfavorable product mix, increased conversion costs including costs to support increased capacity for future growth and unfavorable pricing actions, partially offset by higher sales volume and CCI-led cost savings. The decrease in SG&A expense was driven by the items described in the consolidated discussion. Segment operating margin decreased by 60 basis points to 17.9%. On a constant currency basis, segment operating income decreased by 1.4%.
Current wording
Segment operating income for our Consumer segment for the first quarter of 2026 increased by $32.9 million, or 22.4%, compared to the same period of 2025 driven by an increase in gross profit partially offset by an increase in SG&A expense. The increase in gross profit was driven by the impact of our acquisition of McCormick de Mexico, favorable pricing and CCI-led cost savings partially offset by increased commodity costs primarily driven by tariffs. The increase in SG&A expense was driven by the items described in the consolidated discussion. Segment operating margin decreased by 30 basis points to 15.7%. On a constant currency basis, segment operating income increased by 20.5%.
Previous wording
In the third quarter of 2025, sales of our Flavor Solutions segment increased by 1.2% as compared to the third quarter of 2024 and increased by 0.6% an organic basis. Unfavorable volume and product mix decreased sales by 0.3% driven by the Americas and EMEA regions partially offset by growth in the APAC region. Favorable pricing increased sales by 0.9%. The favorable impact of foreign currency rates increased sales by 0.6% and is excluded from our measure of sales growth of 0.6% on an organic basis.
Current wording
In the first quarter of 2026, sales of our Flavor Solutions segment increased by 6.2% as compared to the first quarter of 2025 and increased by 0.5% on an organic basis. The acquisition of McCormick de Mexico increased sales by 2.4%. Unfavorable volume and product mix unfavorably impacted sales by 1.0% driven by the Americas and EMEA regions partially offset by growth in the APAC region. Favorable pricing increased sales by 1.5%. The favorable impact of foreign currency rates increased sales by 3.3%.
Previous wording
In the Americas region, Flavor Solutions sales increased by 0.1% in the third quarter of 2025 compared to the third quarter of 2024 and increased by 0.9% on an organic basis. Unfavorable volume and product mix decreased sales by 1.3% driven by lower sales to branded foodservice and packaged food customers. Favorable pricing impacted sales by 2.2%. The unfavorable impact from foreign currency rates decreased sales by 0.8% and is excluded from our measure of sales growth of 0.9% on an organic basis.
Current wording
In the Americas region, Flavor Solutions sales increased by 6.1% in the first quarter of 2026 compared to the first quarter of 2025 and increased by 0.8% on an organic basis. The acquisition of McCormick de Mexico increased sales by 3.4%. Unfavorable volume and product mix decreased sales by 1.7% driven by the effect of lower sales to packaged food customers. Favorable pricing impacted sales by 2.5%. The favorable impact from foreign currency rates increased sales by 1.9%.
Previous wording
In the EMEA region, Flavor Solutions sales increased by 2.1% in the third quarter of 2025 compared to the third quarter of 2024 and decreased by 3.1% on an organic basis. Unfavorable volume and product mix decreased sales by 1.0%, driven by the effect of lower sales to packaged food customers. Unfavorable pricing impacted sales by 2.1%. The favorable impact from foreign currency rates increased sales by 5.2% and is excluded from our measure of sales decline of 3.1% on an organic basis.
Current wording
In the EMEA region, Flavor Solutions sales increased by 7.3% in the first quarter of 2026 compared to the first quarter of 2025 and decreased by 0.5% on an organic basis. Unfavorable volume and product mix decreased sales by 0.5%. The favorable impact from foreign currency rates increased sales by 7.8%.
Previous wording
In the APAC region, Flavor Solutions sales increased by 7.7% in the third quarter of 2025 compared to the third quarter of 2024, and increased by 6.3% on an organic basis. Favorable volume and product mix increased sales by 9.0%, primarily driven by growth in China and Southeast Asia. Pricing unfavorably impacted sales by 2.7%. The favorable impact from foreign currency rates increased sales by 1.4% and is excluded from our measure of sales growth of 6.3% on an organic basis.
Current wording
In the APAC region, Flavor Solutions sales increased by 5.1% in the first quarter of 2026 compared to the first quarter of 2025, and increased by 0.5% on an organic basis. Favorable volume and product mix increased sales by 2.6%, primarily driven by growth in China. Pricing unfavorably impacted sales by 2.1%. The favorable impact from foreign currency rates increased sales by 4.6%.
