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What changed in McCormick & Company's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of McCormick & Company's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+286 added−314 removedSource: 10-K (2026-01-22) vs 10-K (2025-01-23)

Top changes in McCormick & Company's 2025 10-K

286 paragraphs added · 314 removed · 235 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

24 edited+5 added−6 removed29 unchanged
Biggest changeThese statements may relate to: general economic and industry conditions, including consumer spending rates, recessions, interest rates, and availability of capital; expectations regarding sales growth potential in various geographies and markets, including the impact of brand marketing support, product innovation, and customer, channel, category, heat platform, and e-commerce expansion; 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 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 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 in the Middle East, particularly regarding the potential for broader economic disruption; expected working capital improvements; the anticipated timing and costs of implementing our business transformation initiative, which includes the implementation of a global enterprise resource planning (ERP) system; the expected impact of accounting pronouncements; expectations regarding pension and postretirement plan contributions and anticipated charges associated with those plans; the holding period and market risks associated with financial instruments; the impact of foreign exchange fluctuations; the adequacy of internally generated funds and existing sources of liquidity, such as the availability of bank financing; the anticipated sufficiency of future cash flows to enable payments of interest, repayment of short- and long-term debt, working capital needs, planned capital expenditures, quarterly dividends, and our ability to obtain additional short- and long-term financing or issue additional debt securities; and expectations regarding purchasing shares of McCormick's common stock under the existing repurchase authorization.
Biggest changeThese statements may relate to: general economic and industry conditions, including consumer spending rates, recessions, interest rates, and availability of capital; expectations regarding sales growth potential in various geographies and markets, including the impact of brand marketing support, product innovation, and customer, channel, category, heat platform, and e-commerce expansion; the expected results of operations of businesses acquired, including the additional 25% ownership interest in McCormick de Mexico; 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 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 tariffs; the impact of legal challenges to U.S tariffs; 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 or future geopolitical conflicts, including the potential for broader economic disruption; expected working capital improvements; the anticipated timing and costs of implementing our business transformation initiative, which includes the implementation of a global enterprise resource planning (ERP) system; the expected impact of accounting pronouncements; expectations regarding pension and postretirement plan contributions and anticipated charges associated with those plans; the holding period and market risks associated with financial instruments; the impact of foreign exchange fluctuations; the adequacy of internally generated funds and existing sources of liquidity, such as the availability of bank financing; the anticipated sufficiency of future cash flows to enable payments of interest, repayment of short- and long-term debt, working capital needs, planned capital expenditures, quarterly dividends, and our ability to obtain additional short- and long-term financing or issue additional debt securities; and expectations regarding purchasing shares of McCormick's common stock under the existing repurchase authorization.
Those agreements with specific terms may be renewable upon agreement of the parties. We also own various patents, none of which are individually material to our business. 3 Seasonality Due to seasonal factors inherent in the business, our sales, operating income, and cash from operations are generally higher in the fourth quarter because of the holiday season.
Those agreements with specific terms may be renewable upon agreement of the parties. We also own various patents, none of which are individually material to our business. Seasonality Due to seasonal factors inherent in the business, our sales, operating income, and cash from operations are generally higher in the fourth quarter because of the holiday season.
The foodservice customers are supplied with branded, packaged products both directly by us and indirectly through distributors, with the exception of our businesses in China, where foodservice sales are managed by and reported in our consumer segment. We supply food manufacturers and foodservice customers with customized flavor solutions, and many of these customer relationships have been active for decades.
The foodservice customers are supplied with branded, packaged products both directly by us and indirectly through distributors, with the exception of our businesses in China, where 2 foodservice sales are managed by, and reported in, our Consumer segment. We supply food manufacturers and foodservice customers with customized Flavor Solutions, and many of these customer relationships have been active for decades.
We have entered into a number of license agreements authorizing the use of our trademarks by affiliated and non-affiliated entities. The loss of these license agreements would not have a material adverse effect on our business. The term of the license agreements is generally two-to-three years or until such time as either party terminates the agreement.
We have entered into a number of license agreements authorizing the use of our trademarks by affiliated and non-affiliated entities. The loss of these license agreements would not have a material adverse effect on our business. 3 The term of the license agreements is generally two-to-three years or until such time as either party terminates the agreement.
Our range of flavor solutions remains one of the broadest in the industry and includes seasoning blends, spices and herbs, condiments, coating systems, and compound flavors. In addition to a broad range of flavor solutions, our long-standing customer relationships are evidence of our effectiveness in building customer 2 intimacy.
Our range of Flavor Solutions remains one of the broadest in the industry and includes seasoning blends, spices and herbs, condiments, coating systems, and compound flavors. In addition to a broad range of Flavor Solutions, our long-standing customer relationships are evidence of our effectiveness in building customer intimacy.
For information on how we manage some of these risks, see the “Market Risk Sensitivity” section of “Management’s Discussion and Analysis.” 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, 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.
For information on how we manage some of these risks, see the “Market Risk Sensitivity” section of “Management’s Discussion and Analysis.” 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.
We are subject in varying degrees to certain risks typically associated with a global business, such as local economic and market conditions, exchange rate fluctuations, and restrictions on investments, royalties, and dividends. In fiscal year 2024, approximately 39% of sales were from non-U.S. operations.
We are subject in varying degrees to certain risks typically associated with a global business, such as local economic and market conditions, exchange rate fluctuations, and restrictions on investments, royalties, and dividends. In fiscal year 2025, approximately 39% of sales were from non-U.S. operations.
Results may be materially affected by factors such as: the Company's ability to drive revenue growth; the Company's ability to increase pricing to offset, or partially offset, inflationary pressures on the cost of our products; damage to the Company's reputation or brand name; loss of brand relevance; increased private label use; the Company's ability to drive productivity improvements, including those related to our CCI program and other streamlining actions; product quality, labeling, or safety concerns; negative publicity about our products; actions by, and the financial condition of, competitors and 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; business interruptions due to natural disasters, unexpected events or public health crises; issues affecting the Company's supply chain and procurement of raw 5 materials, including fluctuations in the cost and availability of raw and packaging materials; 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; government regulation, and changes in legal and regulatory requirements and enforcement practices; the lack of successful acquisition and integration of new businesses; global economic and financial conditions generally, availability of financing, interest and inflation rates, and the imposition of tariffs, quotas, trade barriers and other similar restrictions; foreign currency fluctuations; the effects of our amount of outstanding indebtedness and related level of debt service as well as the effects that such debt service may have on the Company's ability to borrow or the cost of any such additional borrowing, our credit rating, and our ability to react to certain economic and industry conditions; impairments of indefinite-lived intangible assets; assumptions we have made regarding the investment return on retirement plan assets, and the costs associated with pension obligations; the stability of credit and capital markets; risks associated with the Company's information technology systems, including the threat of data breaches and cyber-attacks; the Company's inability to successfully implement our business transformation initiative; fundamental changes in tax laws; including interpretations and assumptions we have made, and guidance that may be issued, and volatility in our effective tax rate; climate change; Environmental, Social and Governance (ESG) matters; infringement of intellectual property rights, and those of customers; litigation, legal and administrative proceedings; the Company's inability to achieve expected and/or needed cost savings or margin improvements; negative employee relations; and other risks described herein under Part I, Item 1A "Risk Factors." Actual results could differ materially from those projected in the forward-looking statements.
Results may be materially affected by factors such as: the Company's ability to drive revenue growth; the Company's ability to increase pricing to offset, or partially offset, inflationary pressures on the cost of our products; damage to the Company's reputation or brand name; loss of brand relevance; increased private label use; the Company's ability to offset cost pressures or business impacts related to trade policies, including tariffs; the Company's ability to drive productivity improvements, including those related to our CCI program and other streamlining actions; product quality, labeling, or safety concerns; negative publicity about our products; actions by, and the financial condition of, competitors and 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; business interruptions due to natural disasters, unexpected events or public health crises; issues affecting the Company's supply chain and procurement of raw materials, including fluctuations in the cost and availability of raw and packaging materials; labor shortage, turnover and labor cost increases; the impact of changing political and geopolitical conditions, including conflicts and the potential for broader economic disruption; government regulation, and changes in legal and regulatory requirements 5 and enforcement practices; the lack of successful acquisition and integration of new businesses; global economic and financial conditions generally, availability of financing, interest and inflation rates, and the imposition of tariffs, quotas, trade barriers and other similar restrictions; foreign currency fluctuations; the effects of our amount of outstanding indebtedness and related level of debt service as well as the effects that such debt service may have on the Company's ability to borrow or the cost of any such additional borrowing, our credit rating, and our ability to react to certain economic and industry conditions; impairments of indefinite-lived intangible assets; assumptions we have made regarding the investment return on retirement plan assets, and the costs associated with pension obligations; the stability of credit and capital markets; risks associated with the Company's information technology systems, including the threat of data breaches and cyber-attacks; the Company's inability to successfully implement our business transformation initiative; fundamental changes in tax laws; including interpretations and assumptions we have made, and guidance that may be issued, and volatility in our effective tax rate; climate change; Environmental, Social and Governance (ESG) matters; infringement of intellectual property rights, and those of customers; litigation, legal and administrative proceedings; the Company's inability to achieve expected and/or needed cost savings or margin improvements; negative employee relations; and other risks described herein under Part I, Item 1A "Risk Factors." Actual results could differ materially from those projected in the forward-looking statements.
We offer our customers and consumers a range of products, extending from premium to value-priced, to meet the increasing demand for certain product attributes such as clean-label, organic, natural, reduced sodium, gluten-free, and non-GMO (genetically modified organisms). Consistent with market conditions in each segment, our consumer segment has a higher overall profit margin than our flavor solutions segment.
We offer our customers and consumers a range of products, extending from premium to value-priced, to meet the increasing demand for certain product attributes including clean-label, organic, natural, reduced sodium, gluten-free, and non-GMO (genetically modified organisms). Consistent with market conditions in each segment, our Consumer segment has a higher overall profit margin than our Flavor Solutions segment.
ITEM 1. BUSINESS McCormick is a global leader in flavor. We manufacture, market, and distribute spices, seasoning mixes, condiments, and other flavorful products to the entire food industry: retailers, food manufacturers, and foodservice businesses.
ITEM 1. BUSINESS McCormick is a global leader in flavor. We manufacture, market, and distribute herbs, spices, seasoning mixes, condiments, and other flavorful products to the entire food and beverage industry: retailers, food manufacturers, and foodservice businesses.
We also market authentic regional and ethnic brands such as Zatarain’s ® , Stubb's ® , Thai Kitchen ® , and Simply Asia ® .
We also market authentic regional brands such as Zatarain’s ® , Stubb's ® , Thai Kitchen ® , and Simply Asia ® .
Our leading brands in the Americas include McCormick ® , French’s ® , Frank’s RedHot ® , Lawry’s ® , Cholula Hot Sauce ® , and Club House ® , as well as brands such as Gourmet Garden ® and OLD BAY ® .
Our leading brands in the Americas include McCormick ® , French’s ® , Frank’s RedHot ® , Lawry’s ® , Cholula ® , and Club House ® , as well as brands such as Gourmet Garden ® and OLD BAY ® .
Business Segments We operate in two business segments: consumer and flavor solutions. Demand for flavor is growing globally, and across both segments, we have the customer base and product breadth to participate in all types of eating occasions. Our products deliver flavor when cooking at home, dining out, purchasing a quick service meal, or enjoying a snack.
Demand for flavor is growing globally, and across both segments, we have the customer base and product breadth to participate in all types of eating occasions. Our products deliver flavor when cooking at home, dining out, purchasing a quick service restaurant meal, or enjoying a snack.
In 2024, 2023, and 2022, the top three customers in our flavor solutions segment represented between 47% and 49% of our global flavor solutions sales. Trademarks, Licenses and Patents We own a number of trademark registrations.
In 2025, 2024, and 2023, the top three customers in our Flavor Solutions segment represented 49% of our global Flavor Solutions sales. Trademarks, Licenses and Patents We own a number of trademark registrations.
Sales to one of our consumer segment customers, Wal-Mart Stores, Inc., accounted for consolidated sales of approximately 12% in 2024, 2023 and 2022. Sales to one of our flavor solutions segment customers, PepsiCo, Inc., accounted for consolidated sales of approximately 13% in 2024, 13% in 2023, and 11% in 2022.
Sales to one of our Consumer segment customers, Wal-Mart Stores, Inc., accounted for consolidated sales of approximately 12% in 2025, 2024, and 2023. Sales to one of our Flavor Solutions segment customers, PepsiCo, Inc., accounted for consolidated sales of approximately 12% in 2025, and 13% in both 2024 and 2023.
Sanchez is 49 years old and, during the last five years, has held the following positions with McCormick: February 2022 to present - President, EMEA; February 2020 to January 2022 – Vice President Consumer, EMEA, and November 2018 to January 2020 – Vice President Marketing, EMEA. Operations Outside of the U.S.
Sanchez. Ms. Sanchez is 51 years old and, during the last five years, has held the following positions with McCormick: February 2022 to present - President, EMEA; and February 2020 to January 2022 – Vice President Consumer, EMEA. Operations Outside of the U.S.
Raw Materials The most significant raw materials used in our business are dairy products, pepper, onion, garlic, capsicums (red peppers and paprika), tomato products, sugar and salts. Pepper and other spices and herbs are generally sourced from countries other than the U.S.
Raw Materials The most significant raw materials used in our business are dairy products, pepper, garlic, onion, capsicums (red peppers and paprika), salt, tomato products, sugar, and soybean oil. Pepper, along with various spices and herbs, is generally sourced from countries outside the U.S.
In 2024, the consumer segment contributed approximately 57% of consolidated net sales and 69% of consolidated operating income, and the flavor solutions segment contributed approximately 43% of consolidated net sales and 31% of consolidated operating income. Consumer Segment. From locations around the world, our brands reach consumers in approximately 150 countries and territories.
In 2025, the Consumer segment contributed approximately 58% of consolidated net sales and 67% of consolidated operating income, and the Flavor Solutions segment contributed approximately 42% of consolidated net sales and 33% of consolidated operating income. Consumer Segment. From locations around the world, our brands reach consumers in approximately 150 countries and territories.
Other raw materials, like dairy products and onion, are primarily sourced locally, either within the U.S. or from our international locations. Because these raw materials are agricultural products, they are subject to fluctuations in market price and availability caused by weather, growing and harvesting conditions, market conditions, including inflationary cost increases, and other factors beyond our control.
Because these raw materials are agricultural products, they are subject to fluctuations in market price and availability caused by weather, growing and harvesting conditions, market conditions, including inflationary cost increases and global trade policies, and other factors beyond our control.
Information about our Executive Officers In addition to the executive officers indicated in the 2025 Proxy Statement incorporated by reference in Part III, Item 10 of this Report, the other executive officers of McCormick are Marcos M. Gabriel, Katherine A. Jenkins, and Ana G. Sanchez. 4 Mr.
The results from these surveys are used to advance programs and processes to enhance employee engagement and improve the overall employee experience. 4 Information about our Executive Officers In addition to the executive officers indicated in the 2026 Proxy Statement incorporated by reference in Part III, Item 10 of this Report, the other executive officer of McCormick is Ana G.
