What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-06-25 compared with 2026-03-31 · 230 added, 164 removed, 406 unchanged (49% of the section changed)

17 unchanged sentences

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.

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.

Supreme Court ruled that certain tariffs imposed under IEEPA by the executive branch are not lawful.

On March 4, 2026, the CIT ordered CBP to begin the refund process for all importers who were subject to IEEPA tariffs.

On April 20, 2026, CBP established an online portal through which companies can submit IEEPA tariff refund requests.

We submitted our refund request on April 28, 2026, which is described in Note 1 of the notes to our accompanying condensed consolidated financial statements.

The CIT order has been appealed and we will continue to monitor U.S.

tariff-related developments for further updates and any associated impacts on our consolidated financial statements.

On March 31, 2026, we entered into the Merger Agreement with Unilever, pursuant to which Unilever will separate its Unilever Foods business, excluding its foods businesses in India, Nepal and Portugal, as well as its Lifestyle & Nutrition business, Buavita business and Lipton Ready-to-Drink business, 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.

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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.

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 up to approximatel y 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.

Unilever will also receive a one-time $15.7 billion cash payment, subject to certain adjustments.

The pending transaction is subject to the satisfaction or waiver of certain customary closing conditions, including shareholder and regulatory approvals.

For additional information regarding the pending transaction, see Note 2 of the notes to our accompanying condensed consolidated financial statements.

Executive Summary

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:

In the second quarter of 2026, we achieved net sales growth of 16.7% as compared to the same quarter of 2025, due to the following factors:

• Volume and product mix unfavorably impacted net sales by 0.5%.

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%.

The Consumer segment experienced unfavorable volume and product mix of 1.9% and the Flavor Solutions segment experienced favorable volume and product mix of 1.4%.

• Pricing favorably impacted net sales by 2.2%.

The Consumer segment experienced favorable pricing of 2.2% and the the Flavor Solutions segment experienced favorable pricing of 1.5%.

The Consumer segment experienced favorable pricing of 2.7% and the Flavor Solutions segment experienced favorable pricing of 1.5%.

• The impact of our acquisition of McCormick de Mexico contributed 12.3% of our net sales growth.

• 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%.

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.

• Fluctuations in currency rates positively impacted n et sales by 2.7%.

Fluctuations in curr ency rates positively impacted our Consumer segment sales growth by 2.4% and our Flavor Solutions segment sales growth by 3.0%.

Operating income was $276.4 million in the second quarter of 2026, compared to $245.8 million in the same period of 2025, reflecting an increase of 12.4%.

Our gross profit margin increased by 270 basis points driven by the impacts of the McCormick de Mexico acquisition, favorable pricing, the IEEPA tariff refund, and cost savings from the Company's Comprehensive Continuous Improvement (CCI) program, partially offset by increased commodity costs and higher freight costs due to the conflict in the Middle East.

Selling, general, and administrative (SG&A) expense as a percentage of sales increased by 90 basis points, primarily driven by the impact of the McCormick de Mexico acquisition and increased investments in technology.

Excluding special charges, adjusted operating income was $336.4 million in the second quarter of 2026, reflecting an increase of 30.1% compared to $258.6 million in the 2025 period, primarily driven by the impact of the McCormick de Mexico acquisition and the IEEPA tariff refund.

In constant currency, adjusted operating income increased by 27.3%.

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.

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.”

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.

Diluted earnings per share was $0.56 and $0.65 in the second quarters of 2026 and 2025, respectively.

Special charges, including transaction and integration costs, lowered diluted earnings per share by $0.24 and $0.04 in the second quarters of 2026 and 2025, respectively.

Excluding the effects of special charges, adjusted diluted earnings per share was $0.80 and $0.69 in the second quarters of 2026 and 2025, respectively.

The increase in adjusted diluted earnings per share was driven by favorable operating income and a decrease in the effective tax rate, partially offset by lower income from unconsolidated operations, higher income attributable to noncontrolling interests, an increase in interest expense, and a decrease in other income.

A detailed review of our second quarter 2026 performance compared to the second 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 .”

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.

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.

We do not provide guidance on a GAAP basis as we cannot predict certain items included in GAAP results such as special charges, including transaction and integration expenses.

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.

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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.

This anticipated increase in adjusted operating income reflects adjusted gross margin expansion, accretion from the acquisition of the controlling interest in McCormick de Mexico and cost savings from our CCI program, partially offset by 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.

The benefit of the IEEPA tariff refund is expected to be offset by increased inflation, including costs related to the Middle East conflict, and continued investments in business growth.

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.

Excluding the per share impact of special charges, adjusted diluted earnings per share was $3.00 in 2025.

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.

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RESULTS OF OPERATIONS – COMPANY

Three months ended

February 28, 2026 February 28, 2025

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Net sales $ 1,936.6 $ 1,659.5 $ 3,810.5 $ 3,265.0

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Gross profit margin 40.2 % 37.5 % 39.0 % 37.6 %

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).

Sales for the second quarter of 2026 increased by 16.7% from the same period in 2025 and increased by 1.7% 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 12.3% to net sales.

