
	2026		2025		2024
Current
Federal	$	10.9	$	6.3	$	3.4
State and local		11.2		1.3		1.2
Non-United States		4.4		2.7		1.5
Total Current	$	26.5	$	10.3	$	6.1

Deferred
Federal	$	2.8	$	(9.1)	$	0.5
State and local		(3.3)		(0.4)		(1.3)
Non-United States		2.5		(0.2)		(1.2)
Total Deferred	$	2.0	$	(9.7)	$	(2.0)

Total Current and Deferred	$	28.5	$	0.6	$	4.1

In accordance with the prospective adoption of ASU 2023-09, the following table presents a reconciliation of the U.S. federal statutory income tax rate to the effective income tax rate for the fiscal year ended May 31, 2026, including both rate and dollar amount information:


	Amount		Rate
U.S. federal statutory income tax rate	$	17.9	21.0	%
State and local income tax, net of federal income tax benefit (1)		6.6	7.8
Foreign tax effects
Australia
Sale of equity method investment		4.1	4.8
Permanent differences		(1.3)	(1.5)
Other		(0.7)	(0.8)
Canada
Foreign tax rate differential		1.0	1.2
Other		1.0	1.2
Other foreign jurisdictions		1.8	2.1
Tax credits
Research and development tax credit		(1.2)	(1.4)
Foreign tax credit		(1.2)	(1.4)
Changes in unrecognized tax benefits		1.4	1.6
Effect of cross-border tax laws		0.0	0.0
Global intangible low-taxed income		2.8	3.3
FDII		(2.8)	(3.3)
Nontaxable or nondeductible items
Charitable contributions		(0.9)	(1.1)
Equity and other compensation		(1.0)	(1.1)
Section 162(m) limitation		2.1	2.5
Sale of equity method investment		(1.1)	(1.3)
Other federal tax adjustments		(1.0)	(1.1)
Other nontaxable or nondeductible items		1.0	0.9
Effective income tax rate	$	28.5	33.4	%
(1) State and local taxes in New York, New York City, and California represented the majority (greater than 50 percent) of the tax effect in this category.


	2025				2024
Computed federal statutory provision			21.0	%			21.0	%
State income tax provision, net of federal income tax benefit			(66.5)				(3.0)
Difference in effective tax rates on earnings of foreign subsidiaries			(61.4)				(0.1)

GILTI inclusion			—				0.1


Various tax credits			62.1				(6.6)
Valuation allowances, excluding state			93.8				2.9
Uncertain positions			40.7				0.4
Transaction costs			—				12.0

Equity and other compensation			51.6				(3.7)
Section 162(m) limitation			(83.5)				6.0
Return to provision and other adjustments			(132.8)				(5.1)
Permanent differences			29.0				1.3
Other, net			(0.2)				0.1
Effective tax rates			(46.2)	%			25.3	%
Total provision (benefit) for income taxes		$	0.6			$	4.1

The Company assesses foreign investment levels periodically to determine if all or a portion of the Company’s investments in foreign subsidiaries are indefinitely invested. The Company is permanently reinvested in certain foreign subsidiaries representing a portion of the Company's investments in foreign subsidiaries. Any required adjustment to the income tax provision would be reflected in the period that the Company changes this assessment. As of May 31, 2026, there have been no adjustments to the income tax provision related to unremitted earnings.


	2026		2025
Deferred tax assets:
Tax uniform capitalization	$	12.8	$	12.2
Prepublication expenses		3.9		3.0
Inventory reserves		19.2		21.8
Allowance for credit losses		2.0		1.8
Deferred revenue		6.1		6.2
Stock based compensation		4.6		5.9
Other reserves		5.2		4.4
Postretirement, post employment and pension obligations		1.6		1.6
Tax carryforwards		30.5		32.4
Lease liabilities		76.5		27.7
Other		13.5		15.0
Gross deferred tax assets	$	175.9	$	132.0
Valuation allowance		(21.6)		(17.1)
Total deferred tax assets	$	154.3	$	114.9
Deferred tax liabilities:
Depreciation and amortization		(35.4)		(53.9)
Lease right-of-use assets		(73.0)		(24.4)
Research and development costs capitalized		(20.6)		(8.3)
Other		(2.0)		(3.7)
Total deferred tax liabilities	$	(131.0)	$	(90.3)
Total net deferred tax assets (1)	$	23.3	$	24.6

(1) Total net deferred tax assets include $8.5 and $10.1 as of May 31, 2026 and May 31, 2025, respectively, of deferred tax liabilities that were recorded in Other noncurrent liabilities on the Company's Consolidated Balance Sheet primarily due to foreign jurisdictions that cannot be netted.