Outside the U.S., our business is subject to numerous similar statutes, laws, and regulatory requirements. Human Capital We believe in the power of people—fostering a culture for our employees that embodies respect and collaboration across the organization. Our high-performance culture is rooted in shared values and respect for all contributions of every employee.
Outside the U.S., our business is subject to numerous similar statutes, laws, and regulatory requirements. Human Capital We believe in the power of people and that by working together, every employee is an integral part of driving our success.
We had approximately 14,100 full-time employees worldwide as of November 30, 2024. Our operations have not been affected significantly by work stoppages, and, in the opinion of management, employee relations are good. We have approximately 400 employees in the U.S. who are covered by a collective bargaining contract.
In the United States, approximately 400 employees are covered by a collective bargaining contract and at our subsidiaries outside the U.S., approximately 2,450 employees are covered by collective bargaining agreements or similar arrangements. We maintain positive and constructive employee relations and our operations have not been affected significantly by work stoppages.
Our key human capital objectives are to attract, retain, and develop the highest quality talent. We employ various human resource programs in support of these objectives. We believe diversity, equity, and inclusion are at the core of our values and strategic business priorities.
Our key human capital objective is to attract, develop, and retain the best talent and we employ various human resource programs in support of this objective. Throughout our global business, we work to create ethical, safe, accessible, and supportive workplaces where all employees thrive and belong.
Throughout our operations, we strive to ensure that all of our employees have access to safe workplaces that allow them to succeed in their jobs.
Our global safety programs focus on hazard prevention to ensure that all our employees have access to safe workplaces that allow them to succeed in their jobs. We offer total rewards programs that support the physical, emotional, and financial well being of our employees. As of November 30, 2025, we had approximately 14,100 full-time employees worldwide.
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Throughout our business, we champion equality, supporting parity for women and under-represented groups, as we work to create ethical, safe, and supportive workplaces where our employees thrive. We believe a diverse and inclusive workplace results in business growth and encourages increased innovation, retention of talent, and a more engaged workforce.
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On January 2, 2026, we completed the purchase of an additional 25% ownership interest in McCormick de Mexico. The purchase price was $750 million, which increased our ownership to a 75% controlling interest. We believe the acquisition creates opportunities for further growth in the Mexican market and provides a strategic platform for further expansion in Latin America.
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We have various employee ambassador groups that provide a supportive and collaborative space for employees to come together and promote inclusion. We prioritize the mental health and wellness of our employees by offering and encouraging participation in various programs and initiatives. Respect for human rights is fundamental to our business and its commitment to ethical conduct.
Added
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. Business Segments We operate in two business segments: Consumer and Flavor Solutions.
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At our subsidiaries outside the U.S., approximately 2,500 employees are covered by collective bargaining agreements or similar arrangements. Through our continuous listening strategy, we measure employee engagement on an ongoing basis to solicit feedback and understand the views of our employees, work environment, and culture.
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Raw materials such as dairy products, onion and soybean oil are primarily obtained locally, either within the U.S. or from our international locations.
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The results from these surveys are used to implement programs and processes designed to enhance employee engagement and improve the overall employee experience. We are committed to the safety, health, and security of our employees. We believe a hazard-free environment is a critical enabler for the success of our business.
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We believe that unlocking the full potential of all employees through inclusion drives innovation, collaboration, and growth, and enhances our competitive advantage. Respect for human rights is central to our business and reflects our commitment to ethical conduct. We are committed to the safety, health, and well-being of our employees.
Removed
Gabriel is 53 years old and, during the last five years has held the following positions within McCormick: December 2024 to present - Executive Vice President and Chief Financial Officer; March 2024 to November 2024 - Senior Vice President Global Finance and Capital Markets; June 2023 to February 2024 - Senior Vice President, Finance and Global Business Services; August 2022 to May 2023 - Chief Transformation Officer; and August 2017 to July 2020 - Chief Financial Officer Americas.
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Through our continuous listening strategy, we measure employee engagement and enablement, receiving valuable feedback from our employees on our work environment and culture.
Removed
Ms. Jenkins is 56 years old and, during the last five years, has held the following positions with McCormick: June 2023 to present - Chief Growth Officer; June 2022 to May 2023 – Chief Strategy Officer & Senior Vice President, Investor Relations; and January 2017 to June 2022, Vice President, Investor Relations. Ms.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

67 edited+16 added−16 removed129 unchanged
Biggest changeWe may not be able to increase prices to fully offset inflationary pressures on costs, such as raw and packaging materials, labor and distribution costs, which may impact our financial condition or results of operations. As a manufacturer and distributor of flavor products, we rely on raw materials, packaging materials, plant labor, distribution resources, and transportation providers.
Biggest changeAn overall labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our business, financial condition or operating results. 9 We may not be able to increase prices to fully offset inflationary and other pressures on costs, such as raw and packaging materials, labor and distribution costs, which may impact our financial condition or results of operations.
Production of certain of our products is highly concentrated, and some are manufactured at a single location.
Production of certain of our products is highly concentrated, and some are manufactured at a single location.
This substantial level of indebtedness could have important consequences to our business, including, but not limited to: • increasing our debt service obligations, making it more difficult for us to satisfy our obligations; • limiting our ability to borrow additional funds; • increasing our exposure to negative fluctuations in interest rates; • subjecting us to financial and other restrictive covenants, the non-compliance with which could result in an event of default; • increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic and industry conditions; • limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and • placing us at a competitive disadvantage as compared to our competitors, to the extent that they are not as highly leveraged.
This substantial level of indebtedness could have important consequences to our business, including, but not limited to: • increasing our debt service obligations, making it more difficult for us to satisfy our obligations; • limiting our ability to borrow additional funds; • increasing our exposure to negative fluctuations in interest rates; • subjecting us to financial and other restrictive covenants, the non-compliance with which could result in an event of default; 14 • increasing our vulnerability to, and reducing our flexibility to respond to, general adverse economic and industry conditions; • limiting our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate; and • placing us at a competitive disadvantage as compared to our competitors, to the extent that they are not as highly leveraged.
A product recall, import alert or an adverse result in any such litigation, or negative perceptions regarding food products and ingredients, could result in our having to pay fines or damages, incur additional costs or cause customers and consumers in our principal markets to lose confidence in the safety and quality of certain products or ingredients, any of which could have a negative effect on our business or financial results and, depending upon the significance of the affected product, that negative effect could be 7 material to our business or financial results.
A product recall, import alert or an adverse result in any such litigation, or negative perceptions regarding food products and ingredients, could result in our having to pay fines or damages, incur additional costs or cause customers and consumers in our principal markets to lose confidence in the safety and quality of certain products or ingredients, any of which could have a negative effect on our business or financial results and, depending upon the significance of the affected product, that negative effect could be material to our business or financial results.
We are subject to numerous laws and regulations relating to the growing, sourcing, manufacturing, storage, labeling, marketing, 16 advertising and distribution of food products, as well as laws and regulations relating to financial reporting requirements, the environment, consumer protection, product design, competition, anti-corruption, privacy, machine learning and artificial intelligence, relations with distributors and retailers, foreign supplier verification, customs and trade laws, including the import and export of products and product ingredients, employment, and health and safety.
We are subject to numerous laws and regulations relating to the growing, sourcing, manufacturing, storage, labeling, marketing, advertising and distribution of food products, as well as laws and regulations relating to financial reporting requirements, the environment, consumer protection, product design, competition, anti-corruption, privacy, machine learning and artificial intelligence, relations with distributors and retailers, foreign supplier verification, customs and trade laws, including the import and export of products and product ingredients, employment, and health and safety.
Increased compliance costs and expenses due to the impacts of climate change and additional legal or regulatory requirements regarding climate change that are designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment may cause disruptions in, or an increase in the costs associated with, the running of our manufacturing facilities and our business, as well as increase distribution and supply chain costs.
Increased compliance costs and expenses due to the impacts of climate change and additional legal or regulatory requirements regarding climate change that are designed to reduce or mitigate the effects of carbon dioxide and other greenhouse gas emissions on the environment may cause disruptions in, or an increase in the 12 costs associated with, the running of our manufacturing facilities and our business, as well as increase distribution and supply chain costs.
As global economic conditions continue to be volatile or economic uncertainty remains, trends in consumer spending also remain unpredictable and subject to reductions due to credit constraints and uncertainties about the future. We are a manufacturer and distributor of flavor products. As such, many of our products are purchased by our customers based on end-user demand from consumers.
As global economic conditions 6 continue to be volatile or economic uncertainty remains, trends in consumer spending also remain unpredictable and subject to reductions due to credit constraints and uncertainties about the future. We are a manufacturer and distributor of flavor products. As such, many of our products are purchased by our customers based on end-user demand from consumers.
If we do not allocate and effectively manage the resources necessary to build and sustain the proper information technology infrastructure, or if we fail to achieve the expected benefits from this initiative, it may impact our ability to process transactions accurately and efficiently and remain in step with the changing needs of our business, which could result in the loss of customers and revenue.
If we do not allocate and effectively manage the resources necessary to build and sustain the proper information technology infrastructure, or if we fail to achieve the expected benefits from this initiative, it may impact our ability to process 16 transactions accurately and efficiently and remain in step with the changing needs of our business, which could result in the loss of customers and revenue.
In addition, we may be required to incur asset impairment charges (including charges related to goodwill and other intangible 10 assets) in connection with acquired businesses, which may reduce our profitability. If we are unable to consummate such transactions, or successfully integrate and grow acquisitions and achieve contemplated revenue synergies and cost savings, our financial results could be adversely affected.
In addition, we may be required to incur asset impairment charges (including charges related to goodwill and other intangible assets) in connection with acquired businesses, which may reduce our profitability. If we are unable to consummate such transactions, or successfully integrate and grow acquisitions and achieve contemplated revenue synergies and cost savings, our financial results could be adversely affected.
These actions may result in a deterioration of employee relations at the impacted locations or elsewhere in our business. If we are unable to fully realize the benefits from our CCI program or streamlining actions to reduce fixed costs, simplify or improve our competitiveness, our financial results could be negatively affected.
These actions may result in a deterioration of employee relations at the impacted locations or elsewhere in our business. 11 If we are unable to fully realize the benefits from our CCI program or streamlining actions to reduce fixed costs, simplify or improve our competitiveness, our financial results could be negatively affected.
If we fail to achieve, or are 12 perceived to have failed or been delayed in achieving, or improperly report our progress toward achieving these goals and commitments, it could negatively affect consumer or customer preference for our products or investor confidence in our stock, as well as expose us to enforcement actions and litigation.
If we fail to achieve, or are perceived to have failed or been delayed in achieving, or improperly report our progress toward achieving these goals and commitments, it could negatively affect consumer or customer preference for our products or investor confidence in our stock, as well as expose us to enforcement actions and litigation.
Increased focus and activism on ESG topics may hinder our access to capital, as investors may reconsider their capital investment as a result of their assessment of our ESG practices. In particular, these constituencies are increasingly focusing on environmental issues, including climate change, water use, deforestation, plastic waste, and other sustainability concerns.
Increased focus and activism on these topics may hinder our access to capital, as investors may reconsider their capital investment as a result of their assessment of our practices. In particular, these constituencies are increasingly focusing on environmental issues, including climate change, water use, deforestation, plastic waste, and other sustainability concerns.
Since litigation is inherently uncertain, there is no guarantee that we will be successful in defending ourselves against such claims or proceedings, or that management’s assessment of the materiality or immateriality of these matters, including any reserves taken in connection with such matters, will be consistent with the ultimate outcome of such claims or 17 proceedings.
Since litigation is inherently uncertain, there is no guarantee that we will be successful in defending ourselves against such claims or proceedings, or that management’s assessment of the materiality or immateriality of these matters, including any reserves taken in connection with such matters, will be consistent with the ultimate outcome of such claims or proceedings.
If we fail to obtain or adequately protect our intellectual property (and the intellectual property of customers to which we have been given access), the value of our products and brands could be reduced and there could be an adverse impact on our business, financial condition and results of operations.
If we fail to obtain or adequately protect our intellectual 15 property (and the intellectual property of customers to which we have been given access), the value of our products and brands could be reduced and there could be an adverse impact on our business, financial condition and results of operations.
Increased regulatory requirements related to environmental causes, and related ESG disclosure rules may result in increased compliance costs or increased costs of energy, raw materials or compliance with emissions standards, which may cause disruptions in the manufacture of our products or an increase in operating costs.
Increased regulatory requirements related to environmental causes, and related disclosure rules may result in increased compliance costs or increased costs of energy, raw materials or compliance with emissions standards, which may cause disruptions in the manufacture of our products or an increase in operating costs.
Any failure to achieve our ESG goals or a perception (whether or not valid) of our failure to act responsibly with respect to the environmental, human capital, or social issues, or to effectively respond to new, or changes in, legal or regulatory requirements concerning environmental or other ESG matters, or increased operating or manufacturing costs due to increased regulation or environmental causes could adversely affect our business and reputation and increase risk of litigation.
Any failure to achieve our goals or a perception (whether or not valid) of our failure to act responsibly with respect to the environmental, human capital, or social issues, or to effectively respond to new, or changes in, legal or regulatory requirements concerning environmental or other sustainability matters, or increased operating or manufacturing costs due to increased regulation or environmental causes could adversely affect our business and reputation and increase risk of litigation.
Our purchases of raw materials are subject to fluctuations in market price and availability caused by inflationary pressures, weather, growing and harvesting conditions, climate change, market conditions, governmental actions and other factors beyond our control, including outbreaks of illnesses, pandemics or other local or global health issues.
Our purchases of raw materials are subject to fluctuations in market price and availability caused by inflationary pressures, weather, growing and harvesting conditions, climate change, market conditions, governmental actions including global trade policies and other factors beyond our control, including outbreaks of illnesses, pandemics or other local or global health issues.
If we are unable to meet our ESG goals or evolving investor, industry or stakeholder expectations and standards, or if we are perceived to have not responded appropriately to the growing concern for ESG issues or negative incidents, it could erode customer confidence and customers and consumers may choose to stop purchasing our products or purchase products from another company or a competitor, and our reputation, business or financial condition may be adversely affected.
If we are unable to meet our goals or evolving investor, industry or stakeholder expectations and standards related to these issues, or if we are perceived to have not responded appropriately to the growing concern for these issues or negative incidents, it could erode customer confidence and customers and consumers may choose to stop purchasing our products or purchase products from another company or a competitor, and our reputation, business or financial condition may be adversely affected.
Damage or disruption to or reduction or termination of raw material supplies or our manufacturing or distribution capabilities due to weather, climate change, natural disaster, fire, international disputes, geopolitical tensions or conflict, terrorism, cyber-attack, health epidemics, pandemics or other contagious outbreaks, governmental restrictions or mandates, strikes, import/export restrictions, or other factors could impair our ability to manufacture or sell our products.
Damage or disruption to or reduction or termination of raw material supplies or our manufacturing or distribution capabilities due to weather, climate change, natural disaster, fire, international disputes, geopolitical tensions or conflict, terrorism, cyber-attack, health epidemics, pandemics or other contagious outbreaks, governmental restrictions or mandates, strikes, import/export restrictions, global trade policies, or other factors could impair our ability to manufacture or sell our products.