Pricing favorably impacted sales by 2.2% with favorable pricing from our Consumer and Flavor Solutions segments of 2.7% and 1.5%, respectively.

Unf avorable 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.

Unfavorable volume and product mix decreased sales by 0.5% with unfavorable volume and product mix from our Consumer segment of 1.9% partially offset by favorable volume and product mix from our Flavor Solutions segment of 1.4%.

Foreign currency rates increased sales by 2.7%.

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.

Three months ended

February 28, 2026 February 28, 2025

Sales for the six months ended May 31, 2026 increased by 16.7% from the same period in 2025 and increased by 1.4% on an organic basis.

The acquisition of McCormick de Mexico added 12.4% to net sales.

Pricing favorably impacted sales by 2.1% with favorable pricing from our Consumer and Flavor Solutions segments of 2.5% and 1.5%, respectively.

Unfavorable volume and product mix decreased sales by 0.7% with unfavorable volume and product mix from our Consumer segment of 1.2% partially offset by favorable volume and product mix from our Flavor Solutions segment of 0.2%.

Foreign currency rates increased sales by 2.9%.

Gross profit for the second quarter of 2026 increased by $155.4 million, or 25.0%, from the same period of 2025.

Our gross profit margin was 40.2%, an increase of 270 basis points, driven by the impacts of the McCormick de Mexico acquisition, favorable pricing, the IEEPA tariff refund, and cost savings from the Company's CCI program, partially offset by increased commodity costs and higher freight costs due to the conflict in the Middle East.

Gross profit for the six months ended May 31, 2026 increased by $260.3 million, or 21.2%, from the same period in 2025.

Our gross profit margin was 39.0%, an increase of 140 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, the impact of the IEEPA tariff refund, and cost savings from the Company's CCI program, partially offset by increased commodity costs and higher freight costs due to the conflict in the Middle East.

Excluding the impact of special charges included in Cost of goods sold, adjusted gross margin was 39.4%, or an increase of 180 basis points.

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Selling, general & administrative (SG&A) expense $ 441.8 $ 364.2 $ 898.1 $ 743.0

Percent of net sales 22.8 % 21.9 % 23.5 % 22.8 %

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 expense increased by $77.6 million in the second quarter of 2026 as compared to the same period in 2025, driven primarily by the impact of the McCormick de Mexico acquisition, increased brand marketing expense, and increased investments in technology.

SG&A as a percentage of net sales increased by 90 basis points.

Three months ended

February 28, 2026 February 28, 2025

SG&A expense increased by $155.1 million in the six months ended May 31, 2026 as compared to the same period in 2025, driven primarily by the impact of the McCormick de Mexico acquisition, increased brand marketing expense, and increased investments in technology.

SG&A as a percentage of net sales increased by 70 basis points.

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Special charges $ 60.0 $ 12.8 $ 85.1 $ 12.8

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.

During the three months ended May 31, 2026, we recorded $60.0 million of special charges, including transaction and integration expenses.

Those expenses consisted of $57.6 million of transaction and integration costs, $1.8 million associated with employee severance and related benefits associated with our SG&A streamlining actions and $0.6 million associated with other actions.

During the six months ended May 31, 2026, we recorded $85.1 million of special charges, including transaction and integration expenses.

Those expenses consisted of $65.5 million of transaction and integration costs, $18.0 million associated with employee severance and related benefits associated with our SG&A streamlining actions and $1.6 million associated with other actions.

During the three and six months ended May 31, 2025, we recorded $12.8 million of special charges, including transaction and integration expenses.

Those expenses principally consisted of $11.4 million associated with employee severance and related benefits associated with our SG&A streamlining actions, $0.8 million of transaction and integration costs, and $0.6 million associated with other actions.

Details with respect to the composition of special charges, including transaction and integration expenses, are included in Note 3 of the notes to the accompanying condensed consolidated financial statements.

Three months ended

February 28, 2026 February 28, 2025

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Interest expense $ 62.7 $ 51.0 $ 110.0 $ 99.5

Other income, net 6.5 9.8 11.3 19.6

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.

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.

Three months ended

February 28, 2026 February 28, 2025

Interest expense increased by $11.7 million and $10.5 million for the three and six months ended May 31, 2026, respectively, compared to the same period in 2025, driven by $6.8 million of amortization of debt financing fees related to our pending merger with Unilever Foods, the effects of higher interest rates and the impact of higher average borrowing levels.

Other income, net, decreased by $3.3 million and $8.3 million for the three and six months ended May 31, 2026, respectively, 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.

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Income from consolidated operations before income taxes $ 220.2 $ 204.6 $ 405.2 $ 391.1

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Effective tax rate 28.8 % 24.1 % 27.7 % 23.2 %

The provision for income taxes is based on the estimate of the annual effective tax rate adjusted to reflect the tax impact of items discrete to the fiscal period.

We record tax expense or tax benefits that do not relate to ordinary income in the current fiscal year discretely in the period in which such items occur pursuant to the requirements of U.S.

