RPM INTERNATIONAL INC. AND SUBSIDIARIES Consolidated Balance Sheets (In thousands, except per share amounts) May 31, 2026 2025 Assets Current Assets Cash and cash equivalents $ 315,188 $ 302,137 Trade accounts receivable (less allowances of $39,179 and $42,844, respectively) 1,661,538 1,509,109 Inventories 1,058,911 1,036,475 Prepaid expenses and other current assets 423,198 322,577 Total current assets 3,458,835 3,170,298 Property, Plant and Equipment, at Cost 2,919,058 2,738,373 Allowance for depreciation (1,362,540 ) (1,264,974 ) Property, plant and equipment, net 1,556,518 1,473,399 Other Assets Goodwill 1,688,164 1,617,626 Other intangible assets, net of amortization 824,638 780,826 Operating lease right-of-use assets 396,936 370,399 Deferred income taxes 116,474 147,436 Other 303,040 215,965 Total other assets 3,329,252 3,132,252 Total Assets $ 8,344,605 $ 7,775,949 Liabilities and Stockholders' Equity Current Liabilities Accounts payable $ 853,524 $ 755,889 Current portion of long-term debt 407,834 7,691 Accrued compensation and benefits 307,299 287,398 Accrued losses 51,258 36,701 Other accrued liabilities 441,148 379,768 Total current liabilities 2,061,063 1,467,447 Long-Term Liabilities Long-term debt, less current maturities 2,125,690 2,638,922 Operating lease liabilities 341,283 317,334 Other long-term liabilities 258,641 241,117 Deferred income taxes 244,823 224,347 Total long-term liabilities 2,970,437 3,421,720 Contingencies and Accrued Losses (Note P) Stockholders' Equity Preferred stock, par value $0.01; authorized 50,000 shares; none issued - - Common stock, par value $0.01; authorized 300,000 shares; issued 146,578 and outstanding 127,643 as of May 2026; issued 146,246 and outstanding 128,269 as of May 2025 1,276 1,283 Paid-in capital 1,210,651 1,177,796 Treasury stock, at cost (1,036,645 ) (953,856 ) Accumulated other comprehensive (loss) (447,200 ) (533,631 ) Retained earnings 3,583,451 3,193,764 Total RPM International Inc. stockholders' equity 3,311,533 2,885,356 Noncontrolling Interest 1,572 1,426 Total equity 3,313,105 2,886,782 Total Liabilities and Stockholders' Equity $ 8,344,605 $ 7,775,949 The accompanying notes to consolidated financial statements are an integral part of these statements. 34 Consolidated Statements of Income (In thousands, except per share amounts) Year Ended May 31, 2026 2025 2024 Net Sales $ 7,863,422 $ 7,372,644 $ 7,335,277 Cost of Sales 4,605,197 4,322,166 4,320,688 Gross Profit 3,258,225 3,050,478 3,014,589 Selling, General and Administrative Expenses 2,292,130 2,150,537 2,113,585 Restructuring Expense 42,612 24,979 30,008 Goodwill Impairment - 11,352 - Interest Expense 111,544 96,543 117,969 Investment (Income), Net (46,889 ) (24,099 ) (44,974 ) Other (Income) Expense, Net (11,512 ) (1,594 ) 10,164 Income Before Income Taxes 870,340 792,760 787,837 Provision for Income Taxes 207,857 102,433 198,395 Net Income 662,483 690,327 589,442 Less: Net Income Attributable to Noncontrolling Interests 1,091 1,639 1,045 Net Income Attributable to RPM International Inc. Stockholders $ 661,392 $ 688,688 $ 588,397 Average Number of Shares of Common Stock Outstanding: Basic 127,049 127,570 127,767 Diluted 127,554 128,204 128,340 Earnings per Share of Common Stock Attributable to RPM International Inc. Stockholders: Basic $ 5.19 $ 5.38 $ 4.58 Diluted $ 5.17 $ 5.35 $ 4.56 The accompanying notes to consolidated financial statements are an integral part of these statements. 35 Consolidated Statements of Comprehensive Income (In thousands) Year Ended May 31 2026 2025 2024 Net Income $ 662,483 $ 690,327 $ 589,442 Other comprehensive income (loss), net of tax: Foreign currency translation adjustments, net of tax 42,022 (8,977 ) 3,547 Pension and other postretirement benefit liability adjustments, net of tax 44,343 11,986 64,117 Unrealized gain on securities and other, net of tax 65 677 - Total other comprehensive income 86,430 3,686 67,664 Total Comprehensive Income 748,913 694,013 657,106 Less: Comprehensive Income Attributable to Noncontrolling Interests 1,090 1,666 1,064 Comprehensive Income Attributable to RPM International Inc. Stockholders $ 747,823 $ 692,347 $ 656,042 The accompanying notes to consolidated financial statements are an integral part of these statements. 36 Consolidated Statements of Cash Flows (In thousands) Year Ended May 31, 2026 2025 2024 Cash Flows From Operating Activities: Net income $ 662,483 $ 690,327 $ 589,442 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 213,490 193,840 171,251 Fair value adjustments to contingent earnout obligations (14,418 ) - - Property, plant and equipment impairment 9,721 - - Goodwill impairment - 11,352 - Deferred income taxes 32,832 (104,507 ) (5,638 ) Stock-based compensation expense 32,848 27,042 25,925 Net (gain) on marketable securities (25,422 ) (4,997 ) (19,914 ) Net (gain) on sales of assets and businesses (6,093 ) - (971 ) Other (488 ) 1,269 2,226 Changes in assets and liabilities, net of effect from purchases and sales of businesses: (Increase) decrease in receivables (119,345 ) (55,037 ) 82,895 Decrease (increase) in inventory 18,523 (34,458 ) 179,843 (Increase) decrease in prepaid expenses and other current and long-term assets (85,596 ) (62,669 ) 23,426 Increase (decrease) in accounts payable 67,658 84,074 (24,439 ) Increase (decrease) in accrued compensation and benefits 14,849 (17,130 ) 39,891 Increase in accrued losses 12,915 3,899 5,958 Increase in other accrued liabilities 84,751 35,185 52,410 Cash Provided By Operating Activities 898,708 768,190 1,122,305 Cash Flows From Investing Activities: Capital expenditures (223,507 ) (229,930 ) (213,970 ) Acquisition of businesses, net of cash acquired (202,403 ) (595,770 ) (15,549 ) Purchase of marketable securities (34,272 ) (85,793 ) (32,981 ) Proceeds from sales of marketable securities 19,781 87,093 46,689 Proceeds from sales of assets and businesses 23,237 - 6,921 Other (10 ) (1,134 ) 2,450 Cash (Used For) Investing Activities (417,174 ) (825,534 ) (206,440 ) Cash Flows From Financing Activities: Additions to long-term and short-term debt 84,000 478,111 - Reductions of long-term and short-term debt (208,862 ) (9,008 ) (575,408 ) Cash dividends (271,705 ) (255,563 ) (231,883 ) Repurchase of common stock (77,497 ) (69,999 ) (54,978 ) Shares of common stock returned for taxes (5,034 ) (18,686 ) (24,548 ) Payments of acquisition-related contingent consideration - (1,122 ) (1,142 ) Other (3,133 ) (1,796 ) (2,075 ) Cash (Used For) Provided By Financing Activities (482,231 ) 121,937 (890,034 ) Effect of Exchange Rate Changes on Cash and Cash Equivalents 13,748 165 (4,239 ) Net Change in Cash and Cash Equivalents 13,051 64,758 21,592 Cash and Cash Equivalents at Beginning of Period 302,137 237,379 215,787 Cash and Cash Equivalents at End of Period $ 315,188 $ 302,137 $ 237,379 Supplemental Disclosures of Cash Flows Information: Cash paid during the year for: Interest $ 108,746 $ 93,460 $ 116,650 Income taxes, net of refunds $ 198,368 $ 204,255 $ 203,607 Supplemental Disclosures of Noncash Investing Activities: Capital expenditures accrued within accounts payable at year-end $ 33,608 $ 24,673 $ 24,632 The accompanying notes to consolidated financial statements are an integral part of these statements. 37 Consolidated Statements of Stockholders' Equity Common Stock Accumulated Number Other Total RPM of Par/Stated Paid-In Treasury Comprehensive Retained International Noncontrolling Total (In thousands) Shares Value Capital Stock Income (Loss) Earnings Inc. Equity Interests Equity Balance at June 1, 2023 128,766 $ 1,288 $ 1,124,825 $ (784,463 ) $ (604,935 ) $ 2,404,125 $ 2,140,840 $ 2,160 $ 2,143,000 Net income - - - - - 588,397 588,397 1,045 589,442 Other comprehensive income - - - - 67,645 - 67,645 19 67,664 Dividends declared and paid ($1.80 per share) - - - - - (231,883 ) (231,883 ) - (231,883 ) Other noncontrolling interest activity - - - - - - - (1,883 ) (1,883 ) Share repurchases under repurchase program (526 ) (5 ) 5 (55,002 ) - - (55,002 ) - (55,002 ) Stock compensation expense and other deferred compensation, shares granted less shares returned for taxes 389 3 25,921 (25,037 ) - - 887 - 887 Balance at May 31, 2024 128,629 1,286 1,150,751 (864,502 ) (537,290 ) 2,760,639 2,510,884 1,341 2,512,225 Net income - - - - - 688,688 688,688 1,639 690,327 Other comprehensive income - - - - 3,659 - 3,659 27 3,686 Dividends declared and paid ($1.99 per share) - - - - - (255,563 ) (255,563 ) - (255,563 ) Other noncontrolling interest activity - - - - - - - (1,581 ) (1,581 ) Share repurchases under repurchase program and related excise tax (582 ) (6 ) 6 (70,259 ) - - (70,259 ) - (70,259 ) Stock compensation expense and other deferred compensation, shares granted less shares returned for taxes 222 3 27,039 (19,095 ) - - 7,947 - 7,947 Balance at May 31, 2025 128,269 1,283 1,177,796 (953,856 ) (533,631 ) 3,193,764 2,885,356 1,426 2,886,782 Net income - - - - - 661,392 661,392 1,091 662,483 Other comprehensive income (loss) - - - - 86,431 - 86,431 (1 ) 86,430 Dividends declared and paid ($2.13 per share) - - - - - (271,705 ) (271,705 ) - (271,705 ) Other noncontrolling interest activity - - - - - - - (944 ) (944 ) Share repurchases under repurchase program and related excise tax (700 ) (7 ) 7 (78,128 ) - - (78,128 ) - (78,128 ) Stock compensation expense and other deferred compensation, shares granted less shares returned for taxes 74 - 32,848 (4,661 ) - - 28,187 - 28,187 Balance at May 31, 2026 127,643 $ 1,276 $ 1,210,651 $ (1,036,645 ) $ (447,200 ) $ 3,583,451 $ 3,311,533 $ 1,572 $ 3,313,105 The accompanying notes to consolidated financial statements are an integral part of these financial statements. 38 NOTE A — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 1) Consolidation, Noncontrolling Interests and Basis of Presentation The accompanying Consolidated Financial Statements have been prepared in accordance with GAAP and the instructions to Form 10-K. In our opinion, all adjustments (consisting of normal, recurring accruals) considered necessary for fair presentation have been included for the periods ended May 31, 2026, 2025, and 2024. Effective June 1, 2025, we realigned certain businesses and management structures to recognize how we allocate resources and analyze the operating performance of our operating segments. As such, we now report under three reportable segments instead of our four previous reportable segments. Our three reportable segments are CPG, PCG and Consumer. This realignment changed our reportable segments beginning with our first quarter of fiscal 2026. As a result, historical segment results disclosed in Note B, "Restructuring," Note C, “Goodwill and Other Intangible Assets” and Note R, "Segment Information," have been recast to reflect the impact of this change. These prior period reclassifications have no impact on previously reported financial position, net income or cash flows. See Note R, “Segment Information,” to the Consolidated Financial Statements for further detail. Our financial statements include all of our majority-owned subsidiaries. We account for our investments in less-than-majority-owned joint ventures, for which we have the ability to exercise significant influence, under the equity method. Effects of transactions between related companies are eliminated in consolidation. Noncontrolling interests are presented in our Consolidated Financial Statements as if parent company investors (controlling interests) and other minority investors (noncontrolling interests) in partially owned subsidiaries have similar economic interests in a single entity. As a result, investments in noncontrolling interests are reported as equity in our Consolidated Financial Statements. Additionally, our Consolidated Financial Statements include 100% of a controlled subsidiary’s earnings, rather than only our share. Transactions between the parent company and noncontrolling interests are reported in equity as transactions between stockholders, provided that these transactions do not create a change in control. Our business is dependent on external weather factors. Historically, we have experienced strong sales and net income in our first, second and fourth fiscal quarters comprising the three-month periods ending August 31, November 30 and May 31, respectively, with seasonally lower performance in our third fiscal quarter (December through February). 2) Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. 3) Acquisitions We account for business combinations and asset acquisitions using the acquisition method of accounting and, accordingly, the assets and liabilities of the acquired entities are recorded at their estimated fair values at the acquisition date. 4) Foreign Currency The functional currency for each of our foreign subsidiaries is its principal operating currency. Accordingly, for the periods presented, assets and liabilities have been translated using exchange rates at year end, while income and expense for the periods have been translated using a weighted-average exchange rate. The resulting translation adjustments have been recorded in accumulated other comprehensive income (loss), a component of stockholders’ equity, and will be included in net earnings only upon the sale or liquidation of the underlying foreign investment, neither of which is contemplated at this time. For the periods ended May 31, 2026, 2025 and 2024, transactional losses approximated $5.2 million, $0.2 million and $6.6 million, respectively. 5) Cash and Cash Equivalents We consider all highly liquid debt instruments purchased with a maturity of three months or less to be cash equivalents. We do not believe we are exposed to any significant credit risk on cash and cash equivalents. The carrying amounts of cash and cash equivalents approximate fair value. 6) Property, Plant & Equipment May 31, 2026 2025 (In thousands) Land $ 94,877 $ 96,259 Buildings and leasehold improvements 813,496 754,088 Machinery and equipment 2,010,685 1,888,026 Total property, plant and equipment, at cost 2,919,058 2,738,373 Less: allowance for depreciation and amortization 1,362,540 1,264,974 Property, plant and equipment, net $ 1,556,518 $ 1,473,399 39 Depreciation is computed primarily using the straight-line method over the following ranges of useful lives: Buildings and leasehold improvements 1 to 50 years Machinery and equipment 1 to 40 years Total depreciation expense for each fiscal period includes the charges to income that result from the amortization of assets recorded under finance leases. For the periods ended May 31, 2026, 2025 and 2024, we recorded depreciation expense of $165.4 million, $146.3 million, and $129.8 million, respectively. Impairment of Property, Plant and Equipment We review long-lived assets for impairment when circumstances indicate that the carrying values of these assets may not be recoverable. For assets that are to be held and used, an impairment charge is recognized when the estimated undiscounted future cash flows associated with the asset or group of assets are less than their carrying value. If impairment exists, an adjustment is made to write the asset down to its fair value, and a loss is recorded for the difference between the carrying value and the fair value. Fair values are determined based on quoted market values, discounted cash flows, internal appraisals or external appraisals, as applicable. Assets to be disposed of are carried at the lower of their carrying value or estimated net realizable value. During the fourth quarter of fiscal 2026, we recorded long-lived asset impairments in two asset groups within the Color Group reporting unit of our Consumer segment. We concluded that each asset group’s reduced cash flow projections as a result of market softness were a triggering event, indicating that the carrying amounts of the assets may not be recoverable. As a result, we performed recoverability tests by comparing the sum of the undiscounted cash flows expected to be generated from the use and eventual disposition of the asset groups to their respective carrying values. Based on these analyses, we determined that the carrying values exceeded the sum of estimated undiscounted cash flows and were therefore not recoverable. We then estimated the fair value of the impacted property, plant and equipment, using a market and cost approach valuation methodology. As a result, during the year ended May 31, 2026, we recognized an impairment charge of $9.7 million to reduce the net book value of these held and used long-lived assets to their estimated fair value. The impairment charge is included within SG&A expenses in the Consolidated Statement of Income. There were no impairments to definite-lived long-lived assets recorded during the year’s ended May 31, 2025 or May 31, 2024. In the future, if events or market conditions affect the estimated fair value of the Color Group’s asset groups to the extent that long-lived assets are impaired, we will adjust the carrying value of these long-lived assets in the period in which the impairment occurs. 7) Revenue Recognition Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. The majority of our revenue is recognized at a point in time. However, we also record revenues generated under construction contracts, mainly in connection with the installation of specialized roofing and flooring systems and related services. For certain polymer flooring installation projects, we account for our revenue using the output method, as we consider square footage of completed flooring to be the best measure of progress toward the complete satisfaction of the performance obligation. In contrast, for certain of our roofing installation projects, we account for our revenue using the input method, as that method is the best measure of performance as it considers costs incurred in relation to total expected project costs, which essentially represents the transfer of control for roofing systems to the customer. In general, for our construction contracts, we record contract revenues and related costs as our contracts progress on an over-time model. 8) Shipping Costs We identify shipping and handling costs as costs paid to third-party shippers for transporting products to customers, and we include these costs in cost of sales in our Consolidated Statements of Income. 9) Allowance for Credit Losses Our primary allowance for credit losses is the allowance for doubtful accounts. The allowance for doubtful accounts reduces the trade accounts receivable balance to the estimated net realizable value equal to the amount that is expected to be collected. The allowance is established using assessments of current creditworthiness of customers, historical collection experience, the aging of receivables and other currently available evidence. Trade accounts receivable balances are written-off against the allowance if a final determination of uncollectibility is made. All provisions for allowances for doubtful collection of accounts are included in SG&A expenses. Actual collections of trade receivables could differ from our estimates due to changes in future economic or industry conditions or specific customers' financial conditions. 10) Inventories Inventories are stated at the lower of cost or net realizable value, cost being determined on a first-in, first-out (FIFO) basis and net realizable value being determined on the basis of replacement cost. Inventory costs include raw materials, labor and manufacturing overhead. We review the net realizable value of our inventory in detail on an on-going basis, with consideration given to various factors, which include our estimated reserves for excess, obsolete, slow-moving or distressed inventories. If actual market conditions differ from 40 our projections, and our estimates prove to be inaccurate, write-downs of inventory values and adjustments to cost of sales may be required. Historically, our inventory reserves have approximated actual experience. Inventories, net of reserves, were composed of the following major classes: May 31, 2026 2025 (In thousands) Raw materials and supplies $ 410,187 $ 387,785 Finished goods 648,724 648,690 Total Inventory, Net of Reserves $ 1,058,911 $ 1,036,475 11) Goodwill and Other Intangible Assets We account for goodwill and other intangible assets in accordance with the provisions of ASC 350 and account for business combinations using the acquisition method of accounting and, accordingly, the assets and liabilities of the entities acquired are recorded at their estimated fair values at the acquisition date. Goodwill Goodwill represents the excess of the purchase price paid over the fair value of net assets acquired, including the amount assigned to identifiable intangible assets. Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination as of the acquisition date. Once goodwill has been allocated to the reporting units, it no longer retains its identification with a particular acquisition and becomes identified with the reporting unit in its entirety. Accordingly, the fair value of the reporting unit as a whole is available to support the recoverability of its goodwill. We evaluate our reporting units when changes in our operating structure occur, and if necessary, reassign goodwill using a relative fair value allocation approach. We test our goodwill balances at least annually, or more frequently as impairment indicators arise, at the reporting unit level. Our annual impairment assessment date has been designated as the first day of our fourth fiscal quarter. Our reporting units have been identified at the component level, which is one level below our operating segments. We follow the FASB guidance found in ASC 350 that simplifies how an entity tests goodwill for impairment. It provides an option to first assess qualitative factors to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, and whether it is necessary to perform a quantitative goodwill impairment test. We assess qualitative factors in each of our reporting units that carry goodwill. We assess these qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment test. The quantitative process is required only if we conclude that it is more likely than not that a reporting unit’s fair value is less than its carrying amount. However, we have an unconditional option to bypass a qualitative assessment and proceed directly to performing the quantitative analysis. We applied the quantitative process during our annual goodwill impairment assessments performed during the fourth quarters of fiscal 2026, 2025 and 2024. In applying the quantitative test, we compare the fair value of a reporting unit to its carrying value. If the calculated fair value is less than the current carrying value, then impairment of the reporting unit exists. Calculating the fair value of a reporting unit requires our use of estimates and assumptions. We use significant judgment in determining the most appropriate method to establish the fair value of a reporting unit. We estimate the fair value of a reporting unit by employing various valuation techniques, depending on the availability and reliability of comparable market value indicators, and employ methods and assumptions that include the application of third-party market value indicators and the computation of discounted future cash flows determined from estimated cashflow adjustments to a reporting unit’s annual projected EBITDA, or adjusted EBITDA, which adjusts for one-off items impacting revenues and/or expenses that are not considered by management to be indicative of ongoing operations. Our fair value estimations may include a combination of value indications from both the market and income approaches, as the income approach considers the future cash flows from a reporting unit’s ongoing operations as a going concern, while the market approach considers the current financial environment in establishing fair value. In applying the market approach, we use market multiples derived from a set of similar companies. In applying the income approach, we evaluate discounted future cash flows determined from estimated cashflow adjustments to a reporting unit’s projected EBITDA. Under this approach, we calculate the fair value of a reporting unit based on the present value of estimated future cash flows. In applying the discounted cash flow methodology utilized in the income approach, we rely on a number of factors, including future business plans, actual and forecasted operating results, and market data. The significant assumptions employed under this method include discount rates; revenue growth rates, including assumed terminal growth rates; and operating margins used to project future cash flows for a reporting unit. The discount rates utilized reflect market-based estimates of capital costs and discount rates adjusted for management’s assessment of a market participant’s view with respect to other risks associated with the projected cash flows of the individual reporting unit. Our estimates are based upon assumptions we believe to be reasonable, but which by nature are uncertain and unpredictable. We believe we incorporate ample sensitivity ranges into our analysis of goodwill impairment testing for a reporting unit, such that actual experience would need to be materially out of the range of expected assumptions in order for an impairment to remain undetected. 41 Refer to Note C, "Goodwill and Other Intangible Assets," to the Consolidated Financial Statements for additional information regarding our conclusions on annual goodwill impairment tests, changes in composition of our reportable segments, reporting units and impairment charges recorded. Indefinite-Lived Intangible Assets Additionally, we test all indefinite-lived intangible assets for impairment at least annually during our fiscal fourth quarter. We follow the guidance provided by ASC 350 that simplifies how an entity tests indefinite-lived intangible assets for impairment. It provides an option to first assess qualitative factors to determine whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount before applying traditional quantitative tests. We applied both the qualitative and quantitative processes during our annual indefinite-lived intangible asset impairment assessments performed during the fourth quarter of fiscal 2026, and applied only the quantitative processes during the fourth quarters of fiscal 2025 and 2024. The annual impairment assessment involves estimating the fair value of each indefinite-lived asset and comparing it with its carrying amount. If the carrying amount of the intangible asset exceeds its fair value, we record an impairment loss equal to the difference. Calculating the fair value of the indefinite-lived assets requires our significant use of estimates and assumptions. We estimate the fair values of our intangible assets by applying a relief-from-royalty calculation, which includes discounted future cash flows related to each of our intangible asset’s projected revenues. In applying this methodology, we rely on a number of factors, including actual and forecasted revenues and market data. The key assumptions used in estimating the relief-from-royalty calculation for impairment testing include discount rates, terminal growth rates, royalty rates, sales projections, and tax rates. Refer to Note C, "Goodwill and Other Intangible Assets," to the Consolidated Financial Statements for further discussion and results of our annual impairment test of our indefinite-lived intangible assets. Definite-Lived Intangible Assets In accordance with the guidance provided by ASC 360, "Property, Plant, and Equipment," we assess identifiable, amortizable intangible assets for impairment whenever events or changes in facts and circumstances indicate the possibility that the carrying values of these assets may not be recoverable over their estimated remaining useful lives. Factors considered important in our assessment, which might trigger an impairment evaluation, include the following: •significant under-performance relative to historical or projected future operating results; •significant changes in the manner of our use of the acquired assets; •significant changes in the strategy for our overall business; and •significant negative industry or economic trends. Measuring a potential impairment of amortizable intangible assets requires the use of various estimates and assumptions, including the determination of which cash flows are directly related to the assets being evaluated, the respective useful lives over which those cash flows will occur and potential residual values, if any. If we determine that the carrying values of these assets may not be recoverable based upon the existence of one or more of the above-described indicators or other factors, any impairment amounts are measured based on the projected net cash flows expected from these assets, including any net cash flows related to eventual disposition activities. The determination of any impairment losses are based on the best information available, including internal estimates of discounted cash flows; market participant assumptions; quoted market prices, when available; and independent appraisals, as appropriate, to determine fair values. Cash flow estimates are based on our historical experience and our internal business plans, with appropriate discount rates applied. We did not record any impairment charges related to our definite-lived intangible assets during fiscal 2026, 2025 and 2024. 12) Advertising Costs Advertising costs are charged to operations when incurred and are included in SG&A expenses. For the years ended May 31, 2026, 2025 and 2024, advertising costs were $66.0 million, $57.0 million and $64.7 million, respectively. 13) Research and Development Research and development costs are charged to operations when incurred and are included in SG&A expenses. The amounts charged to expense for the years ended May 31, 2026, 2025 and 2024 were $97.9 million, $94.7 million and $92.2 million, respectively. 14) Stock-Based Compensation Stock-based compensation represents the cost related to stock-based awards granted to our associates and directors, which may include restricted stock and stock appreciation rights (“SARs”). We measure stock-based compensation cost at the date of grant, based on the estimated fair value of the award. We recognize the cost as expense on a straight-line basis (net of estimated forfeitures) over the related vesting period. Refer to Note J, “Stock-Based Compensation,” to the Consolidated Financial Statements for further information. 42 15) Investment (Income), Net Investment (income), net, consists of the following components: Year Ended May 31, 2026 2025 2024 (In thousands) Interest (income) $ (14,848 ) $ (13,335 ) $ (20,947 ) Net (gain) on marketable securities (25,422 ) (4,997 ) (19,914 ) Dividend (income) (6,619 ) (5,767 ) (4,113 ) Investment (income), net $ (46,889 ) $ (24,099 ) $ (44,974 ) Net (Gain) on Marketable Securities Year Ended May 31, 2026 2025 2024 (In thousands) Unrealized (gains) losses on marketable equity securities $ (22,452 ) $ 5,505 $ (19,703 ) Realized (gains) on marketable equity securities (2,978 ) (10,625 ) (290 ) Realized losses on available-for-sale debt securities 8 123 79 Net (gain) on marketable securities $ (25,422 ) $ (4,997 ) $ (19,914 ) 16) Other (Income) Expense, Net Other (income) expense, net, consists of the following components: Year Ended May 31, 2026 2025 2024 (In thousands) Pension non-service (credits) costs $ (9,969 ) $ 200 $ 11,046 Other (1,543 ) (1,794 ) (882 ) Other (income) expense, net $ (11,512 ) $ (1,594 ) $ 10,164 17) Income Taxes The provision for income taxes is calculated using the asset and liability method. Under the asset and liability method, deferred income taxes are recognized for the tax effect of temporary differences between the financial statement carrying amount of assets and liabilities and the amounts used for income tax purposes and for certain changes in valuation allowances. Valuation allowances are recorded to reduce certain deferred tax assets when, in our estimation, it is more likely than not that a tax benefit will not be realized. 18) Earnings Per Share of Common Stock Earnings per share (EPS) is computed using both the treasury stock and two-class method, as our unvested share-based payment awards contain rights to receive non-forfeitable dividends and, therefore, are considered participating securities. We calculate both Basic and Diluted EPS under each method and compare the results, reporting the method that is most dilutive. Basic EPS of common stock is computed by dividing net income by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS of common stock is computed on the basis of the weighted-average number of shares of common stock, plus the effect of dilutive potential shares of common stock outstanding during the period using the treasury stock method. Dilutive potential shares of common stock include outstanding SARS and restricted stock awards. The treasury stock method also assumes that we use the proceeds from the hypothetical exercise of the stock compensation awards to repurchase common stock at the average market price during the period. The two-class method determines EPS for each class of common stock and participating securities according to dividends and dividend equivalents and their respective participation rights in undistributed earnings. See Note L, “Earnings Per Share,” to the Consolidated Financial Statements for additional information. 19) Supply Chain Financing We offer a supplier finance program with a financial institution, in which suppliers may elect to receive early payment from the financial institution on invoices issued to RPM. The financial institution enters into separate arrangements with suppliers directly to participate in the program. We do not determine the terms or conditions of such arrangements or participate in the transactions between the suppliers and the financial institution. There are no assets pledged by RPM under the supplier finance program. Our responsibility is limited to making payments to the financial institution based on payment terms originally negotiated with the suppliers, regardless of whether the financial institution pays the supplier in advance of the original due date. The range of payment terms RPM negotiates with suppliers are consistent, regardless of whether a supplier participates in the supply chain finance program. RPM or the financial institution may terminate participation in the program upon at least 30 days’ notice. The liabilities associated with the supply chain finance program are included within accounts payable on the Consolidated Balance Sheets. 43 The rollforward of outstanding obligations confirmed as valid under the supplier finance program is as follows: Year Ended May 31, 2026 2025 (In thousands) Beginning Balance $ 38,987 $ 32,899 Invoices confirmed during the year 192,796 139,571 Confirmed invoices paid during the year (173,682 ) (133,483 ) Ending Balance $ 58,101 $ 38,987 20) Recent Accounting Pronouncements New Pronouncements Adopted In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740): Improvements to Income Tax Disclosures," which requires a public business entity to disclose specific categories in its annual effective tax rate reconciliation and disaggregated information about significant reconciling items by jurisdiction and by nature. The ASU also requires entities to disclose annually their income tax payments (net of refunds) to international, federal, and state and local jurisdictions. The guidance makes several other changes to annual income tax disclosure requirements. This guidance is effective for fiscal years beginning after December 15, 2024, and, when issued, was allowed to be applied on a retrospective or prospective basis, and early adoption was permitted. We adopted the new standard effective May 31, 2026 on a prospective basis. Adoption of this ASU resulted in additional annual income tax disclosures, but did not impact our consolidated balance sheet, results of operations or cash flows. Refer to Note H, “Income Taxes,” to the Consolidated Financial Statements. In November 2023, the FASB issued Accounting Standard Update ("ASU") 2023-07, "Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures," which expands disclosures about a public business entity's reportable segments and provides for more detailed information about a reportable segment's expenses. This guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, and requires retrospective application to all prior periods presented in the financial statements. We adopted the new standard effective May 31, 2025. Adoption of this ASU resulted in additional disclosure, but did not impact our consolidated balance sheet, results of operations or cash flows. Refer to Note R, “Segment Information,” to the Consolidated Financial Statements. New Pronouncements Issued In September 2025, the FASB issued ASU 2025-06, “Intangibles - Goodwill and Other-Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software”. The ASU amends the existing standard to remove all references to prescriptive and sequential software development project stages. Under this guidance, eligible software development costs will begin capitalization when management has authorized and committed to funding the software project, and it is probable that the project will be completed and the software will be used to perform the function intended. In evaluating whether it is probable the project will be completed; management is required to consider whether there is significant uncertainty associated with the development activities of the software. This guidance is effective for all annual periods beginning after December 15, 2027, and for interim periods within those annual reporting periods, with early adoption permitted. The guidance may be applied on a prospective basis, a modified basis for in-process projects, or a retrospective basis. We are currently evaluating the impact of this ASU to determine the impact on the consolidated financial statements and related disclosures. In July 2025, the FASB issued ASU 2025-05, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets”. The ASU provides a practical expedient to assume that conditions as of the balance sheet date remain unchanged over the life of the asset when estimating expected credit losses for current accounts receivable and current contract assets arising from transactions accounted for under Topic 606. This guidance is effective for annual reporting periods beginning after December 15, 2025, and for interim periods within those annual reporting periods, with early adoption permitted. The amendments in ASU 2025-05 should be applied prospectively. We are currently evaluating the impact of this ASU and believe that the adoption will not have a material impact on the consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03, " Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)." Additionally, in January 2025, the FASB issued ASU 2025-01 to clarify the effective date of ASU 2024-03. The standard provides guidance to expand disclosures related to the disaggregation of income statement expenses. The standard requires, in the notes to the financial statements, disclosure of specified information about certain costs and expenses which includes purchases of inventory, employee compensation, depreciation, and intangible asset amortization included in each relevant expense caption. This guidance is effective for fiscal years beginning after December 15, 2026, and interim periods within annual reporting periods beginning after December 15, 2027, on a retrospective or prospective basis, with early adoption permitted. We are currently evaluating this ASU to determine its impact on our disclosures. 44 21) Subsequent Event Stock Repurchase Program On July 22, 2026, we announced, and our Board of Directors authorized, a $700 million increase to our existing common stock repurchase program. The authorization has no expiration date. The newly authorized amount is in addition to the $114.8 million available under the stock repurchase program discussed in Note I, “Stock Repurchase Program”. Repurchases under the authorization may be made from time to time in the open market or in private transactions at various times and in amounts and for prices that our management deems appropriate, subject to insider trading rules and other securities law restrictions. The authorization may be modified, suspended, or discontinued at any time. NOTE B — RESTRUCTURING We record restructuring charges associated with management-approved restructuring plans to either reorganize one or more of our business segments, or to remove duplicative headcount and infrastructure associated with our businesses. Restructuring charges can include severance costs to eliminate a specified number of associates, infrastructure charges to vacate facilities and consolidate operations, contract cancellation costs and other costs. We record the short-term portion of our restructuring liability in other accrued liabilities and the long-term portion, if any, in other long-term liabilities in our Consolidated Balance Sheets. Margin Achievement Plan 2025 In August 2022, we approved and announced MAP 2025, which was a multi-year restructuring plan designed to improve margins by streamlining business processes, reducing working capital, implementing commercial initiatives to drive improved mix, pricing discipline and salesforce effectiveness and improving operating efficiency. On May 31, 2025, we formally concluded MAP 2025; however, certain projects identified prior to that date will be completed during fiscal 2027. As a result, we plan to continue recognizing restructuring costs in fiscal 2027. The current total expected costs associated with this plan are outlined below and increased approximately $1.2 million compared to our prior quarter estimate, attributable to an increase in expected severance and benefit charges of $0.1 million and an increase in expected facility closure and other related costs of $1.1 million. The final implementation of the aforementioned phases and total expected costs are subject to change as actual costs are incurred. 