We could also be subjected to negative responses by governmental actors (such as anti-ESG legislation or retaliatory legislative treatment) or consumers (such as boycotts or negative publicity campaigns) that could adversely affect our reputation, business, financial performance and growth.
We could also be subjected to negative responses by governmental actors (such as legislation or retaliatory legislative treatment) or consumers (such as boycotts or negative publicity campaigns) that could adversely affect our reputation, business, financial performance and growth.
As of November 30, 2024, we had approximately $5.2 billion of goodwill and approximately $3.0 billion of other indefinite-lived intangible assets. Goodwill and indefinite-lived intangible assets are initially recorded at fair value and not amortized but are tested for impairment at least annually or more frequently if impairment indicators arise.
As of November 30, 2025, we had approximately $5.3 billion of goodwill and approximately $3.0 billion of other indefinite-lived intangible assets. Goodwill and indefinite-lived intangible assets are initially recorded at fair value and not amortized but are tested for impairment at least annually or more frequently if impairment indicators arise.
We operate our business and market our products internationally. In fiscal year 2024, approximately 39% of our sales were generated in countries other than the U.S.
We operate our business and market our products internationally. In fiscal year 2025, approximately 39% of our sales were generated in countries other than the U.S.
Damage to our reputation or brand name, loss of brand relevance, increase in use of private label or other competitive brands by customers or consumers, or product quality or safety concerns could negatively impact our business, financial condition or results of operations. We have many iconic brands with long-standing consumer recognition.
Damage to our reputation or brand name, loss of brand relevance, increase in use of private label or other competitive brands by customers or consumers, competitive pressures in marketing and technology, or product quality or safety concerns could negatively impact our business, financial condition or results of operations. We have many iconic brands with long-standing consumer recognition.
In addition, there are various compliance obligations for companies that process personal data of certain individuals, including such obligations required by the European Union’s General Data Protection Regulation (GDPR), which affects all member states of the European Economic Area, and the California Consumer Privacy Act (CCPA).
In addition, there are various compliance obligations for companies that process personal data of certain individuals, including such obligations required by the European Union’s General Data Protection Regulation (GDPR), which affects all member states of the European Economic Area, and the California Consumer Privacy Act (CCPA) and other state comprehensive privacy laws.
Risks Related to Intellectual Property, Information Technology, and Cyber-Security Our intellectual property rights, and those of our customers, could be infringed, challenged or impaired, and reduce the value of our products and brands or our business with customers.
Risks Related to Intellectual Property, Information Technology, and Cybersecurity Our intellectual property rights, and those of our customers, could be infringed, challenged or impaired, and reduce the value of our products and brands or our business with customers.
In the event that a natural disaster, terrorist attack or other catastrophic event were to destroy any part of our facilities or interrupt our operations for any extended period of time, or if harsh weather or health conditions prevent us from delivering products in a timely manner, our business, financial condition or operating results could be adversely affected.
In the event that a natural disaster, terrorist attack or other catastrophic event were to destroy any part of our facilities or interrupt our operations for any extended period of time, or prevent us from delivering products in a timely manner, our business, financial condition or operating results could be adversely affected.
Further escalation of these geopolitical conflicts, including increased trade barriers or restrictions on global trade, could result in, among other things, cyberattacks, supply disruptions, lower consumer demand, and changes to foreign exchange rates and financial markets, any of which may adversely affect our business and supply chain operations.
Further changes in political and geopolitical conditions, including increased trade barriers or restrictions on global trade, could result in, among other things, cyberattacks, supply disruptions, lower consumer demand, and changes to foreign exchange rates and financial markets, any of which may adversely affect our business and supply chain operations.
ESG issues, including those related to climate change and sustainability, may have an adverse effect on our business, financial condition and results of operations and damage our reputation. Companies across all industries are facing increasing scrutiny relating to their ESG policies.
Climate change and sustainability issues may have an adverse effect on our business, financial condition and results of operations and damage our reputation. Companies across all industries are facing increasing scrutiny relating to their sustainability policies.
There can be no assurance that these measures will prevent or limit the impact of a future incident. Moreover, the development and maintenance of these measures requires continuous monitoring as technologies change and efforts to overcome security measures evolve.
There can be no assurance that these measures will prevent or limit the impact of a future incident. Moreover, the development and maintenance of these measures require continuous monitoring as technologies change and efforts to overcome security measures evolve and leverage artificial intelligence.
The most significant raw materials used by us in our business are dairy products, pepper, onion, garlic, capsicums (red peppers and paprika), tomato products, sugar and salts.
The most significant raw materials used by us in our business are dairy products, pepper, garlic, onion, capsicums (red peppers and paprika), salt, tomato products, sugar, and soybean oil.
Risks Relating to Credit and Capital Markets, Our Credit Rating, Borrowings and Dividends Increases in interest rates or changes in our credit ratings may negatively impact us. On November 30, 2024, we had total outstanding variable rate debt of approximately $449 million at a weighted-average interest rate of approximately 4.7%.
Risks Relating to Credit and Capital Markets, Our Credit Rating, Borrowings and Dividends Increases in interest rates or changes in our credit ratings may negatively impact us. On November 30, 2025, we had total outstanding variable rate debt of approximately $351.8 million at a weighted-average interest rate of approximately 4.06%.
We have a number of major customers, including two large customers that, in the aggregate, constituted approximately 25% of consolidated sales in 2024.
We have a number of major customers, including two large customers that, in the aggregate, constituted approximately 24% of consolidated sales in 2025.
Our initiatives extend from individuals to entire communities, including those we serve and, just as importantly, those from which we source.
We have established initiatives that extend from individuals to entire communities, including those we serve and, just as importantly, those from which we source.
Our business, financial condition and results of operations have been impacted in the past and may be impacted in the future by disruptions in the global economy associated with these geopolitical conflicts.
The global economy has been negatively impacted by changing political and geopolitical conditions, including conflicts. Our business, financial condition and results of operations have been impacted in the past and may be impacted in the future by disruptions in the global economy associated with these changes in political and geopolitical conditions.
In addition, many of these materials and costs are subject to price fluctuations from a number of factors, including, but not limited to, market conditions, demand for raw materials, weather, growing and harvesting conditions, climate change, energy costs, currency fluctuations, supplier capacities, governmental actions, import and export requirements (including tariffs), armed hostilities (including the ongoing conflicts between Russia and Ukraine and Israel and Hamas) and other factors beyond our control.
I n addition, many of these materials and costs are subject to price fluctuations from a number of factors, including, but not limited to, market conditions, demand for raw materials, weather, growing and harvesting conditions, climate change, energy costs, currency fluctuations, supplier capacities, governmental actions, import and export requirements, global trade policies (including tariffs and retaliatory measures), armed hostilities (including the ongoing geopolitical conflicts) and other factors beyond our control.
In addition, the effects of the ongoing conflicts could also heighten many of the other risk factors described herein. Our operations may be impaired as a result of disasters, business interruptions or similar events.
In addition, the effects of these political and geopolitical conditions could also heighten many of the other risk factors described herein. 10 Our operations may be impaired as a result of disasters, business interruptions or similar events.
As of November 30, 2024, our indebtedness of McCormick and its subsidiaries is approximately $4.3 billion.
As of November 30, 2025, our indebtedness of McCormick and its subsidiaries is approximately $4.0 billion.
Consolidations in some of the industries in which our customers operate have created larger customers, some of which are highly leveraged. In addition, competition has increased with the growth in alternative channels through our customer base. These factors have caused some customers to be less profitable and increased our exposure to credit risk.
In addition, competition has increased with the growth in alternative channels through our customer base. These factors have caused some customers to be less profitable and increased our exposure to credit risk. Current credit markets are volatile, and some of our customers and counterparties are highly leveraged.
While future price movements of raw material costs are uncertain, we seek to mitigate the market price risk in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, customer price adjustments and cost savings from our CCI program. We generally have not used derivatives to manage the volatility related to this risk.
While future price movements of raw material costs are uncertain, we seek to mitigate the market price risk in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, customer price adjustments and cost savings from our CCI program and other streamlining initiatives.
To the extent that price increases or packaging size decreases are not sufficient to offset these increased costs adequately or in a timely manner, and/or if they result in significant decreases in sales volume, our business, 9 financial condition or operating results may be adversely affected.
To the extent that price increases are not sufficient to offset these increased costs adequately or in a timely manner, and/or if they result in significant decreases in sales volume, our business, financial condition or operating results may be adversely affected. Furthermore, we may not be able to fully offset any cost increases through our productivity or efficiency initiatives.
These acquisitions, joint ventures and divestitures may present financial, managerial and operational challenges, including diversion of management attention from existing businesses, difficulty with integrating or separating personnel and financial and other systems, increased expenses and raw material costs, assumption of unknown liabilities and indemnities, and potential disputes with the buyers or sellers.
These acquisitions, such as the additional 25% incremental ownership acquired in McCormick de Mexico on January 2, 2026, joint ventures and divestitures may present financial, managerial and operational challenges, including diversion of management attention from existing businesses, difficulty with integrating or separating personnel and financial and other systems, increased expenses and raw material costs, assumption of unknown liabilities and indemnities, and potential disputes with the buyers or sellers.
In addition, we could be criticized by environmental, social and governance (ESG) detractors for the scope or nature of our ESG initiatives or goals or for any revisions to these goals.
In addition, we could be criticized by those opposed to environmental and sustainability efforts for the scope or nature of our initiatives or goals or for any revisions to these goals.
During recent years, we have experienced significantly elevated commodity and supply chain costs, including the costs of raw materials, packaging materials, labor, energy, fuel, transportation and other inputs necessary for the production and distribution of our products, and we expect inflation to continue in 2025 at a similar level to that experienced in 2024 but at a more modest rate than experienced since 2022.
We have experienced inflation of commodity and supply chain costs, including the costs of raw materials, packaging materials, labor, energy, fuel, transportation and other inputs necessary for the production and distribution of our products, and we expect inflation to continue in 2026 at a similar level to that experienced in 2025 .
Although we have adopted rigorous quality assurance and quality control procedures which are designed to ensure the safety of our imported products, we cannot provide assurance that such events will not have a negative impact on our business, financial condition or operating results. 8 Disruption of our supply chain could adversely affect our business.
Although we have adopted rigorous quality assurance and quality control procedures which are designed to ensure the safety of our imported products, we cannot provide assurance that such events will not have a negative impact on our business, financial condition or operating results. 8 Changes in global trade policies have impacted and may continue to impact our financial condition or results of operations.
Our efforts to comply with these privacy and data protection laws may not be successful, or may be perceived to be unsuccessful, which could adversely affect our business in the U.S., the European Union and in other countries.
Our efforts to comply with these privacy and data protection laws may not be successful, or may 17 be perceived to be unsuccessful, which could adversely affect our business in the U.S., the European Union and in other countries. There also is the threat of consumer class actions related to these laws and the overall protection of personal data.
We do not enter into contracts for trading purposes, nor are we a party to any leveraged derivative instruments. Our use of derivative financial instruments is monitored through regular communication with senior management and the utilization of written guidelines. However, our use of these instruments may not effectively limit or eliminate our exposure to changes in interest rates.
Our use of derivative financial instruments is monitored through regular communication with senior management and the utilization of written guidelines. However, our use of these instruments may not effectively limit or eliminate our exposure to changes in interest rates.
Our inability to obtain financing on acceptable terms or within an acceptable time period could have an adverse impact on our operations, financial condition and liquidity. 14 Uncertain global economic conditions expose us to credit risks from customers and counterparties.
Our inability to obtain financing on acceptable terms or within an acceptable time period could have an adverse impact on our operations, financial condition and liquidity. Uncertain global economic conditions expose us to credit risks from customers and counterparties. Consolidations in some of the industries in which our customers operate have created larger customers, some of which are highly leveraged.
This could have an adverse impact on our financial condition and liquidity. The declaration, payment and amount of dividends is made at the discretion of our board of directors and depends on a number of factors.
The declaration, payment and amount of dividends is made at the discretion of our board of directors and depends on a number of factors.
Therefore, we cannot provide assurance that future exchange rate fluctuations will not have a negative impact on our business, financial position or operating results. 11 We face risks associated with certain pension assets and obligations.
However, these contracts may not effectively limit or eliminate our exposure to a decline in operating results due to foreign currency exchange changes. Therefore, we cannot provide assurance that future exchange rate fluctuations will not have a negative impact on our business, financial position or operating results. We face risks associated with certain pension assets and obligations.
Our business and results of operations have in the past been, and may continue to be, adversely affected by changes in global economic conditions including inflation, changes in prevailing interest rates, bank failures, the impact of any potential U.S. federal government shutdown, changes in governmental rules and approaches to taxation, fluctuations in foreign currency interest rates, availability 6 of capital markets, consumer spending rates, energy availability and costs, the negative impacts caused by pandemics and other local and global public health issues, as well as the potential impacts of geopolitical uncertainties and international conflicts, including the ongoing conflicts between Russia and Ukraine, the war in the Middle East, rising tensions between China and Taiwan, and the effect of governmental initiatives to manage economic conditions.
Our business and results of operations have in the past been, and may continue to be, adversely affected by changes in global economic conditions including inflation, changes in prevailing interest rates, the impact of any U.S. federal government shutdown, changes in governmental rules and approaches to taxation, challenges in global supply chains including new or increased tariffs or trade restrictions, fluctuations in foreign currency interest rates, availability of capital markets, consumer spending rates, energy availability and costs, the negative impacts caused by pandemics and other local and global public health issues and the effect of governmental initiatives to manage economic conditions.
Additionally, disruptions in the commercial paper market or other effects of volatile economic conditions on the credit markets could also reduce the amount of commercial paper that we could issue and raise our borrowing costs.
Additionally, disruptions in the commercial paper market or other effects of volatile economic conditions on the credit markets could also reduce the amount of commercial paper that we could issue and raise our borrowing costs. Our policy is to manage our interest rate risk by entering into both fixed and variable rate debt arrangements.
Failure to attract, hire, develop, motivate and retain highly qualified and diverse executive and employee talent, especially in light of changing worker expectations and talent marketplace variability regarding flexible and hybrid work models, to meet our goals relating to fostering a diverse and inclusive culture or to adequately address potential increased scrutiny of our diversity, equity and inclusion initiatives could impact our ability to achieve our business objectives and adversely affect our future success.
Failure to attract, hire, develop, motivate and retain the best executive and employee talent, especially in light of changing worker expectations and talent marketplace variability regarding flexible and hybrid work models, relating to fostering inclusive culture for all employees could impact our ability to achieve our business objectives and adversely affect our future success.
From time to time, we may need to reduce the prices for some of our products to respond to competitive and customer pressures, particularly during periods of economic uncertainty or significant inflation, which may adversely affect our profitability. Such pressures could reduce our ability to take appropriate remedial action to address commodity and other cost increases.
Weak economic conditions, recessions, significant inflation and other factors, such as pandemics, could affect consumer preferences and demand. From time to time, we may need to reduce the prices for some of our products to respond to competitive and customer pressures, particularly during periods of economic uncertainty or significant inflation, which may adversely affect our profitability.