Examples of such types of discrete items not related to ordinary income include, but are not limited to, excess tax benefits or expense associated with stock-based compensation, changes in estimates of the outcome of tax matters related to prior years, including reversals of reserves upon the lapsing of statutes of limitations, provision-to-return adjustments, the settlement of tax audits, changes in enacted tax rates or other legislation, changes in the assessment of deferred tax valuation allowances, and the tax effects of intra-entity asset transfers (other than inventory).

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.

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.

Three months ended

February 28, 2026 February 28, 2025

The effective tax rate for the three months ended May 31, 2026 increased by 4.7% compared to the same periods in 2025 primarily driven by the unfavorable impact of acquisition related costs partially offset by the impact of discrete tax items which are described in more detail in Note 8 of the notes to our accompanying condensed consolidated financial statements.

The effective tax rate for the six months ended May 31, 2026 increased by 4.5% compared to the same periods in 2025 primarily driven by the unfavorable impact of acquisition related costs.

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Income from unconsolidated operations $ 3.5 $ 20.7 $ 889.5 $ 39.2

Income from unconsolidated operations increased by $867.5 million in the first quarter of 2026 compared to the same period of 2025.

Income from unconsolidated operations decreased $17.2 million for the three months ended May 31, 2026 compared to the same period of 2025.

This decrease was primarily driven by the acquisition of an additional 25% ownership interest in McCormick de Mexico which resulted in the consolidation of McCormick de Mexico's financial results, which is described in more detail in Note 2 of the notes to our accompanying condensed consolidated financial statements.

Income from unconsolidated operations increased by $850.3 million for the six months ended May 31, 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.

Three months ended

February 28, 2026 February 28, 2025

Three months ended May 31, Six months ended May 31,

Net income attributable to noncontrolling interests $ 10.1 $ 1.0 $ 16.2 $ 2.1

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.

Net income attributable to noncontrolling interests increased by $9.1 million for the three months ended May 31, 2026 and $14.1 million for the six months ended May 31, 2026 compared to the same periods in 2025 .

This increase was driven by the net income attributable to our noncontrolling interest in McCormick de Mexico upon its consolidation in 2026.

The following table outlines the major components of the change in diluted earnings per share from 2025 to 2026:

Three months ended February 28,

Three months ended May 31, Six months ended May 31,

2025 Earnings per share – diluted

$ 0.65 $ 1.25

Impact of change in operating income 0.22 0.34

Increase in special charges (0.20) (0.32)

Increase in interest expense (0.02) (0.01)

Decrease in other income, net (0.01) (0.02)

2 unchanged sentences

Impact of net income attributable to noncontrolling interest (0.03) (0.05)

Decrease in unconsolidated income $ (0.07) $ (0.06)

2026 Earnings per share – diluted

$ 0.56 $ 4.33

RESULTS OF OPERATIONS — SEGMENTS

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CONSUMER SEGMENT

Three months ended February 28,

Three months ended May 31, Six months ended May 31,

Net sales $ 1,142.7 $ 930.6 $ 2,287.7 $ 1,849.8

Percent increase (decrease) 24.5 % (0.2) %

Percent increase 22.8 % 2.9 % 23.7 % 1.3 %

Segment operating income $ 216.9 $ 163.6 $ 396.5 $ 310.3

Segment operating income margin 19.0 % 17.6 % 17.3 % 16.8 %

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.

In the second quarter of 2026, sales of our Consumer segment increased by 22.8% compared to the second quarter of 2025 and increased by 0.8% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 19.6%.

Unfavorable volume and product mix decreased sales by 1.9%, 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.

Favorable pricing impacted sales by 2.7% primarily driven by the Americas region.

The favorable impact of foreign currency rates increased sales by 2.4%.

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.

In the Americas region, Consumer segment sales increased by 28.0% in the second quarter of 2026 compared to the same quarter of 2025 and decreased by 0.2% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 27.9%.

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The favorable impact of foreign currency rates increased sales by 0.3%.

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.

In the EMEA region, Consumer segment sales increased by 10.7% in the second quarter of 2026 compared to the same quarter of 2025 and increased by 3.3% on an organic basis.

Favorable volume and product mix increased sales by 1.9%, driven by higher sales in France and the UK.

Favorable pricing impacted sales by 1.4%.

The favorable impact from foreign currency rates increased sales by 7.4%.

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.

In the APAC region, Consumer segment sales increased by 10.0% in the second quarter of 2026 compared to the same quarter of 2025 and increased by 2.9% on an organic basis.

Favorable volume and product mix increased sales by 2.4%, driven by higher sales in China.

1 unchanged sentence

The favorable impact from foreign currency rates increased sales by 7.1%.

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.

For the six months ended May 31, 2026, sales of our Consumer segment increased 23.7% as compared to the same period in 2025 and increased by 1.3% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 19.7%.

Unfavorable volume and product mix decreased sales by 1.2% driven by declines in the Americas region which were partially offset by growth in the EMEA and APAC regions.