Previous wording
Segment operating income for our Flavor Solutions segment for the nine months ended August 31, 2025 increased by $23.7 million, or 9.5%, compared to the same period in 2024, driven by an increase in gross profit and lower SG&A expense. The increase in gross profit was driven by the impacts of favorable pricing and CCI-led cost savings, partially offset by increased conversion costs including costs to support increased capacity for growth. The decrease in SG&A expense was driven by the items described in the consolidated discussion. Segment operating margin increased by 110 basis points to 12.6%. On a constant currency basis, segment operating income increased by 12.0%.
Current wording
Segment operating income for our Flavor Solutions segment for the first quarter of 2026 increased by $9.5 million, or 12.1%, compared to the same period of 2025 driven by an increase in gross profit partially offset by an increase in SG&A expense. The increase in gross profit was driven by the impact of our acquisition of McCormick de Mexico, favorable pricing and CCI-led cost savings, partially offset by increased commodity costs primarily driven by tariffs. The increase in SG&A expense was driven by the impact of the McCormick de Mexico acquisition and increased investments in technology. Segment operating margin increased by 70 basis points to 12.1%. On a constant currency basis, segment operating income increased by 7.5%.
Previous wording
We utilize derivative financial instruments to enhance our ability to manage risk, including foreign exchange and interest rate exposures, which exist as part of our ongoing business operations. We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instrument. The use of derivative financial instruments is monitored through regular communication with senior management and the utilization of written guidelines.
Current wording
We utilize derivative financial instruments to enhance our ability to manage risk, including foreign exchange, interest rate, and commodity exposures, which exist as part of our ongoing business operations. We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instrument. The use of derivative financial instruments is monitored through regular communication with senior management and the utilization of written guidelines.
Previous wording
We purchase certain raw materials which are subject to price volatility caused by weather, market conditions, growing and harvesting conditions, governmental actions, and other factors beyond our control. Our most significant raw materials are dairy products, pepper, onion, garlic, capsicums (red peppers and paprika), tomato products, sugar, and salts. While future movements of raw material costs are uncertain, we respond to this volatility in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, and customer price adjustments. We generally have not used derivatives to manage the volatility related to this risk.
Current wording
We purchase certain raw materials which are subject to price volatility caused by weather, market conditions, growing and harvesting conditions, governmental actions, and other factors beyond our control. Our most significant raw materials are dairy products, pepper, onion, garlic, capsicums (red peppers and paprika), salt, tomato products, sugar, and soybean oil. While future movements of raw material costs are uncertain, we respond to this volatility in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, customer price adjustments, and the use of derivative instruments. Our use of commodity derivatives is currently limited to swaps, futures, and options to reduce our exposure to the price volatility of soybean oil.
Previous wording
Details with respect to the composition of special charges, including transaction and integration expenses, set forth below are included in Note 2 of the notes to our accompanying condensed consolidated financial statements. Details with respect to the composition of special charges for the year ended November 30, 2024 are included in Note 2 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended November 30, 2024.
Current wording
Details with respect to the composition of special charges, including transaction and integration expenses, for the year ended November 30, 2025 are included in Note 2 of the notes to the consolidated financial statements included in our Annual Report on Form 10-K for the year ended November 30, 2025.
Previous wording
Our cash flows from operations enable us to fund operating projects and investments that are designed to meet our growth objectives, service our debt, fund or increase our quarterly dividends, fund capital projects and other investments, and make share repurchases when appropriate. Due to the cyclical nature of a portion of our business, our cash flow from operations has historically been the strongest during the fourth quarter of our fiscal year. Due to the timing of the interest payments on our long-term debt, interest payments are higher in the second and fourth quarters of our fiscal year.
Current wording
Our cash flow from operations enables us to fund operating projects and investments that are designed to meet our growth objectives, service our debt, fund or increase our quarterly dividends, fund capital projects and other investments, and make share repurchases when appropriate. Due to the cyclical nature of a portion of our business, our cash flow from operations has historically been the strongest during the fourth quarter of our fiscal year. Due to the timing of the interest payments on our long-term debt, interest payments are higher in the first and third quarters of our fiscal year.