The rising popularity of social networking and other consumer-oriented technologies has increased the speed and accessibility of information dissemination (whether or not accurate), and, as a result, negative, inaccurate, or misleading posts or comments on websites may generate adverse publicity that could damage our reputation or brands.
Negative publicity about these concerns, whether or not valid, may discourage customers and consumers from buying our products or cause disruptions in production or distribution of our products and adversely affect our business, financial condition or results of operations. 7 The rising popularity of social networking and other consumer-oriented technologies has increased the speed and accessibility of information dissemination (whether or not accurate), and, as a result, negative, inaccurate, or misleading posts or comments on websites may generate adverse publicity that could damage our reputation or brands.
Current credit markets are volatile, and some of our customers and counterparties are highly leveraged. A significant adverse change in the financial and/or credit position of a customer or counterparty could require us to assume greater credit risk relating to that customer or counterparty and could limit our ability to collect receivables.
A significant adverse change in the financial and/or credit position of a customer or counterparty could require us to assume greater credit risk relating to that customer or counterparty and could limit our ability to collect receivables. This could have an adverse impact on our financial condition and liquidity.
Such incidents could result in unauthorized access to information including customer, consumer or other company 15 confidential data as well as disruptions to operations. We, and the third-parties we do business with, have experienced in the past, and expect to continue to experience, cybersecurity threats and attacks, although to date none had a material impact on our operations or business.
We, and the third-parties we do business with, have experienced in the past, and expect to continue to experience, cybersecurity threats and attacks, although to date none had a material impact on our operations or business.
These demands could impact the profitability of some of our products or cause us to incur additional costs, to make changes to our operations to make additional commitments, set targets or establish additional goals and take actions to meet them, which could expose us to market, operational and execution costs or risk.
These demands could impact the profitability of some of our products or cause us to incur additional costs, to make changes to our operations to make additional commitments, set targets or establish additional goals and take actions to meet them, which could expose us to market, operational and execution costs or risk. 13 In addition to environmental issues these constituencies are also focused on social and other governance issues, including matters such as, but not limited to, human capital and social issues.
Primary exposures include the U.S. dollar versus the Euro, British pound sterling, Chinese renminbi, Canadian dollar, Australian dollar, Polish zloty, Singapore dollar, Swiss franc, and Mexican peso, as well as the Euro versus the British pound sterling and Australian dollar, and Polish zloty, and finally the Canadian dollar versus British pound sterling.
Primary exposures include the U.S. dollar versus the Euro, British pound sterling, Chinese renminbi, Canadian dollar, Australian dollar, Polish zloty, Singapore dollar, Swiss franc, and Mexican peso, as well as the Euro versus the British pound sterling and Australian dollar, and Polish zloty. We routinely enter into foreign currency exchange contracts to facilitate managing certain of these foreign currency risks.
We believe that these preventative actions provide adequate measures of protection against security breaches and generally reduce our cybersecurity risks. However, cyber-threats are constantly evolving, are becoming more sophisticated and are being made by groups of individuals with a wide range of expertise and motives, which increases the difficulty of detecting and successfully defending against them.
However, cyber-threats are constantly evolving, are becoming more sophisticated including through the increased adoption of artificial intelligence and are being made by groups of individuals with a wide range of expertise and motives, which increases the difficulty of detecting and successfully defending against them.
Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business. Similarly, outside of the U.S., there are various laws and regulations governing the collection, use, disclosure, transfer, or other processing of personal data.
Even if we are not determined to have violated these laws, government investigations into these issues typically require the expenditure of significant resources and generate negative publicity, which could harm our reputation and our business. Litigation, legal or administrative proceedings could have an adverse impact on our business and financial condition or damage our reputation.
Competition in our product categories is based on price, product innovation, product quality, brand recognition and loyalty, effectiveness of marketing and promotional activity, and the ability to identify and satisfy consumer preferences. Weak economic conditions, recessions, significant inflation and other factors, such as pandemics, could affect consumer preferences and demand.
Our profitability may suffer as a result of competition in our markets. The food industry is intensely competitive. Competition in our product categories is based on price, product innovation, product quality, brand recognition and loyalty, effectiveness of marketing and promotional activity, and the ability to identify and satisfy consumer preferences.
Reduced availability of trucking capacity due to shortages of drivers has caused an increase in the cost of transportation for us and our suppliers. An overall labor shortage, lack of skilled labor, increased turnover or labor inflation could have a material adverse impact on our business, financial condition or operating results.
Reduced availability of trucking capacity due to shortages of drivers has caused an increase in the cost of transportation for us and our suppliers.
Therefore, we cannot provide assurance that future raw material availability will not have a negative impact on our business, financial condition or operating results.
Therefore, we cannot provide assurance that future raw material availability will not have a negative impact on our business, financial condition or operating results. Political, socio-economic, cultural, and geopolitical conditions, as well as disruptions caused by terrorist activities or otherwise, could also create additional risks for regulatory compliance.
To the extent that we have used derivatives for this purpose, it has not been material to our business. Any actions we take in response to market price fluctuations may not effectively limit or eliminate our exposure to changes in raw material prices.
In addition, we enter into financial hedging derivative transactions based on forecasted soybean oil purchases. Other than the soybean oil hedging transactions, we generally have not used derivatives to manage the volatility related to this risk. Any actions we take in response to market price fluctuations may not effectively limit or eliminate our exposure to changes in raw material prices.
Our policy is to manage our interest rate risk by entering into both fixed and variable rate debt arrangements. 13 We also use interest rate swaps to minimize worldwide financing cost and to achieve a desired mix of fixed and variable rate debt.
We also use interest rate swaps to minimize worldwide financing cost and to achieve a desired mix of fixed and variable rate debt. On November 30, 2025, we had total outstanding fixed to variable interest rate swaps with a notional value of $500 million.
On November 30, 2024, we had total outstanding fixed to variable interest rate swaps with a notional value of $600 million. We utilize derivative financial instruments to enhance our ability to manage risk, including interest rate exposures that exist as part of our ongoing business operations.
We utilize derivative financial instruments to enhance our ability to manage risk, including interest rate exposures that 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 instruments.
Cybercriminals have increasingly demonstrated advanced capabilities, such as use of zero-day vulnerabilities, and rapid integration of new technology such as generative artificial intelligence. Continued geographical turmoil, including the ongoing conflicts between Russia and Ukraine, the war in the Middle East, and rising tensions between China and Taiwan, has heightened the risk of cyberattack.
Cybercriminals have increasingly demonstrated advanced capabilities, such as use of zero-day vulnerabilities, and rapid integration of new technology such as generative artificial intelligence. Such incidents could result in unauthorized access to information including customer, consumer or other company confidential data as well as disruptions to operations. Continued geopolitical conflicts have overall heightened the risk of cyberattacks.
Removed
Negative publicity about these concerns, whether or not valid, may discourage customers and consumers from buying our products or cause disruptions in production or distribution of our products and adversely affect our business, financial condition or results of operations.
Added
Changes in global trade policies, including tariffs, have caused inflationary pressures and higher costs on certain raw materials and imports. These actions have impacted our business through increased costs and uncertainty.
Removed
Political, socio-economic, cultural, and geopolitical (including instability and international conflicts such as the ongoing conflicts between Russia and Ukraine, the war in the Middle East, and rising tensions between China and Taiwan) conditions, as well as disruptions caused by terrorist activities or otherwise, could also create additional risks for regulatory compliance.
Added
If maintained, the tariffs, as well as related measures that have been taken and which could be taken by other countries in the future could pose a risk to our business and results of operations.
Removed
Our ability to make, move, and sell products is critical to our success.
Added
The extent and duration of the tariffs and the resulting impact on general economic conditions and on our business are uncertain and depend on various factors, such as legal challenges to the applicability of these tariffs, negotiations between affected countries, the responses of other countries or regions, exemptions, exclusions or other relief that may be granted, availability and cost of alternative sources of supply, and demand for our products in affected markets.
Removed
Furthermore, we may not be able to fully offset any cost increases through our productivity or efficiency initiatives. Our profitability may suffer as a result of competition in our markets. The food industry is intensely competitive.
Added
Our attempts to offset these pressures through supply chain management initiatives and increases in the selling prices of some of our products may not be successful or may result in reductions in sales volume.
Removed
Ongoing geopolitical conflicts and the related implications may negatively impact our operations. The global economy has been negatively impacted by ongoing geopolitical conflicts, including the military conflicts between Russia and Ukraine, the war in the Middle East, as well as rising tensions between China and Taiwan.
Added
To the extent these actions are not sufficient to offset increase costs or result in significant decreases in sales volume, our business, financial condition, or operating results may be adversely affected. Disruption of our supply chain could adversely affect our business. Our ability to make, move, and sell products is critical to our success.
Removed
We routinely enter into foreign currency exchange contracts to facilitate managing certain of these foreign currency risks. However, these contracts may not effectively limit or eliminate our exposure to a decline in operating results due to foreign currency exchange changes.
Added
As a manufacturer and distributor of flavor products, we rely on raw materials, packaging materials, plant labor, distribution resources, and transportation providers.
Removed
In addition to environmental issues these constituencies are also focused on social and other governance issues, including matters such as, but not limited to, human capital and social issues. We have established diversity, equity and inclusion goals as part of our ESG initiative.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWe have an Executive Cybersecurity Steering Committee that is facilitated by our CISO, which is designed to engage business leadership and employ best practices, including ongoing enhancements to governance, risk and compliance.
Biggest changeWe have an Executive Cybersecurity Steering Committee that is facilitated by our CISO, which is designed to engage business leadership and employ best practices, including ongoing enhancements to governance, risk and compliance. We have adopted governance policies and procedures related to artificial intelligence development, deployment and monitoring.
We periodically conduct tests on our systems to help discover potential vulnerabilities, which enable improved decision-making and prioritization and promote monitoring and reporting across compliance functions. We believe that these 18 actions provide adequate measures of protection against security breaches and generally reduce our cybersecurity risks, and we have not had a material cybersecurity threat or attack to date.
We periodically conduct tests on our systems to help discover potential vulnerabilities, which enable improved decision-making and prioritization and promote monitoring and reporting across compliance functions. We believe that these actions provide adequate measures of protection against security breaches and generally reduce our cybersecurity risks, and we have not had a material cybersecurity threat or attack to date.
The Board, at least annually, and the Audit Committee, periodically throughout the year, receive regular reports from our Chief Information Security Officer (“CISO”) and members of the information security team on, among other things, recent developments, the state of the information security program, assessments of risks and threats to our information security systems, information security considerations arising with respect to our peers and third parties, third-party and independent reviews, and processes to maintain and strengthen information security systems.
The Board, at least annually, and the Audit Committee, periodically throughout the year, receive regular reports from our Chief Information Security Officer (“CISO”) and members of the information security team on, among other things, recent developments, the state of the information security program, assessments of risks and threats to our information security systems, information security considerations arising with respect to our peers and 19 third parties, third-party and independent reviews, and processes to maintain and strengthen information security systems.
The CISO is a Certified Information Systems Security Professional with over 20 years of experience developing and maturing information security programs, including experience with leading privacy, enterprise risk, records management, business continuity and operational risk programs, among others. 19
The CISO is a Certified Information Systems Security Professional with over 20 years of experience developing and maturing information security programs, including experience with leading privacy, enterprise risk, records management, business continuity and operational risk programs, among others.
The team devotes significant resources to our cybersecurity risk management, which focuses on developing and implementing strategies and processes to protect the confidentiality, integrity, and availability of our assets and those of our consumers, customers and employees and seeks to continually improve our policies and practices to protect our platforms, adapt to changes in regulations, identify potential and emerging security risks and develop mitigation strategies for those risks.
The team devotes significant resources to our cybersecurity risk management, which focuses on developing and implementing strategies and processes to protect the confidentiality, integrity, and availability of our assets and those of our consumers, customers and employees and seeks to continually improve our policies and practices to protect our platforms, adapt to changes in regulations, identify potential and emerging security risks such as those due to the increased availability of artificial intelligence and develop mitigation strategies for those risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe following is a list of our principal manufacturing properties, all of which are owned except for the facilities in Commerce, California; Lakewood, New Jersey; Melbourne, Australia; Florence, Italy; and a portion of the facility in Littleborough, England, which are leased.
Biggest changeITEM 2. PROPERTIES Our principal executive offices and primary research facilities are leased and owned, respectively, and are located in suburban Baltimore, Maryland. The following is a list of our principal manufacturing properties, all of which are owned except for the facilities in Commerce, California; Lakewood, New Jersey; Melbourne, Australia; and Florence, Italy, which are leased.
We also own a distribution facility in Monteux, France. In addition, we own, lease, or contract other properties used for manufacturing consumer and flavor solutions products and for sales, warehousing, distribution, and administrative functions. 20 We believe our plants are well maintained and suitable for their intended use.
We also own a distribution facility in Monteux, France. In addition, we own, lease, or contract other properties used for manufacturing Consumer and Flavor Solutions products and for sales, warehousing, distribution, and administrative functions. We believe our plants are well maintained and suitable for their intended use.
The manufacturing facilities that we own in Guangzhou, Shanghai and Wuhan, China are each located on land subject to long-term leases: United States: Hunt Valley, Maryland–consumer and flavor solutions (3 principal plants) Gretna, Louisiana–consumer and flavor solutions South Bend, Indiana–consumer and flavor solutions Atlanta, Georgia–flavor solutions Commerce, California–consumer Irving, Texas–flavor solutions Lakewood, New Jersey–flavor solutions Geneva, Illinois–flavor solutions Springfield, Missouri–consumer and flavor solutions Belcamp, Maryland–consumer and flavor solutions Canada: London, Ontario–consumer and flavor solutions Mexico: Cuautitlán de Romero Rubio–flavor solutions United Kingdom: Haddenham, England–consumer and flavor solutions Littleborough, England–flavor solutions Peterborough, England–flavor solutions France: Carpentras–consumer and flavor solutions Monteux–consumer and flavor solutions Poland: Stefanowo–consumer Italy: Florence–consumer and flavor solutions (2 principal plants) China: Guangzhou–consumer and flavor solutions Shanghai–consumer and flavor solutions Wuhan–consumer and flavor solutions Australia: Melbourne–consumer and flavor solutions Palmwoods–consumer Thailand: Chonburi–consumer and flavor solutions In addition to distribution facilities and warehouse space available at our manufacturing facilities, we lease the following regional distribution facilities: (i) U.S.: Baltimore, Maryland; Salinas, California; Byhalia, Mississippi; Irving, Texas; and Springfield, Missouri; (ii) Canada: Mississauga and London, Ontario; (iii) Heywood, U.K.; and (iv) Compans, France.
