MCCORMICK & CO INC 10-Q

ITEM 1. FINANCIAL STATEMENTS McCORMICK & COMPANY, INCORPORATED CONDENSED CONSOLIDATED INCOME STATEMENT (UNAUDITED) (in millions except per share amounts) 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 Cost of goods sold 1,158.4 1,036.7 2,323.4 2,038.2 Gross profit 778.2 622.8 1,487.1 1,226.8 Selling, general and administrative expense 441.8 364.2 898.1 743.0 Special charges 60.0 12.8 85.1 12.8 Operating income 276.4 245.8 503.9 471.0 Interest expense 62.7 51.0 110.0 99.5 Other income, net 6.5 9.8 11.3 19.6 Income from consolidated operations before income taxes 220.2 204.6 405.2 391.1 Income tax expense 63.5 49.3 112.2 90.9 Net income from consolidated operations 156.7 155.3 293.0 300.2 Income from unconsolidated operations 3.5 20.7 889.5 39.2 Net income 160.2 176.0 1,182.5 339.4 Net income attributable to noncontrolling interests 10.1 1.0 16.2 2.1 Net income attributable to McCormick & Company $ 150.1 $ 175.0 $ 1,166.3 $ 337.3 Earnings per share – basic $ 0.56 $ 0.65 $ 4.34 $ 1.26 Earnings per share – diluted $ 0.56 $ 0.65 $ 4.33 $ 1.25 Average shares outstanding – basic 269.2 268.6 269.0 268.5 Average shares outstanding – diluted 269.2 269.4 269.3 269.5 Cash dividends paid per share – voting and non-voting $ 0.48 $ 0.45 $ 0.96 $ 0.90 See notes to condensed consolidated financial statements (unaudited). 4 Table of Contents McCORMICK & COMPANY, INCORPORATED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (UNAUDITED) (in millions) Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Net income $ 160.2 $ 176.0 $ 1,182.5 $ 339.4 Other comprehensive income (loss): Currency translation adjustments ( 32.2 ) 123.5 150.4 89.6 Amounts reclassified into earnings upon acquisition of controlling interest — — 44.8 — Change in derivative financial instruments 30.5 ( 2.6 ) 58.6 ( 0.3 ) Unrealized components of pension and other postretirement plans ( 0.3 ) ( 2.3 ) ( 2.2 ) ( 3.3 ) Tax (expense) benefit ( 10.3 ) 6.1 ( 15.9 ) 5.1 Total other comprehensive income, net of tax ( 12.3 ) 124.7 235.7 91.1 Comprehensive income $ 147.9 $ 300.7 $ 1,418.2 $ 430.5 Attributable to: Non-controlling interests $ 10.3 $ 2.3 $ 50.2 $ 3.2 McCormick & Company shareholders' equity $ 137.6 $ 298.4 $ 1,368.0 $ 427.3 See notes to condensed consolidated financial statements (unaudited). 5 Table of Contents McCORMICK & COMPANY, INCORPORATED CONDENSED CONSOLIDATED BALANCE SHEET (in millions) May 31, 2026 November 30, 2025 (unaudited) ASSETS Cash and cash equivalents $ 331.2 $ 95.9 Trade accounts receivable, net of allowances 709.4 628.9 Inventories, net Finished products 694.7 629.1 Raw materials and work-in-process 713.9 642.9 1,408.6 1,272.0 Prepaid expenses and other current assets 339.6 141.3 Total current assets 2,788.8 2,138.1 Property, plant and equipment, net 1,504.2 1,448.8 Goodwill 6,291.9 5,301.3 Intangible assets, net 4,937.5 3,293.1 Other long-term assets 954.7 1,019.1 Total assets $ 16,477.1 $ 13,200.4 LIABILITIES AND SHAREHOLDERS’ EQUITY Short-term borrowings $ 1,326.6 $ 381.4 Current portion of long-term debt 9.5 509.1 Trade accounts payable 1,515.1 1,259.4 Other accrued liabilities 720.6 912.3 Total current liabilities 3,571.8 3,062.2 Long-term debt 3,597.4 3,105.8 Deferred taxes 1,327.0 835.8 Other long-term liabilities 407.6 428.5 Total liabilities 8,903.8 7,432.3 Shareholders’ equity Common stock 585.1 582.4 Common stock non-voting 1,729.0 1,700.8 Retained earnings 4,842.9 3,816.4 Accumulated other comprehensive loss ( 161.4 ) ( 363.1 ) Total McCormick & Company shareholders’ equity 6,995.6 5,736.5 Non-controlling interests 577.7 31.6 Total shareholders’ equity 7,573.3 5,768.1 Total liabilities and shareholders’ equity $ 16,477.1 $ 13,200.4 See notes to condensed consolidated financial statements (unaudited). 6 Table of Contents McCORMICK & COMPANY, INCORPORATED CONDENSED CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED) (in millions) Six months ended May 31, 2026 2025 Operating activities Net income $ 1,182.5 $ 339.4 Adjustments to reconcile net income to net cash flow provided by operating activities: Depreciation and amortization 136.5 110.9 Stock-based compensation 29.3 29.6 Amortization of inventory fair value adjustments associated with acquisition 15.0 — Deferred income tax benefit ( 11.3 ) ( 12.1 ) Income from unconsolidated operations ( 22.7 ) ( 39.2 ) Gain on remeasurement of previously held equity interest ( 866.8 ) — Changes in operating assets and liabilities (net of effect of businesses acquired) Trade accounts receivable 129.4 23.2 Inventories ( 6.3 ) ( 19.1 ) Trade accounts payable 30.2 ( 74.5 ) Other assets and liabilities ( 199.6 ) ( 219.4 ) Dividends from unconsolidated affiliates 14.5 22.6 Net cash flow provided by operating activities 430.7 161.4 Investing activities Acquisition of business, net of cash acquired ( 729.9 ) ( 19.8 ) Capital expenditures (including software) ( 75.2 ) ( 85.4 ) Net cash flow used in investing activities ( 805.1 ) ( 105.2 ) Financing activities Short-term borrowings, net 945.2 116.0 Long-term debt borrowings (net of debt issuance costs of $ 1.1 ) 497.7 0.9 Debt financing fees paid ( 51.0 ) — Long-term debt repayments ( 504.4 ) ( 13.6 ) Proceeds from exercised stock options 13.6 13.3 Taxes withheld and paid on employee stock awards ( 11.9 ) ( 12.6 ) Common stock acquired by purchase ( 10.9 ) ( 26.5 ) Dividends paid ( 257.9 ) ( 241.5 ) Dividends paid to joint venture partner ( 8.4 ) — Other financing activities ( 9.3 ) 21.1 Net cash flow provided by (used in) financing activities 602.7 ( 142.9 ) Effect of exchange rate changes on cash and cash equivalents 7.0 24.7 Increase (decrease) in cash and cash equivalents 235.3 ( 62.0 ) Cash and cash equivalents at beginning of period 95.9 186.1 Cash and cash equivalents at end of period $ 331.2 $ 124.1 See notes to condensed consolidated financial statements (unaudited). 7 Table of Contents McCORMICK & COMPANY, INCORPORATED CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDERS' EQUITY (UNAUDITED) (in millions) Common Stock Shares Common Stock Non-Voting Shares Common Stock Amount Retained Earnings Accumulated Other Comprehensive Loss Non-controlling Interests Total Shareholders’ Equity Three months ended May 31, 2026 Balance, February 28, 2026 14.8 253.9 $ 2,306.1 $ 4,823.1 $ ( 148.9 ) $ 575.8 $ 7,556.1 Net income attributable to McCormick & Company — 150.1 — — 150.1 Net income attributable to non-controlling interests — — — 10.1 10.1 Other comprehensive income (loss), net of tax — — ( 12.5 ) 0.2 ( 12.3 ) Dividends — ( 129.0 ) — ( 8.4 ) ( 137.4 ) Stock-based compensation 8.6 — — — 8.6 Shares purchased and retired ( 0.1 ) — ( 2.8 ) ( 1.3 ) — — ( 4.1 ) Shares issued 0.2 — 2.2 — — — 2.2 Equal exchange ( 0.1 ) 0.1 — — — — — Balance, May 31, 2026 14.8 254.0 $ 2,314.1 $ 4,842.9 $ ( 161.4 ) $ 577.7 $ 7,573.3 Six months ended May 31, 2026 Balance, November 30, 2025 14.9 253.5 $ 2,283.2 $ 3,816.4 $ ( 363.1 ) $ 31.6 $ 5,768.1 Net income attributable to McCormick & Company — 1,166.3 — — 1,166.3 Fair value of non-controlling interest recognized at acquisition — — — 504.3 504.3 Net income attributable to non-controlling interests — — — 16.2 16.2 Other comprehensive income (loss), net of tax — — 201.7 34.0 235.7 Dividends — ( 129.0 ) — ( 8.4 ) ( 137.4 ) Stock-based compensation 29.3 — — — 29.3 Shares purchased and retired ( 0.4 ) — ( 14.6 ) ( 10.8 ) — — ( 25.4 ) Shares issued 0.8 — 16.2 — — — 16.2 Equal exchange ( 0.5 ) 0.5 — — — — — Balance, May 31, 2026 14.8 254.0 $ 2,314.1 $ 4,842.9 $ ( 161.4 ) $ 577.7 $ 7,573.3 8 Table of Contents Common Stock Shares Common Stock Non-Voting Shares Common Stock Amount Retained Earnings Accumulated Other Comprehensive Loss Non-controlling Interests Total Shareholders’ Equity Three months ended May 31, 2025 Balance, February 28, 2025 15.5 252.6 $ 2,253.3 $ 3,694.3 $ ( 524.6 ) $ 26.7 $ 5,449.7 Net income attributable to McCormick & Company — 175.0 — — 175.0 Net income attributable to non-controlling interest — — — 1.0 1.0 Other comprehensive income, net of tax — — 123.4 1.3 124.7 Dividends — ( 120.8 ) — — ( 120.8 ) Stock-based compensation 9.6 — — — 9.6 Shares purchased and retired ( 0.2 ) — ( 7.7 ) ( 9.5 ) — — ( 17.2 ) Shares issued 0.4 — 8.4 — — — 8.4 Equal exchange ( 0.4 ) 0.4 — — — — — Balance, May 31, 2025 15.3 253.0 $ 2,263.6 $ 3,739.0 $ ( 401.2 ) $ 29.0 $ 5,630.4 Six months ended May 31, 2025 Balance, November 30, 2024 15.7 252.3 $ 2,237.2 $ 3,545.0 $ ( 491.2 ) $ 25.8 $ 5,316.8 Net income attributable to McCormick & Company — — — 337.3 — — 337.3 Net income attributable to non-controlling interests — — — 2.1 2.1 Other comprehensive income, net of tax — — 90.0 1.1 91.1 Dividends — ( 120.8 ) — — ( 120.8 ) Stock-based compensation 29.6 — — — 29.6 Shares purchased and retired ( 0.5 ) — ( 19.5 ) ( 22.5 ) — — ( 42.0 ) Shares issued 0.7 0.1 16.3 — — — 16.3 Equal exchange ( 0.6 ) 0.6 — — — — — Balance, May 31, 2025 15.3 253.0 $ 2,263.6 $ 3,739.0 $ ( 401.2 ) $ 29.0 $ 5,630.4 See notes to condensed consolidated financial statements (unaudited). 