Previous wording
We believe that our sources of liquidity, which include existing cash balances, cash flows from operations, existing credit facilities, our commercial paper program, and access to capital markets, will provide sufficient liquidity to meet our debt obligations, including any repayment of debt or refinancing of debt, working capital needs, planned capital expenditures, the payment associated with an acquisition and payment of anticipated quarterly dividends for at least the next twelve months.
Current wording
We expect that the proposed combination with Unilever Foods is likely to result in a material increase in our debt and liquidity needs that will impact our capital needs prior to and after the closing of such transaction. Under the terms of the Merger Agreement, we will issue voting and non-voting securities to Unilever and its shareholders and make a one-time cash payment of $15.7 billion to Unilever, subject to certain adjustments, which we intend to fund through the Bridge Facility and, to the extent available, the Permanent Financing. See "Bridge Commitment Letter and Financing Arrangements" in the notes to our condensed consolidated financial statements included in Part I, Item 1 of this Quarterly Report on Form 10-Q for further discussion. We believe that our sources of liquidity, which include existing cash balances, cash flows from operations, existing credit facilities, our commercial paper program, access to capital markets and the committed debt financing related to the proposed transaction with Unilever Foods, will provide sufficient liquidity to meet our debt obligations, including any repayment of debt or refinancing of debt, working capital needs, planned capital expenditures, the one-time cash payment to Unilever in connection with the proposed transaction, the payment associated with an acquisition and payment of anticipated quarterly dividends for at least the next twelve months.
Previous wording
In the condensed consolidated cash flow statement, the changes in operating assets and liabilities are presented excluding the translation effects of changes in foreign currency exchange rates as these do not reflect actual cash flows. Accordingly, the amounts in the cash flow statement do not agree with changes in the operating assets and liabilities that are presented in the balance sheet.
Current wording
In the consolidated cash flow statement, the changes in operating assets and liabilities are presented excluding the translation effects of changes in foreign currency exchange rates as these do not reflect actual cash flows. In addition, in the cash flow statement, the changes in operating assets and liabilities are presented excluding the effect of acquired or disposed operating assets and liabilities, as the cash flow associated with acquisition or disposition of businesses is presented as an investing activity. Accordingly, the amounts in the cash flow statement do not agree with changes in the operating assets and liabilities that are presented in the balance sheet.
Previous wording
Operating Cash Flow—Net cash provided by operating activities of $420.2 million for the nine months ended August 31, 2025, decreased $43.0 million as compared to $463.2 million for the corresponding 2024 period. The decrease in operating cash flow was primarily driven by higher cash used for working capital. The higher use of cash associated with working capital was driven by an increased use of cash associated with accounts payable which was partially offset by a lower use of cash associated with inventory in the 2025 period as compared to the 2024 period.
Current wording
Operating Cash Flow—Net cash provided by operating activities of $50.9 million for the three months ended February 28, 2026, decreased $64.6 million as compared to $115.5 million for the corresponding 2025 period. The decrease in operating cash flow was primarily driven by higher income tax payments and cash used for working capital partially offset by lower incentive payments. The higher use of cash associated with working capital, net of effect of business acquired, was driven by an increased use of cash associated with accounts payable, partially offset by a source of cash associated with inventory in 2026 compared to a use of cash in the 2025 period.
Previous wording
Investing Cash Flow—Cash used in investing activities of $172.2 million for the nine months ended August 31, 2025 decreased by $16.9 million as compared to $189.1 million for the corresponding period in 2024. Capital expenditures decreased from the 2024 level of $189.3 million to $138.1 million. We expect 2025 capital expenditures to approximate $250 million. Cash used for the acquisition of a business was $34.1 million.
Current wording
Investing Cash Flow—Cash used in investing activities of $762.4 million for the three months ended February 28, 2026 increased by $725.3 million as compared to $37.1 million for the corresponding period in 2025. Our primary investing cash flows included cash used in the acquisition of a business and cash used for capital expenditures. Capital expenditures, including expenditures for capitalized software decreased from the 2025 level of $37.1 million to $32.5 million. Cash used for the acquisition of a business, net of cash acquired was $729.9 million. We expect 2026 capital expenditures to approximate $275 million.
Previous wording
Financing Cash Flow—Financing activities used cash of $378.3 million for the nine months ended August 31, 2025 and increased $172.4 million as compared to $205.9 million for the corresponding period in 2024. The decrease is a result of changes in our net borrowings, share repurchase activity, and dividends, all as described below.