45 Following is a summary of the charges recorded in connection with MAP 2025 by reportable segment, as well as the total expected costs related to projects identified to date: Year Ended Year Ended Year Ended Cumulative Costs Total Expected (In thousands) May 31, 2026 May 31, 2025 May 31, 2024 to Date Costs CPG Segment: Severance and benefit costs $ 4,097 $ 4,147 $ 9,480 $ 23,815 $ 24,937 Facility closure and other related costs 3,797 1,700 678 6,175 9,575 Total Charges $ 7,894 $ 5,847 $ 10,158 $ 29,990 $ 34,512 PCG Segment: Severance and benefit costs $ 3,443 $ 3,771 $ 4,963 $ 13,781 $ 13,781 Facility closure and other related costs 2,397 2,355 637 5,389 6,189 Other restructuring costs (1) - - 4,555 7,092 7,092 Total Charges $ 5,840 $ 6,126 $ 10,155 $ 26,262 $ 27,062 Consumer Segment: Severance and benefit costs $ 3,245 $ 9,775 $ 9,539 $ 23,416 $ 23,416 Facility closure and other related costs 1,215 2,699 156 4,691 4,691 Other restructuring costs - 532 - 532 532 Total Charges $ 4,460 $ 13,006 $ 9,695 $ 28,639 $ 28,639 Corporate/Other: Severance and benefit (credits) $ - $ - $ - $ (50 ) $ (50 ) Total Charges $ - $ - $ - $ (50 ) $ (50 ) Consolidated: Severance and benefit costs $ 10,785 $ 17,693 $ 23,982 $ 60,962 $ 62,084 Facility closure and other related costs 7,409 6,754 1,471 16,255 20,455 Other restructuring costs - 532 4,555 7,624 7,624 Total Charges $ 18,194 $ 24,979 $ 30,008 $ 84,841 $ 90,163 (1)Of the $4.6 million of other restructuring costs incurred during the year ended May 31, 2024, $3.3 million is associated with the impairment of an indefinite-lived tradename. See Note C, "Goodwill and Other Intangible Assets," of the Consolidated Financial Statements below for further description. A summary of the activity in the restructuring reserves related to MAP 2025 is as follows: (In thousands) Severance and Benefits Costs Facility Closure and Other Related Costs Other Asset Write-Offs Total Balance at June 1, 2024 $ 17,351 $ 18 $ - $ 17,369 Additions charged to expense 17,693 6,754 532 24,979 Cash payments charged against reserve (22,126 ) (6,340 ) - (28,466 ) Non-cash charges and other adjustments 137 - (532 ) (395 ) Balance at May 31, 2025 13,055 432 - 13,487 Additions charged to expense 10,785 7,409 - 18,194 Cash payments charged against reserve (16,121 ) (7,681 ) - (23,802 ) Non-cash charges and other adjustments 130 (43 ) - 87 Balance at May 31, 2026 $ 7,849 $ 117 $ - $ 7,966 2026 Restructuring Action During the third quarter of fiscal 2026, we approved and announced SG&A focused optimization actions in response to performance and market conditions. This is an acceleration of actions planned to be included as part of our next MAP initiative. The initial focus of the program is eliminating SG&A costs through the structural realignment and elimination of certain levels of management, as well as certain footprint rationalization initiatives. The objective of which is to better align our resources with our strategic priorities and navigate the current economic environment. 46 The current total expected costs associated with this plan are outlined below and increased approximately $2.5 million compared to our prior quarter estimate, attributable to an increase in expected severance and benefit charges of $1.6 million and an increase in expected facility closure and other related costs of $0.9 million. As we finalize our next multi-year MAP initiative, we will continue to identify improvement and cost savings opportunities, as well as establish the expected duration of the program. As such, the final implementation and total expected costs are subject to change. The following is a summary of the charges recorded in connection with this program by reportable segment, as well as the total expected costs related to projects identified to date: Year Ended Cumulative Costs Total Expected (In thousands) May 31, 2026 to Date Costs CPG Segment: Severance and benefit costs $ 8,968 $ 8,968 $ 11,772 Facility closure and other related costs 223 223 223 Total Charges $ 9,191 $ 9,191 $ 11,995 PCG Segment: Severance and benefit costs $ 5,798 $ 5,798 $ 6,054 Facility closure and other related costs 446 446 1,445 Total Charges $ 6,244 $ 6,244 $ 7,499 Consumer Segment: Severance and benefit costs $ 6,864 $ 6,864 $ 9,762 Facility closure and other related costs 746 746 1,037 Total Charges $ 7,610 $ 7,610 $ 10,799 Corporate/Other: Severance and benefit costs $ 1,373 $ 1,373 $ 1,373 Total Charges $ 1,373 $ 1,373 $ 1,373 Consolidated: Severance and benefit costs $ 23,003 $ 23,003 $ 28,961 Facility closure and other related costs 1,415 1,415 2,705 Total Charges $ 24,418 $ 24,418 $ 31,666 A summary of the activity in the restructuring reserves related to this program is as follows: (In thousands) Severance and Benefits Costs Facility Closure and Other Related Costs Total Balance at June 1, 2025 $ - $ - $ - Additions charged to expense 23,003 1,415 24,418 Cash payments charged against reserve (16,655 ) (1,296 ) (17,951 ) Non-cash charges and other adjustments 354 - 354 Balance at May 31, 2026 $ 6,702 $ 119 $ 6,821 47 NOTE C — GOODWILL AND OTHER INTANGIBLE ASSETS The changes in the carrying amount of goodwill, by reportable segment, for the years ended May 31, 2026 and 2025, are as follows: CPG PCG Consumer (In thousands) Segment Segment Segment Total Balance as of June 1, 2024 $ 485,135 $ 279,810 $ 543,966 $ 1,308,911 Acquisitions and purchase price allocation adjustments 28,925 47,313 229,787 306,025 Impairments - - (11,352 ) (11,352 ) Translation adjustments & other 4,563 3,801 5,678 14,042 Balance as of May 31, 2025 518,623 330,924 768,079 1,617,626 Acquisitions and purchase price allocation adjustments 8,553 18,752 30,145 57,450 Translation adjustments & other 7,420 4,511 1,157 13,088 Balance as of May 31, 2026 $ 534,596 $ 354,187 $ 799,381 $ 1,688,164 Total accumulated goodwill impairment losses were $204.4 million at May 31, 2026. Of the accumulated balance, $152.8 million is included in our Consumer segment, $14.9 million is included in our CPG segment, and $36.7 million is included in our PCG segment. There were no impairment losses recorded during fiscal 2026. Changes in the Composition of our Segments in the First Quarter of Fiscal 2026 Effective June 1, 2025, we realigned certain businesses and management structures to recognize how we allocate resources and analyze the operating performance of our operating segments, as further discussed in Note R, "Segment Information." As such, we now report under three reportable segments instead of our four previous reportable segments. Our three reportable segments are: CPG, PCG and Consumer. This realignment changed our reportable segments beginning with our first quarter of fiscal 2026. As a result, historical segment results have been recast to reflect the impact of this change. This realignment did not result in any changes to our designated reporting units. As a result, no goodwill impairment assessment was considered necessary as no indications of impairment were identified during the first quarter of fiscal 2026. Conclusion on Annual Goodwill and Indefinite-Lived Intangible Assets Impairment Tests As a result of the annual impairment assessments performed for fiscal 2025, we recorded a goodwill impairment loss of $11.4 million for our Color Group reporting unit in our Consumer Segment. The impairment is related to continued softness in OEM markets and underperformance in our growth initiatives associated with this reporting unit. After recording the goodwill impairment charge, no goodwill remained on the Color Group’s balance sheet as of May 31, 2025. As a result of the annual impairment assessments performed for fiscal 2026 and 2024, there were no goodwill impairments. Our annual impairment test of our indefinite-lived intangible assets performed during fiscal 2025 resulted in a $1.7 million impairment charge for an indefinite-lived tradename in our Consumer segment. Our annual impairment test of our indefinite-lived intangible assets performed during fiscal 2024 resulted in a $1.0 million impairment charge for an indefinite-lived tradename in our Consumer segment. These impairment losses were classified as SG&A expenses in our Consolidated Statements of Income. Our annual impairment test of our indefinite-lived intangible assets performed during fiscal 2026 did not result in an impairment charge. Changes in the Composition of our Segments and USL Restructuring in the First Quarter of Fiscal 2024 Effective June 1, 2023, in connection with our MAP 2025 operating improvement program, we realigned certain businesses and management structures within our CPG, PCG and Consumer segments. Our CPG APAC and CPG India businesses, formerly of our Sealants reporting unit within our CPG segment, were transferred to our Platform component within our PCG segment. As a result of this change, we designated the Platform component as a separate reporting unit within our PCG segment and $11.4 million of goodwill was reassigned from the CPG segment to the PCG segment using a relative fair value allocation approach. Within our Consumer segment, our former DayGlo and Kirker reporting units were combined into one reporting unit: The Color Group. Within our PCG segment, our former Wood Finishes, Kop-Coat Protection Products, TCI and Modern Recreational Technologies reporting units were combined into one reporting unit: The Industrial Coatings Group. Additionally, effective June 1, 2023, certain businesses of our USL reporting unit were transferred to our Fibergrate, Carboline and Stonhard reporting units within our PCG segment. As a result of this change, USL was no longer designated as a separate reporting unit and any remaining goodwill was transferred to the reporting units noted above. Additionally, during the three-month period ended August 31, 2023, we recognized a loss on sale of $4.5 million in connection with the divestiture of Universal Sealants' (USL) Bridgecare services division, which is a contracting business focused on the installation of joints and waterproofing in the U.K. The loss on this sale is included in SG&A in our Consolidated Statements of Income and net (gain) on sales of assets and businesses in our Consolidated Statements of Cash Flows. 48 During the first quarter of fiscal 2024, we performed a goodwill impairment test for the reporting units affected by the USL restructuring and the changes in the composition of our segments and reporting units using either a qualitative or quantitative assessment. We concluded that the estimated fair values exceeded the carrying values for these reporting units, and accordingly, no indications of impairment were identified as a result of these changes. Furthermore, we performed an interim impairment assessment of a remaining USL indefinite-lived tradename. Calculating the fair value of the tradename required the use of various estimates and assumptions. We estimated the fair value by applying a relief-from-royalty calculation, which included discounted future cash flows related to projected revenues impacted by this decision. In applying this methodology, we relied on a number of factors, including actual and forecasted revenues and market data. As the carrying amount of the tradename exceeded its fair value, an impairment loss of $3.3 million was recorded for the three months ended August 31, 2023. This impairment loss was classified as restructuring expense within our PCG segment. Other intangible assets consist of the following major classes: Gross Net Other Amortization Carrying Accumulated Intangible (In thousands) Period (In Years) Amount Amortization Assets As of May 31, 2026 Amortized intangible assets Formulae 9 to 33 $ 241,236 $ (214,914 ) $ 26,322 Customer-related intangibles 5 to 33 794,707 (377,963 ) 416,744 Trademarks/names 5 to 40 40,731 (26,450 ) 14,281 Other 3 to 30 25,163 (23,852 ) 1,311 Total Amortized Intangibles 1,101,837 (643,179 ) 458,658 Indefinite-lived intangible assets Trademarks/names 365,980 - 365,980 Total Other Intangible Assets $ 1,467,817 $ (643,179 ) $ 824,638 As of May 31, 2025 Amortized intangible assets Formulae 9 to 33 $ 239,208 $ (207,934 ) $ 31,274 Customer-related intangibles 5 to 33 724,297 (339,492 ) 384,805 Trademarks/names 5 to 40 33,669 (24,129 ) 9,540 Other 3 to 30 25,079 (23,498 ) 1,581 Total Amortized Intangibles 1,022,253 (595,053 ) 427,200 Indefinite-lived intangible assets Trademarks/names 353,626 - 353,626 Total Other Intangible Assets $ 1,375,879 $ (595,053 ) $ 780,826 The aggregate intangible asset amortization expense for the fiscal years ended May 31, 2026, 2025 and 2024 was $45.8 million, $45.5 million and $39.1 million, respectively. For the next five fiscal years, we estimate annual intangible asset amortization expense related to our existing intangible assets to approximate the following: fiscal 2027 — $45.7 million, fiscal 2028 — $43.4 million, fiscal 2029 — $42.0 million, fiscal 2030 — $39.9 million and fiscal 2031 — $37.1 million. NOTE D — MARKETABLE SECURITIES The following tables summarize available-for-sale debt securities held at May 31, 2026 and 2025 by asset type: Available-For-Sale Debt Securities (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Net Carrying Amount) May 31, 2026 Fixed maturity: U.S. treasury and other government $ 26,174 $ 41 $ (984 ) $ 25,231 Corporate bonds 132 4 (13 ) 123 Total available-for-sale debt securities $ 26,306 $ 45 $ (997 ) $ 25,354 49 Available-For-Sale Debt Securities (In thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value (Net Carrying Amount) May 31, 2025 Fixed maturity: U.S. treasury and other government $ 25,218 $ 69 $ (1,087 ) $ 24,200 Corporate bonds 132 4 (13 ) 123 Total available-for-sale debt securities $ 25,350 $ 73 $ (1,100 ) $ 24,323 Marketable securities are composed of available-for-sale debt securities and marketable equity securities and all marketable securities are reported at fair value. We carry a portion of our marketable securities portfolio in long-term assets since they are generally held for the settlement of our general and product liability insurance claims processed through our wholly owned captive insurance subsidiaries. Available-for-sale debt securities are included in other current and long-term assets totaling $3.2 million and $22.2 million at May 31, 2026, respectively, and included in other current and long-term assets totaling $4.1 million and $20.2 million at May 31, 2025, respectively. Realized gains and losses on sales of available-for-sale debt securities are recognized in net income on the specific identification basis. Changes in the fair values of available-for-sale debt securities that are determined to be holding gains or losses are recorded through accumulated other comprehensive income (loss), net of applicable taxes, within stockholders' equity. In assessing whether a credit loss exists, we evaluate our ability to hold the investment, the strength of the underlying collateral and the extent to which the investment's amortized cost or cost, as appropriate, exceeds it related fair value. As of May 31, 2026 and 2025, we held approximately $174.4 million and $135.4 million in marketable equity securities, respectively. Realized and unrealized gains and losses on marketable equity securities are included in Investment (Income), Net in the Consolidated Statements of Income. Refer to Note A(15), “Summary of Significant Accounting Policies - Investment (Income), Net,” to the Consolidated Financial Statements for further details. Summarized below are the available-for-sale debt securities we held at May 31, 2026 and 2025 that were in an unrealized loss position and that were included in accumulated other comprehensive income (loss), aggregated by the length of time the investments had been in that position: May 31, 2026 May 31, 2025 (In thousands) Fair Value Gross Unrealized Losses Fair Value Gross Unrealized Losses Total investments with unrealized losses $ 17,468 $ (997 ) $ 15,794 $ (1,100 ) Unrealized losses with a loss position for less than 12 months 4,712 (46 ) 5,777 (753 ) Unrealized losses with a loss position for more than 12 months 12,756 (951 ) 10,017 (347 ) We have reviewed all the securities included in the table above and have concluded that we have the ability and intent to hold these investments until their cost can be recovered, based upon the severity and duration of the decline. The decline in fair value is largely due to changes in interest rates and other market conditions. We have evaluated these securities and have determined no allowance for credit losses is necessary for these investments. The net carrying values of available-for-sale debt securities at May 31, 2026, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. (In thousands) Amortized Cost Fair Value Due: Less than one year $ 3,307 $ 3,237 One year through five years 14,390 14,227 Six years through ten years 5,603 5,553 After ten years 3,006 2,337 $ 26,306 $ 25,354 NOTE E — FAIR VALUE MEASUREMENTS Financial instruments recorded in the Consolidated Balance Sheets include cash and cash equivalents, trade accounts receivable, marketable securities, notes and accounts payable, and debt. An allowance for credit losses is established for trade accounts receivable using assessments of current creditworthiness of customers, historical collection experience, the aging of receivables and other currently available evidence. Trade accounts receivable balances are 50 written-off against the allowance if a final determination of uncollectibility is made. All provisions for allowance for doubtful collection of accounts are included in SG&A expense. The valuation techniques utilized for establishing the fair values of assets and liabilities are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect management’s market assumptions. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value, as follows: Level 1 Inputs — Quoted prices for identical instruments in active markets. Level 2 Inputs — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. Level 3 Inputs — Instruments with primarily unobservable value drivers. The following tables present our assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2026 Available-for-sale debt securities: U.S. Treasury and other government $ - $ 25,231 $ - $ 25,231 Corporate bonds - 123 - 123 Total available-for-sale debt securities - 25,354 - 25,354 Marketable equity securities: Stocks-foreign 370 - - 370 Stocks-domestic 5,213 - - 5,213 Mutual funds - foreign - 49,082 - 49,082 Mutual funds - domestic 13,664 106,065 - 119,729 Total marketable equity securities 19,247 155,147 - 174,394 Contingent consideration - - (5,349 ) (5,349 ) Total $ 19,247 $ 180,501 $ (5,349 ) $ 194,399 (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2025 Available-for-sale debt securities: U.S. Treasury and other government $ - $ 24,200 $ - $ 24,200 Corporate bonds - 123 - 123 Total available-for-sale debt securities - 24,323 - 24,323 Marketable equity securities: Stocks-foreign 1,265 - - 1,265 Stocks-domestic 8,642 - - 8,642 Mutual funds - foreign - 38,943 - 38,943 Mutual funds - domestic - 86,569 - 86,569 Total marketable equity securities 9,907 125,512 - 135,419 Contingent consideration - - (17,252 ) (17,252 ) Total $ 9,907 $ 149,835 $ (17,252 ) $ 142,490 Our investments in available-for-sale debt securities and marketable equity securities are valued using a market approach. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors, including the type of instrument, whether the instrument is actively traded and other characteristics particular to the transaction. For most of our financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. The contingent consideration represents the estimated fair value of the additional variable cash consideration payable in connection with recent acquisitions that is contingent upon the achievement of certain performance milestones. We estimated the fair value using expected future cash flows over the period in which the obligation is expected to be settled which is considered to be a Level 3 input. 