The manufacturing facilities that we own in Guangzhou, Shanghai, and Wuhan, China are each located on land subject to long-term leases: United States: Hunt Valley, Maryland–Consumer and Flavor Solutions (3 principal plants) Gretna, Louisiana–Consumer and Flavor Solutions South Bend, Indiana–Consumer and Flavor Solutions Atlanta, Georgia–Flavor Solutions Commerce, California–Consumer Irving, Texas–Flavor Solutions Lakewood, New Jersey–Flavor Solutions Geneva, Illinois–Flavor Solutions Springfield, Missouri–Consumer and Flavor Solutions Belcamp, Maryland–Consumer and Flavor Solutions Canada: London, Ontario–Consumer and Flavor Solutions Mexico: Cuautitlán de Romero Rubio–Consumer and Flavor Solutions (2 principal plants) San Luis Potosí–Consumer and Flavor Solutions United Kingdom: Haddenham, England–Consumer and Flavor Solutions Peterborough, England–Flavor Solutions France: Carpentras–Consumer and Flavor Solutions Monteux–Consumer and Flavor Solutions Poland: Stefanowo–Consumer Italy: Florence–Consumer and Flavor Solutions (2 principal plants) 20 China: Guangzhou–Consumer and Flavor Solutions Shanghai–Consumer and Flavor Solutions Wuhan–Consumer and Flavor Solutions Australia: Melbourne–Consumer and Flavor Solutions Palmwoods–Consumer Thailand: Chonburi–Consumer and Flavor Solutions In addition to distribution facilities and warehouse space available at our manufacturing facilities, we lease the following regional distribution facilities: (i) U.S.: Baltimore, Maryland; Salinas, California; Byhalia, Mississippi; Irving, Texas; and Springfield, Missouri; (ii) Canada: Mississauga and London, Ontario; (iii) Heywood, U.K.; and (iv) Compans, France.
Removed
ITEM 2. PROPERTIES Our principal executive offices and primary research facilities are leased and owned, respectively, and are located in suburban Baltimore, Maryland.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+0 added−2 removed5 unchanged
Biggest changeThe approximate number of holders of our common stock based on record ownership as of December 31, 2024 was as follows: Title of class Approximate number of record holders Common Stock, par value $0.01 per share 2,100 Common Stock Non-Voting, par value $0.01 per share 8,600 The following table summarizes our purchases of Common Stock (CS) and Common Stock Non-Voting (CSNV) during the fourth quarter of 2024: ISSUER PURCHASES OF EQUITY SECURITIES Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under the plans or programs September 1, 2024 to September 30, 2024 CS - 0 CSNV - 0 - - - - $472 million October 1, 2024 to October 31, 2024 CS - 298,310 CSNV - 0 $80.64 - 298,310 - $448 million November 1, 2024 to November 30, 2024 CS - 437 CSNV - 0 $78.51 - 437 - $448 million Total CS - 298,747 CSNV - 0 $80.64 - 298,747 - $448 million On October 9, 2024, we repurchased 55,538 shares of our CS from our U.S. pension plan to facilitate the plan’s rebalancing of its asset allocation.
Biggest changeThe market price of our common stock at the close of business on December 31, 2025 was $68.01 per share for the Common Stock and $68.11 per share for the Common Stock Non-Voting. 21 The approximate number of holders of our common stock based on record ownership as of December 31, 2025 was as follows: Title of class Approximate number of record holders Common Stock, par value $0.01 per share 1,745 Common Stock Non-Voting, par value $0.01 per share 7,924 The following table summarizes our purchases of Common Stock (CS) and Common Stock Non-Voting (CSNV) during the fourth quarter of 2025: ISSUER PURCHASES OF EQUITY SECURITIES Period Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under the plans or programs September 1, 2025 to September 30, 2025 CS - 19,883 CSNV - 0 $64.39 - 19,883 - $418 million October 1, 2025 to October 31, 2025 CS - 15,384 CSNV - 0 $67.12 - 15,384 - $417 million November 1, 2025 to November 30, 2025 CS - 51,912 CSNV - 0 $64.81 - 51,912 - $414 million Total CS - 87,179 CSNV - 0 $65.12 - 87,179 - $414 million On November 11, 2025, various trusts affiliated with Lawrence Kurzius, former McCormick Chairman, President and CEO who retired from our Board as Executive Chairman on March 26, 2025 and current beneficial owner of more than five percent of the CS of the Company, sold 39,014 shares of McCormick CS as a part of McCormick's authorized share repurchase program for $2,517,964.
During fiscal 2024, we issued 1,028,181 shares of CSNV in exchange for shares of CS and issued 14,083 shares of CS in exchange for shares of CSNV.
During fiscal 2025, we issued 1,105,409 shares of CSNV in exchange for shares of CS and issued 24,157 shares of CS in exchange for shares of CSNV.
We have disclosed the information related to the dividends declared and paid on our classes of common stock in Note 16 of the accompanying financial statements. The market price of our common stock at the close of business on December 31, 2024 was $75.80 per share for the Common Stock and $76.24 per share for the Common Stock Non-Voting.
We have disclosed the information related to the dividends declared and paid on our classes of common stock in Note 16 of the accompanying financial statements.
The price paid per share represented the closing price of the CS on October 2, 2024. As of November 30, 2024, approximately $448 million remained of a $600 million share repurchase authorization approved by the Board of Directors in November 2019.
The repurchase price per share was equal to the average of the high and low trading price of the CSNV on the date McCormick agreed to repurchase the shares. As of November 30, 2025, approximately $414 million remained of a $600 million share repurchase authorization approved by the Board of Directors in November 2019.
Removed
Additionally, on October 10, 2024, October 11, 2024, October 15, 2024 and October 16, 2024, we purchased 55,000 shares each day, for a total of 220,000 shares of our CS from our U.S. pension plan to facilitate the plan's rebalancing of its asset allocation.
Removed
The prices paid per share represented the average of the high and low prices of the common shares on October 9, 2024, October 10, 2024, October 11, 2024, October 15, 2024, and October 16, 2024, respectively. 21 On October 2, 2024, we purchased 22,772 shares of our CS from our U.S. defined contribution retirement plan to manage shares, based upon participant activity, in the plan's company stock fund.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

131 edited+30 added−54 removed55 unchanged
Biggest changeWe intend to continue providing these non-GAAP financial measures as part of our future earnings discussions, ensuring consistency in our financial reporting. 29 A reconciliation of these non-GAAP financial measures to GAAP financial results is provided below: 2024 2023 2022 Operating income $ 1,060.3 $ 963.0 $ 863.6 Impact of transaction and integration expenses (1) — — 2.2 Impact of special charges (2) 9.5 61.2 51.6 Adjusted operating income $ 1,069.8 $ 1,024.2 $ 917.4 % increase (decrease) versus prior year 4.5 % 11.6 % (16.7) % Operating income margin (3) 15.8 % 14.5 % 13.6 % Impact of transaction and integration expenses and special charges (3) 0.1 % 0.9 % 0.8 % Adjusted operating income margin (3) 15.9 % 15.4 % 14.4 % Income tax expense $ 184.0 $ 174.5 $ 168.6 Impact of transaction and integration expenses (1) — — 0.6 Impact of special charges (2) 2.4 14.5 13.3 Impact of sale of Kitchen Basics — — (11.6) Adjusted income tax expense $ 186.4 $ 189.0 $ 170.9 Income tax rate (4) 20.5 % 21.8 % 20.7 % Impact of transaction and integration expenses, special charges, and sale of Kitchen Basics (4) — % 0.2 % 0.2 % Adjusted income tax rate (4) 20.5 % 22.0 % 20.9 % Net income $ 788.5 $ 680.6 $ 682.0 Impact of transaction and integration expenses (1) — — 1.6 Impact of special charges (2) 7.1 46.7 38.3 Impact of after-tax gain on sale of Kitchen Basics — — (38.0) Adjusted net income $ 795.6 $ 727.3 $ 683.9 % increase (decrease) versus prior year 9.4 % 6.3 % (17.0) % Earnings per share—diluted $ 2.92 $ 2.52 $ 2.52 Impact of transaction and integration expenses (1) — — 0.01 Impact of special charges (2) 0.03 0.18 0.14 Impact of after-tax gain on sale of Kitchen Basics — — (0.14) Adjusted earnings per share—diluted $ 2.95 $ 2.70 $ 2.53 (1) Transaction and integration expenses include integration expenses associated with our acquisition of FONA.
Biggest changeA reconciliation of these non-GAAP financial measures to GAAP financial results is provided below: 2025 2024 2023 Gross profit $ 2,592.2 $ 2,591.0 $ 2,502.5 Impact of special charges included in cost of goods sold 2.1 — — Adjusted gross profit $ 2,594.3 $ 2,591.0 $ 2,502.5 Gross profit margin (1) 37.9 % 38.5 % 37.6 % Impact of special charges (1) — % — % — % Adjusted gross profit margin (1) 37.9 % 38.5 % 37.6 % Operating income $ 1,070.8 $ 1,060.3 $ 963.0 Impact of special charges 23.2 9.5 61.2 Adjusted operating income $ 1,094.0 $ 1,069.8 $ 1,024.2 % increase versus prior year 2.3 % 4.5 % 11.6 % Operating income margin (2) 15.7 % 15.8 % 14.5 % Impact of special charges (2) 0.3 % 0.1 % 0.9 % Adjusted operating income margin (2) 16.0 % 15.9 % 15.4 % Income tax expense $ 195.8 $ 184.0 $ 174.5 Impact of special charges 5.5 2.4 14.5 Adjusted income tax expense $ 201.3 $ 186.4 $ 189.0 Income tax rate (3) 21.4 % 20.5 % 21.8 % Impact of special charges 0.1 % — % 0.2 % Adjusted income tax rate (3) 21.5 % 20.5 % 22.0 % Net income $ 789.4 $ 788.5 $ 680.6 Impact of special charges 17.7 7.1 46.7 Adjusted net income $ 807.1 $ 795.6 $ 727.3 % increase versus prior year 1.4 % 9.4 % 6.3 % Earnings per share—diluted $ 2.93 $ 2.92 $ 2.52 Impact of special charges 0.07 0.03 0.18 Adjusted earnings per share—diluted $ 3.00 $ 2.95 $ 2.70 % increase versus prior year 1.7 % 9.3 % 6.7 % (1) Gross margin, impact of special charges, and adjusted gross profit margin are calculated as gross profit, impact of special charges, and adjusted gross profit as a percentage of net sales for each period presented.
We have a strong pipeline of flavor solutions products aligned with our customers’ new product launch plans, many of which include clean-label, organic, natural, and “better-for-you” innovation. With over 20 22 product innovation centers around the world, we are supporting the growth of our brands and those of our flavor solutions customers with products that appeal to local consumers.
We have a strong pipeline of Flavor Solutions products aligned with our customers’ new product launch plans, many of which include clean-label, organic, natural, and “better-for-you” innovation. With over 20 product innovation centers around the world, we are supporting the growth of our brands and those of our Flavor Solutions customers with products that appeal to local consumers.
The dollar and share information in the charts and tables in MD&A are in millions, except per share data. McCormick is a global leader in flavor. We manufacture, market, and distribute spices, seasoning mixes, condiments and other flavorful products to the entire food and beverage industry–retailers, food manufacturers and foodservice businesses.
The dollar and share information in the charts and tables in MD&A are in millions, except per share data. 22 McCormick is a global leader in flavor. We manufacture, market, and distribute spices, seasoning mixes, condiments, and other flavorful products to the entire food and beverage industry–retailers, food manufacturers, and foodservice businesses.
Due to the cyclical nature of a portion of our business, our cash flow from operations has historically been the strongest during the fourth quarter of our fiscal year. Due to the timing of the interest payments on our debt, interest payments are higher in the first and third quarter of our fiscal year.
Due to the cyclical nature of a portion of our business, our cash flow from operations has historically been the strongest during the fourth quarter of our fiscal year. Due to the timing of the interest payments on our debt, interest payments are higher in the first and third quarters of our fiscal year.
In the 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 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.
We calculate CCC as follows: Days sales outstanding (average trade accounts receivable divided by average daily net sales) plus days in inventory (average inventory divided by average daily cost of goods sold) less days payable outstanding (average trade accounts payable divided by average daily cost of goods sold plus the average daily change in inventory).
We calculate CCC as follows: 32 Days sales outstanding (average trade accounts receivable divided by average daily net sales) plus days in inventory (average inventory divided by average daily cost of goods sold) less days payable outstanding (average trade accounts payable divided by average daily cost of goods sold plus the average daily change in inventory).
While we believe these assumptions are appropriate, changes in various factors—such as actual returns on plan assets versus expected returns, as well as projected future rates of return—can affect the pension expense or income recognized. Specifically, a 1% increase or decrease in the actuarial assumption for the discount rate would impact our 2025 pension benefit expense by approximately $0.1 million.
While we believe these assumptions are appropriate, changes in various factors—such as actual returns on plan assets versus expected returns, as well as projected future rates of return—can affect the pension expense or income recognized. Specifically, a 1% increase or decrease in the actuarial assumption for the discount rate would impact our 2026 pension benefit expense by approximately $0.1 million.
These financial measures exclude the impact, as applicable, of the following: 28 • Special charges – Special charges consist of expenses and income associated with certain actions undertaken to reduce fixed costs, simplify or improve processes, and improve competitiveness and are of such significance in terms of both up-front costs and organizational/structural impact to require advance approval by our Management Committee.
These financial measures exclude the impact, as applicable, of the following: • Special charges – Special charges consist of expenses and income associated with certain actions undertaken by us to reduce fixed costs, simplify or improve processes, and improve our competitiveness and are of such significance in terms of both up-front costs and organizational/structural impact to require advance approval by our Management Committee.
As of November 30, 2024 and 2023, we had cross currency interest rate swap contracts of (i) $250 million notional value to receive $250 million at USD Secured Overnight Financing Rate (SOFR) plus 0.907% and pay £194.1 million at three-month GBP SONIA plus 0.859% and (ii) £194.1 million notional value to receive £194.1 million at three-month GBP SONIA plus 0.859% and pay €221.8 million at three-month Euro EURIBOR plus 0.808%.
As of November 30, 2025 and 2024, we had cross currency interest rate swap contracts of (i) $250 million notional value to receive $250 million at USD Secured Overnight Financing Rate (SOFR) plus 0.907% and pay £194.1 million at three-month GBP SONIA plus 0.859% and (ii) £194.1 million notional value to receive £194.1 million at three-month GBP SONIA plus 0.859% and pay €221.8 million at three-month Euro EURIBOR plus 0.808%.
As of November 30, 2024 and 2023, we also had cross currency interest rate swap contracts of (i) $250 million notional value to receive $250 million at USD SOFR plus 0.684% and pay £184.1 million at GBP SONIA plus 0.574% and (ii) £184.1 million notional value to receive £184.1 million at GBP SONIA plus 0.574% and pay €219.2 million at Euro ESTR plus 0.667%.
As of November 30, 2025 and 2024, we also had cross currency interest rate swap contracts of (i) $250 million notional value to receive $250 million at USD SOFR plus 0.684% and pay £184.1 million at GBP SONIA plus 0.574% and (ii) £184.1 million notional value to receive £184.1 million at GBP SONIA plus 0.574% and pay €219.2 million at Euro ESTR plus 0.667%.
We do not expect that this covenant would limit our access to either revolving credit facilities for the foreseeable future. The terms of those revolving credit facilities are more fully described in Note 5 of the notes to the consolidated financial statements. We generally use our revolving credit facilities to support our issuance of commercial paper.