9 Table of Contents McCORMICK & COMPANY, INCORPORATED NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. ACCOUNTING POLICIES Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all the information and notes required by United States Generally Accepted Accounting Principles (GAAP) for complete financial statements. In our opinion, the accompanying condensed consolidated financial statements contain all adjustments, which are of a normal and recurring nature, necessary to present fairly the financial position and the results of operations for the interim periods presented. Certain prior period amounts have been reclassified to conform with the current period presentation. Net income attributable to noncontrolling interests is presented separately on the condensed consolidated income statement. Amounts from prior periods previously included in Income from unconsolidated operations are reflected in Net income attributable to noncontrolling interests. The results of consolidated operations for the six-month period ended May 31, 2026 are not necessarily indicative of the results to be expected for the full year. Historically, our net sales, net income, and cash flow from operations have been lower in the first half of the fiscal year and higher in the second half of the fiscal year. This historical increase in the second half of the year has largely been due to the consumer business cycle in the United States (U.S.), where customers typically purchase more of our products in the fourth quarter due to the Thanksgiving and Christmas holiday seasons. For further information, refer to the consolidated financial statements and notes included in our Annual Report on Form 10-K for the year ended November 30, 2025. On January 2, 2026, we completed the acquisition of an additional 25 % ownership interest in McCormick de Mexico from Grupo Herdez, which increased our ownership to a 75 % controlling interest. The results of McCormick de Mexico’s operations have been fully consolidated in our financial statements from the date the controlling interest was acquired, which is more fully described in Note 2. Accounts Payable - Supplier Finance Program As more fully described in our Annual Report on Form 10-K for the year ended November 30, 2025, we participate in a Supply Chain Financing (SCF) program with several global financial institutions (SCF Banks). Under the SCF program, qualifying suppliers may elect to sell their receivables from us to an SCF Bank, enabling participating suppliers to negotiate their receivables sales arrangements directly with the respective SCF Bank. We are not party to those agreements and have no economic interest in a supplier’s decision to sell a receivable. All outstanding amounts related to suppliers participating in the SCF program are recorded within the line entitled Trade accounts payable in our condensed consolidated balance sheets, and the associated payments are included in operating activities within our consolidated statements of cash flows. As of May 31, 2026 and November 30, 2025, the amounts due to suppliers participating in the SCF program and included in Trade accounts payable were approximately $ 314.9 million and $ 332.1 million, respectively. U.S. Tariffs 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. 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 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, for reimbursement in the amount of $ 30.8 million, reflecting the amount of IEEPA tariffs we determined were paid while such tariffs were in effect from February 2025 until February 2026. We believe it is probable that we will recover the IEEPA tariffs previously paid and recorded a receivable of $ 30.8 million under the loss recovery accounting model. During the three months ended May 31, 2026, we reduced cost of goods sold by $ 27.6 million, effectively reversing the IEEPA tariff expense previously recognized in connection with inventory sold to customers since the tariffs were enacted in the first quarter of 2025, and reduced the carrying value of inventory by $ 3.2 million. Notwithstanding the foregoing, uncertainty remains regarding the ultimate outcome and timing of recovery of these refunds, and any anticipated refunds may be delayed, reduced, or denied. The CIT order has been appealed by the U.S government, and 10 Table of Contents a successful appeal could delay, reduce or deny the funds described above. To the extent we are unable to recover tariffs previously paid, our results of operations, cash flows, and financial condition could be adversely affected. We will continue to monitor U.S. tariff-related developments and any associated impacts on our consolidated financial statements. Accounting Pronouncements Recently Adopted In November 2023, the FASB issued ASU No. 2023-07: Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures that requires entities to report incremental information about significant segment expenses included in a segment’s profit or loss measure as well as the position and title of the chief operating decision maker (CODM). The guidance also requires interim disclosures related to reportable segment profit or loss that had previously only been disclosed annually. The new standard requirements were effective for our annual period ending November 30, 2025 and are effective for interim periods of our fiscal year ending November 30, 2026. We include significant segment expenses and the required disclosure about our CODM in Note 11. The adoption of the new standard did not have a material impact on our consolidated financial statements. In November 2025, the FASB issued ASU No. 2025-09: Derivatives and Hedging (Topic 815), Hedge Accounting Improvements that better aligns the hedge accounting model with risk management activities. The guidance is effective for our fiscal year ending November 30, 2028, with early adoption permitted. We elected to adopt the guidance effective December 1, 2025 and applied the amendments prospectively. We have designated all hedge positions as of December 1, 2025 under the updated guidance, which did not have a material impact on our consolidated financial statements. 2. MERGERS AND ACQUISITIONS Acquisitions are part of our strategy to increase sales and profits. The McCormick de Mexico and Jurado acquisitions described below were recorded as business combinations with the excess of total consideration over the estimated fair value of assets acquired and liabilities assumed recorded as goodwill. McCormick de Mexico On January 2, 2026, we completed the acquisition of an additional 25 % ownership interest in McCormick de Mexico from Grupo Herdez, for a purchase price of $ 750 million, which increased our ownership to a 75 % controlling interest. 