Current wording
Financing Cash Flow—Financing activities provided cash of $781.7 million for the three months ended February 28, 2026 as compared to a use of cash of $155.2 million for the corresponding period in 2025. The year-over-year change was primarily driven by fluctuations in net borrowings, share repurchase activity, and dividend payments, as further described below.
Previous wording
As of August 31, 2025, approximately $419 million remained of the $600 million share repurchase program that was authorized by the Board of Directors in November 2019. The timing and amount of any shares repurchased is determined by our management based on its evaluation of market conditions and other factors.
Current wording
As of February 28, 2026, approximately $403 million remained of the $600 million share repurchase program that was authorized by the Board of Directors in November 2019. The timing and amount of any shares repurchased is determined by our management based on its evaluation of market conditions and other factors.
Previous wording
During the nine months ended August 31, 2025, we received proceeds of $15.1 million from exercised stock options as compared to $12.8 million received in the corresponding 2024 period. We repurchased $13.2 million and $8.9 million of common stock during the nine months ended August 31, 2025 and 2024, respectively, in conjunction with employee tax withholding requirements associated with our stock compensation plans.
Current wording
During the three months ended February 28, 2026, we received proceeds of $12.6 million from exercised stock options as compared to $6.7 million received in the corresponding 2025 period. We repurchased $9.2 million and $6.7 million of common stock during the three months ended February 28, 2026 and 2025, respectively, in conjunction with employee tax withholding requirements associated with our stock compensation plans.
Previous wording
Dividends paid increased to $362.2 million, or a per share quarterly dividend of $0.45, in the first nine months of 2025 from $338.3 million, or a per share quarterly dividend of $0.42, of dividends paid in the same period last year. The timing and amount of any future dividends is determined by our Board of Directors.
Current wording
Dividends paid increased to $128.9 million, or a per share quarterly dividend of $0.48, in the first three months of 2026 from $120.7 million, or a per share quarterly dividend of $0.45, of dividends paid in the same period last year. The timing and amount of any future dividends is determined by our Board of Directors.
Previous wording
At August 31, 2025 and 2024, we temporarily used $652.2 million and $609.0 million, respectively, of cash from our non-U.S. subsidiaries to pay down short-term debt in the U.S. During a quarter, our short-term borrowings vary, but are typically lower at the end of a quarter. The average short-term borrowings outstanding for the nine months ended August 31, 2025 and 2024 were $1,099.4 million and $955.8 million, respectively. Total average debt outstanding for the nine months ended August 31, 2025 and 2024 was $4,899.4 million and $4,970.8 million, respectively.
Current wording
At February 28, 2026 and 2025, we temporarily used $439.3 million and $607.3 million, respectively, of cash from our non-U.S. subsidiaries to pay down short-term debt in the U.S. During a quarter, our short-term borrowings vary, but are typically lower at the end of a quarter. The average short-term borrowings outstanding for the three months ended February 28, 2026 and 2025 were $1,286.7 million and $981.3 million, respectively. Total average debt outstanding for the three months ended February 28, 2026 and 2025 was $4,920.0 million and $4,781.3 million, respectively.
Previous wording
In May 2025, we entered into a five-year $2.0 billion revolving credit facility which will expire in May 2030 and simultaneously cancelled the five-year $1.5 billion revolving credit facility which was set to expire in June 2026 and the 364-day $500 million revolving credit facility which was set to expire in August 2025. The current pricing for the five-year credit facility, on a fully drawn basis, is Term SOFR plus 1.125%. The pricing of the revolving credit facility is based on a credit rating grid that contains a fully drawn maximum pricing of the credit facility equal to Term SOFR plus 1.50%. The provisions of the revolving credit facility restrict subsidiary indebtedness and require us to maintain a minimum interest coverage ratio. We do not expect that this covenant will limit our access to those facilities for the foreseeable future.
Current wording
Our committed revolving credit facilities include a five-year $2.0 billion revolving credit facility expiring in May 2030 and a 364-day $500 million revolving credit facility expiring in January 2027. Pricing for both facilities, on a fully drawn basis, is currently Term SOFR plus 1.125% and is based on a credit rating grid, with a maximum fully drawn rate of Term SOFR plus 1.50%. The provisions of our revolving credit facilities restrict subsidiary indebtedness and require us to maintain a minimum interest coverage ratio. We do not expect that this covenant would limit our access to our revolving credit facilities for the foreseeable future.