51 During fiscal 2026, we decreased our accrual by $14.4 million primarily related to the Star Brands Group acquisition completed during fiscal 2025. During fiscal 2025, we paid approximately $2.2 million to satisfy contingent consideration obligations relating to certain performance milestones that were established in prior periods and achieved during the year, and we increased our accrual by $17.3 million related to acquisitions completed during fiscal 2025, which is considered a noncash investing activity. In the Consolidated Statements of Cash Flows, payments of acquisition-related contingent consideration for the amount recognized at fair value as of the acquisition date are reported in cash flows from financing activities, while payment of contingent consideration in excess of fair value as of the acquisition date, are reported in cash flows from operating activities within accrued liabilities. The carrying value of our current financial instruments, which include cash and cash equivalents, marketable securities, trade accounts receivable, accounts payable and short-term debt, approximates fair value because of the short-term maturity of these financial instruments. At May 31, 2026 and 2025, the fair value of our long-term debt was estimated using active market quotes, based on our current incremental borrowing rates for similar types of borrowing arrangements, which are Level 2 inputs. Based on the analysis performed, the fair value and the carrying value of our financial instruments and long-term debt as of May 31, 2026 and 2025 are as follows: At May 31, 2026 (In thousands) Carrying Value Fair Value Long-term debt, including current portion $ 2,533,524 $ 2,434,070 At May 31, 2025 (In thousands) Carrying Value Fair Value Long-term debt, including current portion $ 2,646,613 $ 2,523,202 NOTE F — ACQUISITIONS AND DIVESTITURES During the fiscal year ended May 31, 2026, we completed a total of six acquisitions across our three reportable segments. Most notably, on June 17, 2025, we announced the acquisition of Ready Seal Inc. ("Ready Seal"), a Texas-based manufacturer of premium exterior wood stains, which is included in our Consumer segment. Furthermore, in the fourth quarter of fiscal 2026, we acquired Kalzip GmbH ("Kalzip"), a global leader in the design and production of metal-based roofs and facades for building envelopes, which is included primarily in our CPG reportable segment. During the fiscal year ended May 31, 2025, we completed a total of six acquisitions across our three reportable segments. Most notably, on April 30, 2025, we acquired 100% of the stock of Clean Topco Limited, including its wholly owned subsidiaries comprising the Star Brands Group, which is the parent company of The Pink Stuff. The Star Brands Group is included in our Consumer reportable segment and is a globally recognized leader in household cleaning products best known for its iconic cleaning paste, vibrant branding and signature scent. The total purchase price for this acquisition was $487.4 million. In addition to cash consideration, the seller may be eligible to receive a future contingent cash receipt of up to an additional $106.9 million upon achievement of certain financial goals. Furthermore, in the second quarter of fiscal 2025, we acquired TMP Convert SAS which is a leading manufacturer of outdoor design and landscape products and is included in our PCG reportable segment. We incurred $12.1 million and $11.3 million of acquisition-related costs during the years ended May 31, 2026 and 2025, respectively, which are recorded in SG&A on the Consolidated Statement of Income. The purchase price for each acquisition has been allocated to the estimated fair values of the assets acquired and liabilities assumed as of the date of acquisition. We have finalized the purchase price allocation for our fiscal 2025 acquisitions. At May 31, 2026, the value of total assets acquired and liabilities assumed are substantially complete. The areas that remain open primarily relate to working capital adjustments and the fair value of deferred income taxes. 52 Acquisitions are aggregated by year of purchase in the following table: Fiscal 2026 Acquisitions Fiscal 2025 Acquisitions (In thousands) Weighted-Average Intangible Asset Amortization Life (In Years) Total Weighted-Average Intangible Asset Amortization Life (In Years) Total Current assets $ 79,350 $ 128,685 Property, plant and equipment 38,897 41,276 Goodwill N/A 57,450 N/A 306,025 Trade names - indefinite lives N/A 9,825 N/A 95,804 Other intangible assets 16 76,623 18 213,262 Other long-term assets 9,679 8,063 Total Assets Acquired $ 271,824 $ 793,115 Liabilities assumed (51,993 ) (153,516 ) Net Assets Acquired $ 219,831 (1) $ 639,599 (2) (1)Figure includes cash acquired of $17.4 million. (2)Figure includes cash acquired of $43.8 million. The fiscal year 2025 acquisitions above include goodwill of $229.8 million, indefinite-lived trade names of $89.8 million, and other intangible assets of $179.6 million for the Star Brands Group of which $35.7 million is expected to be deductible for tax purposes. Our Consolidated Financial Statements reflect the results of operations of acquired businesses as of their respective dates of acquisition. Pro-forma results of operations for the years ended May 31, 2026 and 2025 were not materially different from reported results and, consequently, are not presented. NOTE G — BORROWINGS A description of long-term debt follows: May 31, 2026 2025 (In thousands) Total Long-Term Debt Revolving credit facility with a syndicate of banks, through February 27, 2031 (1) $ 598,155 $ 789,023 Accounts receivable securitization program with two banks, through April 30, 2028 274,000 190,000 Unsecured 3.75% notes due March 15, 2027 (2) 399,950 399,885 Unsecured 4.55% senior notes due March 1, 2029 (2) 349,835 349,782 Unsecured 2.95% notes due January 15, 2032 (2) 299,599 299,535 Unsecured 5.25% notes due June 1, 2045 (2) 301,320 301,363 Unsecured 4.25% notes due January 15, 2048 (2) 299,993 299,992 Other obligations, including finance leases and unsecured notes payable at various rates of interest due in installments through 2035 21,797 28,041 Unamortized debt issuance costs (11,125 ) (11,008 ) 2,533,524 2,646,613 Less: current portion 407,834 7,691 Total Long-Term Debt, Less Current Maturities $ 2,125,690 $ 2,638,922 (1)Interest as of May 31, 2026 was 4.63% for the USD denominated swingline account and the revolver, which are tied to SOFR; 2.93% on EUR denominated debt which is tied to ESTR; 3.25% on CAD denominated debt, which is tied to CORRA. The debt balances outstanding, excluding deferred financing fees, as of May 31, 2026 for the USD denominated swingline, USD denominated revolver, EUR denominated revolver, and CAD denominated revolver were as follows: $7.2 million, $55.0 million, $163.3 million, and $372.7 million. Interest as of May 31, 2025 was 5.53% for the USD denominated swingline account, which is tied to SOFR; 3.31% on EUR denominated debt which is tied to ESTR; and 5.34% on GBP denominated debt, which is tied to the Sterling Overnight Index Average (SONIA). The debt balances outstanding, excluding deferred financing fees, as of May 31, 2025 for the USD denominated swingline, EUR denominated revolver, GBP denominated revolver, and CAD denominated revolver were as follows: $17.7 million, $271.2 million, $45.1 million, and $455.1 million. (2)Net of bond discounts and premiums of $0.7 million and $0.6 million at May 31, 2026 and 2025, respectively. 53 The aggregate maturities of long-term debt for the five years subsequent to May 31, 2026 are as follows: fiscal 2027 — $409.0 million; fiscal 2028 — $280.8 million; fiscal 2029 — $353.7 million; fiscal 2030 — $2.0 million; fiscal 2031 — $599.1 million and thereafter $901.4 million. Additionally, at May 31, 2026, we had unused lines of credit totaling $774.3 million. Our available liquidity, including our cash and cash equivalents and amounts available under our committed credit facilities, stood at $1,089.5 million at May 31, 2026. Our debt-to-capital ratio was 43.3% at May 31, 2026, compared with 47.8% at May 31, 2025. Revolving Credit Agreement Our $1.35 billion unsecured syndicated revolving credit facility (the "Revolving Credit Facility"), was amended during the third quarter of fiscal 2026. The amendment extended the expiration date to February 27, 2031 and streamlined our financial covenants. The Revolving Credit Facility bears interest at either the base rate or the adjusted SOFR, as defined, at our option, plus a spread determined by our debt rating. The Revolving Credit Facility includes sublimits for the issuance of swingline loans, which are comparatively short-term loans used for working capital purposes and letters of credit. The Revolving Credit Facility is available to refinance existing indebtedness, to finance working capital and capital expenditures, and for general corporate purposes. The Revolving Credit Facility requires us to comply with various customary affirmative and negative covenants, including a leverage covenant (i.e. Net Leverage Ratio), which is calculated in accordance with the terms as defined by the Revolving Credit Facility. Under the terms of the leverage covenant, we may not permit our leverage ratio for total indebtedness to consolidated EBITDA for the four most recent fiscal quarters to exceed 3.75 to 1.00. During certain periods and per the terms of the Revolving Credit Facility, this ratio may be increased to 4.25 to 1.00 upon delivery of a notice to our lender requesting an increase to our maximum leverage or in connection with certain “material acquisitions.” As of May 31, 2026, we were in compliance with all covenants contained in our Revolving Credit Facility, including the Net Leverage Ratio covenant. At that date, our Net Leverage Ratio was 1.70 to 1.00. Our available liquidity under our Revolving Credit Facility stood at $748.3 million at May 31, 2026. Our access to funds under our Revolving Credit Facility is dependent on the ability of the financial institutions that are parties to the Revolving Credit Facility to meet their funding commitments. Those financial institutions may not be able to meet their funding commitments if they experience shortages of capital and liquidity or if they experience excessive volumes of borrowing requests within a short period of time. Moreover, the obligations of the financial institutions under our Revolving Credit Facility are several and not joint and, as a result, a funding default by one or more institutions does not need to be made up by the others. Accounts Receivable Securitization Program The accounts receivable securitization facility (the “AR Program”) was initially entered in on May 9, 2014 and subsequently amended on multiple dates. Pursuant to Amendment No. 10 to the Purchase Agreement effective April 30, 2025, the facility termination date was extended to April 30, 2028 and the borrowing capacity changed to a maximum availability of $300.0 million during all borrowing periods. The AR Program was entered into pursuant to (1) a receivables sales agreement (the “Sale Agreement”), among certain of our subsidiaries (the “Originators”), and RPM Funding Corporation, a special purpose entity (the “SPE”) whose voting interests are wholly owned by us, and (2) a receivables purchase agreement (the “Purchase Agreement”), among the SPE, certain purchasers from time to time party thereto (the “Purchasers”), and PNC Bank, National Association as administrative agent. Under the Sale Agreement, the Originators may, during the term thereof, sell specified accounts receivable to the SPE, which may in turn, pursuant to the Purchase Agreement, transfer an undivided interest in such accounts receivable to the Purchasers. Once transferred to the SPE, such receivables are owned in their entirety by the SPE and are not available to satisfy claims of our creditors or creditors of the originating subsidiaries until the obligations owing to the participating banks have been paid in full. We indirectly hold a 100% economic interest in the SPE and will, along with our subsidiaries, receive the economic benefit of the AR Program. The transactions contemplated by the AR Program do not constitute a form of off-balance sheet financing and will be fully reflected in our financial statements. The maximum availability under the AR Program is $300.0 million. Availability is further subject to changes in the credit ratings of our customers, customer concentration levels or certain characteristics of the accounts receivable being transferred and, therefore, at certain times, we may not be able to fully access the $300.0 million of funding available under the AR Program. As of May 31, 2026, there was $274.0 million outstanding under the AR Program. The interest rate under the Purchase Agreement is based on SOFR and as set forth in Amendment No. 10 to the Purchase Agreement dated April, 30, 2025, the margin was increased from 0.85% to 0.90%. In addition, as set forth in an Amended and Restated Fee Letter, dated March 18, 2021 (the “Fee Letter”), the SPE is obligated to pay a monthly unused commitment fee to the Purchasers based on the daily amount of unused commitments under the Agreement, which ranges from 0.30% to 0.50% based on usage. The AR Program contains various customary affirmative and negative covenants and also contains customary default and termination provisions. Our failure to comply with the covenants described in the Revolving Credit Facility section above could result in an event of default under that agreement, entitling the lenders to, among other things, declare the entire amount outstanding under the Revolving Credit Facility to be due and payable. The instruments governing our other outstanding indebtedness generally include cross-default provisions 54 that provide that, under certain circumstances, an event of default that results in acceleration of our indebtedness under the Revolving Credit Facility will entitle the holders of such other indebtedness to declare amounts outstanding immediately due and payable. 5.25% Notes due 2045 and 3.75% Notes due 2027 On March 2, 2017, we issued $50.0 million aggregate principal amount of 5.25% Notes due 2045 (the “2045 Notes”) and $400.0 million aggregate principal amount of 3.75% Notes due 2027 (the “2027 Notes”). The effective interest rate on the $50.0 million notes issued March 2017 is 4.84%. The 2045 Notes are a further issuance of the $250.0 million aggregate principal amount of 5.25% Notes due 2045 initially issued by us on May 29, 2015. Interest on the 2045 Notes is payable semiannually in arrears on June 1st and December 1st of each year at a rate of 5.25% per year. The effective interest rate on the $250.0 million aggregate principal amount of 5.25% Notes due 2045, including the amortization of the discount, is 5.29%. The 2045 Notes mature on June 1, 2045. Interest on the 2027 Notes is payable semiannually in arrears on March 15th and September 15th of each year, at a rate of 3.75% per year. The effective interest rate on the 2027 Notes, including the amortization of the discount, is 3.77%. The 2027 Notes mature on March 15, 2027. The indenture governing this indebtedness includes cross-acceleration provisions. Under certain circumstances, where an event of default under our other instruments results in acceleration of the indebtedness under such instruments, holders of the indebtedness under the indenture are entitled to declare amounts outstanding immediately due and payable. 4.55% Notes due 2029 On February 27, 2019, we closed an offering for $350.0 million aggregate principal amount of 4.55% Notes due 2029 (the “2029 Notes”). The proceeds from the 2029 Notes were used to repay a portion of the outstanding borrowings under our revolving credit facility and for general corporate purposes. Interest on the 2029 Notes accrues from February 27, 2019 and is payable semiannually in arrears on March 1st and September 1st of each year, beginning September 1, 2019, at a rate of 4.55% per year. The effective interest rate on the 2029 Notes, including the amortization of the discount, is 4.57%. The 2029 Notes mature on March 1, 2029. The indenture governing this indebtedness includes cross-acceleration provisions. Under certain circumstances, where an event of default under our other instruments results in acceleration of the indebtedness under such instruments, holders of the indebtedness under the indenture are entitled to declare amounts outstanding immediately due and payable. 2.95% Notes due 2032 On January 25, 2022, we closed an offering for $300.0 million aggregate principal amount of 2.95% Notes due 2032. The proceeds from the 2032 notes were used to repay a portion of the outstanding borrowings under our revolving credit facility and for general corporate purposes. Interest on the Notes accrues from January 25, 2022 and will be payable semiannually in arrears on January 15 and July 15 of each year, beginning July 15, 2022, at a rate of 2.95% per year. The effective interest rate on the notes, including the amortization of the discount, is 2.98%. The notes mature on January 15, 2032. The indenture governing this indebtedness includes cross-acceleration provisions. Under certain circumstances, where an event of default under our other instruments results in acceleration of the indebtedness under such instruments, holders of the indebtedness under the indenture are entitled to declare amounts outstanding immediately due and payable. 4.25% Notes due 2048 On December 20, 2017, we closed an offering for $300.0 million aggregate principal amount of 4.25% Notes due 2048 (the “2048 Notes”). The proceeds from the 2048 Notes were used to repay $250.0 million in principal amount of unsecured 6.50% senior notes due February 15, 2018, and for general corporate purposes. Interest on the 2048 Notes accrues from December 20, 2017 and is payable semiannually in arrears on January 15th and July 15th of each year, beginning July 15, 2018, at a rate of 4.25% per year. The effective interest rate on the notes, including the amortization of the discount, is 4.25%. The 2048 Notes mature on January 15, 2048. The indenture governing this indebtedness includes cross-acceleration provisions. Under certain circumstances, where an event of default under our other instruments results in acceleration of the indebtedness under such instruments, holders of the indebtedness under the indenture are entitled to declare amounts outstanding immediately due and payable. NOTE H — INCOME TAXES The provision for income taxes is calculated in accordance with ASC 740, "Income Taxes," which requires the recognition of deferred income taxes using the asset and liability method. Income before income taxes as shown in the Consolidated Statements of Income is summarized below for the periods indicated. Year Ended May 31, 2026 2025 2024 (In thousands) United States $ 671,812 $ 645,397 $ 625,167 Foreign 198,528 147,363 162,670 Income Before Income Taxes $ 870,340 $ 792,760 $ 787,837 55 Provision (benefit) for income taxes consists of the following for the periods indicated: Year Ended May 31, 2026 2025 2024 (In thousands) Current: U.S. federal $ 88,816 $ 113,885 $ 109,869 State and local 24,010 43,881 31,996 Foreign 62,199 49,174 62,168 Total Current 175,025 206,940 204,033 Deferred: U.S. federal 17,525 25,656 (2,263 ) State and local 10,391 160 618 Foreign 4,916 (130,323 ) (3,993 ) Total Deferred 32,832 (104,507 ) (5,638 ) Provision for Income Taxes $ 207,857 $ 102,433 $ 198,395 The significant components of deferred income tax assets and liabilities as of May 31, 2026 and 2025 were as follows: 2026 2025 (In thousands) Deferred income tax assets related to: Inventories $ 19,650 $ 17,348 Accrued compensation and benefits 22,456 15,430 Other accrued and prepaid expenses, net 27,166 21,294 Deferred income and other long-term liabilities 26,954 24,880 Credit, net operating, interest and capital loss carryforwards 109,875 60,457 Research and development - 42,258 Pension and other postretirement benefits - 5,069 Total Deferred Income Tax Assets 206,101 186,736 Less: valuation allowances (77,342 ) (49,167 ) Net Deferred Income Tax Assets 128,759 137,569 Deferred income tax (liabilities) related to: Depreciation (165,326 ) (136,966 ) Amortization of intangibles (79,602 ) (77,142 ) Unremitted foreign earnings (435 ) - Net unrealized gain on securities (5,633 ) (372 ) Pension and other postretirement benefits (6,112 ) - Total Deferred Income Tax (Liabilities) (257,108 ) (214,480 ) Deferred Income Tax Assets (Liabilities), Net $ (128,349 ) $ (76,911 ) As of May 31, 2026, we had foreign tax credit carryforwards of $31.2 million, which expire at various dates through fiscal 2036, and $25.9 million of U.S. capital loss carryforwards which expire in fiscal 2031. Additionally, as of May 31, 2026, we had approximately $62.8 million of U.S. interest deduction carryforward attributes that have an indefinite carryforward period. As of May 31, 2026, we had foreign net operating losses of approximately $119.5 million and interest deduction carryforwards of approximately $85.7 million, totaling approximately $205.2 million. Of these carryforward amounts, approximately $14.6 million will expire at various dates beginning in fiscal 2027 and approximately $190.6 million have an indefinite carryforward period. Additionally, as of May 31, 2026, we had foreign capital loss carryforwards of approximately $26.2 million that can be carried forward indefinitely. When evaluating the realizability of deferred income tax assets, we consider, among other items, whether a jurisdiction has experienced cumulative pretax losses and whether a jurisdiction will generate the appropriate character of income to recognize a deferred income tax asset. More specifically, if a jurisdiction experiences cumulative pretax losses for a period of three years, including the current fiscal year, or if a jurisdiction does not have sufficient income of the appropriate character in the relevant carryback or projected carryforward periods, we generally conclude that it is more likely than not that the respective deferred tax asset will not be realized unless factors such as expected operational changes, availability of prudent and feasible tax planning strategies, reversal of taxable temporary differences or other information exists that would lead us to conclude otherwise. If, after we have evaluated these factors, the deferred income tax assets are not expected to be realized within the carryforward or carryback periods allowed for that jurisdiction, we would conclude that a valuation allowance is required. 