ACI

FORWARD-LOOKING STATEMENTS AND FACTORS THAT IMPACT OUR OPERATING RESULTS AND TRENDS This Form 10-Q contains "forward-looking statements" within the meaning of the federal securities laws. The "forward-looking statements" include our current expectations, assumptions, estimates and projections about our business and our industry. They include statements relating to our future operating or financial performance which the Company believes to be reasonable at this time. You can identify forward-looking statements by the use of words such as "outlook," "may," "should," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future" and "intends" and similar expressions which are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to numerous risks and uncertainties which are beyond our control and difficult to predict and could cause actual results to differ materially from the results expressed or implied by the statements. Risks and uncertainties that could cause actual results to differ materially from such statements and may adversely impact our financial condition and results of operations include: 19 Table of Contents •changes in macroeconomic conditions such as rates of food price inflation or deflation, fuel and commodity prices and macroeconomic uncertainty, including in international trade and current and potential future tariffs; •changes in consumer behavior and spending patterns including those resulting from macroeconomic conditions such as inflation and shifts in state and federal assistance programs; •changes in wage rates and our ability to negotiate acceptable contracts with labor unions, including the outcome of pending union negotiations; •changes in price of goods sold in our stores and cost of goods used in our food products, as well as limitations in our ability to provide certain services, due to changes in various state and federal government legislation, regulation and executive orders; •uncertainty regarding the geopolitical environment including armed hostilities, acts of war and disruption in the distribution of goods; •our ability to succeed in a competitive environment; •our ability to execute on our business and value-creating strategies, including our operating structure realignment; •our ability to attract and retain qualified or specialized associates who are critical to the success of our business strategy; •failure to achieve productivity initiatives, including those related to artificial intelligence, unexpected changes in our objectives and plans, inability to implement our strategies, plans, programs and initiatives, or enter into strategic transactions, investments or partnerships in the future on terms acceptable to us, or at all; •challenges with our supply chain; •operational and financial effects resulting from cyber incidents at the Company or at a third party, including outages in the cloud environment and the effectiveness of business continuity plans during a ransomware or other cyber incident; and •changes in tax rates, tax laws, and regulations that directly impact our business or our customers. All forward-looking statements attributable to us or persons acting on our behalf are expressly qualified in their entirety by these cautionary statements and risk factors. Forward-looking statements contained in this Form 10-Q reflect our view only as of the date of this Form 10-Q. We undertake no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In evaluating our financial results and forward-looking statements, you should carefully consider the risks and uncertainties more fully described in the "Risk Factors" section or other sections in our reports filed with the SEC including the most recent annual report on Form 10-K and any subsequent periodic reports on Form 10-Q and current reports on Form 8-K. As used in this Form 10-Q, unless the context otherwise requires, references to "Albertsons," the "Company," "we," "us" and "our" refer to Albertsons Companies, Inc. and, where appropriate, its subsidiaries. NON-GAAP FINANCIAL MEASURES We define EBITDA as GAAP earnings (net loss) before interest, income taxes, depreciation and amortization. We define Adjusted EBITDA as earnings (net loss) before interest, income taxes, depreciation and amortization, further adjusted to eliminate the effects of items management does not consider in assessing our ongoing core performance. We define Adjusted net income as GAAP Net income adjusted to eliminate the effects of items management does not consider in assessing our ongoing core performance. We define Adjusted net income per Class A common share as Adjusted net income divided by the weighted average diluted Class A common shares outstanding, as adjusted to 20 Table of Contents reflect all RSUs outstanding at the end of the period. See "Results of Operations" for further discussion and a reconciliation of Adjusted EBITDA, Adjusted net income and Adjusted net income per Class A common share. EBITDA, Adjusted EBITDA, Adjusted net income and Adjusted net income per Class A common share (collectively, the "Non-GAAP Measures") are performance measures that provide supplemental information we believe is useful to analysts and investors to evaluate our ongoing results of operations, when considered alongside other GAAP measures such as net income, operating income, gross margin and net income per Class A common share. These Non-GAAP Measures exclude the financial impact of items management does not consider in assessing our ongoing core operating performance, and thereby provide useful measures to analysts and investors of our operating performance on a period-to-period basis. Other companies may have different definitions of Non-GAAP Measures and provide for different adjustments, and comparability to our results of operations may be impacted by such differences. We also use Adjusted EBITDA for board of director and bank compliance reporting. Our presentation of Non-GAAP Measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Non-GAAP Measures should not be considered as measures of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results and using Non-GAAP Measures only for supplemental purposes. 21 Table of Contents FIRST QUARTER OF FISCAL 2026 OVERVIEW We are one of the largest food retailers in the United States, with 2,240 stores across 35 states and the District of Columbia as of June 20, 2026. We operate 22 well known banners including Albertsons, Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Jewel-Osco, ACME, Shaw's, Star Market, United Supermarkets, Market Street, Haggen, Kings Food Markets and Balducci's Food Lovers Market, with approximately 275,000 talented and dedicated employees, as of June 20, 2026, who serve on average 36.5 million customers each week. Additionally, as of June 20, 2026, we operated 1,708 pharmacies, 1,238 in-store branded coffee shops, 408 associated fuel centers, 22 dedicated distribution centers, 19 manufacturing facilities and various digital platforms. During the first quarter of fiscal 2026, we continued to execute our business strategy, including investments in our digital and loyalty platforms, media business, customer value proposition, technology capabilities, and productivity initiatives. Our growth initiatives remain focused on eCommerce, loyalty, pharmacy and health offerings, and digital tools that support both online and in-store customer experiences. On July 23, 2026, we announced ACI Edge, an operating structure realignment intended to simplify operations, increase accountability, and more effectively leverage enterprise scale. As part of the realignment, we consolidated our 11 divisions into four regions and centralized center-store merchandising under a single enterprise team. The new structure aligns category management, supplier management, and merchandising functions across the enterprise and is intended to improve consistency and execution across banners and regions. Identical sales, excluding fuel, decreased 0.8% during the first quarter of fiscal 2026. Digital sales, including Drive Up & Go curbside pickup and home delivery, increased 13% compared to the first quarter of fiscal 2025. Flash delivery continued to be the fastest-growing component of our digital offering during the quarter, and we continued to build our digital capabilities, personalization tools, and fulfillment operations. Our media business also grew during the quarter, driven primarily by increased monetization of existing and new advertising placements. During the quarter, we expanded our advertising offerings through the introduction of branded entertainment solutions for advertising partners. We continue to invest in our customer value proposition through a combination of pricing, Own Brands offerings, personalized promotions, digital capabilities, and improving the customer experience. In response to a more pressured unit environment and increasingly value-conscious consumers, we are accelerating execution and making targeted investments in our customer value proposition. These investments are intended to improve customer engagement, traffic and unit trends, and strengthen customer loyalty over time. Technology and artificial intelligence capabilities continue to be advanced across multiple areas of the business. Following the ACI Edge operating structure realignment, we expect to deploy technology-enabled tools and operating practices more consistently across the enterprise. During the quarter, we continued to enhance customer-facing digital capabilities by building AI-powered experiences that we believe will improve engagement, increase basket size, and create a more seamless shopping journey. Within supply chain operations, we are expanding the use of advanced analytics and machine learning to support forecasting, inventory management, and replenishment processes. Our capital allocation strategy balances investing for the future, strengthening our balance sheet and returns to shareholders through a combination of dividends and opportunistic share repurchases. Capital expenditures were approximately $522 million for the first quarter of