We do not expect that this covenant would limit our access to our revolving credit facilities for the foreseeable future. The terms of those revolving credit facilities are more fully described in Note 5 of the notes to the consolidated financial statements. 34 We generally use our revolving credit facilities to support our issuance of commercial paper.
In 2023, the increase was primarily driven by an improvement in cash provided by working capital, which was driven by the lower inventory levels and the lower amount of employee incentive payments associated with the prior years, as well as an increase in dividends received from unconsolidated affiliates.
In 2023, the increase was primarily driven by an improvement in cash provided by working capital, which was driven by the lower inventory levels and the lower amount of employee incentive payments associated with the prior year, as well as an increase in dividends received from unconsolidated affiliates.
These figures are then compared to the 2025 local currency projected results, which are translated into U.S. dollars at the average actual exchange rates in effect during the corresponding months of fiscal year 2024.
These figures are then compared to the 2026 local currency projected results, which are translated into U.S. dollars at the average actual exchange rates in effect during the corresponding months of fiscal year 2025.
The table that follows provides principal cash flows and related interest rates, excluding the effect of interest rate swaps and the amortization of any discounts or fees, by fiscal year of maturity at November 30, 2024. For foreign currency-denominated debt, the 39 information is presented in U.S. dollar equivalents.
The table that follows provides principal cash flows and related interest rates, excluding the effect of interest rate swaps and the amortization of any discounts or fees, by fiscal year of maturity at November 30, 2025. For foreign currency-denominated debt, the information is presented in U.S. dollar equivalents.
Our short-term borrowings, principally consisting of commercial paper, have short-term maturities. See Note 5 of notes to our consolidated financial statements for additional information. 36 Our other cash requirements at November 30, 2024, include raw material purchases, lease payments, income taxes, and pension and postretirement benefits.
Our short-term borrowings, principally consisting of commercial paper, have short-term maturities. See Note 5 of notes to our consolidated financial statements for additional information. Our other cash requirements at November 30, 2025, include raw material purchases, lease payments, income taxes, and pension and postretirement benefits.
We believe that our sources of liquidity, which include existing cash balances, cash flows from operations, existing credit facilities, our commercial paper program, and access to capital markets, will provide sufficient liquidity to meet our debt obligations, including any repayment or refinancing of debt, working capital needs, planned capital expenditures, and payment of anticipated quarterly dividends for at least the next twelve months.
We believe that our sources of liquidity, which include existing cash balances, cash flows from operations, existing credit facilities, our commercial paper program, and access to capital markets, will provide sufficient liquidity to meet our debt obligations, including any repayment or refinancing of debt, working capital needs, planned capital expenditures, the payment associated with an acquisition and payment of anticipated quarterly dividends for at least the next twelve months.
As of November 30, 2024 and 2023, the amounts due to suppliers participating in the SCF and included in trade accounts payable were approximately $417.4 million and $300.5 million, respectively. The terms of our payment obligations are not impacted by a supplier's participation in the SCF.
As of November 30, 2025, 2024, and 2023 the amounts due to suppliers participating in the SCF and included in trade accounts payable were approximately $332.1 million, $417.4 million, and $300.5 million, respectively. The terms of our payment obligations are not impacted by a supplier's participation in the SCF.
Specifically, net discrete tax benefits amounted to $31.7 million in 2024, an increase of $22.1 million from $9.6 million in 2023. 25 The $31.7 million of net discrete tax benefits for 2024 principally included (i) $19.4 million of tax benefits associated with the recognition of a deferred tax asset related to an international legal entity reorganization, (ii) $12.3 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with both the effective settlement from the conclusion of a tax examination and the expiration of statutes of limitations, (iii) $6.0 million of tax benefits resulting from state tax matters, and related deferred taxes, (iv) $1.8 million of tax benefit from an adjustment to a prior year tax accrual and related deferred taxes based on final returns filed, (v) $6.2 million of tax expense associated with the adjustment of valuation allowances due to changes in judgment about the realizability of deferred tax assets, and (vi) $1.8 million of tax expense related to certain unremitted prior year earnings.
The $31.7 million of net discrete tax benefits for 2024 principally included (i) $19.4 million of tax benefits associated with the recognition of a deferred tax asset related to an international legal entity reorganization, (ii) $12.3 million of tax benefit from the reversal of certain reserves for unrecognized tax benefits and related interest associated with both the effective settlement from the conclusion of a tax examination and the expiration of statutes of limitations, (iii) $6.0 million of tax benefits resulting from state tax matters, and related deferred taxes, (iv) $1.8 million of tax benefit from an adjustment to a prior year tax accrual and related deferred taxes based on final returns filed, (v) $6.2 million of tax expense associated with the adjustment of valuation allowances due to changes in judgment about the realizability of deferred tax assets, and (vi) $1.8 million of tax expense related to certain unremitted prior year earnings.
Assets associated with our nonqualified defined benefit pension plan are primarily invested in corporate-owned life insurance, the value of which approximates an investment mix of 50% in equities and 50% in fixed income investments. See Note 10 of notes to our consolidated financial statements, which provides details on our pension funding.
Assets associated 35 with our nonqualified defined benefit pension plan are primarily invested in corporate-owned life insurance, the value of which approximates an investment mix of 40% in equities and 60% in fixed income investments. See Note 10 of notes to our consolidated financial statements, which provides details on our pension funding.
These contracts expire in April 2030. Interest Rate Risk – Our policy is to manage interest rate risk by entering into both fixed and variable rate debt arrangements. We are exposed to interest rate volatility, with primary exposures related to movements in U.S. Treasury rates, Secured Overnight Financing Rate (SOFR), and commercial paper rates.
These contracts expire in April 2030. 37 Interest Rate Risk – Our policy is to manage interest rate risk by entering i nto both fixed and variable rate debt arrangements. We are exposed to interest rate volatility, with primary exposures related to movements in U.S. Treasury rates, Secured Overnight Financing Rate (SOFR), and commercial paper rates.
We are committed to maintaining investment grade credit ratings. Our cash flows from operations enable us to fund operating projects and investments that are designed to meet our growth objectives, service our debt, fund or increase our quarterly dividends, fund capital projects and other investments, and make share repurchases, when appropriate.
We are committed to maintaining investment grade credit ratings. Our cash flow from operations enables us to fund operating projects and investments that are designed to meet our growth objectives, service our debt, fund or increase our quarterly dividends, fund capital projects and other investments, and make share repurchases, when appropriate.
In 2024, we continued to have a balanced use of cash for debt repayment, capital expenditures, and the return of cash to shareholders through dividends and share repurchases. We are using our cash to fund shareholder dividends, with annual increases in each of the past 39 years, and to fund capital expenditures and acquisitions.
In 2025, we continued to have a balanced use of cash for debt repayment, capital expenditures, and the return of cash to shareholders through dividends and share repurchases. We are using our cash to fund shareholder dividends, with annual increases in each of the past 40 years, and to fund capital expenditures and acquisitions.
Similarly, a 1% increase or decrease in the expected return on plan assets would affect the 2025 pension expense by approximately $9.5 million. We will continue to evaluate the appropriateness of the assumptions used in the measurement of our pension benefit obligations.
Similarly, a 1% increase or decrease in the expected return on plan assets would affect the 2026 pension expense by approximately $9.4 million. We will continue to evaluate the appropriateness of the assumptions used in the measurement of our pension benefit obligations.
We also use interest rate swaps to minimize financing costs and to achieve a desired mix of fixed and variable rate debt. As of November 30, 2024 and 2023, we had interest rate swap contracts of $600 million notional value outstanding to receive fixed rate interest and pay variable rate interest.
We also use interest rate swaps to minimize financing costs and to achieve a desired mix of fixed and variable rate debt. As of November 30, 2025 and 2024, we had interest rate swap contracts of $500 million and $600 million notional value outstanding, respectively, to receive fixed rate interest and pay variable rate interest.
We use a combination of equity and short- and long-term debt. We use short-term debt, primarily in the form of commercial paper, principally to finance ongoing operations. This includes our requirements for working capital, which encompasses accounts receivable, prepaid expenses, other current assets, and inventories, less accounts payable, accrued payroll, and other accrued liabilities.
We use a combination of equity and short- and long-term debt. We use short-term debt, primarily in the form of commercial paper, principally to finance ongoing operations, including our requirements for working capital (accounts receivable, prepaid expenses and other current assets, and inventories, less accounts payable, accrued payroll, and other accrued liabilities).
Changes in these estimates can have a significant impact on the assessment of fair value which could result in material impairment losses. As of November 30, 2024, we had $3,043.9 million of brand name assets and trademarks recognized in our consolidated balance sheet, and none of the balances exceeded their estimated fair values at that date.
Changes in these estimates can have a significant impact on the assessment of fair value which could result in material impairment losses. As of November 30, 2025, we had $3,048.8 million of brand name assets and trademarks recognized in our consolidated balance sheet, and none of the balances exceeded their estimated fair values at that date.
In 2024, our most significant raw materials were dairy products, pepper, onion, garlic, capsicums (red peppers and paprika), tomato products, sugar and salts. While future movements of raw material costs are uncertain, we respond to this volatility in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, and customer price adjustments.
In 2025, our most significant raw materials were dairy products, pepper, garlic, onion, capsicums (red peppers and paprika), salt, tomato products, sugar, and soybean oil. While future movements of raw material costs are uncertain, we respond to this volatility in a number of ways, including strategic raw material purchases, purchases of raw material for future delivery, and customer price adjustments.
The pricing of that credit facility is based on a credit rating grid that contains a fully drawn maximum pricing of the credit facility equal to Term SOFR plus 1.60%. The provisions of each revolving credit facility restrict subsidiary indebtedness and require us to maintain a minimum interest coverage ratio.
The pricing of the credit facility is based on a credit rating grid that contains a fully drawn maximum pricing of the credit facility equal to Term SOFR plus 1.50%. The provisions of our revolving credit facilities restrict subsidiary indebtedness and require us to maintain a minimum interest coverage ratio.
For the year ended November 30, 2024 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Impact of Acquisitions & Divestitures Percentage change on organic basis Net sales: Consumer segment: Americas 0.6 % (0.1) % 0.7 % — % 0.7 % EMEA 7.3 % 3.0 % 4.3 % — % 4.3 % APAC (5.1) % (1.0) % (4.1) % — % (4.1) % Total Consumer 1.1 % 0.3 % 0.8 % — % 0.8 % Flavor Solutions segment: Americas 1.4 % (0.1) % 1.5 % — % 1.5 % EMEA (3.5) % 2.4 % (5.9) % (2.3) % (3.6) % APAC 4.1 % (1.0) % 5.1 % — % 5.1 % Total Flavor Solutions 0.7 % 0.3 % 0.4 % (0.5) % 0.9 % Total net sales 0.9 % 0.3 % 0.6 % (0.2) % 0.8 % 31 For the year ended November 30, 2024 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Adjusted operating income: Consumer segment 0.7 % — % 0.7 % Flavor Solutions segment 14.1 % (0.4) % 14.5 % Total adjusted operating income 4.5 % (0.1) % 4.6 % For the year ended November 30, 2023 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Impact of Acquisitions & Divestitures Percentage change on organic basis Net sales: Consumer segment: Americas 0.4 % (0.4) % 0.8 % (0.7) % 1.5 % EMEA 7.1 % 0.9 % 6.2 % — % 6.2 % APAC (1.1) % (6.2) % 5.1 % — % 5.1 % Total Consumer 1.3 % (0.8) % 2.1 % (0.5) % 2.6 % Flavor Solutions segment: Americas 10.7 % 1.1 % 9.6 % — % 9.6 % EMEA 10.3 % (1.9) % 12.2 % (0.7) % 12.9 % APAC 5.6 % (5.4) % 11.0 % — % 11.0 % Total Flavor Solutions 10.1 % (0.2) % 10.3 % (0.1) % 10.4 % Total net sales 4.9 % (0.6) % 5.5 % (0.4) % 5.9 % For the year ended November 30, 2023 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Adjusted operating income: Consumer segment 3.5 % (0.9) % 4.4 % Flavor Solutions segment 39.7 % 1.2 % 38.5 % Total adjusted operating income 11.6 % (0.4) % 12.0 % To present the percentage change in projected 2025 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. dollar are translated into U.S. dollars at forecasted exchange rates.
Rates of constant currency and organic growth (decline) follow: For the year ended November 30, 2025 Percentage change as reported Impact of foreign currency exchange Percentage change on both a constant currency and organic basis Net sales: Consumer segment: Americas 2.0 % (0.3) % 2.3 % EMEA 6.0 % 2.5 % 3.5 % APAC 1.0 % (0.9) % 1.9 % Total Consumer 2.6 % 0.2 % 2.4 % Flavor Solutions segment: Americas 0.5 % (1.4) % 1.9 % EMEA (2.2) % 2.1 % (4.3) % APAC 6.2 % (0.5) % 6.7 % Total Flavor Solutions 0.5 % (0.6) % 1.1 % Total net sales 1.7 % (0.2) % 1.9 % For the year ended November 30, 2025 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Adjusted operating income: Consumer segment (0.7) % (0.1) % (0.6) % Flavor Solutions segment 9.0 % (1.7) % 10.7 % Total adjusted operating income 2.3 % (0.5) % 2.8 % 30 For the year ended November 30, 2024 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Impact of Acquisitions & Divestitures Percentage change on organic basis Net sales: Consumer segment: Americas 0.6 % (0.1) % 0.7 % — % 0.7 % EMEA 7.3 % 3.0 % 4.3 % — % 4.3 % APAC (5.1) % (1.0) % (4.1) % — % (4.1) % Total Consumer 1.1 % 0.3 % 0.8 % — % 0.8 % Flavor Solutions segment: Americas 1.4 % (0.1) % 1.5 % — % 1.5 % EMEA (3.5) % 2.4 % (5.9) % (2.3) % (3.6) % APAC 4.1 % (1.0) % 5.1 % — % 5.1 % Total Flavor Solutions 0.7 % 0.3 % 0.4 % (0.5) % 0.9 % Total net sales 0.9 % 0.3 % 0.6 % (0.2) % 0.8 % For the year ended November 30, 2024 Percentage change as reported Impact of foreign currency exchange Percentage change on constant currency basis Adjusted operating income: Consumer segment 0.7 % — % 0.7 % Flavor Solutions segment 14.1 % (0.4) % 14.5 % Total adjusted operating income 4.5 % (0.1) % 4.6 % 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. dollar are translated into U.S. dollars at forecasted exchange rates.
In addition to our committed revolving credit facilities, we have uncommitted facilities of $326.8 million as of November 30, 2024 that can be withdrawn based upon the lenders' discretion. See Note 5 of notes to our consolidated financial statements for more details on our financing arrangements.
In addition to our committed revolving credit facilities, we have uncommitted facilities of $346.9 million as of November 30, 2025 that can be withdrawn based upon the lenders' discretion. See Note 5 of notes to our consolidated financial statements for more details on our financing arrangements.
During 2024, we recorded $9.5 million of special charges, consisting principally of $4.5 million associated with the GOE program and $5.0 million associated with the transition of a manufacturing facility in EMEA.
During 2024, we recorded $9.5 million of special charges, consisting principally of $4.5 million associated with the Global Operating Effectiveness program and $5.0 million associated with the transition of a manufacturing facility in EMEA.