56 Total valuation allowances approximating $77.3 and $49.2 million have been recorded as of May 31, 2026 and 2025, respectively. These recorded valuation allowances relate primarily to certain foreign net operating losses, U.S. and foreign interest deduction carryforwards, U.S. foreign tax credit and capital loss carryforwards and other net foreign deferred tax assets. The following table reconciles fiscal 2026 income tax expense and the effective tax rate by applying the U.S. statutory federal income tax rate against income before income taxes to the tax provision for income taxes in accordance with the adoption of ASU 2023-09: Year Ended May 31, 2026 (In thousands, except percentages) Amount Percent Federal statutory tax rate $ 182,771 21.0 % State and local income taxes, net (1) 29,359 3.4 % Foreign tax effects: Canada Withholding tax 19,856 2.3 % Other adjustments 1,497 0.2 % United Kingdom Intragroup asset transfer 18,509 2.1 % Other adjustments (155 ) 0.0 % Other foreign jurisdictions 6,943 0.8 % Effect of cross border tax laws (2,107 ) (0.2 %) Tax credits: Foreign tax credit (23,503 ) (2.7 %) Other (3,000 ) (0.4 %) Changes in valuation allowances 18,981 2.2 % Nontaxable or nondeductible items 4,858 0.5 % Changes in unrecognized tax benefits (13 ) 0.0 % Other adjustments: Capital losses (18,369 ) (2.1 %) U.S. interest deduction carryforwards (13,315 ) (1.5 %) Intragroup asset transfer (17,839 ) (2.1 %) Other 3,384 0.4 % Effective Income Tax Rate $ 207,857 23.9 % (1)State income taxes in California, Illinois, New Jersey, Pennsylvania, New York and Wisconsin account for the majority (greater than 50%) of the tax effect in this category. The following table reconciles income tax expense for years prior to the adoption of ASU 2023-09: Year Ended May 31, 2025 2024 (In thousands, except percentages) Income tax expense at the U.S. statutory federal income tax rate $ 166,480 $ 165,446 Foreign rate differential and other foreign tax adjustments (32,497 ) 9,632 Impact of foreign derived intangible income deduction (38,174 ) (5,290 ) State and local income taxes, net 34,432 28,000 Impact of GILTI provisions 3,960 3,548 Nondeductible business expense 1,895 1,944 Valuation allowance 17,246 (754 ) Deferred tax liability for unremitted foreign earnings - 3,658 Changes in unrecognized tax benefits (3,771 ) 2,209 Equity-based compensation (1,963 ) (5,496 ) Nondeductible goodwill impairment 2,119 - Deferred tax adjustment to U.S. foreign tax credit carryforwards (43,922 ) - Other (3,372 ) (4,502 ) Provision for Income Tax Expense $ 102,433 $ 198,395 Effective Income Tax Rate 12.9 % 25.2 % The fiscal 2025 provision for income taxes includes incremental benefits of the U.S. deduction for foreign derived intangible income and the foreign tax rate differential associated with certain global capital structure initiatives. Additionally, during fiscal 2025, following developments in U.S. tax case law, we assessed certain of our income tax positions and recorded a deferred tax adjustment totaling $43.9 million, which represents an increase to our deferred income tax assets for U.S. foreign tax credit carryforwards. 57 The following table summarizes total income taxes paid, net of refunds received, by material jurisdiction in accordance with the adoption of ASU 2023-09: Year Ended May 31, 2026 (In thousands) U.S. federal $ 103,150 State and local: California 9,690 Other states 32,968 Foreign 52,560 Total income taxes paid, net of refunds $ 198,368 Uncertain income tax positions are accounted for in accordance with ASC 740. The following table summarizes the activity related to unrecognized tax benefits: (In millions) 2026 2025 2024 Balance at June 1 $ 1.6 $ 4.4 $ 2.9 Additions for tax positions of prior years - 0.2 3.4 Reductions for tax positions of prior years (0.1 ) (2.9 ) (1.4 ) Settlements - - (0.5 ) Foreign currency translation - (0.1 ) - Balance at May 31 $ 1.5 $ 1.6 $ 4.4 The total amount of unrecognized tax benefits that would impact the effective tax rate, if recognized, at May 31, 2026, 2025 and 2024 was $1.5 million, $1.6 million and $4.4 million, respectively. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. At May 31, 2026, 2025 and 2024, the accrual for interest and penalties was $0.7 million, $0.6 million and $3.0 million, respectively. Unrecognized tax benefits, including interest and penalties, have been classified as other long-term liabilities unless expected to be paid in one year. We file income tax returns in the United States and in various state, local and foreign jurisdictions. With limited exceptions, we are subject to federal, state and local, or non-U.S. income tax examinations by tax authorities for fiscal 2019 through 2027. Our fiscal 2023 U.S. federal income tax return is currently under examination. Additionally, we are currently under examination, or have been notified of an upcoming tax examination, for various non-U.S. and domestic state and local jurisdictions. As of May 31, 2026, we have approximately $171.6 million of unremitted foreign earnings that are not considered to be permanently reinvested. There is a $0.4 million deferred income tax liability associated with these earnings. We have not provided for U.S. income taxes or foreign withholding taxes on the remaining foreign unremitted earnings because such earnings have been retained and reinvested by the foreign subsidiaries as of May 31, 2026. Accordingly, no provision has been made for U.S. income taxes or foreign withholding taxes, which may become payable if the remaining unremitted earnings of foreign subsidiaries were distributed to the United States. Due to the uncertainties and complexities involved in the various options for repatriation of foreign earnings, it is not practical to calculate the deferred taxes associated with the remaining foreign earnings. On July 4, 2025, the One Big Beautiful Bill Act (the “Act”) was enacted in the U.S. The Act includes significant changes to corporate income tax provisions. Included in the Act are certain changes including immediate expensing for most business assets acquired and the elimination of the requirement to capitalize and amortize domestic R&D expenditures. Additionally, the Act provided taxpayers an election to accelerate amortization deductions for prior year R&D expenditures. The fiscal 2026 provision for income taxes reflects the Company’s intent to elect to accelerate such amortization deductions. NOTE I — STOCK REPURCHASE PROGRAM On January 8, 2008, we announced our authorization of a stock repurchase program under which we may repurchase shares of RPM International Inc. common stock at management’s discretion. As announced on November 28, 2018, our goal was to return $1.0 billion in capital to stockholders by May 31, 2021 through share repurchases and the retirement of our convertible note during fiscal 2019. On April 16, 2019, after taking into account share repurchases under our existing stock repurchase program to date, our Board of Directors authorized the repurchase of the remaining $600.0 million in value of RPM International Inc. common stock by May 31, 2021. In January 2021, when our Board of Directors authorized the resumption of stock repurchases under the program after briefly suspending them at the beginning of the Covid pandemic, $469.7 million of shares of common stock remained available for repurchase. At that time, the Board of Directors also extended the stock repurchase program beyond its original May 31, 2021, expiration date until such time that the remaining $469.7 million of capital has been returned to our stockholders. As a result, we may repurchase shares from time to time in the open market or in private transactions at various times and in amounts and for prices that our management deems appropriate, subject to insider trading rules and other securities law restrictions. The timing 58 of our purchases will depend upon prevailing market conditions, alternative uses of capital and other factors. We may limit or terminate the repurchase program at any time. During the fiscal year ended May 31, 2026, we repurchased 699,931 shares of our common stock at a cost of approximately $77.5 million, or an average cost of $110.72 per share, under this program. During the fiscal year ended May 31, 2025, we repurchased 581,759 shares of our common stock at a cost of approximately $70.0 million, or an average cost of $120.32 per share, under this program. During the fiscal year ended May 31, 2024, we repurchased 526,113 shares of our common stock at a cost of approximately $55.0 million, or an average cost of $104.50 per share, under this program. The maximum dollar amount that may yet be repurchased under our stock repurchase program was approximately $114.8 million at May 31, 2026. NOTE J — STOCK-BASED COMPENSATION Stock-based compensation represents the cost related to stock-based awards granted to our associates and directors; these awards include restricted stock, restricted stock units, performance stock, performance stock units and SARs. We grant stock-based incentive awards to our associates and our directors under various share-based compensation plans. Plans that are active or provide for stock option grants or share-based payment awards include the Amended and Restated 2014 Omnibus Equity and Incentive Plan (the “2014 Omnibus Plan”) and the 2024 Omnibus Equity and Incentive Plan (the “2024 Omnibus Plan”), which include provisions for grants of restricted stock, restricted stock units, performance shares, performance units, unrestricted stock and SARs. The shares available for grant out of the 2014 Omnibus Plan have expired, therefore, all future grants will be issued from the 2024 Omnibus Plan until its expiration or replacement. We measure stock-based compensation cost at the date of grant, based on the estimated fair value of the award. We recognize the cost as expense on a straight-line basis (net of estimated forfeitures) over the related vesting period. The following table represents total stock-based compensation expense included in our Consolidated Statements of Income: Year Ended May 31, 2026 2025 2024 (In thousands) Stock-based compensation expense, included in SG&A $ 33,237 $ 27,042 $ 25,925 Stock-based compensation expense, included in restructuring expense (389 ) - - Total stock-based compensation cost 32,848 27,042 25,925 Income tax (benefit) (4,427 ) (3,685 ) (3,627 ) Total stock-based compensation cost, net of tax $ 28,421 $ 23,357 $ 22,298 SARs SARs are awards that allow our associates to receive shares of our common stock at a fixed price. We grant SARs at an exercise price equal to the stock price on the date of the grant. The fair value of SARs granted is estimated as of the date of grant using a Black-Scholes option-pricing model. The Black-Scholes option-pricing model was developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected life of options granted is derived from the input of the option-pricing model and represents the period of time that options granted are expected to be outstanding. Expected volatility rates are based on historical volatility of shares of our common stock. The following is a summary of our weighted-average assumptions related to SARs grants made during the last three fiscal years: Year Ended May 31, 2026 2025 2024 Risk-free interest rate 4.1 % 4.1 % 3.9 % Expected life of option - years 6.0 6.0 6.0 Expected dividend yield 1.8 % 1.6 % 1.8 % Expected volatility rate 25.5 % 25.2 % 24.6 % The 2024 Omnibus Plan was approved by our stockholders on October 3, 2024. The 2024 Omnibus Plan provides us with the flexibility to grant a wide variety of stock and stock-based awards, as well as dollar-denominated performance-based awards, and is the primary stock-based award program for covered associates. The plan replaces the 2014 Omnibus Plan, which expired under its own terms in October 2024. SARs are issued at fair value at the date of grant, have up to ten-year terms and have graded-vesting terms over four years. Compensation cost for these awards is recognized on a straight-line basis over the related vesting period. Currently all SARs outstanding are to be settled with stock. 59 The following tables summarize option and share-based payment activity (including SARs) under these plans during the fiscal year ended May 31, 2026: 2026 Share-Based Payments Weighted- Average Exercise Price Number of Shares Under Option (Shares in thousands) Balance at June 1, 2025 $ 81.44 1,892 Options granted 110.59 262 Options exercised 53.23 (75 ) Balance at May 31, 2026 86.14 2,079 Exercisable at May 31, 2026 $ 79.50 1,512 SARs 2026 2025 2024 (In thousands, except per share amounts) Weighted-average grant-date fair value per SAR $ 29.39 $ 30.99 $ 24.04 Fair value of SARS vested $ 22.49 $ 18.93 $ 15.28 Intrinsic value of options exercised $ 11.06 $ 15.49 $ 12.37 Tax benefit from options exercised $ 783 $ 559 $ 6,049 At May 31, 2026, the aggregate intrinsic value and weighted-average remaining contractual life of options outstanding was $44.0 million and 5.45 years, respectively, while the aggregate intrinsic value and weighted-average remaining contractual life of options exercisable was $40.6 million and 4.45 years, respectively. At May 31, 2026, the total unamortized stock-based compensation expense related to SARs that were previously granted was $10.2 million, which is expected to be recognized over a weighted-average of 2.50 years. We anticipate that approximately 2.1 million shares at a weighted-average exercise price of $86.11 and a weighted-average remaining contractual term of 5.44 years are vested or expected to vest under these plans. Restricted Stock Plans We also grant stock-based awards, which may be made in the form of restricted stock, restricted stock units, performance shares and performance stock units. These awards are granted to eligible associates or directors and entitle the holder to shares of our common stock as the award vests. The fair value of the awards is determined and fixed based on the stock price at the date of grant. A description of our restricted stock plans follows. Under the 2014 Omnibus Plan, a total of 6,000,000 shares of our common stock may be subject to awards. Of those issuable shares, up to 3,000,000 shares of common stock may be subject to “full-value” awards. In October 2019, shareholders approved an amendment to the 2014 Omnibus Plan making an additional 5,000,000 shares of common stock subject to awards. Of those additional issuable shares, 2,250,000 shares may be subject to “full-value” awards similar to those issued under the 2014 Omnibus Plan. Under the 2024 Omnibus Plan, a total of 5,000,000 shares of our common stock may be subject to awards. Of those issuable shares, up to 2,500,000 shares of common stock may be subject to “full-value” awards. Nonvested restricted shares/units of common stock under both the 2014 Omnibus Plan and 2024 Omnibus Plan are eligible for dividend payments, while performance stock units are not eligible for dividend payments unless and until such units vest. Dividends are then paid based on the units that have vested. The following table summarizes the share-based performance-earned restricted stock (“PERS”) and performance stock units (“PSUs”) activity during the fiscal year ended May 31, 2026: Weighted-Average Grant-Date Fair Value 2026 (Shares in thousands) Balance at June 1, 2025 $ 97.96 816 Shares granted 110.54 259 Shares forfeited 87.28 (211 ) Shares vested 90.44 (84 ) Balance at May 31, 2026 $ 105.81 780 The weighted-average grant-date fair value was $110.54, $114.14 and $93.74 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. The restricted stock and performance stock cliff vest after three years. At May 31, 2026, remaining unamortized deferred compensation expense for performance-earned restricted stock totaled $14.3 million. The remaining amount is being amortized over the applicable vesting period for each participant. 60 PSUs have been granted to certain executives and the awards are contingent upon the level of attainment of performance goals for the three-year performance period. Vesting of 50% of the PSUs relates to compounded annualized growth rates in adjusted revenue for the period, and the vesting of the remaining 50% relates to an increase in EBIT margin, measured at the end of the three-year performance period. The number of PSUs that may vest with respect to the achievement of the performance goals may range from 0% to 200% of the PSUs granted under this program. Compensation cost for these awards has been recognized on a straight-line basis over the related performance period, with consideration given to the probability of attaining the performance goals. The following table sets forth such awards for the year ended May 31, 2026: Performance Stock Units ("PSUs") Shares Granted Weighted-Average Grant Date Fair Value Shares Outstanding as of May 31, 2026 Unamortized Expense, as of May 31, 2026 (In thousands, except per share amounts) 2023 PSUs (1) 176 $ 93.51 141 $ - 2024 PSU's (2) 153 $ 114.26 134 $ 4,489 2025 PSU's (3) 142 $ 110.59 139 $ 18,920 (1)The "2023 PSUs" were granted on July 19, 2023. The expense has been fully recognized, in line with the final results achieved for the three-year performance plan. (2)The "2024 PSUs" were granted on July 18, 2024. The unamortized expense is expected to be recognized over a weighted-average period of 1.0 year. (3)The "2025 PSUs" were granted on July 16, 2025. The unamortized expense is expected to be recognized over a weighted-average period of 2.0 years. During fiscal 2026, shares were awarded under the 2024 Omnibus Plan to our non-employee directors, for the purpose of recruiting and retaining directors and to align the interests of directors with the interests of our stockholders. These awards cliff vest after three years. The shares available for grant out of the 2014 Omnibus Plan have expired, therefore, all future grants will be issued from the 2024 Omnibus Plan. The following table summarizes the share-based activity under the 2014 Omnibus Plan and 2024 Omnibus Plan related to directors during fiscal 2026: Weighted-Average Grant-Date Fair Value 2026 (Shares in thousands) Balance at June 1, 2025 $ 104.44 41 Shares granted to directors 117.19 15 Shares vested 92.87 (15 ) Balance at May 31, 2026 $ 113.52 41 The weighted-average grant-date fair value was $117.19, $127.65 and $98.61 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. Unamortized deferred compensation expense relating to restricted stock grants for directors of $2.3 million at May 31, 2026, is being amortized over the applicable remaining vesting period for each director. During fiscal 2026, a total of 18,261 shares were awarded under the 2024 Omnibus Plan to certain associates as supplemental retirement benefits, generally subject to forfeiture. The shares vest upon the latter of attainment of age 55 and the fifth anniversary of the May 31st immediately preceding the date of the grant. In April 2026, the grant provisions were amended to remove the post vesting restriction which previously lapsed upon associates’ retirement. The modification has no impact on compensation cost recognized. The following table sets forth such awards for the year ended May 31, 2026: Weighted-Average Grant-Date Fair Value 2026 (Shares in thousands) Balance at June 1, 2025 $ 47.06 373 Shares granted 110.59 18 Shares vested 91.43 (26 ) Shares released from restriction 31.25 (282 ) Balance at May 31, 2026 $ 93.18 83 The weighted-average grant-date fair value was $110.59, $114.26 and $93.51 for the fiscal years ended May 31, 2026, 2025 and 2024, respectively. As noted above, no shares remain available for future grant under the 2007 Plan and the 2014 Omnibus Plan has expired, and future issuances of shares as supplemental retirement benefits are made under the 2024 Omnibus Plan. At May 31, 2026, unamortized stock-based compensation expense of $4.1 million is being amortized over the applicable vesting period associated with each participant. 