fiscal 2026, primarily including the completion of 15 remodels, the opening of four new stores and continued investment in our digital and technology platforms. On April 14, 2026, we increased the quarterly cash dividend from $0.15 per common share to $0.17 per common share. Also on April 14, 2026, we increased the remaining share repurchase authorization to $2.0 billion in total. Capital returns to 22 Table of Contents shareholders during the first quarter of fiscal 2026 included $84.0 million of common stock dividends ($0.17 per common share) and the repurchase of 13.4 million shares of common stock for a total of $226.5 million. First quarter of fiscal 2026 highlights In summary, our financial and operating highlights for the first quarter of fiscal 2026 include: •Identical sales decreased 0.8% •Digital sales increased 13% •Net income of $85 million, or $0.17 per Class A common share •Adjusted net income of $210 million, or $0.42 per Class A common share •Adjusted EBITDA of $1,013 million Stores The following table shows stores operating, acquired, opened and closed during the periods presented: 16 weeks ended June 20, 2026 June 14, 2025 Stores, beginning of period 2,244 2,270 Acquired 2 — Opened 4 3 Closed (10) (9) Stores, end of period 2,240 2,264 The following table summarizes our stores by size: Number of stores Percent of Total Retail Square Feet (1) Square Footage June 20, 2026 June 14, 2025 June 20, 2026 June 14, 2025 June 20, 2026 June 14, 2025 Less than 30,000 206 211 9.2 % 9.3 % 4.7 4.8 30,000 to 50,000 761 773 34.0 % 34.2 % 31.9 32.4 More than 50,000 1,273 1,280 56.8 % 56.5 % 75.2 75.6 Total stores 2,240 2,264 100.0 % 100.0 % 111.8 112.8 (1) In millions, reflects total square footage of retail stores operating at the end of the period. 23 Table of Contents RESULTS OF OPERATIONS Comparison of the First Quarter of Fiscal 2026 to the First Quarter of Fiscal 2025. The following tables and related discussion set forth certain information and comparisons regarding the components of our Condensed Consolidated Statements of Operations for the 16 weeks ended June 20, 2026 ("first quarter of fiscal 2026") and 16 weeks ended June 14, 2025 ("first quarter of fiscal 2025") (dollars in millions, except per share data). 16 weeks ended June 20, 2026 % of Sales June 14, 2025 % of Sales Net sales and other revenue $ 24,941.6 100.0 % $ 24,880.8 100.0 % Cost of sales 18,303.5 73.4 18,142.5 72.9 Gross margin 6,638.1 26.6 6,738.3 27.1 Selling and administrative expenses 6,379.2 25.6 6,320.9 25.4 Gain on property dispositions and impairment losses, net (4.7) — (31.9) (0.1) Operating income 263.6 1.0 449.3 1.8 Interest expense, net 166.7 0.7 141.8 0.6 Other income, net (16.8) (0.1) (3.9) — Income before income taxes 113.7 0.4 311.4 1.2 Income tax expense 29.0 0.1 75.0 0.3 Net income $ 84.7 0.3 % $ 236.4 0.9 % Basic net income per Class A common share $ 0.17 $ 0.41 Diluted net income per Class A common share 0.17 0.41 Net Sales and Other Revenue Net sales and other revenue increased 0.2% to $24,941.6 million for the first quarter of fiscal 2026 from $24,880.8 million for the first quarter of fiscal 2025. The increase in Net sales and other revenue was primarily driven by higher fuel sales, while identical sales declined 0.8%. Pharmacy and digital remained areas of strength, with pharmacy sales continuing to grow despite ongoing Inflation Reduction Act ("IRA") headwinds and digital sales increasing 13% during the first quarter of fiscal 2026. Identical Sales, Excluding Fuel Identical sales include stores operating during the same period in both the current year and the prior year, comparing sales on a daily basis. Direct to consumer digital sales are included in identical sales, and fuel sales are excluded from identical sales. Acquired stores become identical on the one-year anniversary date of the acquisition. Identical sales for the 16 weeks ended June 20, 2026 and the 16 weeks ended June 14, 2025, respectively, were: 16 weeks ended June 20, 2026 June 14, 2025 Identical sales, excluding fuel (0.8)% 2.8% 24 Table of Contents The following table represents Net sales and other revenue by product type (dollars in millions): 16 weeks ended June 20, 2026 June 14, 2025 Amount (1) % of Total Amount (1) % of Total Non-perishables (2) $ 11,875.7 47.6 % $ 12,141.7 48.8 % Fresh (3) 7,883.1 31.6 7,986.8 32.1 Pharmacy 3,304.0 13.2 3,155.0 12.7 Fuel 1,463.9 5.9 1,229.9 4.9 Other (4) 414.9 1.7 367.4 1.5 Net sales and other revenue $ 24,941.6 100.0 % $ 24,880.8 100.0 % (1) Digital related sales are included in the categories to which the revenue pertains. (2) Consists primarily of general merchandise, grocery, dairy and frozen foods. (3) Consists primarily of produce, meat, deli and prepared foods, bakery, floral and seafood. (4) Consists primarily of wholesale sales to third parties, commissions, rental income, media advertising revenue and other miscellaneous revenue. Gross Margin Gross margin rate decreased to 26.6% during the first quarter of fiscal 2026 compared to 27.1% during the first quarter