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. We believe the acquisition creates opportunities for further growth in the Mexican market and provides a strategic platform for further expansion in Latin America. The purchase of the additional 25 % ownership interest was funded through a combination of cash on hand and commercial paper borrowings. Prior to the acquisition of the additional ownership interest, we accounted for our 50 % ownership interest in McCormick de Mexico as an equity method investment and recorded our proportional share of earnings as income from unconsolidated operations. The acquisition of the additional ownership interest resulted in the consolidation of McCormick de Mexico's financial results, which have been included as a component of our consumer and flavor solutions segments in our financial statements from the date of acquisition. The earnings attributable to the 25 % ownership retained by Grupo Herdez are recorded as net income attributable to noncontrolling interests. As a result of the consolidation, the carrying value of our previously held 50 % ownership interest was remeasured to fair value resulting in a pre-tax and after-tax gain of $ 866.8 million which was recognized in Income from unconsolidated operations. The gain represents the remeasurement of our previously held 50 % ownership interest over its carrying value at the date of acquisition, less $ 44.8 million previously recorded in Accumulated other comprehensive loss primarily related to foreign currency translation adjustments. The fair value of the previously held equity interest was estimated based on a valuation derived from estimated fair value assessments and assumptions. This valuation was based on the implied value derived from the consideration transferred for the additional 25 % ownership interest, adjusted for the control premium, and was supported by a market approach as well as an overall enterprise level discounted cash flow. The following is a summary of the total consideration for the acquisition of the additional ownership interest in McCormick de Mexico (in millions): Cash paid $ 750.0 Effective settlement of preexisting amounts due to McCormick de Mexico ( 6.7 ) Fair value of previously held equity interest 1,008.0 Total consideration $ 1,751.3 11 Table of Contents The total consideration for the additional ownership interest in McCormick de Mexico was allocated to the underlying assets and liabilities based upon their preliminary estimated fair values at the date of acquisition. We estimated the fair values based on independent valuations, discounted cash flow analyses, quoted market prices, and estimates made by management, which are subject to finalization. The following is a summary of the preliminary allocation as of May 31, 2026, of the total consideration which we expect to be finalized during the fiscal year ending November 30, 2026 (in millions): Cash acquired $ 20.1 Trade accounts receivable 195.9 Inventories 123.4 Other current assets 36.5 Property, plant and equipment 56.0 Intangible assets 1,600.0 Goodwill 939.9 Other long-term assets 11.9 Trade accounts payable ( 208.2 ) Other current liabilities ( 47.8 ) Deferred tax liabilities ( 469.2 ) Other long-term liabilities ( 2.9 ) Fair value of noncontrolling interest ( 504.3 ) Net assets acquired $ 1,751.3 We determined the carrying values of cash, trade receivables and payables, as well as certain other current and non-current assets and liabilities, represented the fair values. The property, plant and equipment fair value was estimated using the replacement cost method. Inventories acquired consist of raw materials and finished goods inventory that were valued using a net realizable value approach, which resulted in a step-up of $ 15.0 million that was recognized in cost of goods sold as the related inventory was sold. Intangible assets include a reacquired right indefinite-lived intangible asset with an estimated fair value of $ 1,470.0 million and customer relationships with a weighted-average life of 15 years and an estimated fair value of $ 130.0 million. The reacquired right represents the value of McCormick's reacquisition of contractual rights previously granted to Grupo Herdez as part of the joint venture agreement giving McCormick de Mexico the perpetual and exclusive licensing right to sell specified McCormick branded products in Mexico. This right is expected to contribute cash flows for the foreseeable future and does not have substantive limiting factors. The fair value of the reacquired right was estimated using the multi-period excess earnings method of the income approach. The fair value of customer relationships was estimated using the distributor method, a variation of the multi-purpose excess earnings method that uses distributor-based inputs for margins and contributory asset charges. Some of the more significant assumptions inherent in developing the estimated fair values included the estimated annual net cash flows for each intangible asset (including net sales, operating profit margin, and working capital/contributory asset charges), a discount rate that appropriately reflects the risk inherent in each future cash flow stream, the assessment of each asset’s life cycle, and competitive trends, as well as other factors. The assumptions used in the financial forecasts were determined using historical data, supplemented by current and anticipated market conditions, estimated product category growth rates, management plans, and market comparables. Goodwill, which represents the value associated with the expected synergies, acquired workforce and future growth opportunities anticipated to be realized as a combined company, is not deductible for tax purposes. Goodwill will be allocated to our consumer and flavor solutions segments when the allocation of the consideration to the acquired net assets is finalized. Deferred tax liabilities primarily represent the expected future tax consequences of temporary differences between the fair value of the assets acquired and liabilities assumed and their tax bases. The fair value of the noncontrolling interest was estimated based on a valuation derived from estimated fair value assessments and assumptions. This valuation was based on the implied value derived from the consideration transferred for the additional 25 % ownership interest, adjusted for the control premium, and was supported by a market approach as well as an overall enterprise level discounted cash flow. 12 Table of Contents During the second quarter, we recorded immaterial adjustments to provisional amounts recognized at the acquisition date. The Company transacts in the ordinary course of business with Grupo Herdez, a related party that owns a 25 % noncontrolling interest in McCormick de Mexico. Contractual arrangements with Grupo Herdez include payments from McCormick de Mexico for (i) supervision and strategic management services based on a percentage of net sales of products registered under the McCormick brand and (ii) exclusive distribution services, including invoicing to customers, based on a percentage of net sales. For the three and six months ended May 31, 2026, McCormick de Mexico incurred expenses of $ 34.1 million and $ 66.8 million, respectively, related to transactions with Grupo Herdez. As of May 31, 2026, accounts receivable included $ 115.7 million due from Grupo Herdez and accounts payable included $ 15.4 million due to Grupo Herdez. For the three and six months ended May 31, 2026, we paid a dividend to Grupo Herdez in the amount of $ 8.4 million. For the three and six months ended May 31, 2026, McCormick de Mexico added $ 204.8 million and $ 403.7 million, respectively, to our net sales. Supplemental Pro Forma Information The following table presents unaudited supplemental pro forma consolidated net sales as if the McCormick de Mexico acquisition had occurred on December 1, 2024. Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Net sales $ 1,936.6 $ 1,869.7 $ 3,897.1 $ 3,669.0 The unaudited supplemental pro forma consolidated net sales gives effect to actual revenues prior to the McCormick de Mexico acquisition, adjusted to exclude the elimination of intercompany transactions. Other than the impact of the gain on remeasurement of previously held equity interest and transaction and integration costs (as discussed above), supplemental pro forma net earnings, assuming the McCormick de Mexico acquisition had occurred on December 1, 2024, would not be materially different from the results reported during the three and six months ended May 31, 2025 and 2026. The unaudited pro forma information has been prepared for comparative purposes only, in accordance with the acquisition method of accounting, and is not necessarily indicative of the results of operations that would have occurred if the McCormick de Mexico acquisition had been completed on the date indicated, nor is it indicative of our future operating results. Jurado On March 31, 2025, we purchased substantially all of the assets of Jurado, Inc. (Jurado), supplier of chili mash located in Las Cruces, New Mexico. The purchase price for Jurado was $ 38.1 million and the determination of the fair value of the acquired Jurado assets was finalized during 2025. The results of Jurado’s operations have been included in our financial statements from the date of the acquisition and are not material. Pending Merger with Unilever Foods Business On March 31, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Unilever PLC (“Unilever”) to combine with the Unilever Foods business (“Unilever Foods”), a transaction that will create a global flavor leader in attractive and high-growth categories. To facilitate the transaction, Unilever is expected to 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. 