61 The following table summarizes the activity for all nonvested restricted shares during the year ended May 31, 2026: Weighted-Average Grant-Date Fair Number of Value Shares (Shares in thousands) Balance at June 1, 2025 $ 97.40 947 Granted 110.89 292 Vested 90.95 (125 ) Forfeited 87.28 (211 ) Balance at May 31, 2026 $ 105.00 903 The fair value of the nonvested restricted share awards have been calculated using the market value of the shares on the date of issuance. Total unrecognized compensation cost related to all nonvested awards of restricted shares of common stock was $44.1 million as of May 31, 2026. The remaining weighted-average contractual term of nonvested restricted shares at May 31, 2026 is the same as the period over which the remaining cost of the awards will be recognized, which is approximately 2.15 years. We did not receive any cash from associates as a result of associate vesting and release of restricted shares for the year ended May 31, 2026. The following table summarizes the grant date and vested values of restricted shares during the last three fiscal years: Year Ended May 31, Weighted-Average Grant Date Fair Value Fair Value of Restricted Shares Vested Shares of Restricted Stock Vested Intrinsic Value of Restricted Shares Vested (In thousands, except per share amounts) 2024 $ 93.95 $ 32,842 421 $ 38,608 2025 $ 114.60 $ 33,246 384 $ 37,640 2026 $ 110.89 $ 11,325 125 $ 15,547 NOTE K — ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Accumulated other comprehensive income (loss) consists of the following components: Pension And Other Foreign Postretirement Unrealized Currency Benefit Unrealized Gain (Loss) Translation Liability Gain On On (In thousands) Adjustments Adjustments (1) Derivatives Securities Total Balance at May 31, 2023 $ (465,375 ) $ (148,764 ) $ 11,405 $ (2,201 ) $ (604,935 ) Current period comprehensive income 3,276 66,592 - 205 70,073 Income taxes associated with the current period 252 (15,769 ) - (56 ) (15,573 ) Amounts reclassified from accumulated other comprehensive income (loss) - 17,416 - (165 ) 17,251 Income taxes reclassified into earnings - (4,122 ) - 16 (4,106 ) Balance at May 31, 2024 (461,847 ) (84,647 ) 11,405 (2,201 ) (537,290 ) Current period comprehensive (loss) income (5,505 ) 6,872 - 1,086 2,453 Income taxes associated with the current period (1,260 ) (2,004 ) - (116 ) (3,380 ) Amounts reclassified from accumulated other comprehensive income (loss) - 9,394 - (332 ) 9,062 Income taxes reclassified into earnings (2,239 ) (2,276 ) - 39 (4,476 ) Balance at May 31, 2025 (470,851 ) (72,661 ) 11,405 (1,524 ) (533,631 ) Current period comprehensive income 42,178 51,562 - 115 93,855 Income taxes associated with the current period (155 ) (12,221 ) - (14 ) (12,390 ) Amounts reclassified from accumulated other comprehensive income (loss) - 6,542 - (38 ) 6,504 Income taxes reclassified into earnings - (1,540 ) - 2 (1,538 ) Balance at May 31, 2026 $ (428,828 ) $ (28,318 ) $ 11,405 $ (1,459 ) $ (447,200 ) (1)For additional information, see Note N, "Pension Plans," and Note O, "Postretirement Benefits," to the Consolidated Financial Statements for details. Amounts reclassified from accumulated other comprehensive income (loss) are included in pension non-service costs (credits) as a component of "Other (Income) Expense, Net" on the Consolidated Statements of Income. 62 NOTE L — EARNINGS PER SHARE The following table sets forth the reconciliation of the numerator and denominator of basic and diluted earnings per share for the years ended May 31, 2026, 2025 and 2024: Year Ended May 31, 2026 2025 2024 (In thousands, except per share amounts) Numerator for earnings per share: Net income attributable to RPM International Inc. stockholders $ 661,392 $ 688,688 $ 588,397 Less: Allocation of earnings and dividends to participating securities (2,581 ) (2,625 ) (2,630 ) Net income available to common shareholders - basic 658,811 686,063 585,767 Add: Undistributed earnings reallocated to unvested shareholders 6 9 8 Net income available to common shareholders - diluted $ 658,817 $ 686,072 $ 585,775 Denominator for basic and diluted earnings per share: Basic weighted average common shares 127,049 127,570 127,767 Average diluted options and awards 505 634 573 Total shares for diluted earnings per share (1) 127,554 128,204 128,340 Earnings Per Share of Common Stock Attributable to RPM International Inc. Stockholders: Basic Earnings Per Share of Common Stock $ 5.19 $ 5.38 $ 4.58 Method used to calculate basic earnings per share Two-Class Two-Class Two-Class Diluted Earnings Per Share of Common Stock $ 5.17 $ 5.35 $ 4.56 Method used to calculate diluted earnings per share Two-Class Two-Class Two-Class (1)The dilutive effect of performance stock units is included when they have met minimum performance thresholds. The dilutive effect of SARs includes all outstanding awards except awards that are considered antidilutive. SARs are antidilutive when the exercise price exceeds the average market price of the Company’s common shares during the periods presented. For the years ended May 31, 2026, 2025 and 2024, approximately 450,000, 170,000 and 260,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted EPS, as the effect would have been anti-dilutive. NOTE M — LEASES We have leases for manufacturing facilities, warehouses, office facilities, equipment, and vehicles, which are primarily classified and accounted for as operating leases. Some leases include one or more options to renew, generally at our sole discretion, with renewal terms that can extend the lease term from one to five years or more. In addition, certain leases contain termination options, where the rights to terminate are held by either us, the lessor, or both parties. These options to extend or terminate a lease are included in the lease terms when it is reasonably certain that we will exercise that option. We have made an accounting policy election not to recognize right-of-use ("ROU") assets and lease liabilities for leases with a term of twelve months or less, with no renewal option that we are reasonably certain to exercise. ROU assets and lease liabilities are recognized based on the present value of the fixed and in-substance fixed lease payments over the lease term at the commencement date. The ROU assets also include any initial direct costs incurred and lease payments made at or before the commencement date and are reduced by lease incentives. We use our incremental borrowing rate as the discount rate to determine the present value of the lease payments for leases, as our leases do not have readily determinable implicit discount rates. Our incremental borrowing rate is the rate of interest that we would have to borrow on a collateralized basis over a similar term and amount in a similar economic environment. We determine the incremental borrowing rates for our leases by adjusting the local risk-free interest rate with a credit risk premium corresponding to our credit rating. Operating lease expense is recognized on a straight-line basis over the lease term. For a small portfolio of finance leases, lease expense is recognized as a combination of the amortization expense for the ROU assets and interest expense for the outstanding lease liabilities using the discount rate discussed above. The depreciable life of assets and leasehold improvements are limited by the expected lease term, unless there is a transfer of title or purchase option reasonably certain of exercise. Our lease agreements do not contain any significant residual value guarantees or material restrictive covenants. Income from subleases was not significant for any period presented. 63 The following represents our lease costs for the fiscal years ending May 31, 2026, 2025 and 2024: May 31, 2026 2025 2024 (In thousands) Operating lease expense $ 100,294 $ 92,040 $ 87,225 Variable lease expense 20,830 16,839 15,305 Short-term lease expense 2,223 2,458 2,104 The following represents our supplemental cash flow disclosures for the fiscal years ending May 31, 2026, 2025 and 2024: May 31, 2026 2025 2024 (In thousands) Operating cash outflows from operating leases $ 99,076 $ 86,632 $ 81,540 Leased assets obtained in exchange for operating lease obligations 108,212 106,396 69,749 The following represents our supplemental balance sheet and other required disclosures as of May 31, 2026 and 2025: May 31, 2026 2025 (In thousands, except percentages) Current portion of operating leases within other accrued liabilities $ 74,571 $ 69,846 Weighted average remaining lease term for operating leases (in years) 9.0 8.6 Weighted average discount rate for operating leases 4.5 % 4.5 % The following represents our future undiscounted cash flows for each of the next five years and thereafter and reconciliation to the lease liabilities, as of May 31, 2026: Year ending May 31, Operating Leases (In thousands) 2027 $ 89,954 2028 74,519 2029 57,390 2030 47,440 2031 37,678 Thereafter 205,119 Total lease payments $ 512,100 Less imputed interest 96,246 Total present value of lease liabilities $ 415,854 NOTE N — PENSION PLANS We sponsor several pension plans for our associates, including our principal plan (the “Retirement Plan”), which is a non-contributory defined benefit pension plan covering substantially all domestic non-union associates. Pension benefits are provided for certain domestic union associates through separate plans. Associates of our foreign subsidiaries receive pension coverage, to the extent deemed appropriate, through plans that are governed by local statutory requirements. The Retirement Plan provides benefits that are based upon years of service and average compensation with accrued benefits vesting after five years. Benefits for union associates are generally based upon years of service, or a combination of years of service and average compensation. Our pension funding policy considers contributions in an amount on an annual basis that can be deducted for federal income tax purposes, using a different actuarial cost method and different assumptions from those used for financial reporting. For the fiscal year ending May 31, 2027, we are required, based on minimum funding rules, to contribute approximately $7.8 million to our foreign plans. Required contributions, based on minimum funding rules, to the retirement plans in the United States for fiscal 2027 are immaterial. During the year, we will evaluate whether to make contributions in excess of the minimum required amounts. During fiscal 2026, we contributed $51.0 million to the pension plans in the United States which was in excess of the required immaterial contributions but serves to improve the funded status of the plans. 64 Net periodic pension cost consisted of the following for the year ended May 31: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2024 2026 2025 2024 Service cost $ 43,453 $ 43,217 $ 43,652 $ 5,911 $ 4,427 $ 3,534 Interest cost 37,937 39,180 35,967 8,387 7,836 7,667 Expected return on plan assets (53,305 ) (48,069 ) (42,072 ) (10,063 ) (9,490 ) (9,588 ) Amortization of: Prior service cost (credit) 2 2 2 (106 ) 159 (127 ) Net actuarial losses recognized 5,794 8,613 16,822 1,253 1,189 833 Curtailment/settlement (gains) losses - - - (21 ) 7 (50 ) Net Pension Cost $ 33,881 $ 42,943 $ 54,371 $ 5,361 $ 4,128 $ 2,269 The changes in benefit obligations and plan assets, as well as the funded status of our pension plans at May 31, 2026 and 2025, were as follows: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Benefit obligation at beginning of year $ 749,686 $ 719,663 $ 186,617 $ 166,060 Service cost 43,453 43,217 5,911 4,427 Interest cost 37,937 39,180 8,387 7,836 Benefits paid (56,912 ) (45,237 ) (9,748 ) (9,162 ) Participant contributions - - 1,562 1,414 Plan amendments 1 - - 299 Plan settlements/curtailments - - (666 ) (256 ) Plan combinations - - 10,789 10,550 Actuarial losses (gains) 27,287 (7,137 ) (3,407 ) 3,323 Premiums paid - - (139 ) (90 ) Currency exchange rate changes - - 672 2,216 Benefit Obligation at End of Year $ 801,452 $ 749,686 $ 199,978 $ 186,617 Fair value of plan assets at beginning of year $ 770,703 $ 720,079 $ 188,984 $ 174,260 Actual gain on plan assets 125,496 50,324 12,601 9,365 Employer contributions 51,009 45,537 5,797 4,537 Participant contributions - - 1,562 1,414 Benefits paid (56,912 ) (45,237 ) (9,748 ) (9,162 ) Assets related to plan combinations - - - 6,630 Premiums paid - - (139 ) (90 ) Plan settlements/curtailments - - (674 ) (256 ) Currency exchange rate changes - - 381 2,286 Fair Value of Plan Assets at End of Year $ 890,296 $ 770,703 $ 198,764 $ 188,984 Surplus of plan assets versus benefit obligations at end of year $ 88,844 $ 21,017 $ (1,214 ) $ 2,367 Net Amount Recognized $ 88,844 $ 21,017 $ (1,214 ) $ 2,367 Accumulated Benefit Obligation $ 696,907 $ 650,986 $ 190,481 $ 175,236 The fair value of the assets held by our pension plans has increased at May 31, 2026 since our previous measurement date at May 31, 2025, due to contributions and market returns. Total plan liabilities increased due to benefit accruals and a net actuarial loss compared to a small actuarial gain in the prior year. We have recorded an overfunded position for the net status of our pension plans. We expect pension expense in fiscal 2027 to be lower than our fiscal 2026 expense level due to an increase in the value of expected return on plan assets driven by the higher market value of plan assets and a reduction in the amortization of the net actuarial loss to be recognized. Any future declines in the value of our pension plan assets or increases in our plan liabilities could require us to decrease our recorded asset for the net funded status of our pension plans and could also require accelerated and higher cash contributions to our pension plans. Amounts recognized in the Consolidated Balance Sheets for the years ended May 31, 2026 and 2025 are as follows: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Noncurrent assets $ 89,297 $ 21,637 $ 23,503 $ 15,833 Current liabilities (8 ) (8 ) (1,517 ) (960 ) Noncurrent liabilities (445 ) (612 ) (23,200 ) (12,506 ) Net Amount Recognized $ 88,844 $ 21,017 $ (1,214 ) $ 2,367 65 The following table summarizes the relationship between our plans' benefit obligations and assets: U.S. Plans 2026 2025 (In thousands) Benefit Obligation Plan Assets Benefit Obligation Plan Assets Plans with projected benefit obligations in excess of plan assets $ 4,688 $ 4,235 $ 4,756 $ 4,136 Plans with accumulated benefit obligations in excess of plan assets 37 - 40 - Plans with assets in excess of projected benefit obligations 796,764 886,061 744,930 766,567 Plans with assets in excess of accumulated benefit obligations 696,870 890,296 650,946 770,703 Non-U.S. Plans 2026 2025 (In thousands) Benefit Obligation Plan Assets Benefit Obligation Plan Assets Plans with projected benefit obligations in excess of plan assets $ 51,654 $ 26,937 $ 35,864 $ 22,399 Plans with accumulated benefit obligations in excess of plan assets 45,245 22,591 31,513 20,117 Plans with assets in excess of projected benefit obligations 148,324 171,827 150,753 166,585 Plans with assets in excess of accumulated benefit obligations 145,236 176,173 143,723 168,867 The following table presents the pretax net actuarial loss and prior service (cost) credits recognized in accumulated other comprehensive income (loss) not affecting retained earnings: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Net actuarial loss $ (57,777 ) $ (108,475 ) $ (29,513 ) $ (37,298 ) Prior service (costs) credits (5 ) (6 ) 246 330 Total recognized in accumulated other comprehensive income not affecting retained earnings $ (57,782 ) $ (108,481 ) $ (29,267 ) $ (36,968 ) The following table includes the changes recognized in other comprehensive income: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Changes in plan assets and benefit obligations recognized in other comprehensive income: Prior service cost $ 1 $ - $ - $ 299 Net (gain) loss arising during the year (44,904 ) (9,393 ) (5,945 ) 5,129 Effect of exchange rates on amounts included in AOCI - - (77 ) 570 Amounts recognized as a component of net periodic benefit cost: Amortization or curtailment recognition of prior service (cost) benefit (2 ) (2 ) 106 (159 ) Amortization or settlement recognition of net (loss) (5,794 ) (8,613 ) (1,225 ) (1,196 ) Total recognized in other comprehensive (income) loss $ (50,699 ) $ (18,008 ) $ (7,141 ) $ 4,643 In measuring the projected benefit obligation and net periodic pension cost for our plans, we utilize actuarial valuations. These valuations include specific information pertaining to individual plan participants, such as salary, age and years of service, along with certain assumptions. The most significant assumptions applied include discount rates, expected return on plan assets and rate of compensation increases. We evaluate these assumptions, at a minimum, on an annual basis, and make required changes, as applicable. In developing our expected long-term rate of return on pension plan assets, we consider the current and expected target asset allocations of the pension portfolio, as well as historical returns and future expectations for returns on various categories of plan assets. Expected return on assets is determined by using the weighted-average return on asset classes based on expected return for the target asset allocations of the principal asset categories held by each plan. In determining expected return, we consider both historical performance and an estimate of future long-term rates of return. Actual experience is used to develop the assumption for compensation increases. 66 The following weighted-average assumptions were used to determine our year-end benefit obligations and net periodic pension cost under the plans: U.S. Plans Non-U.S. Plans Year-End Benefit Obligations 2026 2025 2026 2025 Discount rate 5.55 % 5.65 % 4.93 % 4.78 % Rate of compensation increase 3.38 % 3.38 % 2.97 % 3.03 % U.S. Plans Non-U.S. Plans Net Periodic Pension Cost 2026 2025 2024 2026 2025 2024 Discount rate 5.66 % 5.59 % 5.26 % 4.78 % 4.81 % 4.88 % Expected return on plan assets 7.25 % 7.00 % 7.00 % 5.35 % 5.49 % 5.79 % Rate of compensation increase 3.38 % 3.39 % 3.39 % 3.03 % 2.98 % 2.97 % The following tables illustrate the weighted-average actual and target allocation of plan assets: U.S. Plans Target Allocation Actual Asset Allocation (Dollars in millions) as of May 31, 2026 2026 2025 Equity securities 43 % $ 410.0 $ 429.2 Fixed income securities 35 % 306.8 166.3 Multi-class 17 % 145.2 155.8 Cash 5 % 28.3 19.3 Other - 0.1 Total assets 100 % $ 890.3 $ 770.7 Non-U.S. Plans Target Allocation Actual Asset Allocation (Dollars in millions) as of May 31, 2026 2026 2025 Equity securities 35 % $ 71.2 $ 66.1 Fixed income securities 44 % 87.6 83.9 Cash 0.7 0.5 Property and other 21 % 39.3 38.5 Total assets 100 % $ 198.8 $ 189.0 The following tables present our pension plan assets as categorized using the fair value hierarchy at May 31, 2026 and 2025: U.S. Plans (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2026 U.S. Treasury and other government $ - $ 95,683 $ - $ 95,683 Foreign bonds - 5,444 - 5,444 Mortgage-backed securities - 17,481 - 17,481 Corporate bonds - 13,211 - 13,211 Mutual funds - equity 62,249 347,756 - 410,005 Mutual funds - multi-class - 145,220 - 145,220 Mutual funds - fixed - 3,166 - 3,166 Cash and cash equivalents 28,241 - - 28,241 Futures contracts - - 48 48 Investments measured at NAV (1) 171,797 Total $ 90,490 $ 627,961 $ 48 $ 890,296 (1)In accordance with Subtopic 820-10, Fair Value Measurements and Disclosures, certain investments that are measured at fair value using the net asset value ("NAV") per share practical expedient have not been classified in the fair value hierarchy. The investments that are measured at fair value using NAV per share included in the table above are intended to permit reconciliation of the fair value hierarchy to the fair value of the plan assets at the end of each period. 