of fiscal 2025. Excluding the impact of fuel and LIFO expense, gross margin rate decreased 23 basis points compared to the first quarter of fiscal 2025. This decrease was primarily driven by increases in delivery and handling costs related to the continued growth in digital sales, as well as higher fuel costs. These impacts were partially offset by improvements in pharmacy margins, primarily related to the impact of the IRA. The Company also continued to make incremental investments in its customer value proposition, funded by productivity initiatives. Selling and Administrative Expenses Selling and administrative expenses increased to 25.6% of Net sales and other revenue during the first quarter of fiscal 2026 compared to 25.4% of Net sales and other revenue for the first quarter of fiscal 2025. Excluding the impact of fuel, Selling and administrative expenses as a percentage of Net sales and other revenue increased 42 basis points during the first quarter of fiscal 2026 compared to the first quarter of fiscal 2025. This increase in Selling and administrative expenses as a percentage of Net sales and other revenue was primarily attributable to increases in rent and occupancy costs, merger-related litigation costs, business transformation costs and depreciation and amortization, partially offset by a decrease in employee costs. Despite disciplined productivity and cost management initiatives, the rate was negatively impacted by lower identical sales, including the effect of the IRA on pharmacy sales growth. Gain on Property Dispositions and Impairment Losses, Net For the first quarter of fiscal 2026, net gain on property dispositions and impairment losses was $4.7 million, primarily driven by net gains from the sale of real estate assets. For the first quarter of fiscal 2025, net gain on property dispositions and impairment losses was $31.9 million, primarily driven by $45.5 million of net gains from the sale of real estate assets, partially offset by $11.4 million from the impairment and disposal of certain technology assets and $2.2 million of retail store impairment losses. 25 Table of Contents Interest Expense, Net Interest expense, net was $166.7 million during the first quarter of fiscal 2026 compared to $141.8 million during the first quarter of fiscal 2025. The increase in interest expense, net was primarily attributable to higher average outstanding borrowings. Other Income, Net For the first quarter of fiscal 2026, other income, net was $16.8 million compared to other income, net of $3.9 million for the first quarter of fiscal 2025. Other income, net during the first quarter of fiscal 2026 was primarily driven by realized gains from non-operating investments and non-service cost components of net pension and post-retirement income, partially offset by unrealized losses from non-operating investments. Other income, net during the first quarter of fiscal 2025 was primarily driven by non-service cost components of net pension and post-retirement income, partially offset by unrealized losses from non-operating investments. Income Taxes Income tax expense was $29.0 million during the first quarter of fiscal 2026, representing a 25.5% effective tax rate. Income tax expense was $75.0 million during the first quarter of fiscal 2025, representing a 24.1% effective tax rate. The increase in the effective income tax rate was primarily driven by the legislative expiration of federal employment tax credits. Net Income and Adjusted Net Income Net income was $84.7 million, or $0.17 per Class A common share, during the first quarter of fiscal 2026 compared to $236.4 million, or $0.41 per Class A common share, during the first quarter of fiscal 2025. Adjusted net income was $210.3 million, or $0.42 per Class A common share, during the first quarter of fiscal 2026 compared to $318.9 million, or $0.55 per Class A common share, during the first quarter of fiscal 2025. Adjusted EBITDA For the first quarter of fiscal 2026, Adjusted EBITDA was $1,013.2 million, or 4.1% of Net sales and other revenue, compared to $1,111.0 million, or 4.5% of Net sales and other revenue, for the first quarter of fiscal 2025. 26 Table of Contents Reconciliation of Non-GAAP Measures The following table reconciles Net income to Adjusted net income and Adjusted EBITDA (in millions): 16 weeks ended June 20, 2026 June 14, 2025 Net income $ 84.7 $ 236.4 Adjustments: Business transformation (1)(b) 54.2 38.3 Equity-based compensation expense (b) 31.4 33.7 Gain on property dispositions and impairment losses, net (4.7) (31.9) LIFO expense (a) 20.0 17.3 Merger-related costs (2)(b) 41.6 19.0 Certain legal and regulatory accruals and settlements, net (b) 1.2 2.6 Amortization of debt discount and deferred financing costs (c) 4.8 6.2 Amortization of intangible assets resulting from acquisitions (b) 15.7 14.8 Miscellaneous adjustments (3)(e) (1.9) 6.1 Tax impact of adjustments to Adjusted net income (36.7) (23.6) Adjusted net income $ 210.3 $ 318.9 Tax impact of adjustments to Adjusted net income 36.7 23.6 Income tax expense 