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 up to approximately 9.9 % of the total outstanding equity of the combined company, assuming Unilever does not elect to dispose of such interest to its shareholders in accordance with the Merger Agreement. Unilever will also receive a one-time $ 15.7 billion cash payment, subject to certain adjustments. The distribution of shares of Unilever Foods to Unilever’s shareholders and the pending transaction, taken together, are intended to qualify as a Reverse Morris Trust transaction that is generally 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 or Unilever elects to sell all or substantially all of the Unilever Foods assets operated in the United States to 13 Table of Contents McCormick or a subsidiary of McCormick in a transaction that is taxable for U.S. federal income tax purposes (the "U.S. Asset Sale Election"). The pending transaction is subject to the satisfaction or waiver of customary closing conditions, including the receipt of our shareholders' approval, the expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvement Act of 1976, as amended, obtaining certain other consents, authorizations, orders or approvals from governmental authorities, including certain other antitrust and any foreign investment approvals, and the effectiveness of a registration statement on Form S-4 to be filed by us. We and Unilever each have termination rights under the Merger Agreement. A termination fee of $ 420 million may be payable by us to Unilever, upon termination of the Merger Agreement under specified circumstances, each as more fully described in the Merger Agreement. In connection with the execution of the Merger Agreement, we entered into a commitment letter on March 31, 2026 (the "Bridge Commitment Letter") with Citigroup Global Markets Inc., Goldman Sachs Bank USA and Morgan Stanley Senior Funding, Inc., (the "Commitment Parties") pursuant to which the Commitment Parties committed to provide, subject to the terms and conditions set forth therein, a 364-day senior unsecured bridge term loan credit facility (the "Bridge Facility") in an aggregate principal amount of up to $ 15.7 billion. See Note 4 for more information on the Bridge Facility. The Bridge Commitment Letter also contemplates that we will seek to obtain permanent financing in the form of senior unsecured notes and/or senior unsecured term loans prior to the closing of the Merger (collectively, the “Permanent Financing”). Commitments under the Bridge Facility will be reduced by the amount of any Permanent Financing as well as the proceeds of certain asset sales and certain other events. The receipt of financing by us is not a condition to our obligation to consummate the pending transaction. 3. SPECIAL CHARGES The following is a summary of Special charges, by income statement line item, recognized in the three and six months ended May 31, 2026 and May 31, 2025 (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Transaction and integration expenses $ 57.6 $ 0.8 $ 65.5 $ 0.8 Employee severance and related benefits 1.8 11.4 18.0 11.4 Other costs 0.6 0.6 1.6 0.6 Special charges $ 60.0 $ 12.8 $ 85.1 $ 12.8 Inventory step-up included in Cost of goods sold — — 15.0 — Transaction expenses included in Interest expense $ 6.8 — 6.8 $ — Total Special charges $ 66.8 $ 12.8 $ 106.9 $ 12.8 In our consolidated income statement, we include a separate line item captioned Special charges in arriving at our consolidated operating income. Special charges consist of expenses associated with certain actions undertaken to reduce fixed costs, simplify or improve processes, and enhance our competitiveness. These charges are of such significance in terms of both up-front costs and organizational/structural impact to require advance approval by our Management Committee, comprised of our senior management, including our Chairman, President, and Chief Executive Officer. Expenses associated with any approved action are classified as Special charges upon recognition and monitored on an ongoing basis through completion. Included in special charges are transaction and integration costs incurred in conjunction with acquisitions. Transaction and Integration Expenses During the three months ended May 31, 2026, we recorded $ 57.6 million of transaction and integration expenses primarily related to our pending merger with Unilever Foods announced on March 31, 2026, as discussed in Note 2. These charges were incurred to directly support due diligence, deal execution and integration activities, and are primarily comprised of banking, legal, and consulting fees. Additional transaction costs of $ 6.8 million were recognized in Interest expense related to the amortization of debt financing fees associated with our pending merger with Unilever Foods. 14 Table of Contents The following transaction and integration expenses recorded in 2026 relate to the pending Merger Agreement with Unilever Foods (in millions) for the three and six month periods ended: May 31, 2026 Transaction and integration expenses in Special charges $ 57.4 Transaction expenses included in Interest expense $ 6.8 Total Special charges related to the pending Unilever transaction $ 64.2 During the six months ended May 31, 2026, we recorded $ 65.5 million of transaction and integration expenses including $ 57.4 million related to our pending merger with Unilever Foods which is described above and $ 8.1 million related to our acquisition of McCormick de Mexico that closed on January 2, 2026, as discussed in Note 2. We also recorded $ 15.0 million in Cost of goods sold related to the step-up of acquired inventory related to the acquisition of McCormick de Mexico. During the three and six months ended May 31, 2025, we recorded $ 0.8 million of transaction and integration costs related to the acquisition of Jurado, described in Note 2, which was primarily comprised of transaction costs. Employee Severance and Related Benefits We continue to evaluate changes to our organizational structure to reduce fixed costs, simplify or improve processes, and improve our competitiveness. During the three months ended May 31, 2026, we recorded $ 1.8 million of employee severance and related benefit costs related to global selling, general and administrative streamlining actions and $ 0.6 million associated with other actions. During the six months ended May 31, 2026, we recorded $ 18.0 million of employee severance and related benefit costs related to global selling, general and administrative streamlining actions and $ 1.6 million associated with other actions. During the three and six months ended May 31, 2025, we recorded $ 11.4 million of employee severance and related benefit costs related to global selling, general and administrative streamlining actions and $ 0.6 million associated with other actions. As of May 31, 2026 and November 30, 2025, special charges of $ 8.6 million and $ 4.7 million, respectively, are included in Other accrued liabilities in our consolidated balance sheet. 