Favorable pricing impacted sales by 2.5% driven by the Americas region.

The favorable impact from foreign currency rates increased sales by 2.7% .

Segment operating income for our Consumer segment for the second quarter of 2026 increased by $53.3 million, or 32.6%, as 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 impacts of our acquisition of McCormick de Mexico, favorable pricing, the IEEPA tariff refund, and CCI-led cost savings, partially offset by increased commodity costs and higher freight costs due to the conflict in the Middle East.

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%.

Segment operating margin increased by 140 basis points to 19.0% .

On a constant currency basis, segment operating income increased by 30.7%.

Segment operating income for our Consumer segment for the six months ended May 31, 2026 increased by $86.2 million, or 27.8%, as compared to the same period in 2025, driven by the effects of an increase in gross profit partially offset by an increase in SG&A expense.

The increase in gross profit was driven by the impacts of our acquisition of McCormick de Mexico, the IEEPA tariff refund, favorable pricing, and CCI-led cost savings, partially offset by increased commodity costs and higher freight costs due to the conflict in the Middle East.

Segment operating margin increased by 50 basis points to 17.3%.

On a constant currency basis, segment operating income increased by 25.9%.

FLAVOR SOLUTIONS SEGMENT

Three months ended

February 28, 2026 February 28, 2025

Three months ended May 31, Six months ended May 31,

2026 2025 2026

Net sales $ 793.9 $ 728.9 $ 1,522.8 $ 1,415.2

2 unchanged sentences

Segment operating income margin 15.1 % 13.0 % 13.6 % 12.3 %

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.

In the second quarter of 2026, sales of our Flavor Solutions segment increased by 8.9% as compared to the second quarter of 2025 and increased by 2.9% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 3.0%.

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%.

Favorable volume and product mix increased sales by 1.4% driven by the Americas and APAC regions, partially offset by lower sales in the EMEA region.

Favorable pricing increased sales by 1.5% driven by the Americas and EMEA regions.

The favorable impact of foreign currency rates increased sales by 3.0%.

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.

In the Americas region, Flavor Solutions sales increased by 10.0% in the second quarter of 2026 compared to the second quarter of 2025 and increased by 3.9% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 4.2%.

Unfavorable volume and product mix decreased sales by 1.7% driven by the effect of lower sales to packaged food customers.

Favorable volume and product mix increased sales by 2.1% driven by the effect of higher sales to packaged food customers.

Favorable pricing impacted sales by 1.8%.

The favorable impact from foreign currency rates increased sales by 1.9% .

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%.

In the EMEA region, Flavor Solutions sales increased by 5.4% in the second quarter of 2026 compared to the second quarter of 2025 and increased by 0.4% on an organic basis.

Unfavorable volume and product mix decreased sales by 1.2% driven by the effect of lower sales to quick-service restaurant customers.

Favorable pricing impacted sales by 1.6%.

The favorable impact from foreign currency rates increased sales by 5.0%.

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.

In the APAC region, Flavor Solutions sales increased by 7.5% in the second quarter of 2026 compared to the second quarter of 2025, and increased by 0.2% on an organic basis.

Favorable volume and product mix increased sales by 0.8%, primarily driven by growth in China.

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The favorable impact from foreign currency rates increased sales by 7.3%.

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.

For the six months ended May 31, 2026, sales of our Flavor Solutions segment increased 7.6% as compared to the same period in 2025 and increased by 1.7% on an organic basis.

The acquisition of McCormick de Mexico increased sales by 2.7% .

Favorable volume and product mix increased sales by 0.2% driven primarily by growth in the APAC region partially offset by lower sales in the EMEA region.

Favorable pricing increased sales by 1.5%, driven by the Americas and EMEA regions partially offset by unfavorable pricing in the APAC region.

The favorable impact of foreign currency rates increased segment sales by 3.2% .

Segment operating income for our Flavor Solutions segment for the second quarter of 2026 increased by $24.5 million, or 25.8%, 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 favorable pricing, the impact of our acquisition of McCormick de Mexico, and CCI-led cost savings.

The increase in SG&A expense was driven by the impact of the McCormick de Mexico acquisition and increased investments in technology.

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On a constant currency basis, segment operating income increased by 21.4%.

Segment operating income for our Flavor Solutions segment for the six months ended May 31, 2026 increased by $34.0 million, or 19.6%, compared to the same period in 2025, driven by the effects of an increase in gross profit partially offset by an increase in SG&A expense.

The increase in gross profit was driven by favorable pricing, the impact of our acquisition of McCormick de Mexico, and CCI-led cost savings.

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 b y 130 basis points to 13.6%.

O n a constant currency basis, segment operating income increased by 15.1%.

MARKET RISK SENSITIVITY

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Management assesses foreign currency risk based on transactional cash flows and translational volatility and may enter into forward contract and currency swaps with highly-rated financial institutions to reduce fluctuations in the long or short currency positions.

We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instruments.

All derivatives are designated as hedges.