Previous wording
We will continue to have cash requirements to support seasonal working capital needs and capital expenditures, to pay interest, to service debt, and to fund acquisitions. As part of our ongoing operations, we enter into contractual arrangements that obligate us to make future cash payments. Our primary obligations include principal and interest payments on our outstanding short-term borrowings and long-term debt. In the next year, our most significant debt service obligations include the maturity of our $250.0 million, 3.25% notes due in November 2025 and our $500.0 million, 0.90% notes due in February 2026. During the third quarter of 2025 we entered into a definitive agreement, subject to customary closing and regulatory conditions, to acquire an additional 25% ownership interest in our largest joint venture, McCormick de Mexico, for a purchase price of $750 million which is expected to be completed early in the fiscal year ending November 30, 2026. Our other cash requirements include raw material purchases, lease payments, income taxes, anticipated quarterly dividends, and pension and postretirement benefits, as well as other contractual obligations.
Current wording
We will continue to have cash requirements to support seasonal working capital needs and capital expenditures, to pay interest, to service debt, and to fund acquisitions. As part of our ongoing operations, we enter into contractual arrangements that obligate us to make future cash payments. Our primary obligations include principal and interest payments on our outstanding short-term borrowings and long-term debt. Our other cash requirements include raw material purchases, lease payments, income taxes, anticipated quarterly dividends, and pension and postretirement benefits, as well as other contractual obligations. In addition, in connection with the proposed transaction with Unilever Foods, we will be obligated to make a one-time cash payment of $15.7 billion to Unilever, subject to certain adjustments.
Previous wording
These obligations impact our liquidity and capital resource needs. To meet those cash requirements, we intend to use our existing cash, cash equivalents and internally generated funds, to borrow under our existing credit facilities or under other short-term borrowing facilities and depending on market conditions and upon the significance of the cost of a particular debt maturity to our then-available sources of funds, to obtain additional short- and long-term financing. We believe that the cash provided from these sources will be adequate to meet our future cash requirements.
Current wording
These obligations impact our liquidity and capital resource needs. To meet those cash requirements, we intend to use our existing cash, cash equivalents and internally generated funds, to borrow under our existing credit facilities or under other short-term borrowing facilities, to utilize the committed debt financing we have obtained in connection with the proposed transaction, and depending on market conditions and upon the significance of the cost of a particular debt maturity to our then-available sources of funds, to obtain additional short- and long-term financing. We believe that the cash provided from these sources will be adequate to meet our future cash requirements.
Previous wording
There have been no changes in our critical accounting estimates and assumptions included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2024.
Current wording
There have been no changes in our critical accounting estimates and assumptions included in our Annual Report on Form 10-K for the fiscal year ended November 30, 2025 except as follows.
Showing the first 40 of 42 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
•Pricing favorably impacted net sales by 1.9%. The Consumer segment experienced favorable pricing of 2.2% and the the Flavor Solutions segment experienced favorable pricing of 1.5%.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
•Pricing favorably impacted net sales by 0.6%.
Previous report — wording carried elsewhere
During the nine months ended August 31, 2025, we recorded $16.7 million of special charges, including transaction and integration expenses. Those expenses consisted principally of $12.7 million associated with employee severance and related benefits associated with our SG&A streamlining actions, $2.3 million associated with other actions and $1.7 million of transaction and integration costs.
Previous report — wording carried elsewhere
the ability to identify, attract, hire, retain, and develop qualified personnel and the next generation of leaders; the impact of ongoing conflicts, including those between Russia and Ukraine and the war in the Middle East, including the potential for broader economic disruption; expected working capital improvements; the anticipated timing and costs of implementing our business transformation initiative, which includes the implementation of a global enterprise resource planning (ERP) system; the expected impact of accounting pronouncements; expectations regarding pension and postretirement plan contributions and anticipated charges associated with those plans; the holding period and market risks associated with financial instruments; the impact of foreign exchange fluctuations; the adequacy of internally generated funds and existing sources of liquidity, such as the availability of bank financing; the anticipated sufficiency of future cash flows to enable payments of interest, repayment of short- and long-term debt, working capital needs, planned capital expenditures, quarterly dividends, and our ability to obtain additional short- and long-term financing or issue additional debt securities; and expectations regarding purchasing shares of McCormick's common stock under the existing repurchase authorization.