Net interest payments are based on USD SOFR plus 0.684% with an effective variable rate of 5.22% as of November 30, 2024. • We issued $500 million of 4.95% notes due April 15, 2033.
Net interest payments are based on USD SOFR plus 0.684% with an effective variable rate of 4.53% as of November 30, 2025. • We issued $500 million of 4.95% notes due April 15, 2033.
The timing and amount of any shares repurchased is determined by our management based on its evaluation of market conditions and other factors. During 2024, 2023, and 2022, we received proceeds from exercised stock options of $17.5 million, $16.6 million, and $41.4 million, respectively.
The timing and amount of any shares repurchased is determined by our management based on its evaluation of market conditions and other factors. During 2025, 2024, and 2023, we received proceeds from exercised stock options of $20.9 million, $17.5 million, and $16.6 million, respectively.
Cash contributions to pension plans, including unfunded plans, were $10.0 million in 2024, $9.2 million in 2023, and $11.4 million in 2022. It is expected that the 2025 total pension plan contributions will be approximately $10 million.
Cash contributions to pension plans, including unfunded plans, were $9.2 million in 2025, $10.0 million in 2024, and $9.2 million in 2023. It is expected that the 2026 total pension plan contributions will be approximately $13.0 million.
Across all of our qualified defined benefit pension plans, approximately 18% of assets are invested in equities, 75% in fixed income investments and 7% in other investments.
Across all of our qualified defined benefit pension plans, approximately 16% of assets are invested in equities, 77% in fixed income investments and 7% in other investments.
Net interest payments are based on USD SOFR plus 0.907% with an effective variable rate of 5.73% as of November 30, 2024. • We issued $500 million of 2.50% notes due April 15, 2030.
Net interest payments are based on USD SOFR plus 0.907% with an effective variable rate of 4.98% as of November 30, 2025. • We issued $500 million of 2.50% notes due April 15, 2030.
Our dividend history over the past three years is as follows: 2024 2023 2022 Total dividends paid $ 451.0 $ 418.5 $ 396.7 Dividends paid per share 1.68 1.56 1.48 Percentage increase per share 7.7 % 5.4 % 8.8 % In November 2024, the Board of Directors approved a 7.1% increase in the quarterly dividend from $0.42 to $0.45 per share.
Our dividend history over the past three years is as follows: 2025 2024 2023 Total dividends paid $ 483.0 $ 451.0 $ 418.5 Dividends paid per share 1.80 1.68 1.56 Percentage increase per share 7.1 % 7.7 % 5.4 % In November 2025, the Board of Directors approved a 6.7% increase in the quarterly dividend from $0.45 to $0.48 per share.
In addition, in the cash flow statement, the changes in operating assets and liabilities are presented excluding the effect of disposed operating assets and liabilities, as the cash flow associated with dispositions of businesses is presented as an investing activity.
In addition, in the cash flow statement, the changes in operating assets and liabilities are presented excluding the effect of acquired or disposed operating assets and liabilities, as the cash flow associated with acquisition or disposition of businesses is presented as an investing activity.
Of the $3,043.9 million in brand name assets and trademarks as of November 30, 2024: (i) $2,320.0 million relates to the French’s, Frank’s RedHot, and Cattlemen’s brand names and trademarks which we group for purposes of our impairment analysis; (ii) $380.0 million relates to the Cholula brand names and trademarks associated with the acquisition of Cholula in November 2020; and (iii) the remaining $343.9 million represents various other brand name assets and trademarks with individual carrying values ranging from $106.4 million to $0.2 million.
Of the $3,048.8 million in brand name assets and trademarks as of November 30, 2025: (i) $2,320.0 million relates to the 39 French’s, Frank’s RedHot, and Cattlemen’s brand names and trademarks which we group for purposes of our impairment analysis; (ii) $380.0 million relates to the Cholula brand names and trademarks associated with the acquisition of Cholula in November 2020; and (iii) $348.8 million represents various other brand name assets and trademarks with individual carrying values ranging from $0.2 million to $106.4 million.
All outstanding amounts related to suppliers participating in the SCF are recorded within the line item 'Trade accounts payable' in our condensed consolidated balance sheets, and the associated payments are included in operating activities in our consolidated statements of cash flows.
All outstanding amounts related to suppliers participating in the SCF are recorded within the line item 'Trade accounts payable' in our consolidated balance sheets, and the associated payments are included in operating activities in our consolidated cash flow statement.
RESULTS OF OPERATIONS—2024 COMPARED TO 2023 2024 2023 Net sales $ 6,723.7 $ 6,662.2 Percent growth 0.9 % 4.9 % Components of percent growth in net sales – increase (decrease): Volume and product mix 0.3 % (2.6) % Pricing actions 0.5 % 8.5 % Divestiture (0.2) % (0.4) % Foreign exchange 0.3 % (0.6) % Sales for 2024 increased by 0.9% from 2023 and by 0.8% on an organic basis (that is, excluding the impact of divestitures and foreign currency exchange as more fully described under the caption, Non-GAAP Financial Measures).
RESULTS OF OPERATIONS—2025 COMPARED TO 2024 2025 2024 Net sales $ 6,840.3 $ 6,723.7 Percent growth 1.7 % 0.9 % Components of percent change in net sales: Volume and product mix 1.2 % 0.3 % Pricing actions 0.7 % 0.5 % Divestiture — % (0.2) % Foreign exchange (0.2) % 0.3 % Sales for 2025 increased by 1.7% from 2024 and by 1.9% on an organic basis (that is, excluding the impact of foreign currency exchange as more fully described under the caption, Non-GAAP Financial Measures).
See Note 15 of notes to our consolidated financial statements for additional information on our segment measures as well as for a reconciliation by segment of operating income, excluding special charges and transaction and integration expenses related to our acquisitions.
See Note 15 of notes to our consolidated financial statements for additional information on our segment measures as well as for a reconciliation by segment of operating income, excluding special charges.
We repurchased $9.0 million, $10.8 million, and $19.4 million of common stock during 2024, 2023, and 2022, respectively, in conjunction with employee tax withholding requirements associated with our stock compensation plans.
We repurchased $13.2 million, $9.0 million, and $10.8 million of common stock during 2025, 2024, and 2023, respectively, in conjunction with employee tax withholding requirements associated with our stock compensation plans.
Our standby letters of credit, leases, and pension and other post-retirement obligations are more fully described in Notes 5, 6 and 10, respectively, of notes to our consolidated financial statements. These obligations impact our liquidity and capital resource needs.
Our standby letters of credit, leases, and pension and other post-retirement obligations are more fully described in Notes 5, 6, and 10, respectively, of notes to our consolidated financial statements.
In the following discussion, we refer to our previously described measure of segment profit as "Segment operating income." 26 Consumer Segment 2024 2023 Net sales $ 3,848.5 $ 3,807.3 Percent - increase 1.1 % 1.3 % Components of percent change in net sales - increase (decrease): Pricing actions — % 6.5 % Volume and product mix 0.8 % (3.9) % Divestiture — % (0.5) % Foreign exchange 0.3 % (0.8) % Segment operating income $ 740.3 $ 735.5 Segment operating income margin 19.2 % 19.3 % Sales of our consumer segment in 2024 increased by 1.1% as compared to 2023 and increased by 0.8% on an organic basis.
In the following discussion, we refer to our previously described measure of segment profit as "Segment operating income." Consumer Segment 2025 2024 Net sales $ 3,950.3 $ 3,848.5 Percent growth 2.6 % 1.1 % Components of percent change in net sales: Pricing actions 0.3 % — % Volume and product mix 2.1 % 0.8 % Foreign exchange 0.2 % 0.3 % Segment operating income $ 734.9 $ 740.3 Segment operating income margin 18.6 % 19.2 % In 2025, sales of our Consumer segment increased by 2.6% as compared to 2024 and increased by 2.4% on an organic basis.
Special charges lowered earnings per share by $0.03 and $0.18 in 2024 and 2023, respectively. Excluding the effects of special charges, adjusted diluted earnings per share was $2.95 in 2024, compared to $2.70 in 2023, representing an increase of 9.3%. Net cash provided by operating activities was $921.9 million, $1,237.3 million, and $651.5 million in 2024, 2023, and 2022, respectively.
Special charges lowered earnings per share by $0.07 and $0.03 in 2025 and 2024, respectively. Excluding the effects of special charges, adjusted diluted earnings per share was $3.00 in 2025, compared to $2.95 in 2024, representing an increase of 1.7%. Net cash provided by operating activities was $962.2 million, $921.9 million, and $1,237.3 million in 2025, 2024, and 2023, respectively.
From time to time, those changes are of such significance in terms of both up-front costs and organizational/ structural impact that we obtain advance approval from our Management Committee and classify expenses related to those changes as special charges in our financial statements.
From time to time, those changes are of such significance in terms of both up-front costs and organizational/structural impact that we obtain advance approval from our Management Committee and classify expenses related to those changes as special charges in our financial statements. During 2025, we recorded $21.1 million of special charges, including transaction and integration expenses.
As of November 30, 2024, we had $5,227.5 million of goodwill recorded in our balance sheet ($3,583.1 million in the consumer segment and $1,644.4 million in the flavor solutions segment). Our fiscal year 2024 impairment testing indicated that the estimated fair values of our reporting units were significantly in excess of their carrying values.
As of November 30, 2025, we had $5,301.3 million of goodwill recorded in our balance sheet ($3,645.6 million in the Consumer segment and $1,655.7 million in the Flavor Solutions segment). Our fiscal year 2025 impairment testing indicated that the estimated fair values of our reporting units were significantly in excess of their carrying values.
Our primary obligations include principal and interest payments on our outstanding short-term borrowings and long-term debt. In the next year, our most significant debt service obligation is the maturity of our $250.0 million, 3.25% notes due in November 2025.
Our primary obligations include principal and interest payments on our outstanding short-term borrowings and long-term debt. In the next year, our most significant debt service obligation is the maturity of our $500.0 million, 0.90% notes due in February 2026.
The pricing of that credit facility is based on a credit rating grid that contains a fully drawn maximum pricing of the credit facility equal to Term SOFR plus 1.75%. The current pricing for the 364-day credit facility, on a fully drawn basis, is Term SOFR plus 1.23%.
The current pricing for the five-year credit facility, on a fully drawn basis, is Term SOFR plus 1.125%. The pricing of that credit facility is based on a credit rating grid that contains a fully drawn maximum pricing of the credit facility equal to Term SOFR plus 1.50%.
On a constant currency basis, segment operating income for our consumer segment increased by 0.7% in 2024, as compared to 2023. 27 Flavor Solutions Segment 2024 2023 Net sales $ 2,875.2 $ 2,854.9 Percent growth 0.7 % 10.1 % Components of percent growth in net sales – increase (decrease): Pricing actions 1.2 % 11.4 % Volume and product mix (0.3) % (1.0) % Divestiture (0.5) % (0.1) % Foreign exchange 0.3 % (0.2) % Segment operating income $ 329.5 $ 288.7 Segment operating income margin 11.5 % 10.1 % Sales of our flavor solutions segment increased 0.7% in 2024 as compared to 2023 and increased by 0.9% on an organic basis.
On a constant currency basis, segment operating income decreased by 0.6%. 27 Flavor Solutions Segment 2025 2024 Net sales $ 2,890.0 $ 2,875.2 Percent growth 0.5 % 0.7 % Components of percent change in net sales: Pricing actions 1.3 % 1.2 % Volume and product mix (0.2) % (0.3) % Divestiture — % (0.5) % Foreign exchange (0.6) % 0.3 % Segment operating income $ 359.1 $ 329.5 Segment operating income margin 12.4 % 11.5 % Sales of our Flavor Solutions segment increased 0.5% in 2025 as compared to 2024 and increased by 1.1% on an organic basis.
All contracts are valued in U.S. dollars using year-end 2024 exchange rates and have been designated as hedges of foreign currency transactional exposures, firm commitments, or anticipated transactions.
The following table summarizes the foreign currency exchange contracts held at November 30, 2025. All contracts are valued in U.S. dollars using year-end 2025 exchange rates and have been designated as hedges of foreign currency transactional exposures, firm commitments, or anticipated transactions.
The change in trade accounts receivable was a moderate use of cash in 2024 and 2022 and a source of cash in 2023. The change in accounts payable was a significant source of cash in 2024 and 2022 and a use of cash in 2023.
The change in inventory was a moderate source of cash from operations in 2025, a significant use of cash in 2024, and a significant source of cash from operations in 2023. The change in trade accounts receivable was a moderate use of cash in 2025 and 2024, and a source of cash in 2023.
The unfavorable impact of foreign currency rates decreased sales by 0.1% in the year and is excluded from our measure of sales growth of 0.7% on an organic basis. In the EMEA region, consumer sales increased 7.3% in 2024 as compared to 2023 and increased by 4.3% on an organic basis.
The unfavorable impact of foreign currency rates decreased sales by 0.3% and is excluded from our measure of sales growth of 2.3% on an organic basis. In the EMEA region, Consumer segment sales increased 6.0% in 2025 as compared to 2024 and increased by 3.5% on an organic basis. Favorable pricing impacted sales by 2.1%.
Separately, the fixed interest rate on $100 million of the 3.25% notes due in December 2025 was effectively converted to a variable rate by interest rate swaps through the notes maturity in 2025.
Separately, the fixed interest rate on $250 million of the 3.40% notes due in August 2027 was effectively converted to a variable rate by interest rate swaps through the notes maturity in 2027.
Interest rate swaps have the following effects: • We issued $250 million of 3.25% notes due in 2025 in November 2015. Forward treasury lock agreements settled upon issuance of these notes effectively set the interest rate on these notes at a weighted-average fixed rate of 3.45%.
Interest rate swaps have the following effects: • We issued $750 million of 3.40% notes due in 2027 in August 2017. Forward treasury lock agreements settled upon issuance of these notes effectively set the interest rate on these $750 million notes at a weighted-average fixed rate of 3.44%.
In 2024, the return of cash to our shareholders through dividends and share repurchases was $504.1 million.
In 2025, the return of cash to our shareholders through dividends and share repurchases was $517.8 million.
The aggregate fair value of these contracts was $0.1 million at November 30, 2024. At November 30, 2023, we had foreign currency exchange contracts with an aggregate notional value of $1,000.4 million to purchase or sell other currencies. The aggregate fair value of these contracts was a loss of $13.5 million at November 30, 2023.
The aggregate fair value of these contracts was $(0.1) million at November 30, 2025. At November 30, 2024, we had foreign currency exchange contracts with an aggregate notional value of $1,034.2 million to purchase or sell other currencies. The aggregate fair value of these contracts was $(7.3) million at November 30, 2024.
Foreign Exchange Risk – We are exposed to fluctuations in foreign currency in the following main areas: cash flows related to raw material purchases; the translation of foreign currency earnings to U.S. dollars; the effects of foreign currency on loans between subsidiaries and unconsolidated affiliates; and cash flows related to repatriation of earnings from unconsolidated affiliates.