The following table sets forth the notional values and unrealized net gain (loss) of the portfolio of our forward foreign currency and cross currency swap contracts:

February 28, 2026 November 30, 2025

The following table sets forth the notional values and unrealized net gains (losses) of the portfolio of our forward foreign currency and cross currency swap contracts:

May 31, 2026 November 30, 2025

Forward foreign currency:

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We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instruments, and all derivatives are designated as hedges.

The following table sets forth the notional values and unrealized net gain (loss) of our interest rate swap contracts:

February 28, 2026 November 30, 2025

The following table sets forth the notional values and unrealized net gains (losses) of our interest rate swap contracts:

May 31, 2026 November 30, 2025

Notional value $ 500.0 $ 500.0

Unrealized net loss (18.6) (20.8)

Unrealized net (loss) gain (23.7) (20.8)

The change in fair values of our interest rate swap contracts is due to changes in interest rates on the notional amounts outstanding as of each date as well as the remaining duration of our interest rate derivative contracts.

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Our use of commodity derivatives is currently limited to swaps, futures, and options to reduce our exposure to the price volatility of soybean oil.

The following table sets forth the notional values and unrealized net gain (loss) of our commodity contracts:

February 28, 2026 November 30, 2025

The following table sets forth the notional values and unrealized net gains (losses) of our commodity contracts:

May 31, 2026 November 30, 2025

Notional value $ 301.8 $ —

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We continue to closely monitor the credit worthiness of our customers and counterparties.

We believe that our allowance for doubtful accounts properly recognizes trade receivables at realizable value.

We believe that our allowance for credit losses properly recognizes trade receivables at realizable value.

We consider nonperformance credit risk for other financial instruments to be insignificant.

NON-GAAP FINANCIAL MEASURES

The following tables include financial measures of organic net sales, adjusted gross profit, adjusted gross profit margin, adjusted operating income, adjusted operating income margin, adjusted income tax expense, adjusted income tax rate, adjusted

net income, and adjusted diluted earnings per share.

These represent non-GAAP financial measures which are prepared as a complement to our financial results prepared in accordance with United States generally accepted accounting principles.

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A reconciliation of these non-GAAP financial measures to the related GAAP financial measures follows:

For the year ended November 30, 2025 For the three months ended

February 28, 2026 February 28, 2025

For the year ended November 30, 2025

Three months ended May 31, Six months ended May 31,

2026 2025 2026 2025

Gross profit $ 2,592.2 $ 778.2 $ 622.8 $ 1,487.1 $ 1,226.8

Impact of Special charges included in cost of goods sold

2.1 — — 15.0 —

Adjusted gross profit $ 2,594.3 $ 778.2 $ 622.8 $ 1,502.1 $ 1,226.8

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Impact of Special charges

23.2 60.0 12.8 100.1 12.8

Adjusted operating income $ 1,094.0 $ 336.4 $ 258.6 $ 604.0 $ 483.8

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Impact of Special charges

5.5 1.0 3.0 10.9 3.0

Adjusted income tax expense $ 201.3 $ 64.5 $ 52.3 $ 123.1 $ 93.9

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Impact of Special charges, net of non-controlling interest (4)(5)

17.7 65.8 9.8 93.3 9.8

Gain on remeasurement of previously held equity interest — — — (866.8) —

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(3) Income tax rate is calculated as income tax expense as a percentage of income from consolidated operations before income taxes.

Adjusted income tax rate is calculated as adjusted income tax expense as a percentage of income from consolidated operations before income taxes excluding special charges of $225.1 million and $186.5 million for the three months ended February 28, 2026 and 2025, respectively.

Adjusted income tax rate is calculated as adjusted income tax expense as a percentage of income from consolidated operations before income taxes excluding special charges of $287.0 million and $217.4 million for the three months ended May 31, 2026 and 2025, respectively, and $512.1 million and $403.9 million for the six months ended May 31, 2026 and 2025, respectively.

Adjusted income tax rate is calculated as adjusted income tax expense as a percentage of income from consolidated operations before income taxes excluding special charges of $936.2 million for the year ended November 30, 2025.

(4) The impact of special charges, net of noncontrolling interests, for the three months ended February 28, 2026 represents a $2.6 million non-controlling interest effect associated with the step-up of acquired inventory recognized in cost of goods sold as the related inventory was sold.

(4) The impact of special charges, net of noncontrolling interests, for six months ended May 31, 2026 includes a $2.6 million non-controlling interest effect associated with the step-up of acquired inventory recognized in cost of goods sold as the related inventory was sold.

(5) The impact of special charges, net of noncontrolling interests, for three and six months ended May 31, 2026 includes a net income impact of $5.2 million related to transaction expenses included in interest expense.

Because we are a multi-national company, we are subject to variability of our reported U.S.