29.0 75.0 Amortization of debt discount and deferred financing costs (c) (4.8) (6.2) Interest expense, net 166.7 141.8 Amortization of intangible assets resulting from acquisitions (b) (15.7) (14.8) Depreciation and amortization (d) 591.0 572.7 Adjusted EBITDA $ 1,013.2 $ 1,111.0 The following tables reconcile diluted net income per Class A common share to Adjusted net income per Class A common share (in millions, except per share data): 16 weeks ended June 20, 2026 June 14, 2025 Numerator: Adjusted net income (4) $ 210.3 $ 318.9 Denominator: Weighted average Class A common shares outstanding - diluted 498.2 575.4 Restricted stock units (5) 8.5 8.5 Adjusted weighted average Class A common shares outstanding - diluted 506.7 583.9 Adjusted net income per Class A common share - diluted $ 0.42 $ 0.55 27 Table of Contents 16 weeks ended June 20, 2026 June 14, 2025 Net income per Class A common share - diluted $ 0.17 $ 0.41 Non-GAAP adjustments (6) 0.26 0.15 Restricted stock units (5) (0.01) (0.01) Adjusted net income per Class A common share - diluted $ 0.42 $ 0.55 (1) Includes costs related to the Company's business transformation, including third-party consulting fees and certain integration and employee termination costs, as follows (see table below): 16 weeks ended June 20, 2026 June 14, 2025 Third-party consulting fees $ 32.5 $ 33.3 Integration and employee termination costs 21.7 5.0 Total Business transformation $ 54.2 $ 38.3 (2) Primarily includes litigation costs related to the terminated merger. The first quarter of fiscal 2025 also includes retention program expense related to the terminated merger. (3) Miscellaneous adjustments include the following (see table below): 16 weeks ended June 20, 2026 June 14, 2025 Closed stores and surplus properties $ 15.7 $ 5.5 Net realized and unrealized (gain) loss on non-operating investments (11.9) 1.3 Non-cash lease-related adjustments (1.7) — Other (i) (4.0) (0.7) Total miscellaneous adjustments $ (1.9) $ 6.1 (i) Includes adjustments for the financial impact of other items not considered in our core performance. (4) See reconciliation of Net income to Adjusted net income above for further details. (5) Represents incremental unvested RSUs to adjust the diluted weighted average Class A common shares outstanding during each respective period to the fully outstanding RSUs as of the end of each respective period. (6) Reflects the per share impact of Non-GAAP adjustments for each period. See the reconciliation of Net income to Adjusted net income above for further details. Non-GAAP adjustment classifications within the Condensed Consolidated Statements of Operations: (a) Cost of sales (b) Selling and administrative expenses (c) Interest expense, net (d) Depreciation and amortization: 16 weeks ended June 20, 2026 June 14, 2025 Cost of sales $ 65.3 $ 64.1 Selling and administrative expenses 525.7 508.6 Total Depreciation and amortization $ 591.0 $ 572.7 28 Table of Contents (e) Miscellaneous adjustments: 16 weeks ended June 20, 2026 June 14, 2025 Cost of sales $ (5.1) $ (0.5) Selling and administrative expenses 13.7 5.6 Other income, net (10.5) 1.0 Total Miscellaneous adjustments $ (1.9) $ 6.1 LIQUIDITY AND CAPITAL RESOURCES The following table sets forth the major sources and uses of cash and cash equivalents and restricted cash for each period (in millions): 16 weeks ended June 20, 2026 June 14, 2025 Cash and cash equivalents and restricted cash at end of period $ 295.0 $ 155.3 Cash flows provided by operating activities 728.9 754.4 Cash flows used in investing activities (507.7) (474.1) Cash flows used in financing activities (129.2) (422.9) Net Cash Provided by Operating Activities Net cash provided by operating activities was $728.9 million for the first quarter of fiscal 2026 compared to $754.4 million for the first quarter of fiscal 2025. The decrease in cash flow from operations compared to the first quarter of fiscal 2025 was primarily driven by a decrease in Adjusted EBITDA and increases in cash paid for interest, as well as higher merger-related and business transformation costs, partially offset by changes in working capital and lower cash paid for indirect taxes during the first quarter of fiscal 2026. Net Cash Used in Investing Activities Net cash used in investing activities was $507.7 million for the first quarter of fiscal 2026 compared to $474.1 million for the first quarter of fiscal 2025. For the first quarter of fiscal 2026, cash used in investing activities consisted primarily of payments for property, equipment and intangibles of $522.1 million and the Hames acquisition of $28.0 million, partially offset by proceeds from the sale of assets of $25.8 million, primarily related to real estate. Payments for property, equipment and intangibles in the first quarter of fiscal 2026 included the completion of 15 remodels, the opening of four new stores and continued investment in our digital and technology platforms. For the first quarter of fiscal 2025, cash used in investing activities consisted primarily of payments for property, equipment and intangibles of $584.6 million, partially offset by proceeds from the sale of assets of $78.2 million, primarily related to real estate. Payments for property, equipment and intangibles in the first quarter of fiscal 2025 included the completion of 36 remodels, the opening of three new stores and continued investment in our digital and technology platforms. 