The information presented below should be read in conjunction with Notes 5 and 7 of notes to our consolidated financial statements. 36 Foreign Exchange Risk – We are exposed to fluctuations in foreign currency in the following main areas: cash flows related to raw material purchases; the translation of foreign currency earnings to U.S. dollars; the effects of foreign currency on loans between subsidiaries and unconsolidated affiliates; and cash flows related to repatriation of earnings from unconsolidated affiliates.
Unfavorable volume and product mix decreased flavor solutions sales in the Americas by 0.1% during 2024, as compared to the prior year. An unfavorable impact from foreign currency rates decreased sales by 0.1% compared to 2023 and is excluded from our measure of sales growth of 1.5% on an organic basis.
Unfavorable volume and product mix decreased sales by 0.7%. The unfavorable impact of foreign currency rates decreased sales by 1.4% and is excluded from our measure of sales growth of 1.9% on an organic basis. In the EMEA region, Flavor Solutions segment sales in 2025 decreased by 2.2% as compared to 2024 and decreased by 4.3% on an organic basis.
Most of our cash is in our subsidiaries outside of the U.S. We manage our worldwide cash requirements by considering available funds among the many subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed.
Most of our cash is in our subsidiaries outside of the U.S. We manage our worldwide cash requirements by considering available funds among our subsidiaries through which we conduct our business and the cost effectiveness with which those funds can be accessed. Those balances are generally available without legal restrictions to fund ordinary business operations, capital projects, and future acquisitions.
Conversely, as of November 30, 2024, the exchange rates for the Euro, Canadian dollar, Mexican peso, Chinese renminbi, Polish zloty, and Australian dollar were lower against the U.S. dollar compared to November 30, 2023. 33 Operating Cash Flow – Operating cash flow was $921.9 million in 2024, $1,237.3 million in 2023, and $651.5 million in 2022.
As of November 30, 2025, the exchange rates for the Euro, British pound sterling, Canadian dollar, Mexican peso, Chinese renminbi, Polish zloty, and Australian dollar were higher against the U.S. dollar than on November 30, 2024. Operating Cash Flow – Operating cash flow was $962.2 million in 2025, $921.9 million in 2024, and $1,237.3 million in 2023.
CUSTOMERS AND COUNTERPARTIES – See the subsequent section of this discussion under the heading "Market Risk Sensitivity–Credit Risk." PERFORMANCE GRAPH — SHAREHOLDER RETURN The following line graph compares the yearly change in McCormick’s cumulative total shareholder return (stock price appreciation plus reinvestment of dividends) on McCormick’s Non-Voting Common Stock with (1) the cumulative total return of the Standard & Poor’s 500 Stock Price Index, assuming reinvestment of dividends, and (2) the cumulative total return of the Standard & Poor’s Packaged Foods & Meats Index, assuming reinvestment of dividends. 37 MARKET RISK SENSITIVITY We utilize derivative financial instruments to enhance our ability to manage risk, including foreign exchange and interest rate exposures, which exist as part of our ongoing business operations.
CUSTOMERS AND COUNTERPARTIES – See the subsequent section of this discussion under the heading "Market Risk Sensitivity–Credit Risk." PERFORMANCE GRAPH — SHAREHOLDER RETURN The following line graph compares the yearly change in McCormick’s cumulative total shareholder return (stock price appreciation plus reinvestment of dividends) on McCormick’s Non-Voting Common Stock with (1) the cumulative total return of the Standard & Poor’s 500 Stock Price Index, assuming reinvestment of dividends, and (2) the cumulative total return of the Standard & Poor’s Packaged Foods & Meats Index, assuming reinvestment of dividends.
The following table outlines the activity in our share repurchase program: 2024 2023 2022 Number of shares of common stock 0.7 0.5 0.4 Dollar amount $ 53.1 $ 35.7 $ 38.8 As of November 30, 2024, $448 million remained of a $600 million share repurchase program that was authorized by our Board of Directors in November 2019.
We also issued $500.0 million of 4.95% notes due 2033, with net cash proceeds received of $496.4 million. 33 The following table outlines the activity in our share repurchase program: 2025 2024 2023 Number of shares of common stock 0.5 0.7 0.5 Dollar amount $ 34.8 $ 53.1 $ 35.7 As of November 30, 2025, $414 million remained of a $600 million share repurchase program that was authorized by our Board of Directors in November 2019.
During 2024, the foreign currency translation component in other comprehensive income was principally related to the impact of exchange rate fluctuations on our net investments in our subsidiaries with a functional currency of the Mexican peso, Euro, Australian dollar, and Chinese renminbi. 38 We also utilize cross currency interest rate swap contracts, which are designated as net investment hedges, to manage the impact of exchange rate fluctuations on our net investments in subsidiaries with a functional currency of the British pound sterling and Euro.
We also utilize cross currency interest rate swap contracts, which are designated as net investment hedges, to manage the impact of exchange rate fluctuations on our net investments in subsidiaries with a functional currency of the British pound sterling and Euro. Gains and losses on these instruments are included in foreign currency translation adjustments in accumulated other comprehensive income (loss).
We believe our reserve for uncertain tax positions, including related interest and penalties, is adequate. As of November 30, 2024, the Company had $20.6 million of unrecognized tax benefits, including interest and penalties, recorded in Other long-term liabilities.
Any change in judgment regarding the expected resolution of uncertain tax positions is recognized in earnings in the quarter of such change. We believe our reserve for uncertain tax positions, including related interest and penalties, is adequate. As of November 30, 2025, the Company had $14.4 million of unrecognized tax benefits, including interest and penalties, recorded in Other long-term liabilities.
The following table outlines our net borrowing activities: 2024 2023 2022 Net increase (decrease) in short-term borrowings $ 211.1 $ (964.6) $ 698.3 Proceeds from issuance of long-term debt, net of debt issuance costs 494.5 495.3 — Repayments of long-term debt (801.1) (268.1) (772.0) Net cash (used in) net borrowing activities $ (95.5) $ (737.4) $ (73.7) In 2024, we repaid $801.1 million of long-term debt, including the $700.0 million, 3.15% notes that matured in August 2024 as well as $55.0 million, 7.63% to 8.12% notes that matured in August and October 2024.
The following table outlines our net borrowing activities: 2025 2024 2023 Net (decrease) increase in short-term borrowings $ (101.4) $ 211.1 (964.6) Proceeds from issuance of long-term debt, net of debt issuance costs 2.7 494.5 495.3 Repayments of long-term debt (267.9) (801.1) (268.1) Net cash (used in) net borrowing activities $ (366.6) $ (95.5) $ (737.4) In 2025, we repaid $267.9 million of long-term debt, including the $250.0 million, 3.25% notes that matured in November 2025.
We estimate that our 2025 effective tax rate, including the net favorable impact of anticipated discrete tax items, although at a lower amount than in 2024, will be 22.0% as compared to 20.5% in 2024.
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.
YEARS OF MATURITY AT NOVEMBER 30, 2024 2025 2026 2027 2028 Thereafter Total Fair value Debt Fixed rate $ 299.1 $ 509.3 $ 759.7 $ 10.3 $ 2,375.3 $ 3,953.7 $ 3,711.0 Average interest rate 3.29 % 0.95 % 3.40 % 3.46 % 3.57 % Variable rate $ 449.2 $ — $ — $ — $ — $ 449.2 $ 449.2 Average interest rate 4.71 % — % — — — The table above displays the debt, including finance leases, by the terms of the original debt instrument without consideration of fair value, interest rate swaps, and any loan discounts or origination fees.
YEARS OF MATURITY AT November 30, 2025 2026 2027 2028 2029 Thereafter Total Fair value Debt Fixed rate $ 538.7 $ 759.8 $ 10.4 $ 20.7 $ 2,354.7 $ 3,684.3 $ 3,535.5 Average interest rate 1.09 % 3.40 % 3.45 % 1.82 % 3.59 % Variable rate $ 351.8 $ — $ — $ — $ — $ 351.8 $ 351.8 Average interest rate 4.06 % — — — — The table above displays the debt, including finance leases, by the terms of the original debt instrument without consideration of fair value, interest rate swaps, and any loan discounts or origination fees.
The unfavorable impact from foreign currency rates decreased sales by 1.0% compared to the year-ago period and is excluded from our measure of sales decline of 4.1% on an organic basis. Segment operating income for our consumer segment increased by $4.8 million, or 0.7%, in 2024 as compared to 2023.
The unfavorable impact from foreign currency rates decreased sales by 0.9% and is excluded from our measure of sales growth of 1.9% on an organic basis. Segment operating income for our Consumer segment decreased by $5.4 million, or 0.7%, in 2025 as compared to 2024, driven by a decrease in gross profit, partially offset by a decrease in SG&A expense.
CCC is a calculation of the number of days, on average, that it takes us to convert a cash outlay for resources, such as raw materials, to a cash inflow from collection of accounts receivable. Our goal is to lower our CCC over time.
This metric is different than operating cash flow in that it uses average balances instead of specific point in time measures. CCC is a calculation of the number of days, on average, that it takes us to convert a cash outlay for resources, such as raw materials, to a cash inflow from collection of accounts receivable.
This was partially offset by an increased use of cash associated with accounts payable which partially resulted from our lower level of inventory.
This was partially offset by an increased use of cash associated with accounts payable which partially resulted from our lower level of inventory. Our working capital management – principally related to inventory, trade accounts receivable, and accounts payable – impacts our operating cash flow.
The favorable impact of foreign currency exchange rates increased sales by 3.0% compared to 2023 and is excluded from our measure of sales growth of 4.3% on an organic basis. In the APAC region, consumer sales decreased 5.1% in 2024 as compared to 2023 and decreased by 4.1% on an organic basis.
The unfavorable impact of foreign currency rates decreased sales by 0.6% and is excluded from our measure of sales growth of 1.1% on an organic basis. In the Americas region, Flavor Solutions segment sales increased by 0.5% during 2025 as compared to 2024 and increased by 1.9% on an organic basis. Favorable pricing impacted sales by 2.6%.
Favorable volume and product mix increased sales by 4.2%, driven by higher sales to quick service restaurant customers in China. An unfavorable impact from foreign currency rates decreased sales by 1.0% compared to 2023 and is excluded from our measure of sales growth of 5.1% on an organic basis.
Favorable volume and product mix increased sales by 1.4% driven by growth in France and Poland. The favorable impact of foreign currency exchange rates increased sales by 2.5% and is excluded from our measure of sales growth of 3.5% on an organic basis.
Investing Cash Flow – Net cash used in investing activities was $269.0 million in 2024, $260.5 million in 2023, and $146.4 million in 2022. Our primary investing cash flows include cash used for capital expenditures as well as cash provided by the sale of businesses or other assets.
Investing Cash Flow – Net cash used in investing activities was $255.2 million in 2025, $269.0 million in 2024, and $260.5 million in 2023. Our primary investing cash flows include cash used for capital expenditures as well as cash used in the acquisition of a business.
SG&A as a percent of net sales for 2024 increased by 40 basis points from the prior year level, as the net impact of the previously mentioned factors was partially offset by the impact of the higher sales base. 2024 2023 Total special charges $ 9.5 $ 61.2 We regularly evaluate whether to implement changes to our organization structure to reduce fixed costs, simplify or improve processes, and improve our competitiveness, and we expect to continue to evaluate such actions in the future.
SG&A as a percent of net sales decreased by 70 basis points. 2025 2024 Special charges $ 21.1 $ 9.5 We regularly evaluate whether to implement changes to our organization structure to reduce fixed costs, simplify or improve processes, and improve our competitiveness, and we expect to continue to evaluate such actions in the future.
(3) Operating income margin, impact of transaction and integration expenses and special charges, and adjusted operating income margin are calculated as operating income, impact of transaction and integration expenses and special charges, and adjusted operating income as a percentage of net sales for each period presented.
(2) Operating income margin, impact of special charges, and adjusted operating income margin are calculated as operating income, impact of special charges, and adjusted operating income as a percentage of net sales for each period presented. (3) Income tax rate is calculated as income tax expense as a percentage of income from consolidated operations before income taxes.
We expect adjusted diluted earnings per share to increase by 3% to 5%, which includes a 2% unfavorable impact from currency rates, or to increase by 5% to 7% on a constant currency basis over adjusted diluted earnings per share of $2.95 in 2024.
Adjusted diluted earnings per share is projected to range from $3.05 to $3.13 in 2026. We expect adjusted diluted earnings 24 per share to increase by 2% to 5%, which includes a 1% favorable impact from currency rates, or to increase by 1% to 4% on a constant currency basis.
This comparison determines what the 2025 consolidated U.S. dollar net sales, adjusted operating income, and adjusted earnings per share (diluted) would have been if the relevant currency exchange rates had not changed from those of the comparable 2024 periods. 32 Projections for the Year Ending November 30, 2025 Percentage change in net sales 0% to 2% Impact of unfavorable foreign currency exchange 1 % Percentage change in organic net sales 1% to 3% Percentage change in adjusted operating income 3% to 5% Impact of unfavorable foreign currency exchange 1 % Percentage change in adjusted operating income in constant currency 4% to 6% Percentage change in adjusted earnings per share - diluted 3% to 5% Impact of unfavorable foreign currency exchange 2 % Percentage change in adjusted earnings per share - diluted 5% to 7% LIQUIDITY AND FINANCIAL CONDITION 2024 2023 2022 Net cash provided by operating activities $ 921.9 $ 1,237.3 $ 651.5 Net cash used in investing activities (269.0) (260.5) (146.4) Net cash used in financing activities (583.1) (1,184.2) (487.2) The primary objective of our financing strategy is to maintain a prudent capital structure that provides the flexibility to pursue our growth objectives.
Projections for the Year Ending November 30, 2026 Percentage change in net sales 13% to 17% Impact of favorable foreign currency exchange 1 % Percentage change in net sales in constant currency 12% to 16% Impact of acquisition 11% to 13% Percentage change in organic net sales 1% to 3% Percentage change in adjusted operating income 16% to 20% Impact of favorable foreign currency exchange 1 % Percentage change in adjusted operating income in constant currency 15% to 19% Percentage change in adjusted earnings per share - diluted 2% to 5% Impact of favorable foreign currency exchange 1 % Percentage change in adjusted earnings per share - diluted 1% to 4% 31 LIQUIDITY AND FINANCIAL CONDITION 2025 2024 2023 Net cash flow provided by operating activities $ 962.2 $ 921.9 $ 1,237.3 Net cash flow used in investing activities (255.2) (269.0) (260.5) Net cash flow used in financing activities (840.9) (583.1) (1,184.2) The primary objective of our financing strategy is to maintain a prudent capital structure that provides the flexibility to pursue our growth objectives.
We also rely on our revolving credit facilities, or borrowings backed by these facilities, to fund working capital needs and other general corporate requirements.
We also rely on our revolving credit facilities, or borrowings backed by these facilities, to fund working capital needs and other general corporate requirements. Our committed revolving credit facilities include a five-year $2.0 billion revolving credit facility, which will expire in May 2030.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK This information is set forth in the “Market Risk Sensitivity” section of “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in Note 7 of our notes to consolidated financial statements. 42
Biggest changeITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK This information is set forth in the “Market Risk Sensitivity” section of “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and in Note 7 of our notes to consolidated financial statements. 40