4. FINANCING ARRANGEMENTS AND FINANCIAL INSTRUMENTS Debt and Credit Facilities In January 2026, we entered into a 364-day $ 500 million revolving credit facility, which will expire in January 2027. The current pricing for the 364-day credit facility, on a fully drawn basis, is Term Secured Overnight Financing Rate (SOFR) plus 1.125 %. The pricing of the credit facility is based on a credit rating 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, consistent with our five-year $ 2.0 billion revolving credit facility (the five-year facility). We do not expect this covenant will limit our access to those facilities for the foreseeable future. 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, 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 Foods, 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 required for the pending transaction. We paid $ 51.0 million of debt financing fees related to the transaction which were deferred in Other assets and are being amortized to Interest expense. We recognized $ 6.8 million of interest expense for the three and six months ended May 31, 2026. 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 a term loan agreement (the "Term Loan Agreement") by and among us, the lenders party thereto and Citibank, N.A., as administrative agent (the "Administrative Agent"). The Term Loan Agreement provides us with the ability to borrow up to $ 2.0 billion (the "Term Loan Facility") at the closing of the pending merger with Unilever Foods (the "Closing Date"), subject to satisfaction of customary closing conditions for similar facilities, for the purpose of financing a 15 Table of Contents 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. As of May 31, 2026, we are in compliance with all debt covenants. Derivative Financial Instruments We use derivative financial instruments to enhance our ability to manage risk, including foreign currency, net investment, commodity, 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. We are not a party to master netting arrangements, and we do not offset the fair value of derivative contracts with the same counterparty in our financial statement disclosures. The use of derivative financial instruments is monitored through regular communication with senior management and the use of written guidelines. Foreign currency exchange risk. We are potentially exposed to foreign currency fluctuations affecting net investments in subsidiaries, transactions (both third-party and intercompany), and earnings denominated in foreign currencies. We assess foreign currency risk based on transactional cash flows and translational volatility and may enter into forward contracts and currency swaps with highly-rated financial institutions to reduce fluctuations in the long or short currency positions. The following is a summary of the notional amounts of outstanding foreign currency exchange contracts as of May 31, 2026 and November 30, 2025 (in millions): May 31, 2026 November 30, 2025 Fair value hedges $ 672.9 $ 877.3 Cash flow hedges 186.6 140.9 Foreign exchange contracts not designated as hedging instruments 69.4 — Total $ 928.9 $ 1,018.2 As a matter of policy, all cash flow hedges are designated for hedge accounting on the trade date of the derivative. However, certain cash flow hedges are de-designated at the anticipated transaction date and subsequently marked-to-market through earnings until maturity. For the six months ended May 31, 2026, derivatives not designated as hedging instruments consisted primarily of foreign exchange contracts. Foreign exchange contracts not designated as hedging instruments resulted in a net gain of $ 3.3 million and $ 0.6 million in the three and six months ended May 31, 2026, respectively, recognized in Cost of goods sold, reflecting the effect of exchange rate movements associated with purchases denominated in U.S. dollars. The fair value and cash flow hedges were designated as hedges of foreign currency denominated assets or liabilities or hedges of anticipated purchases denominated in a foreign currency. Hedge ineffectiveness was not material. All foreign currency exchange contracts generally have durations of less than 18 months. At May 31, 2026, $ 205.7 million of notional contracts had an initial duration of less than one month and are used to hedge short-term cash flow funding. Contracts which are designated as hedges of foreign currency denominated assets are accounted for as fair value hedges. These foreign currency exchange contracts manage both exposure to currency fluctuations in certain intercompany loans between subsidiaries as well as currency exposure to third-party non-functional currency assets or liabilities. Gains and losses from contracts that are designated as hedges of assets, liabilities, or firm commitments are recognized through income, offsetting the change in fair value of the hedged item. Contracts which are designated as hedges of anticipated purchases denominated in a foreign currency (generally purchases of inventory in U.S. dollars by operating units outside the U.S.) are accounted for as cash flow hedges. The gains and losses on these contracts are deferred in accumulated other comprehensive income until the hedged item is recognized in cost of goods sold, at which time the net amount deferred in accumulated other comprehensive income is also recognized in cost of goods sold. Contracts which are not designated as hedging instruments are marked-to-market, with changes in unrealized gain or loss recognized in earnings. We also utilize cross currency interest rate swap contracts that are designated as net investment hedges. Any gains or losses on net investment hedges are included in foreign currency translation adjustments in Accumulated other comprehensive loss. Net interest accruals excluded from the assessment of hedge effectiveness are included in earnings as interest expense. 16 Table of Contents Interest rate risk. We finance a portion of our operations with both fixed and variable rate debt instruments, principally commercial paper, notes, and bank loans. We utilize interest rate derivative contracts, including interest rate swap agreements, to minimize worldwide financing costs and to achieve a desired mix of variable and fixed rate debt. Commodity price risk . 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. 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. With the exception of soybean oil, we generally do not use derivatives to manage price volatility. We utilize commodity contracts, including commodity futures, options, and over-the counter swaps to manage price risk for soybean oil. These commodity contracts are designated as cash flow hedges. Generally, we hedge a portion of our anticipated consumption of soybean oil inputs for periods of up to 24 months. The following table discloses the notional amount and fair values of derivative instruments on our balance sheet (in millions): Asset Derivatives Liability Derivatives Balance sheet location Notional amount Fair value Balance sheet location Notional amount Fair value As of May 31, 2026 Derivatives designated as hedging instruments Interest rate contracts Other current assets / Other long-term assets $ — $ — Other accrued liabilities / Other long-term liabilities $ 500.0 $ 23.7 Foreign exchange contracts Other current assets 535.7 4.5 Other accrued liabilities 323.9 1.1 Cross currency contracts Other current assets / Other long-term assets 506.8 4.7 Other accrued liabilities / Other long-term liabilities 517.2 20.0 Commodity contracts Other current assets / Other long-term assets 228.2 72.6 Other accrued liabilities / Other long-term liabilities 73.6 16.7 Derivatives not designated as hedging instruments Foreign exchange contracts Other current assets 10.2 0.3 Other accrued liabilities 59.1 $ 3.2 Total $ 82.1 $ 64.7 As of November 30, 2025 Derivatives designated as hedging instruments Interest rate contracts Other current assets / Other long-term assets $ — $ — Other accrued liabilities / Other long-term liabilities $ 500.0 $ 20.8 Foreign exchange contracts Other current assets 894.6 6.5 Other accrued liabilities 123.6 0.7 Cross currency contracts Other current assets / Other long-term assets 500.8 8.5 Other accrued liabilities / Other long-term liabilities 511.1 18.1 Total $ 15.0 $ 39.6 17 Table of Contents The following tables disclose the impact of derivative instruments on our other comprehensive income (OCI), accumulated other comprehensive income (AOCI), and our consolidated income statement for the