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Rates of constant currency and organic growth (decline) follow:

Three months ended February 28, 2026

Percentage change as reported Impact of foreign currency exchange Percentage change on a constant currency basis Impact of acquisition Percentage change on an organic basis

Three months ended May 31, 2026

Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Impact of acquisition Percentage change on an organic basis

Consumer segment:

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Total net sales 16.7 % 2.7 % 14.0 % 12.3 % 1.7 %

Three months ended February 28, 2026

Six months ended May 31, 2026

Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Impact of acquisition Percentage change on an organic basis

Consumer segment:

Americas 29.1 % 0.3 % 28.8 % 28.4 % 0.4 %

EMEA 13.1 % 9.6 % 3.5 % — % 3.5 %

APAC 8.0 % 5.5 % 2.5 % — % 2.5 %

Total Consumer 23.7 % 2.7 % 21.0 % 19.7 % 1.3 %

Flavor Solutions segment:

Americas 8.1 % 1.9 % 6.2 % 3.8 % 2.4 %

EMEA 6.3 % 6.4 % (0.1) % — % (0.1) %

APAC 6.3 % 6.0 % 0.3 % — % 0.3 %

Total Flavor Solutions 7.6 % 3.2 % 4.4 % 2.7 % 1.7 %

Total net sales 16.7 % 2.9 % 13.8 % 12.4 % 1.4 %

Three months ended May 31, 2026

Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis

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Total adjusted operating income 30.1 % 2.8 % 27.3 %

Six months ended May 31, 2026

Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis

Adjusted operating income:

Consumer segment 27.8 % 1.9 % 25.9 %

Flavor Solutions segment 19.6 % 4.5 % 15.1 %

Total adjusted operating income 24.8 % 2.8 % 22.0 %

To present the percentage change in projected 2026 net sales, adjusted operating income, and adjusted earnings per share (diluted) on a constant currency basis, the projected local currency net sales, adjusted operating income, and adjusted net income for entities reporting in currencies other than the U.S.

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LIQUIDITY AND FINANCIAL CONDITION

Three months ended

February 28, 2026 February 28, 2025

Six months ended May 31,

Net cash provided by operating activities $ 430.7 $ 161.4

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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.

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.

We expect that the pending 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, the Term Loan Facility, and, to the extent available, the Permanent Financing.

See Note 4 of the notes to the condensed consolidated financial statements 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 pending 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 pending transaction, the payment associated with an acquisition and payment of anticipated quarterly dividends for at least the next twelve months.

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

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.

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.

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.

Operating Cash Flow — Net cash provided by operating activities of $430.7 million for the six months ended May 31, 2026 increased $269.3 million as compared to $161.4 million for the corresponding 2025 period.

The increase in operating cash flow was primarily driven by lower cash used for working capital.

The lower use of cash associated with working capital, net of effect of businesses acquired, was driven by a decreased use of cash associated with accounts payable and increased source of cash from accounts receivables in 2026 compared to the 2025 period.

Investing Cash Flow — Cash used in investing activities of $805.1 million for the six months ended May 31, 2026 increased by $699.9 million as compared to $105.2 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 $85.4 million to $75.2 million.

Cash used for the acquisition of a business, net of cash acquired was $729.9 million.

Cash used for the acquisition of a business, net of cash acquired for the six months ended May 31, 2026 was $729.9 million as compared to $19.8 million for the six months ended May 31, 2025.

We expect 2026 capital expenditures to approximate $250 million.

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.

Financing Cash Flow — Financing activities provided cash of $602.7 million for the six months ended May 31, 2026 as compared to a use of cash of $142.9 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.

The following table outlines our net borrowing activities:

Three months ended

February 28, 2026 February 28, 2025

Six months ended May 31,

Net increase in short-term borrowings (repayments), net $ 945.2 $ 116.0

Repayments of long-term debt (504.4) (13.6)

Debt financing fees paid (51.0) —

Long-term debt borrowings (net of debt issuance costs of $1.1)

Net cash provided by (used in) borrowing activities $ 923.7 $ (37.4)

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.

Net cash provided by borrowing activities $ 887.5 $ 103.3

During the six months ended May 31, 2026, the increase in short-term borrowings was principally to fund investing cash requirements.

During the six months ended May 31, 2026, we repaid $504.4 million of long-term debt, including the $500 million, 0.90% notes that matured in February 2026.

In the second quarter of 2026, we paid $51.0 million of aggregate debt financing fees related to the pending merger with Unilever Foods which were deferred in Other assets and are being amortized to Interest expense.

During the six months ended May 31, 2026, we issued $500 million of 4.15% notes due 2029, with net proceeds received of $497.1 million.

The following table outlines the activity in our share repurchase program:

Three months ended

February 28, 2026 February 28, 2025

Six months ended May 31,

Number of shares of common stock repurchased (in thousands) 154 345

Dollar amount (in millions) $ 10.9 $ 26.5

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.

As of May 31, 2026, approximately $402.6 million remained of the $600.0 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.

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.

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.

During the six months ended May 31, 2026, we received proceeds of $13.6 million from exercised stock options as compared to $13.3 million received in the corresponding 2025 period.

We repurchased $11.9 million and $12.6 million of common stock during the six months ended May 31, 2026 and 2025, respectively, in conjunction with employee tax withholding requirements associated with our stock compensation plans.