67 Non-U.S. Plans (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2026 Pooled equities $ - $ 71,182 $ - $ 71,182 Pooled fixed income - 86,194 - 86,194 Foreign bonds - 1,370 - 1,370 Insurance contracts - - 29,036 29,036 Mutual funds - real estate - 10,267 - 10,267 Cash and cash equivalents 715 - - 715 Total $ 715 $ 169,013 $ 29,036 $ 198,764 U.S. Plans (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2025 U.S. Treasury and other government $ - $ 57,763 $ - $ 57,763 State and municipal bonds - 213 - 213 Foreign bonds - 3,365 - 3,365 Mortgage-backed securities - 17,964 - 17,964 Corporate bonds - 15,750 - 15,750 Stocks - large cap 51,743 - - 51,743 Mutual funds - equity - 377,516 - 377,516 Mutual funds - multi-class - 155,782 - 155,782 Mutual funds - fixed - 2,900 - 2,900 Cash and cash equivalents 19,327 - - 19,327 Futures contracts - - 64 64 Investments measured at NAV (2) 68,316 Total $ 71,070 $ 631,253 $ 64 $ 770,703 (2)In accordance with Subtopic 820-10, Fair Value Measurements and Disclosures, certain investments that are measured at fair value using the net asset value ("NAV") per share practical expedient have not been classified in the fair value hierarchy. The investments that are measured at fair value using NAV per share included in the table above are intended to permit reconciliation of the fair value hierarchy to the fair value of the plan assets at the end of each period. Non-U.S. Plans (In thousands) Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Fair Value at May 31, 2025 Pooled equities $ - $ 66,101 $ - $ 66,101 Pooled fixed income - 82,844 - 82,844 Foreign bonds - 1,050 - 1,050 Insurance contracts - - 28,121 28,121 Mutual funds - real estate - 10,392 - 10,392 Cash and cash equivalents 476 - - 476 Total $ 476 $ 160,387 $ 28,121 $ 188,984 The following table includes the activity that occurred during the years ended May 31, 2026 and 2025 for our Level 3 assets: Actual (Loss) Return on Plan Assets For: Balance at Assets Still Held Assets Sold Purchases, Sales and Balance at (In thousands) Beginning of Period at Reporting Date During Year Settlements, net (3) End of Period Year ended May 31, 2026 $ 28,185 (207 ) - 1,106 $ 29,084 Year ended May 31, 2025 20,477 348 - 7,360 28,185 (3)Includes the impact of exchange rate changes during the year. 68 The primary objective for the investments of the Retirement Plan is to provide for long-term growth of capital without undue exposure to risk. This objective is accomplished by utilizing a diversified portfolio strategy of equities, fixed-income securities and cash equivalents in a mix that is conducive to participation in a rising market, while allowing for adequate protection in a falling market. Our Investment Committee oversees the investment allocation process, which includes the selection and evaluation of investment managers, the determination of investment objectives and risk guidelines, and the monitoring of actual investment performance. In order to manage investment risk properly, Plan policy prohibits short selling, securities lending, financial futures, options and other specialized investments, except for certain alternative investments specifically approved by the Investment Committee. The Investment Committee reviews, on a quarterly basis, reports of actual Plan investment performance provided by independent third parties, in addition to its review of the Plan investment policy on an annual basis. The investment objectives are similar for our plans outside of the United States, subject to local regulations. The goals of the investment strategy for pension assets include: the total return of the funds shall, over an extended period of time, surpass an index composed of the MSCI World Stock Index (equity), the Bloomberg Long-Term Government/Credit Index (fixed income), and 90-day Treasury Bills (cash), weighted appropriately to match the asset allocation of the plans. The equity portion of the funds shall surpass the MSCI World Stock Index over a full market cycle, while the fixed-income portion shall surpass Bloomberg Long-Term Government/Credit Index over a full market cycle. The purpose of the fixed-income fund is to reduce the overall volatility of the plan assets and provide a hedge against interest rate fluctuations. Therefore, the primary objective of the fixed-income portion is to match the Bloomberg Long-Term Government/Credit Index. We expect to pay the following estimated pension benefit payments in the next five years (in millions): $78.8 in 2027, $81.7 in 2028, $92.0 in 2029, $91.4 in 2030 and $94.9 in 2031. In the five years thereafter (2032-2036), we expect to pay $485.4 million. In addition to the defined benefit pension plans discussed above, we also sponsor associate savings plans under Section 401(k) of the Internal Revenue Code, which cover most of our associates in the United States. We record expense for defined contribution plans for any employer-matching contributions made in conjunction with services rendered by associates. The majority of our plans provide for matching contributions made in conjunction with services rendered by associates. Matching contributions are invested in the same manner that the participants invest their own contributions. Matching contributions charged to income were $31.8 million, $31.3 million and $29.8 million for the years ending May 31, 2026, 2025 and 2024, respectively. NOTE O — POSTRETIREMENT BENEFITS We sponsor several unfunded-healthcare-benefit plans for certain of our retired associates, as well as postretirement life insurance for certain former associates. Eligibility for these benefits is based upon various requirements. The following table illustrates the effect on operations of these plans for the three years ended May 31: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2024 2026 2025 2024 Service cost $ - $ - $ - $ 936 $ 1,672 $ 2,259 Interest cost 49 83 87 1,089 1,251 1,550 Amortization of: Net actuarial losses (gains) 34 (25 ) (15 ) (1,024 ) (551 ) (49 ) Curtailment/settlement losses 617 - - - - - Net Postretirement Benefit Cost $ 700 $ 58 $ 72 $ 1,001 $ 2,372 $ 3,760 The changes in benefit obligations of the plans at May 31, 2026 and 2025 were as follows: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Accumulated postretirement benefit obligation at beginning of year $ 1,663 $ 1,621 $ 24,557 $ 26,058 Service cost - - 936 1,672 Interest cost 49 83 1,089 1,251 Benefit payments (746 ) (135 ) (648 ) (568 ) Actuarial (gains) losses (22 ) 94 (701 ) (3,635 ) Currency exchange rate changes - - (108 ) (221 ) Accumulated and accrued postretirement benefit obligation at end of year $ 944 $ 1,663 $ 25,125 $ 24,557 In determining the postretirement benefit amounts outlined above, measurement dates as of May 31 for each period were applied. 69 Amounts recognized in the Consolidated Balance Sheets for the years ended May 31, 2026 and 2025 are as follows: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Current liabilities $ (137 ) $ (733 ) $ (1,050 ) $ (949 ) Noncurrent liabilities (807 ) (930 ) (24,075 ) (23,608 ) Net Amount Recognized $ (944 ) $ (1,663 ) $ (25,125 ) $ (24,557 ) The following table presents the pretax net actuarial gain recognized in accumulated other comprehensive income (loss) not affecting retained earnings by fiscal year: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Net actuarial gain $ 724 $ 51 $ 14,419 $ 14,803 The following table includes the changes recognized in other comprehensive loss (income) by fiscal year: U.S. Plans Non-U.S. Plans (In thousands) 2026 2025 2026 2025 Changes in plan assets and benefit obligations recognized in other comprehensive loss (income): Net (gain) loss arising during the year $ (22 ) $ 94 $ (701 ) $ (3,635 ) Effect of exchange rates on amounts included in AOCI - - 61 66 Amounts recognized as a component of net periodic benefit cost: Amortization or settlement recognition of net (loss) gain (651 ) 25 1,024 551 Total recognized in other comprehensive (income) loss $ (673 ) $ 119 $ 384 $ (3,018 ) The following weighted-average assumptions were used to determine our year-end benefit obligations and net periodic postretirement benefit costs under the plans by fiscal year: U.S. Plans Non-U.S. Plans Year-End Benefit Obligations 2026 2025 2026 2025 Discount rate 5.18 % 5.17 % 4.98 % 4.88 % Current healthcare cost trend rate 7.60 % 8.30 % 5.07 % 5.13 % Ultimate healthcare cost trend rate 4.00 % 4.00 % 3.70 % 3.70 % Year ultimate healthcare cost trend rate will be realized 2048 2048 2040 2040 U.S. Plans Non-U.S. Plans Net Periodic Postretirement Cost 2026 2025 2024 2026 2025 2024 Discount rate 5.17 % 5.50 % 5.20 % 4.88 % 5.03 % 5.10 % Current healthcare cost trend rate 8.30 % 8.90 % 6.00 % 5.13 % 5.21 % 5.53 % Ultimate healthcare cost trend rate 4.00 % 4.04 % 4.03 % 3.70 % 3.70 % 3.70 % Year ultimate healthcare cost trend rate will be realized 2048 2049 2045 2040 2040 2040 We expect to pay approximately $1.2 million to $1.4 million in estimated postretirement benefits in each of the next five years. In the five years thereafter (2032-2036), we expect to pay a cumulative total of $8.1 million. NOTE P — CONTINGENCIES AND ACCRUED LOSSES Accrued loss reserves consist of the following: May 31, 2026 2025 (In thousands) Accrued product liability and other loss reserves $ 35,517 $ 24,781 Accrued warranty reserves 10,395 10,494 Accrued environmental reserves 5,346 1,426 Total Accrued Loss Reserves - Current $ 51,258 $ 36,701 Accrued product liability and other loss reserves - noncurrent $ 26,236 $ 25,206 Accrued warranty liability - noncurrent 3,379 3,534 Accrued environmental reserves - noncurrent 3,512 2,719 Total Accrued Loss Reserves - Noncurrent $ 33,127 $ 31,459 70 Product Liability Matters We provide, through our wholly-owned insurance subsidiaries, certain insurance coverage, primarily product liability coverage, to our other subsidiaries. Excess coverage is provided by third-party insurers. Our product liability accruals provide for these potential losses, as well as other uninsured claims. Product liability accruals are established based upon actuarial calculations of potential liability using industry experience, actual historical experience and actuarial assumptions developed for similar types of product liability claims, including development factors and lag times. To the extent there is a reasonable possibility that potential losses could exceed the amounts already accrued, we believe that the amount of any such additional loss would be immaterial to our results of operations, liquidity and consolidated financial position. Warranty Matters We also offer warranties on many of our products, as well as long-term warranty programs at certain of our businesses, and have established product warranty liabilities. We review these liabilities for adequacy on a quarterly basis and adjust them as necessary. The primary factors that could affect these liabilities may include changes in performance rates, as well as costs of replacement. Provision for estimated warranty costs is recorded at the time of sale and periodically adjusted, as required, to reflect actual experience. It is probable that we will incur future losses related to warranty claims we have received but that have not been fully investigated and related to claims not yet received. While our warranty liabilities represent our best estimates at May 31, 2026, we can provide no assurances that we will not experience material claims in the future or that we will not incur significant costs to resolve such claims beyond the amounts accrued or beyond what we may recover from our suppliers. Based upon the nature of the expense, product warranty expense is recorded as a component of cost of sales or within SG&A. Also, due to the nature of our businesses, the amount of claims paid can fluctuate from one period to the next. While our warranty liabilities represent our best estimates of our expected losses at any given time, from time to time we may revise our estimates based on our experience relating to factors such as weather conditions, specific circumstances surrounding product installations and other factors. The following table includes the changes in our accrued warranty balances: Year Ended May 31, 2026 2025 2024 (In thousands) Beginning Balance $ 14,028 $ 11,621 $ 11,776 Deductions (1) (37,343 ) (29,434 ) (34,388 ) Provision charged to expense 37,089 31,841 34,233 Ending Balance $ 13,774 $ 14,028 $ 11,621 (1)Primarily claims paid during the year. Environmental Matters Like other companies participating in similar lines of business, some of our subsidiaries are involved in environmental remediation matters. It is our policy to accrue remediation costs when the liability is probable and the costs are reasonably estimable, which generally is not later than at completion of a feasibility study or when we have committed to an appropriate plan of action. We also take into consideration the estimated period of time over which payments may be required. The liabilities are reviewed periodically and, as investigation and remediation activities continue, adjustments are made as necessary. Liabilities for losses from environmental remediation obligations do not consider the effects of inflation and anticipated expenditures are not discounted to their present value. The liabilities are not offset by possible recoveries from insurance carriers or other third parties but do reflect anticipated allocations among potentially responsible parties at federal superfund sites or similar state-managed sites, third-party indemnity obligations, and an assessment of the likelihood that such parties will fulfill their obligations at such sites. Other Contingencies One of our former subsidiaries has been the subject of a proceeding in which one of its former distributors brought suit against the subsidiary for breach of contract. Following a June 2017 trial, a jury determined that the distributor was not entitled to any damages on the distributor’s claims. On appeal, the Ninth Circuit Court of Appeals ordered a new trial with respect to certain issues. On December 10, 2021, a new jury awarded $6.0 million in damages to the distributor. Per the parties’ contracts, the distributor was also entitled to seek recovery of some portion of its attorneys’ fees and costs. On November 15, 2023, the U.S. District Court for the Eastern District of California issued an order awarding the distributor approximately $4.4 million in connection with attorney's fees and costs the distributor allegedly incurred throughout the duration of this legal action. As a result of this order, we increased our accrual to $10.4 million as of November 30, 2023. On December 27, 2023, we paid the $6.0 million judgment, and then decreased our accrual to approximately $4.4 million. We appealed the District Court's order awarding attorneys’ fees and costs to the distributor to the Ninth Circuit Court of Appeals. On January 21, 2025, the Ninth Circuit reversed in part and affirmed in part the District Court’s order awarding attorneys’ fees and costs. As a result, we paid the distributor $4.6 million, of which $4.4 million was previously accrued in fiscal 2024. On April 17, 2025, at a Court-ordered settlement conference, we agreed to pay the distributor $4.5 million to resolve all remaining claims, known or unknown, between the parties. As a result of this settlement, we increased our accrual to $4.5 million as of May 31, 2025. We paid the $4.5 million settlement during the first quarter of fiscal 2026. We incurred SG&A expense related to this matter of 71 $4.7 million and $4.4 million during fiscal 2025 and 2024, respectively. We did not incur any SG&A expense related to this matter during fiscal 2026. One of our subsidiaries in our Consumer reportable segment has been the subject of a lawsuit filed in the United States District Court for the District of Oregon in which a former supplier of that subsidiary alleged that the subsidiary breached certain contractual obligations, misappropriated trade secrets, and committed fraud in connection with an Exclusive Sales Agreement and a Mutual Settlement Agreement and Release executed in November 2015 and 2017, respectively. Our subsidiary denied, and continues to deny, these allegations. A jury trial commenced in this matter on September 17, 2024. On September 27, 2024, the jury rendered a verdict against our subsidiary for $190.0 million, consisting of both compensatory and punitive damages. We filed an objection to the former supplier’s proposed form of judgment seeking a reduction or elimination of certain damages included in the jury’s verdict. On January 28, 2025, the District Court reduced the compensatory and punitive damages award by $79.2 million. On February 28, 2025, the District Court entered judgment in the amount of $110.8 million, consisting of both compensatory and punitive damages, plus prejudgment interest applicable to the compensatory damages in the amount of 9.0% per annum beginning on August 1, 2018. Further, on July 15, 2025, the District Court awarded the former supplier approximately $2.3 million in attorneys’ fees and expenses and awarded supplemental attorneys' fees of approximately $0.2 million on October 2, 2025. We believe that the jury verdict, as well as the District Court's judgment and award are not supported by the facts of the case or applicable law, are the result of significant trial error, and there are strong grounds for appeal. We vigorously challenged the verdict and judgment through appropriate post-trial motions and will continue to challenge them and the award through the appellate process. As a result, we believe that the likelihood that the amount of the judgment will be affirmed is not probable. We currently estimate a range of possible outcomes between approximately $0.5 million and $152.5 million, which is inclusive of the prejudgment interest awarded (but exclusive of any accruing postjudgment interest), and we accrued a liability as of August 31, 2024, at the low end of the range, as no amount within the range is a better estimate than any other amount. This amount is reflected in accrued losses, and SG&A expenses in our Consolidated Financial Statements as of and for the year ending May 31, 2025. We did not incur any SG&A expense related to this matter during fiscal 2026. The ultimate loss to the Company with respect to the litigation matter could be materially different from the amount the Company has accrued. The Company cannot predict or estimate the duration or ultimate outcome of this matter. Gain on Business Interruption Insurance In April 2021, there was a significant plant explosion at a key alkyd resin supplier which caused severe supply chain disruptions. As a result of this disruption, the Consumer segment incurred incremental costs and lost sales during fiscal 2021 and 2022. A claim for these losses was submitted under our business interruption insurance policy. The Consumer segment recovered $11.1 million from insurance during the year ended May 31, 2024. The insurance gain is recorded as a reduction to SG&A expenses in our Consolidated Statements of Income, and the proceeds are included within cash flows from operating activities in our Consolidated Statement of Cash Flows for the year ended May 31, 2024. No such proceeds were received during fiscal 2026 and 2025. NOTE Q — REVENUE We operate a portfolio of services and product lines which include a variety of specialty paints, protective coatings, roofing systems, flooring solutions, sealants, cleaners and adhesives, among other things. We disaggregate revenues from the sales of our products and services based upon geographical location by each of our reportable segments, which are aligned by similar economic factors, trends and customers, which best depict the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. See Note R, “Segment Information,” to the Consolidated Financial Statements for further details regarding our disaggregated revenues, as well as a description of each of the unique revenue streams related to each of our three reportable segments. Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration we expect to receive in exchange for those products or services. The majority of our revenue is recognized at a point in time. However, we also record revenues generated under construction contracts, mainly in connection with the installation of specialized roofing and flooring systems and related services. For certain polymer flooring installation projects, we account for our revenue using the output method, as we consider square footage of completed flooring to be the best measure of progress toward the complete satisfaction of the performance obligation. In contrast, for certain of our roofing installation projects, we account for our revenue using the input method, as that method is the best measure of performance as it considers costs incurred in relation to total expected project costs, which essentially represents the transfer of control for roofing systems to the customer. In general, for our construction contracts, we record contract revenues and related costs as our contracts progress on an over-time model. 72 We have elected to apply the practical expedient to recognize revenue net of allowances for returns and any taxes collected from customers, which are subsequently remitted to governmental authorities. Payment terms and conditions vary by contract type, although our customers’ payment terms generally include a requirement to pay within 30 to 60 days of fulfilling our performance obligations. In instances where the timing of revenue recognition differs from the timing of invoicing, we have determined that our contracts generally do not include a significant financing component. We have elected to apply the practical expedient to treat all shipping and handling costs as fulfillment costs, as a significant portion of these costs are incurred prior to control transfer. Significant Judgments Our contracts with customers may include promises to transfer multiple products and/or services to a customer. Determining whether products and services are considered distinct performance obligations that should be accounted for separately versus together may require significant judgment. For example, judgment is required to determine whether products sold in connection with the sale of installation services are considered distinct and accounted for separately, or not distinct and accounted for together with installation services and recognized over time. We provide customer rebate programs and incentive offerings, including special pricing and co-operative advertising arrangements, promotions and other volume-based incentives. These customer programs and incentives are considered variable consideration and recognized as a reduction of net sales. Up-front consideration provided to customers is capitalized as a component of other assets and amortized over the estimated life of the contractual arrangement. We include in revenue variable consideration only to the extent that it is probable that a significant reversal in the amount of cumulative revenue recognized will not occur when the variable consideration is resolved. In general, this determination is made based upon known customer program and incentive offerings at the time of sale, and expected sales volume forecasts as it relates to our volume-based incentives. This determination is updated each reporting period. Certain of our contracts include contingent consideration that is receivable only upon the final inspection and acceptance of a project. We include estimates of such variable consideration in our transaction price. Based on historical experience, we consider the probability-based expected value method appropriate to estimate the amount of such variable consideration. Our products are generally sold with a right of return, and we may provide other credits or incentives, which are accounted for as variable consideration when estimating the amount of revenue to recognize. Returns and credits are estimated at contract inception and updated at the end of each reporting period as additional information becomes available. We record a right of return liability to accrue for expected customer returns. Historical actual returns are used to estimate future returns as a percentage of current sales. Obligations for returns and refunds were not material individually or in the aggregate. We offer assurance type warranties on our products as well as separately sold warranty contracts. Revenue related to warranty contracts that are sold separately is recognized over the life of the warranty term. Warranty liabilities for our assurance type warranties are discussed further in Note P, “Contingencies and Accrued Losses,” to the Consolidated Financial Statements. Contract Balances Timing of revenue recognition may differ from the timing of invoicing customers. Our contract assets are recorded for products and services that have been provided to our customer but have not yet been billed and are included in prepaid expenses and other current assets in our Consolidated Balance Sheets. Our short-term contract liabilities consist of advance payments, or deferred revenue, and are included in other accrued liabilities in our Consolidated Balance Sheets. Trade accounts receivable, net of allowances, and net contract (liabilities) assets consisted of the following: Year Ended May 31, 2026 2025 $ Change % Change (In thousands, except percentages) Trade accounts receivable, less allowances $ 1,661,538 $ 1,509,109 $ 152,429 10.1 % Contract assets $ 61,757 $ 72,949 $ (11,192 ) (15.3 %) Contract liabilities - short-term (75,279 ) (56,634 ) (18,645 ) 32.9 % Net Contract (Liabilities) Assets $ (13,522 ) $ 16,315 $ (29,837 ) The $29.8 million change in our net contract (liabilities) assets from May 31, 2025 to May 31, 2026, resulted primarily due to the timing and volume of construction jobs in progress at May 31, 2026 versus May 31, 2025. During the years ended May 31, 2026 and May 31, 2025 we recognized $52.3 million and $42.2 million of revenue, which was included in contract liabilities as of May 31, 2025 and 2024, respectively. We also record long-term deferred revenue, which amounted to $92.4 million and $85.6 million as of May 31, 2026 and 2025, respectively. The long-term portion of deferred revenue is related to warranty contracts and is included in other long-term liabilities in our Consolidated Balance Sheets. We have elected to adopt the practical expedient to not disclose the aggregate amount of transaction price allocated to performance obligations that are unsatisfied as of the end of the reporting period for performance obligations that are part of a contract with an original expected duration of one year or less. 73 We recognize an asset for the incremental costs of obtaining a contract with a customer if we expect the benefit of those costs to be longer than one year. As our contract terms are primarily one year or less in duration, we have elected to apply a practical expedient to expense costs as incurred for costs to obtain a contract with a customer when the amortization period would have been one year or less. These costs include our internal sales force compensation program and certain incentive programs as we have determined annual compensation is commensurate with annual sales activities. Allowance for Credit Losses Our primary allowance for credit losses is the allowance for doubtful accounts. The allowance for doubtful accounts reduces the trade accounts receivable balance to the estimated net realizable value equal to the amount that is expected to be collected. The allowance was based on assessments of current creditworthiness of customers, historical collection experience, the aging of receivables and other currently available evidence. Trade accounts receivable balances are written-off against the allowance if a final determination of uncollectibility is made. All provisions for allowances for doubtful collection of accounts are included in SG&A expenses. The following tables summarize the activity for the allowance for credit losses: Year Ended May 31, 2026 2025 2024 (In thousands) Beginning Balance $ 42,844 $ 48,763 $ 49,482 Bad debt provision 9,297 16,411 18,375 Uncollectible accounts written off, net of recoveries (13,776 ) (22,560 ) (19,160 ) Translation adjustments 814 230 66 Ending Balance $ 39,179 $ 42,844 $ 48,763 NOTE R — SEGMENT INFORMATION Effective June 1, 2025, we realigned certain businesses and management structures to recognize how we allocate resources and analyze the operating performance of our operating segments. As such, we now report under three reportable segments instead of our four previous reportable segments. Our three reportable segments are: CPG, PCG and Consumer. In connection with this realignment, we transferred our Legend Brands reporting unit from SPG to CPG, our Industrial Coatings Group and Food Group reporting units from SPG to PCG, and our Color Group reporting unit from SPG to Consumer. This realignment changed our reportable segments beginning with our first quarter of fiscal 2026. As a result, historical segment results have been recast to reflect the impact of this change. We operate a portfolio of services and product lines which include a variety of specialty paints, protective coatings, roofing systems, flooring solutions, sealants, cleaners and adhesives, among other things. We manage our portfolio by organizing our businesses and product lines into three reportable segments as outlined below, which are comprised from our four operating segments. We have aggregated our Legend Brands and CPG operating segments into our CPG reportable segment, because they are economically similar and meet the other aggregation criteria for determining reportable segments. Within each operating segment, we manage product lines and businesses which generally address common markets, share similar economic characteristics, utilize similar technologies and can share manufacturing or distribution capabilities. Our four operating segments are each managed by an operating segment manager, who is responsible for the day-to-day operating decisions and performance evaluation of the operating segment’s underlying businesses. These four operating segments represent components of our business for which separate financial information is available that is utilized on a regular basis by our Chief Operating Decision Maker ("CODM"), who is our Chairman, President and Chief Executive Officer. Our CODM evaluates the profit performance of our segments and allocates resources primarily based on income before income taxes, but also looks to EBIT, or adjusted EBIT, because interest (income) expense, net is essentially related to corporate functions, as opposed to segment operations. Our CODM utilizes these performance metrics in determining how to allocate the assets of the company, evaluate performance in periodic reviews, and during the annual budget and forecasting process. Our CPG reportable segment products and services are sold throughout North America and also account for a significant portion of our international sales. Our construction product lines are sold directly to manufacturers, contractors, distributors and end-users, including industrial manufacturing facilities, concrete and cement producers, public institutions and other commercial customers. Products and services within this reportable segment include construction sealants and adhesives, coatings and chemicals, roofing systems, roofing installation, HVAC and roofing restoration, concrete admixture and repair products, building envelope solutions, parking decks, insulated cladding, firestopping, flooring systems, weatherproofing solutions and restoration services equipment. Our PCG reportable segment products and services are sold throughout North America, as well as internationally, and are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. Products and services within this reportable segment include high-performance flooring solutions, corrosion control and fireproofing coatings, infrastructure repair systems, FRP structures, factory applied industrial coatings, preservation products, edible coatings and specialty glazes for pharmaceutical and food industry coatings and solutions. Our Consumer reportable segment manufactures and markets professional use and do-it-yourself products for a variety of mainly residential applications, including home improvement and personal leisure activities. Our Consumer reportable segment’s major manufacturing and distribution operations are located primarily in North America, along with a few locations in Europe, Latin America 74 and Asia Pacific. Our Consumer reportable segment products are primarily sold directly to mass merchandisers, home improvement centers, hardware stores, paint stores, craft shops and through distributors. The Consumer reportable segment offers products that include specialty, hobby and professional paints; caulks; adhesives; cleaners; sandpaper and other abrasives; silicone sealants; wood stains and colorants. In addition to our three reportable segments, there is a category of certain business activities and expenses, referred to as corporate/other, that does not constitute an operating segment. This category includes our corporate headquarters and related administrative expenses, results of our captive insurance companies, gains or losses on the sales of certain assets and other expenses not directly associated with any reportable segment. These corporate and other expenses reconcile reportable segment data to total consolidated income before income taxes. We reflect income from our joint ventures on the equity method and receive royalties from our licensees. The following tables present the results of our reportable segments consistent with our management philosophy, by representing the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses, and a disaggregation of revenues by geography. We do not report identifiable assets by segment as this is not a metric used by our CODM to allocate resources or evaluate segment performance. Year Ended May 31, 2026 CPG Segment PCG Segment Consumer Segment Total (In thousands) Net Sales $ 3,069,785 $ 2,131,914 $ 2,661,723 $ 7,863,422 Less: Cost of Sales 1,753,894 1,200,584 1,650,905 Selling, General and Administrative Expenses 849,530 615,012 635,301 Other Segment Items (1) 18,033 7,274 13,072 Income Before Income Taxes $ 448,328 $ 309,044 $ 362,445 $ 1,119,817 Less: Corporate/Other Expense 249,477 Consolidated Income Before Income Taxes $ 870,340 Year Ended May 31, 2025 CPG Segment PCG Segment Consumer Segment Total (In thousands) Net Sales $ 2,874,452 $ 1,995,816 $ 2,502,376 $ 7,372,644 Less: Cost of Sales 1,660,611 1,107,047 1,554,508 Selling, General and Administrative Expenses 780,927 609,342 588,596 Other Segment Items (1) 7,803 1,452 26,445 Income Before Income Taxes $ 425,111 $ 277,975 $ 332,827 $ 1,035,913 Less: Corporate/Other Expense 243,153 Consolidated Income Before Income Taxes $ 792,760 Year Ended May 31, 2024 CPG Segment PCG Segment Consumer Segment Total (In thousands) Net Sales $ 2,827,813 $ 1,958,606 $ 2,548,858 $ 7,335,277 Less: Cost of Sales 1,632,435 1,105,889 1,582,364 Selling, General and Administrative Expenses 791,715 603,402 555,028 Other Segment Items (1) 15,342 3,565 8,263 Income Before Income Taxes $ 388,321 $ 245,750 $ 403,203 $ 1,037,274 Less: Corporate/Other Expense 249,437 Consolidated Income Before Income Taxes $ 787,837 (1)Other Segment Items includes Restructuring Expense, Goodwill Impairment (recorded within our Consumer segment in fiscal year 2025), Interest Expense, Investment (Income), Net and Other (Income) Expense, Net. 75 Year Ended May 31, 2026 CPG Segment PCG Segment Consumer Segment Consolidated (In thousands) Net Sales (based on shipping location) (2) United States $ 2,048,843 $ 1,394,159 $ 2,078,739 $ 5,521,741 Foreign Canada 265,175 86,653 161,901 513,729 Europe 512,455 338,984 370,681 1,222,120 Latin America 242,876 36,573 25,531 304,980 Asia Pacific - 154,047 24,871 178,918 Other Foreign 436 121,498 - 121,934 Total Foreign 1,020,942 737,755 582,984 2,341,681 Total $ 3,069,785 $ 2,131,914 $ 2,661,723 $ 7,863,422 Year Ended May 31, 2025 CPG Segment PCG Segment Consumer Segment Consolidated (In thousands) Net Sales (based on shipping location) (2) United States $ 1,899,940 $ 1,322,091 $ 2,020,031 $ 5,242,062 Foreign Canada 264,727 90,656 163,783 519,166 Europe 483,808 295,822 273,104 1,052,734 Latin America 225,977 39,364 25,120 290,461 Asia Pacific - 139,124 20,338 159,462 Other Foreign - 108,759 - 108,759 Total Foreign 974,512 673,725 482,345 2,130,582 Total $ 2,874,452 $ 1,995,816 $ 2,502,376 $ 7,372,644 Year Ended May 31, 2024 CPG Segment PCG Segment Consumer Segment Consolidated (In thousands) Net Sales (based on shipping location) (2) United States $ 1,815,667 $ 1,292,672 $ 2,077,278 $ 5,185,617 Foreign Canada 265,287 95,816 165,222 526,325 Europe 488,401 277,312 261,600 1,027,313 Latin America 258,458 39,251 25,072 322,781 Asia Pacific - 149,920 19,686 169,606 Other Foreign - 103,635 - 103,635 Total Foreign 1,012,146 665,934 471,580 2,149,660 Total $ 2,827,813 $ 1,958,606 $ 2,548,858 $ 7,335,277 (2)It is not practicable to obtain the information needed to disclose revenues attributable to each of our product lines. May 31, 2026 2025 (In thousands) Long-Lived Assets (3) United States $ 1,605,234 $ 1,475,984 Foreign Canada 117,401 115,161 Europe 258,548 223,921 United Kingdom 142,471 126,648 Other Foreign 132,840 118,049 Total Foreign 651,260 583,779 Total $ 2,256,494 $ 2,059,763 (3)Long-lived assets include all non-current assets, excluding non-current deferred income taxes, goodwill and intangible assets. 76 Management’s Report on Internal Control Over Financial Reporting The management of RPM International Inc. ("RPM") is responsible for establishing and maintaining adequate internal control over financial reporting for the Company, as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of 1934. RPM’s internal control system was designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of the Consolidated Financial Statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements and even when determined to be effective, can only provide reasonable assurance with respect to financial statements preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may be inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Management assessed the effectiveness of RPM’s internal control over financial reporting as of May 31, 2026. In making this assessment, management used criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission in Internal Control-Integrated Framework (2013 Framework). Based on this assessment, management concluded that, as of May 31, 2026, RPM’s internal control over financial reporting is effective. The independent registered public accounting firm Deloitte & Touche LLP, has also audited the Company’s internal control over financial reporting as of May 31, 2026, and their report thereon is included below. /s/ Frank C. Sullivan /s/ Russell L. Gordon Frank C. Sullivan Russell L. Gordon Chairman and Chief Executive Officer Vice President and Chief Financial Officer July 22, 2026 77 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of RPM International Inc. Opinion on Internal Control Over Financial Reporting We have audited the internal control over financial reporting of RPM International Inc. and subsidiaries (the "Company") as of May 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of May 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as of and for the year ended May 31, 2026, of the Company and our report dated July 22, 2026, expressed an unqualified opinion on those financial statements. Basis for Opinion The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control over Financial Reporting A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Deloitte & Touche LLP Cleveland, Ohio July 22, 2026 78 Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of RPM International Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of RPM International Inc. and subsidiaries (the "Company") as of May 31, 2026 and 2025, the related consolidated statements of income, comprehensive income, cash flows, and stockholders’ equity, for each of the three years in the period ended May 31, 2026, and the related notes and schedule listed in the Index at Item 15 (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of May 31, 2026 and 2025, and the results of its operations and its cash flows for each of the three years in the period ended May 31, 2026, in conformity with accounting principles generally accepted in the United States of America. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of May 31, 2026, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated July 22, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Goodwill – Specific Reporting Unit - Refer to Note C to the Consolidated Financial Statements Critical Audit Matter Description The Company’s goodwill is tested annually on March 1st, or more frequently if events or changes in circumstances indicate that the assets might be impaired. The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to their carrying values. The Company determines the fair value of its reporting units using a combination of the income and the market approach. The determination of the fair value using the income approach requires management to make significant estimates and assumptions related to forecasts of future revenues, operating margins, and discount rates. The determination of the fair value using the market approach requires management to make significant assumptions related to earnings before interest, taxes, depreciation, and amortization (EBITDA) and EBITDA multiples. Changes in these assumptions could have significant impacts on either the fair value, the amount of any goodwill impairment charge, or both. When the carrying value of a reporting unit exceeds the fair value, an impairment is recognized. We identified goodwill of a specific reporting unit as a critical audit matter because of the significant judgments made by management to estimate the fair value of the reporting unit and the difference between its fair value and carrying value. This required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists, when performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to selection of the discount rate and forecasts of future revenue and operating margin, EBITDA and EBITDA multiples. 79 How the Critical Audit Matter Was Addressed in the Audit Our audit procedures related to the forecasts of future revenues, operating margin, discount rate, EBITDA and the selection of EBITDA multiples for a specific reporting unit included the following, amongst others: •We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the determination of the fair value, such as controls related to management’s selection of the discount rate and forecasts of future revenue and operating margins, EBITDA and EBITDA multiples. •We evaluated management’s determination and evaluation of triggering events at each of the quarterly and year end reporting periods. •We evaluated management’s ability to accurately forecast future revenues, operating margins, and EBITDA by comparing actual results to management’s historical forecasts. •We evaluated the reasonableness of management’s revenue and operating margin forecasts by comparing the forecasts to (1) historical revenues, operating margins, and EBITDA, (2) internal communications to management and the Board of Directors, and (3) forecasted information included in analyst and industry reports for the Company and certain of its peer companies. •With the assistance of our fair value specialists, we evaluated the reasonableness of the valuation methods and discount rate by (1) testing the source information underlying the determination of the discount rate and the mathematical accuracy of the calculation and (2) developing a range of independent estimates and comparing those to the discount rate selected by management. •With the assistance of our fair value specialists, we evaluated the EBITDA multiples, including testing the underlying source information and mathematical accuracy of the calculations, and comparing the multiples selected by management to its guideline companies. •With the assistance of our fair value specialists, we evaluated the reasonableness of the weighting management applied to each valuation method and the resulting fair value derived. •We evaluated the impact of changes in management’s forecasts from the March 1, 2026, annual measurement date to May 31, 2026, inclusive of macroeconomic factors. /s/ Deloitte & Touche LLP Cleveland, Ohio July 22, 2026 We have served as the Company's auditor since 2016. 80