three and six months ended May 31, 2026 and 2025 (in millions): Fair Value Hedges Derivative Income statement location Expense Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Interest rate contracts Interest expense $ 2.0 $ 3.6 $ 4.0 $ 7.3 Income statement location Gain (loss) recognized in income Income statement location Gain (loss) recognized in income Derivative 2026 2025 Hedged item 2026 2025 Three months ended May 31, Foreign exchange contracts Other income, net $ 4.0 $ ( 17.4 ) Intercompany loans Other income, net $ ( 5.0 ) $ 17.8 Six months ended May 31, Foreign exchange contracts Other income, net $ 4.9 $ ( 17.9 ) Intercompany loans Other income, net $ ( 6.7 ) $ 17.2 Cash Flow Hedges Gain (loss) recognized in OCI Income statement location Gain (loss) reclassified from AOCI Derivative 2026 2025 2026 2025 Three months ended May 31, Interest rate contracts $ — $ — Interest expense $ ( 0.1 ) $ ( 0.2 ) Foreign exchange contracts 0.6 ( 2.2 ) Cost of goods sold ( 0.4 ) 0.7 Commodity contracts 31.9 — Cost of goods sold ( 4.8 ) — Total $ 32.5 $ ( 2.2 ) $ ( 5.3 ) $ 0.5 Six months ended May 31, Interest rate contracts $ — $ — Interest expense $ ( 0.2 ) $ ( 0.3 ) Foreign exchange contracts ( 1.2 ) ( 3.0 ) Cost of goods sold 0.2 0.6 Commodity contracts 65.5 — Cost of goods sold ( 6.3 ) — Total $ 64.3 $ ( 3.0 ) $ ( 6.3 ) $ 0.3 As of May 31, 2026, the net amount of Accumulated other comprehensive loss associated with all cash flow, settled interest rate cash flow hedge derivatives, and commodity contracts expected to be reclassified in the next 12 months is a $ 48.6 million increase to earnings. 18 Table of Contents Net Investment Hedges Gain (loss) recognized in OCI Income statement location Gain excluded from the assessment of hedge effectiveness Derivative 2026 2025 2026 2025 Three months ended May 31, Cross currency contracts $ 6.2 $ ( 44.2 ) Interest expense $ 2.0 $ 2.3 Six months ended May 31, Cross currency contracts $ ( 3.2 ) $ ( 36.1 ) Interest expense $ 4.0 4.8 For all net investment hedges, no amounts have been reclassified out of accumulated other comprehensive loss. The amounts noted in the tables above for OCI do not include any adjustments for the impact of deferred income taxes. Accounts Receivable Sale Program We maintain a non-recourse accounts receivable sale program whereby certain eligible U.S. receivables are sold to a third-party financial institution in exchange for cash. The program provides us with an additional means for managing liquidity. We account for the transfer of receivables as a sale at the point control is transferred and remove the sold receivables from our condensed consolidated balance sheet. The proceeds from the sales of receivables are included in cash from operating activities in the consolidated statement of cash flows. Under the terms of the arrangement, we act as the collecting agent on behalf of the financial institution for sold receivables of $ 406.1 million and $ 430.0 million as of May 31, 2026 and November 30, 2025, respectively. As collecting agent, we had $ 36.1 million and $ 45.4 million of cash collected that was not yet remitted to the third-party financial institution as of May 31, 2026 and November 30, 2025, respectively. This obligation is reported within Other accrued liabilities on the consolidated balance sheet and within cash flows from financing activities on the consolidated cash flow statement. For the three and six months ended May 31, 2026, the incremental costs of the receivable sale program totaled $ 4.7 million and $ 8.9 million, respectively, and were recognized as a reduction of Net sales. For the three and six months ended May 31, 2025, the incremental costs of the receivable sale program totaled $ 4.1 million and $ 8.0 million, respectively. 5. FAIR VALUE MEASUREMENTS Fair value can be measured using valuation techniques, such as the market approach (comparable market prices), the income approach (present value of future income or cash flow), and the cost approach (cost to replace the service capacity of an asset or replacement cost). Accounting standards utilize a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The following is a brief description of those three levels: • Level 1: Observable inputs such as quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2: Inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active. • Level 3: Unobservable inputs that reflect management's own assumptions. 19 Table of Contents At May 31, 2026 and November 30, 2025, we had no financial assets or liabilities that were subject to a level 3 fair value measurement. Our population of financial assets and liabilities subject to fair value measurements on a recurring basis are as follows (in millions): May 31, 2026 Fair Value Level 1 Level 2 Assets Cash and cash equivalents 331.2 $ 331.2 — Insurance contracts 132.4 — 132.4 Bonds and money market fund investments 5.4 5.4 — Foreign currency derivatives 4.5 — 4.5 Cross currency contracts 4.7 — 4.7 Commodity contracts 72.6 53.5 19.1 Total $ 550.8 $ 390.1 160.7 Liabilities Foreign currency derivatives $ 1.1 $ — $ 1.1 Interest rate derivatives 23.7 — 23.7 Cross currency contracts 20.0 — 20.0 Commodity contracts 16.7 16.7 — Total $ 61.5 $ 16.7 $ 44.8 November 30, 2025 Fair Value Level 1 Level 2 Assets Cash and cash equivalents $ 95.9 $ 95.9 $ — Insurance contracts 131.0 — 131.0 Bonds and money market fund investments 1.9 1.9 — Foreign currency derivatives 6.5 — 6.5 Cross currency contracts 8.5 — 8.5 Total $ 243.8 $ 97.8 $ 146.0 Liabilities Foreign currency derivatives $ 0.7 $ — $ 0.7 Interest rate derivatives 20.8 — 20.8 Cross currency contracts 18.1 — 18.1 Total $ 39.6 $ — $ 39.6 At May 31, 2026 and November 30, 2025, the carrying amounts of cash and cash equivalents, interest rate derivatives, foreign currency derivatives, cross currency contracts, commodity contracts, insurance contracts, and bonds and money market fund investments were equal to their respective fair values. Because of their short-term nature, the amounts reported in the balance sheet for cash and cash equivalents, trade accounts receivables, short-term borrowings, and trade accounts payable approximate fair value. Investments in affiliates are not readily marketable, and it is not practicable to estimate their fair value. Insurance contracts and bonds and money market fund investments are comprised of fixed income and equity securities held for certain non-qualified U.S. employee benefit plans and are stated at fair value on the balance sheet. The fair values of insurance contracts and bonds and money market fund investments are based upon the underlying values of the securities in which they are invested and are from quoted market prices from various stock and bond exchanges for similar type assets. The fair values for interest rate derivatives, foreign currency derivatives, cross currency contracts, and commodity contracts are based on values for similar instruments using models with market-based inputs. 20 Table of Contents The following table sets forth the carrying amounts and fair values of our long-term debt including the current portion thereof (in millions): May 31, 2026 November 30, 2025 Carrying amount $ 3,606.9 $ 3,614.9 Level 1 valuation techniques $ 3,355.3 $ 3,401.1 Level 2 valuation techniques 100.6 104.8 Total fair value $ 3,455.9 $ 3,505.9 The fair value for Level 2 long-term debt is determined by using quoted prices for similar debt instruments. 