Dividends paid increased to $257.9 million, or a per share quarterly dividend of $0.48, in the first six months of 2026 from $241.5 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.

We paid dividends to our joint venture partner of $8.4 million in the first six months of 2026.

Most of our cash is in our subsidiaries outside of the U.S.

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Those balances are generally available without legal restrictions to fund ordinary business operations, capital projects and any possible future acquisitions.

At February 28, 2026 and 2025, we temporarily used $439.3 million and $607.3 million, respectively, of cash from our non-U.S.

At May 31, 2026 and 2025, we temporarily used $449.4 million and $614.2 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.

The average short-term borrowings outstanding for the six months ended May 31, 2026 and 2025 were $1,519.4 million and $1,073.5 million, respectively.

Total average debt outstanding for the six months ended May 31, 2026 and 2025 was $5,111.1 million and $4,873.5 million, respectively.

The reported values of our assets and liabilities are significantly affected by fluctuations in foreign exchange rates between periods.

At February 28, 2026, the exchange rate for the British pound sterling, Euro, Canadian dollar, Mexican peso, Chinese renminbi, Australian dollar, and Polish zloty were higher than the U.S.

At May 31, 2026, the exchange rate for the British pound sterling, Euro, Canadian dollar, Mexican peso, Chinese renminbi, Australian dollar, and Polish zloty were higher than the U.S.

dollar at November 30, 2025.

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In February 2026, we issued $500 million aggregate principal amount of 4.15% unsecured senior notes due 2029.

Interest is payable semiannually in February and August of each year.

Interest is payable semiannually in February and August of each year, beginning in August 2026.

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.

In March 2026, we entered into the Bridge Commitment Letter in connection with the financing of the pending transaction with Unilever, pursuant to which the Commitment Parties committed to provide, subject to the terms and conditions set forth therein, the Bridge Facility an aggregate principal amount of up to $15.7 billion to fund the cash consideration and related fees and expenses at closing of the pending transaction.

Effective April 28, 2026, we terminated $2.0 billion of the commitments under the Bridge Facility and entered into a term loan agreement as described below, subject to customary closing conditions for similar facilities.

In April 2026, we entered into the Term Loan Agreement by and among us, the lenders party thereto and Citibank, N.A., as the Administrative Agent.

The Term Loan Agreement provides us with the Term Loan Facility at the the Closing Date, subject to satisfaction of customary closing conditions for similar facilities, for the purpose of financing a portion of the cash consideration to be paid in the pending transaction and paying related fees and expenses in connection therewith.

The Term Loan Facility may be funded on the Closing Date or, subject to compliance with certain conditions, on the preceding business day, and matures three years after the Closing Date.

Under the Term Loan Agreement, borrowings will bear interest on the principal amount outstanding at a floating rate based on, at our election, (i) Term SOFR (as defined in the Term Loan Agreement) plus an applicable margin based on the credit ratings of our senior unsecured long term debt ranging from 0.75% to 1.50% or (ii) Base Rate (as defined in the Term Loan Agreement) plus an applicable margin based on the credit ratings of our senior unsecured long term debt ranging from 0.00% to 0.50%.

The Term Loan Agreement contains a financial covenant requiring us to maintain a minimum interest coverage ratio as well as other non-financial covenants and certain customary events of default.

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.

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If any of the banks in this syndicate are unable to perform on their commitments, our liquidity could be impacted, which could reduce our ability to grow through funding of our working capital.

We periodically review our banking and financing relationships, considering the stability of the institutions and other aspects of the relationships.

We periodically review our banking and financing relationships, considering the stability of the institutions and other aspects of

the relationships.

In addition, we engage in regular communication with all banks participating in our credit facility.

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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.

In addition, in connection with the pending 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.

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.

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 pending 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.

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These estimates can also affect supplemental information disclosed by us, including information about contingencies, risk and financial condition.

We believe, given current facts and circumstances, our estimates

and assumptions are reasonable, adhere to GAAP and are consistently applied.

We believe, given current facts and circumstances, our estimates and assumptions are reasonable, adhere to GAAP and are consistently applied.

Inherent in the nature of an estimate or assumption is the fact that actual results may differ from estimates, and estimates may vary as new facts and circumstances arise.

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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.

We generally obtain the assistance of a third-party valuation specialist in estimating fair values of tangible and intangible assets as well as 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.

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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.

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.

FORWARD-LOOKING INFORMATION

Certain statements contained in this report, including statements concerning expected performance such as those relating to net sales, gross margin, earnings, cost savings, special charges, including transaction and integration expenses, acquisitions, brand marketing support, volume and product mix, income tax expense, and the impact of foreign currency rates are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.

Certain statements contained in this report, including statements concerning expected performance such as those relating to net sales, gross margin, earnings, cost savings, special charges, including transaction and integration expenses, mergers, acquisitions, brand marketing support, volume and product mix, income tax expense, tariff-related matters, and the impact of foreign currency rates are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended.

These statements may be identified by the use of words such as “may,” “will,” “expect,” “should,” “anticipate,” “intend,” “believe,” “plan,” and similar expressions.