29 Table of Contents Net Cash Used in Financing Activities Net cash used in financing activities was $129.2 million during the first quarter of fiscal 2026 compared to net cash used in financing activities of $422.9 million during the first quarter of fiscal 2025. Net cash used in financing activities during the first quarter of fiscal 2026 consisted primarily of the repurchase of common stock, dividends paid on our Class A common stock, payments on long-term borrowings and tax withholding payments on vesting of RSUs, partially offset by $275.0 million of proceeds from the issuance of long-term debt under the ABL Facility. Net cash used in financing activities during the first quarter of fiscal 2025 consisted primarily of the repurchase of common stock, dividends paid on our Class A common stock and tax withholding payments on vesting of RSUs, partially offset by $25.0 million of proceeds from the ABL Facility. Proceeds from the issuance of long-term debt and payments on long-term borrowings also included a $600 million issuance and subsequent $600 million redemption of senior unsecured notes. Debt Management As of June 20, 2026, there was $700.0 million outstanding under our ABL Facility and total availability of $3,287.4 million (net of letter of credit usage). We repaid the remaining $56.5 million in aggregate principal amount outstanding of New Albertsons L.P.'s 7.75% Notes due 2026 on their maturity date, June 15, 2026. Dividends We have established a dividend policy pursuant to which we intend to pay a quarterly dividend on our Class A common stock. On April 14, 2026, the Board of Directors (the "Board") increased the quarterly cash dividend 13% from $0.15 per common share to $0.17 per common share. Cash dividends paid on our Class A common stock were $84.0 million ($0.17 per common share) and $85.7 million ($0.15 per common share) during the first quarter of fiscal 2026 and first quarter of fiscal 2025, respectively. On July 14, 2026, we announced the next quarterly dividend payment of $0.17 per share of Class A common stock to be paid on August 7, 2026 to stockholders of record as of the close of business on July 24, 2026. Common Stock Repurchase Program On April 14, 2026, the Board increased the remaining share repurchase authorization to $2.0 billion in total. The share repurchase program could include open market repurchases, accelerated share repurchase programs, tender offers, block trades, potential privately negotiated transactions, or trading plans in compliance with the federal securities laws. During the first quarter of fiscal 2026, we repurchased 13.4 million shares of common stock for a total of $226.5 million pursuant to the existing multi-year repurchase authorization. Liquidity Based on current operating trends, we believe that we have significant sources of cash to meet our liquidity needs for the next 12 months and for the foreseeable future, including cash on hand, cash flows from operating activities and other sources of liquidity, including the ABL Facility. We estimate our liquidity needs over the next 12 months to be in the range of $6.0 billion to $6.7 billion. This includes $700.0 million related to the outstanding borrowings under our ABL Facility for which we may, at our discretion, elect to pay all or a portion of the outstanding balance within the next 12 months, and anticipated requirements for working capital, capital expenditures, pension obligations, interest payments and scheduled principal payments of debt, operating leases, finance leases, legal settlements, quarterly dividends on Class A common stock and common stock repurchases. In addition, we may 30 Table of Contents enter into refinancing and sale leaseback transactions from time to time. We believe we have adequate cash flow to continue to maintain our current debt ratings and to respond effectively to competitive conditions. CRITICAL ACCOUNTING POLICIES The preparation of Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. We have chosen accounting policies that we believe are appropriate to report accurately and fairly our operating results and financial position, and we apply those accounting policies in a fair and consistent manner. See the Critical Accounting Policies section included in our Annual Report on Form 10-K for the fiscal year ended February 28, 2026, filed with the SEC on April 27, 2026, for a discussion of our significant accounting policies. RECENTLY ISSUED AND RECENTLY ADOPTED ACCOUNTING STANDARDS See Note 1 - Basis of Presentation and Summary of Significant Accounting Policies of our unaudited interim Condensed Consolidated Financial Statements located elsewhere in this Form 10-Q.