6. EMPLOYEE BENEFIT AND RETIREMENT PLANS We sponsor defined benefit pension plans in the U.S. and certain foreign locations. Additionally, we sponsor defined contribution plans in the U.S. and contribute to defined contribution plans in various locations outside the U.S., including government-sponsored retirement plans. We also provide postretirement medical and life insurance benefits to certain U.S. employees and retirees. We previously froze the accrual of future benefits under certain defined benefit pension plans in the U.S. and certain foreign locations. Although our defined benefit plans in the U.S., United Kingdom (UK), and Canada have generally been frozen, employees who are participants in the plans retained benefits accumulated up to the date of the freeze, based on credited service and eligible earnings, in accordance with the terms of the plans. The following table presents the components of our pension (income) and other postretirement benefits expense for the three and six months ended May 31, 2026 and 2025 (in millions): United States pension International pension Other postretirement benefits 2026 2025 2026 2025 2026 2025 Three months ended May 31, Service cost $ 0.3 $ 0.4 $ 0.1 $ 0.1 $ 0.2 $ 0.2 Interest costs 8.9 8.9 2.7 2.5 0.5 0.6 Expected return on plan assets ( 9.2 ) ( 9.3 ) ( 3.7 ) ( 3.5 ) — — Amortization of prior service costs 0.1 0.1 0.1 0.1 ( 0.1 ) — Amortization of net actuarial losses (gains) 0.3 0.3 ( 0.1 ) ( 0.1 ) ( 0.5 ) ( 0.7 ) Total expense (income) $ 0.4 $ 0.4 $ ( 0.9 ) $ ( 0.9 ) $ 0.1 $ 0.1 Six months ended May 31, Service cost $ 0.7 $ 0.8 $ 0.3 $ 0.3 $ 0.4 $ 0.4 Interest costs 17.8 17.8 5.3 5.0 1.0 1.1 Expected return on plan assets ( 18.4 ) ( 18.6 ) ( 7.4 ) ( 7.0 ) — — Amortization of prior service costs 0.2 0.2 0.1 0.1 ( 0.1 ) ( 0.1 ) Amortization of net actuarial losses (gains) 0.5 0.6 ( 0.1 ) ( 0.1 ) ( 1.1 ) ( 1.3 ) Total expense (income) $ 0.8 $ 0.8 $ ( 1.8 ) $ ( 1.7 ) $ 0.2 $ 0.1 During the six months ended May 31, 2026 and 2025, we contributed $ 4.0 million and $ 3.7 million, respectively, to our pension plans. Total contributions to our pension plans in fiscal year 2025 were $ 9.2 million. All of the amounts in the tables above for pension (income) and other postretirement benefits expense, other than service cost, were included in Other income, net within our consolidated income statements. The net aggregate amount of pension and other postretirement benefits income, excluding service cost components, was $( 1.0 ) million and $( 1.1 ) million for the three months 21 Table of Contents ended May 31, 2026 and 2025, respectively, and $( 2.2 ) million and $( 2.3 ) million for the six months ended May 31, 2026 and 2025, respectively. 7. STOCK-BASED COMPENSATION We have three types of stock-based compensation awards: restricted stock units (RSUs), stock options, and company stock awarded as part of our long-term performance plan (LTPP). The following table sets forth the stock-based compensation expense recorded in Selling, general and administrative (SG&A) expense (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Stock-based compensation expense $ 8.6 $ 9.6 $ 29.3 $ 29.6 Our 2026 annual grant consisted of RSUs and stock awarded under our LTPP and occurred in the first quarter, similar to the 2025 annual grant. Substantially all the RSUs granted in 2026 and 2025 vest ratably over a three-year period or, if earlier, upon the holder’s retirement eligibility date. Stock awarded under our LTPP vest ratably over a three-year period. The following is a summary of our stock option activity for the six months ended May 31, 2026 and 2025: 2026 2025 (shares in millions) Number of Shares Weighted- Average Exercise Price Number of Shares Weighted- Average Exercise Price Outstanding at beginning of period 5.5 $ 73.92 6.1 $ 72.25 Exercised ( 0.3 ) 49.82 ( 0.3 ) 50.08 Forfeited — — ( 0.1 ) 73.45 Outstanding at end of the period 5.2 $ 75.16 5.7 $ 73.33 Exercisable at end of the period 4.9 $ 75.12 4.9 $ 72.83 As of May 31, 2026, there is no intrinsic value (the difference between the exercise price and the market price) for options outstanding and options currently exercisable. The total intrinsic value of all options exercised during the six months ended May 31, 2026 and May 31, 2025 was $ 4.7 million and $ 8.2 million, respectively. The following is a summary of our RSU activity for the six months ended May 31, 2026 and 2025: 2026 2025 (shares in thousands) Number of Shares Weighted- Average Grant-Date Fair Value Number of Shares Weighted- Average Grant-Date Fair Value Outstanding at beginning of period 771 $ 73.11 533 $ 73.68 Granted 624 63.37 526 74.76 Vested ( 325 ) 74.75 ( 230 ) 79.01 Forfeited ( 40 ) 69.36 ( 27 ) 74.73 Outstanding at end of period 1,030 $ 66.84 802 $ 72.82 The following is a summary of our LTPP activity for the six months ended May 31, 2026 and 2025: 2026 2025 (shares in thousands) Number of Shares Weighted- Average Grant-Date Fair Value Number of Shares Weighted- Average Grant-Date Fair Value Outstanding at beginning of period 523 $ 80.88 539 $ 83.45 Granted 226 65.02 177 86.92 Vested ( 177 ) 89.00 ( 206 ) 95.00 Forfeited ( 10 ) 76.99 ( 35 ) 79.96 Outstanding at end of period 562 $ 72.01 475 $ 79.97 22 Table of Contents 8. INCOME TAXES Income tax expense for the three and six months ended May 31, 2026 included $ 7.6 million of net discrete tax benefits consisting principally of the following: (i) $ 4.2 million of tax benefit associated with the reversal of a deferred tax liability related to the reassessment of a permanent reinvestment assertion, (ii) $ 3.0 million of tax benefit associated with the adjustment of a valuation allowance, and (iii) $ 1.2 million net tax benefit resulting from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the expiration of statutes of limitations in a non-U.S. jurisdiction. Income tax expense for the three months ended May 31, 2025 included $ 2.4 million of net discrete tax benefits consisting principally of a $ 1.5 million net tax benefit resulting from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the expiration of statutes of limitations in a non-U.S. jurisdiction and $ 0.9 million of excess tax benefits associated with stock compensation. Income tax expense for the six months ended May 31, 2025 included $ 7.6 million of net discrete tax benefits consisting principally of the following: (i) $ 5.0 million net tax benefit resulting from the revaluation of deferred taxes associated with enacted legislation, (ii) $ 1.5 million net tax benefit resulting from the reversal of certain reserves for unrecognized tax benefits and related interest associated with the expiration of statutes of limitations in a non-U.S. jurisdiction, and (iii) $ 1.2 million of excess tax benefits associated with stock compensation. Other than additions for current year tax positions and the discrete tax benefit associated with unrecognized tax benefits, as previously described, there were no significant changes to unrecognized tax benefits during the six months ended May 31, 2026. As of May 31, 2026, we believe the reasonably possible total amount of unrecognized tax benefits that could increase or decrease in the next 12 months as a result of various statute expirations, audit closures, and/or tax settlements would not be material to our consolidated financial statements. 9. CAPITAL STOCK AND EARNINGS PER SHARE The following table sets forth the reconciliation of average shares outstanding (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Average shares outstanding – basic 269.2 268.6 269.0 268.5 Effect of dilutive securities: Stock options/RSUs/LTPP — 0.8 0.3 1.0 Average shares outstanding – diluted 269.2 269.4 269.3 269.5 The following table sets forth the stock options and RSUs that were not considered in our earnings per share calculation since they were anti-dilutive (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Anti-dilutive securities 5.3 2.6 4.7 2.4 The following table sets forth common stock activity (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Shares issued under stock options, RSUs, LTPP, and employee stock purchase plans 0.2 0.4 0.8 0.7 Shares repurchased under the stock repurchase program and shares withheld for taxes under stock options, RSUs, and LTPP 0.1 0.2 0.4 0.5 As of May 31, 2026, $ 403 million remained of the $ 600 million share repurchase program authorization approved by our Board of Directors in November 2019. 