These statements may relate to:

the anticipated benefits of, and our plans, strategies and objectives relating to, the proposed transaction with Unilever Foods, including:

due to the parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction, including changes in relevant tax and other applicable laws;

the failure to obtain necessary regulatory approvals, approval of our shareholders, anticipated tax treatment or any required financing, or to satisfy any of the other conditions to the proposed transaction;

the possibility that unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies could impact the value or expected benefit of, timing or pursuit of the proposed transaction;

the anticipated benefits and timing of, and our plans, strategies and objectives relating to, the pending transaction with Unilever Foods, including:

due to the parties’ ability to meet expectations regarding the timing, completion and accounting and tax treatments of the pending transaction, including changes in relevant tax and other applicable laws;

the risks and costs of the pursuit and/or implementation of the anticipated separation of Unilever Foods business prior to closing, including the anticipated timing required to complete the separation, any adjustment to the terms of the separation and any changes to the configuration of the businesses included in the separation if implemented;

the financing of the proposed transaction, including with respect to the Bridge Commitment and any other subsequent financing;

the effectiveness of a registration statement on Form S-4 and our receipt of shareholder approval for the proposed transaction and certain related matters;

the anticipated ownership percentages of McCormick shareholders, Unilever shareholders and Unilever following the closing of the proposed transaction;

the effect of the announcement or pendency of the proposed transaction on Unilever Foods’ or McCormick’s business relationships, competition, business, financial condition and operating results;

the ability of McCormick to successfully integrate Unilever Foods’ operations and implement its plans, forecasts and other expectations with respect to Unilever Foods’ business or the combined business after the closing of the proposed transaction;

the financing of the pending transaction, including with respect to the Bridge Facility, the Term Loan Facility, and any other subsequent financing;

the effectiveness of a registration statement on Form S-4 and our receipt of shareholder approval for the pending transaction and certain related matters;

the anticipated ownership percentages of McCormick shareholders, Unilever shareholders and Unilever following the closing of the pending transaction;

the effect of the announcement or pendency of the pending transaction on Unilever Foods’ or McCormick’s business relationships, competition, business, financial condition and operating results;

the ability of McCormick to manage additional debt and successfully de-lever following the transaction;

3 unchanged sentences

expected trends in net sales, earnings performance, and other financial measures;

the expected impact of pricing

actions on the Company's results of operations, including our sales volume and mix as well as gross margins;

the expected impact of pricing actions on the Company's results of operations, including our sales volume and mix as well as gross margins;

the expected impact of the inflationary cost environment on our business;

the anticipated effects of factors affecting our supply chain, including the availability and prices of commodities and other supply chain resources such as raw materials, packaging, labor, and transportation;

the potential impact of trade policies, including new tariffs;

the potential impact of trade policies, including tariffs;

the potential impact of legal challenges to U.S.

tariffs, tariff refunds, and the timing and anticipated benefits thereof;

the expected impact of productivity improvements, including those associated with our CCI program and the Global Business Services operating model initiative;

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/conflict in the Middle East, including the potential for broader economic disruption, in particular related to fuel prices;

the impact of ongoing or future geopolitical conflicts, including those between Russia and Ukraine and the war/conflict in the Middle East, including the potential for broader economic disruption, in particular related to fuel and freight prices;

expected working capital improvements;

14 unchanged sentences

increased private label use;

the Company's ability to offset cost pressures or business impacts related to trade policies, including new tariffs;

the Company's ability to offset cost pressures or business impacts related to trade policies such as tariffs, including relating to tariff refunds;

the Company's ability to drive productivity improvements, including those related to our CCI program and other streamlining actions;

2 unchanged sentences

actions by, and the financial condition of, competitors and customers;

the longevity of mutually beneficial relationships with our large customers;

the longevity of mutually beneficial

relationships with our large customers;

the ability to identify, interpret and react to changes in consumer preference and demand;

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labor shortage, turnover and labor cost increases;

the impact of the ongoing conflicts between Russia and Ukraine and the war in the Middle East, including the potential for broader economic disruption;

the impact of changing political and geopolitical conditions, including the ongoing conflicts between Russia and Ukraine and the war/conflict in the Middle East, including the potential for broader economic disruption;

government regulation, and changes in legal and regulatory requirements and enforcement practices;

16 unchanged sentences

negative employee relations;

risks related to the proposed transaction, including:

direct transaction costs and substantial transition and integration-related costs associated with the proposed transaction with Unilever Foods;

risks related to the pending transaction with Unilever Foods, including:

direct transaction costs and substantial transition and integration-related costs associated with the pending transaction;

the parties' ability to meet expectations regarding the timing, completion and accounting and tax treatments of the transaction, and the occurrence of any event, change or other circumstance that could give rise to the termination of the transaction agreement;

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the ability of McCormick to manage additional debt and successfully de-lever following the transaction;

the outcome of any legal proceedings that may be instituted against Unilever

Foods or McCormick related to the transaction;

the outcome of any legal proceedings that may be instituted against Unilever 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”;

3 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis