v3.26.1
Income Taxes
 12 Months Ended
May 31, 2026
Income Taxes  
Income Taxes

7. Income Taxes

Our income tax expense includes the following components:

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​

​

​

​

​

​

​

​

​

​

​

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For the Year Ended

​

​

May 31, 

​

  ​ ​ ​

2026

  ​ ​ ​

2025

  ​ ​ ​

2024

Current:

​

​

​

​

​

​

​

​

​

Federal

​

$

37.6

​

$

20.7

​

$

21.0

State

​

 

11.3

​

 

3.1

​

 

4.0

Foreign

​

 

12.5

​

 

8.1

​

 

7.5

​

​

 

61.4

​

 

31.9

​

 

32.5

Deferred

​

 

(3.2)

​

 

(5.5)

​

​

(20.5)

​

​

$

58.2

​

$

26.4

​

$

12.0

​

Income (Loss) before income tax expense includes the following components:

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​

​

​

​

​

​

​

​

​

​

​

​

For the Year Ended

​

​

May 31, 

​

  ​ ​ ​

2026

  ​ ​ ​

2025

  ​ ​ ​

2024

Domestic

​

$

184.2

​

$

(22.5)

​

$

14.6

Foreign

​

 

61.7

​

 

61.4

​

 

43.7

​

​

$

245.9

​

$

38.9

​

$

58.3

​

Our foreign earnings are comprised primarily of the results of our operations in Canada and Thailand.

The Company adopted ASU 2023-09, Income Taxes (Topic 740) Improvements To Income Tax Disclosures, on a prospective basis beginning with the year ended May 31, 2026. The following table presents the required disclosure to reconcile the U.S. federal statutory income tax amount and rate to our effective amount and rate for the year ended May 31, 2026 pursuant to the new ASU:

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  ​ ​ ​

Amount

  ​ ​ ​

Percent

 

Income tax expense at the U.S. federal statutory rate

​

$

51.6

 

21.0

%

State income taxes, net of federal benefit

​

 

9.6

 

3.9

​

Foreign tax effects

​

 

0.1

 

—

​

Nontaxable or nondeductible items:

​

 

  ​

 

  ​

​

Bargain purchase gain

​

 

(6.2)

 

(2.5)

​

Compensation

​

 

2.6

 

1.1

​

Other

​

 

1.9

 

0.8

​

Tax benefit from stock-based compensation

​

 

(1.4)

 

(0.6)

​

​

​

$

58.2

 

23.7

%  

​

State income taxes in Illinois and Florida comprise the majority (greater than 50%) of the tax effect of this category.

The following table presents the required disclosures prior to our adoption of new ASU and reconciles the U.S. federal statutory income tax rate of 21.0% to our effective income tax rate:

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​

​

​

​

​

​

​

​

For the Year Ended May 31,

 

​

  ​ ​ ​

2025

  ​ ​ ​

2024

 

Income tax expense at the U.S. federal statutory rate

​

21.0

%  

21.0

%

FCPA settlement

 

26.7

 

—

​

State income taxes, net of federal benefit

 

10.1

 

5.0

​

Non-deductible compensation

 

7.1

 

4.4

​

Tax benefit from stock-based compensation

 

(1.7)

 

(5.1)

​

Pension settlement

 

—

 

(8.6)

​

Other

 

4.7

 

3.9

​

Effective income tax rate

 

67.9

%  

20.6

%

​

The following table presents the required disclosure to present income taxes paid (net of refunds received) for the year ended May 31, 2026 pursuant to the new ASU:

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​

​

​

​

U.S. federal taxes

  ​ ​ ​

$

23.5

State taxes

​

 

7.1

Foreign taxes:

​

 

  ​

Canada

​

 

12.1

Other foreign jurisdictions

​

 

6.9

​

​

$

49.6

​

Income taxes paid (net of refunds received) during fiscal 2025 and 2024 was $23.7 million and $41.8 million, respectively.

Income tax payable was $8.8 million at May 31, 2026 and was included in Other accrued liabilities on the Consolidated Balance Sheet. Income tax receivable was $5.6 million at May 31, 2025 and was included in Prepaid expenses and other current assets on the Consolidated Balance Sheet.

Deferred tax assets and liabilities result primarily from the differences in the timing of the recognition of transactions for financial reporting and income tax purposes. Our deferred tax assets and liabilities consist of the following components:

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​

​

​

​

​

​

​

​

​

May 31, 

​

  ​ ​ ​

2026

  ​ ​ ​

2025

Deferred tax assets:

​

​

​

​

​

​

Operating lease liabilities

​

$

26.8

​

$

25.4

Employee and retirement benefits

​

​

10.4

​

​

8.9

Inventory

​

​

9.4

​

​

—

State net operating losses

​

​

7.3

​

​

6.4

Other

​

 

4.0

​

 

8.2

Total deferred tax assets

​

​

57.9

​

​

49.0

Valuation allowance

​

​

(1.8)

​

​

(0.1)

Total deferred tax assets net of valuation allowance

​

​

56.1

​

​

48.9

Deferred tax liabilities:

​

​

​

​

​

​

ROU operating lease assets

​

​

(34.9)

​

​

(25.8)

Intangible assets

​

​

(33.9)

​

​

(32.2)

Tangible assets

​

​

(7.5)

​

​

(5.0)

Other

​

 

(2.9)

​

 

(4.3)

Total deferred tax liabilities

​

​

(79.2)

​

​

(67.3)

Net deferred tax liabilities

​

$

(23.1)

​

$

(18.4)

​

Our net operating losses have carry forward periods that range from 5 to 20 years. Our history of operating earnings, our expectations for continued future earnings, the nature of certain of our deferred tax assets and the scheduled reversal of deferred tax liabilities, primarily related to depreciation, support the recoverability of the majority of the deferred tax assets.

Our federal income tax returns for fiscal years 2023 and subsequent are open for examination. Various states and foreign jurisdictions also remain open subject to their applicable statute of limitations.