23 Table of Contents 10. ACCUMULATED OTHER COMPREHENSIVE LOSS ATTRIBUTABLE TO McCORMICK The following table sets forth the components of accumulated other comprehensive income (loss), net of tax, where applicable (in millions): May 31, 2026 November 30, 2025 Foreign currency translation adjustment (1) $ ( 100.7 ) $ ( 269.9 ) Unrealized net gain (loss) on cash flow hedges (2) 30.6 ( 3.2 ) Unamortized value of settled interest rate swaps ( 1.0 ) ( 1.1 ) Pension and other postretirement costs ( 90.3 ) ( 88.9 ) Accumulated other comprehensive loss attributable to McCormick $ ( 161.4 ) $ ( 363.1 ) (1) During the six months ended May 31, 2026, the foreign currency translation adjustment of Accumulated other comprehensive loss decreased on a net basis by $ 169.2 million, inclusive of $ 3.2 million of unrealized losses associated with net investment hedges and $ 40.6 million of foreign currency translation loss associated with our prior 50 % ownership interest in McCormick de Mexico that was reclassified from Accumulated other comprehensive loss as more fully described in Note 2. Net investment hedges are more fully described in Note 4. (2) During the six months ended May 31, 2026, the unrealized net gain on cash flow hedges increased on a net basis by $ 33.8 million, inclusive of $ 4.2 million unrealized net loss on cash flow hedges associated with our prior 50 % ownership interest in McCormick de Mexico that was reclassified from Accumulated other comprehensive loss as more fully described in Note 2. Cash flow hedges are more fully described in Note 4. The following table sets forth the amounts reclassified from accumulated other comprehensive income (loss) and into consolidated net income (in millions): Three months ended May 31, Six months ended May 31, Affected Line Items in the Condensed Consolidated Income Statement 2026 2025 2026 2025 (Gains)/losses on cash flow hedges: Interest rate derivatives $ ( 0.1 ) $ 0.2 ( 0.2 ) 0.3 Interest expense Foreign exchange contracts ( 0.4 ) ( 0.7 ) 0.2 ( 0.6 ) Cost of goods sold Commodity contracts ( 4.8 ) — ( 6.3 ) — Cost of goods sold Total before tax ( 5.3 ) ( 0.5 ) ( 6.3 ) ( 0.3 ) Tax effect 1.6 0.1 1.9 0.1 Income tax expense Net, after tax $ ( 3.7 ) $ ( 0.4 ) $ ( 4.4 ) $ ( 0.2 ) Amortization of pension and postretirement benefit adjustments: Amortization of prior service costs (1) $ 0.1 $ 0.2 0.2 $ 0.2 Other income, net Amortization of net actuarial (gains) (1) ( 0.3 ) ( 0.5 ) ( 0.7 ) ( 0.8 ) Other income, net Total before tax $ ( 0.2 ) $ ( 0.3 ) ( 0.5 ) $ ( 0.6 ) Tax effect — 0.1 0.1 0.2 Income tax expense Net, after tax $ ( 0.2 ) $ ( 0.2 ) $ ( 0.4 ) $ ( 0.4 ) Reclassification as a result of McCormick de Mexico acquisition: Amounts reclassified into earnings upon acquisition of controlling interest $ — $ — $ 44.8 $ — Income from unconsolidated operations Total before tax — — 44.8 — Tax effect — — — — Income tax expense Net, after tax $ — $ — $ 44.8 $ — 24 Table of Contents (1) This accumulated other comprehensive income (loss) component is included in the computation of total pension (income) and other postretirement benefits expense. Refer to Note 6 for additional details. 11. BUSINESS SEGMENTS We operate in two business segments: Consumer and Flavor Solutions. The Consumer and Flavor Solutions segments manufacture, market, and distribute spices, herbs, seasoning mixes, condiments, and other flavorful products throughout the world. Our Consumer segment sells to retail channels, including grocery, mass merchandise, warehouse clubs, discount and drug stores, and e-commerce under the “McCormick” brand and a variety of brands around the world, including “French’s,” “Frank’s RedHot,” “Lawry’s,” “Zatarain’s,” “Simply Asia,” “Thai Kitchen,” “Ducros,” “Vahiné,” “Cholula,” “Schwartz,” “Club House,” “Kamis,” “DaQiao,” “La Drogheria,” “Stubb’s,” “OLD BAY,” and “Gourmet Garden.” Our Flavor Solutions segment sells to food manufacturers and the foodservice industry both directly and indirectly through distributors, with the exception of our business in China, where foodservice sales are managed by and reported in our Consumer segment. Our CODM is our Chairman, President & Chief Executive Officer. Our CODM uses operating income excluding special charges and transaction and integration expenses related to our acquisitions to manage segment performance and allocate resources across segments and considers variances of actual performance to our annual budget and periodic forecasts as well as year over year performance when making decisions. Special charges and transaction and integration expenses are excluded from operating income in our internal reporting to the CODM as this activity is managed separately from the business segments. Activity related to special charges, including transaction and integration expenses, is described in Note 3. Transaction and integration expenses include the amortization of the acquisition-date fair value adjustment of inventories included in Cost of goods sold, costs directly associated with that acquisition and costs associated with integrating the businesses. We also exclude the gain on remeasurement of previously held equity interest from operating income in our internal reporting to the CODM, which was recorded upon consolidation of McCormick de Mexico during the first quarter of 2026 and is described in more detail in Note 2. Although the segments are managed separately due to their distinct distribution channels and marketing strategies, manufacturing and warehousing are often integrated to maximize cost efficiencies. As a result, jointly utilized assets, including fixed assets, and depreciation and amortization expense are not maintained by individual segment. Depreciation and amortization expense is allocated to the segments except for amounts that are recognized in interest. Because of manufacturing integration for certain products within the segments, products are not sold from one segment to another but rather inventory is transferred at cost. Inter-segment transfers are not material. 25 Table of Contents Consumer Flavor Solutions Total (in millions) Three months ended May 31, 2026 Net sales $ 1,142.7 $ 793.9 $ 1,936.6 Cost of goods sold $ 614.7 $ 543.7 $ 1,158.4 SG&A expense $ 311.1 $ 130.7 $ 441.8 Operating income excluding special charges $ 216.9 $ 119.5 $ 336.4 Three months ended May 31, 2025 Net sales $ 930.6 $ 728.9 $ 1,659.5 Cost of goods sold $ 520.7 $ 516.0 $ 1,036.7 SG&A expense $ 246.3 $ 117.9 $ 364.2 Operating income excluding special charges $ 163.6 $ 95.0 $ 258.6 Six months ended May 31, 2026 Net sales $ 2,287.7 $ 1,522.8 $ 3,810.5 Cost of goods sold excluding special charges $ 1,253.5 $ 1,054.9 $ 2,308.4 SG&A expense $ 637.7 $ 260.4 $ 898.1 Operating income excluding special charges $ 396.5 $ 207.5 $ 604.0 Six months ended May 31, 2025 Net sales $ 1,849.8 $ 1,415.2 $ 3,265.0 Cost of goods sold $ 1,034.5 $ 1,003.7 $ 2,038.2 SG&A expense $ 505.0 $ 238.0 $ 743.0 Operating income excluding special charges $ 310.3 $ 173.5 $ 483.8 26 Table of Contents A reconciliation of cost of goods sold excluding special charges and operating income excluding special charges to cost of goods sold and operating income for the three and six months ended May 31, 2026 is as follows (in millions): Consumer Flavor Solutions Total Three months ended May 31, 2026 Operating income excluding special charges $ 216.9 $ 119.5 $ 336.4 Less: Special charges 60.0 Operating income $ 276.4 Three months ended May 31, 2025 Operating income excluding special charges $ 163.6 $ 95.0 $ 258.6 Less: Special charges 12.8 Operating income $ 245.8 Six months ended May 31, 2026 Cost of goods sold excluding special charges $ 1,253.5 $ 1,054.9 $ 2,308.4 Less: Special charges 15.0 Cost of goods sold $ 2,323.4 Operating income excluding special charges $ 396.5 $ 207.5 $ 604.0 Less: Special charges 100.1 Operating income $ 503.9 Six months ended May 31, 2025 Operating income excluding special charges $ 310.3 $ 173.5 $ 483.8 Less: Special charges 12.8 Operating income $ 471.0 The preceding table provides a reconciliation of our segment operating income excluding special charges to our consolidated operating income. The reconciliation of that operating income to income from consolidated operations before income taxes, which includes interest expense and other income, net is presented on the consolidated income statement. Geographic Area The following table sets forth our net sales, by geographic area, for the three and six months ended May 31, 2026 and 2025 (in millions): Three months ended May 31, Six months ended May 31, 2026 2025 2026 2025 Americas $ 1,411.9 $ 1,176.3 $ 2,751.5 $ 2,294.6 EMEA 334.5 308.6 670.2 608.1 APAC 190.2 174.6 388.8 362.3 Total $ 1,936.6 $ 1,659.5 $ 3,810.5 $ 3,265.0 27 Table of Contents