The Company regularly assesses the realizability of deferred tax assets considering all available evidence including, to the extent applicable, the nature, frequency and severity of prior cumulative losses, forecasts of future taxable income, tax filing status, duration of statutory carryforward periods, tax planning strategies and historical experience. For the fiscal year ended May 31, 2026, the valuation allowance increased by $4.5, primarily due to state net operating losses not expected to be realized. For the fiscal year ended May 31, 2025, the valuation allowance decreased by $2.8.

The Company has gross federal, state and foreign net operating loss carryforwards of $0.9, $95.2 and $87.3, respectively, and tax effected federal, state and foreign net operating loss carryforwards of $0.6, $6.2 and $20.6, respectively, for the fiscal year ended May 31, 2026. In addition, the Company has certain tax carryforwards related to tax credits of $2.3, which have various expiration dates between 2029 and 2035, and charitable contributions of $0.8 for the fiscal year ended May 31, 2026. The federal net operating loss can be carried forward indefinitely, however the deduction is limited to 80% of taxable income in the carryforward year. Certain state net operating loss carryforwards, if not utilized, expire at various times, primarily between fiscal year 2028 and fiscal year 2044. Certain foreign net operating loss carryforwards, if not utilized, also expire at various times. Approximately half of the foreign net operating loss carryforwards expire between fiscal year 2027 and fiscal year 2044 and the remaining carryforwards do not have an expiration date.

The benefits of uncertain tax positions are recorded in the financial statements only after determining a more likely-than-not probability that the uncertain tax positions will withstand challenge, if any, from taxing authorities, in which case such benefits are included in long-term income taxes payable and reduced by the associated federal deduction for state taxes and non-U.S. tax credits. The interest and penalties related to these uncertain tax positions are recorded

The total amount of unrecognized tax benefits at May 31, 2026, 2025, and 2024 were $2.6, excluding $0.3 accrued for interest and penalties, $1.2, excluding $0.3 accrued for interest and penalties, and $1.8, excluding $0.3 accrued for interest and penalties, respectively. Of the total amount of unrecognized tax benefits at May 31, 2026, 2025, and 2024, $2.6, $1.2 and $1.8, respectively, would impact the Company’s effective tax rate.

During the years presented, the Company recognized interest and penalties related to unrecognized tax benefits in the provision for taxes in the Consolidated Financial Statements. The Company recognized an expense of $0.1, a benefit of less than $0.1, and an expense of $0.1 for the years ended May 31, 2026, 2025, and 2024, respectively.


Gross unrecognized benefits at May 31, 2023	$	2.0
Decreases related to prior year tax positions		(0.8)
Increase related to prior year tax positions		0.7
Increases related to current year tax positions		0.1
Settlements during the period		(0.2)
Lapse of statute of limitation		—
Gross unrecognized benefits at May 31, 2024	$	1.8
Decreases related to prior year tax positions		—
Increase related to prior year tax positions		0.1
Increases related to current year tax positions		0.1
Settlements during the period		—
Lapse of statute of limitation		(0.8)
Gross unrecognized benefits at May 31, 2025	$	1.2
Decreases related to prior year tax positions		—
Increase related to prior year tax positions		1.9
Increases related to current year tax positions		0.1
Settlements during the period		—
Lapse of statute of limitation		(0.6)
Gross unrecognized benefits at May 31, 2026	$	2.6

The Company, including its domestic subsidiaries, files a consolidated U.S. income tax return, and also files tax returns in various states and other local jurisdictions. Certain foreign subsidiaries also file income tax returns in the jurisdictions in which they operate. The Company is routinely audited by various tax authorities. Tax years relating to fiscal 2021 through 2025 remain subject to examination.

The Organization for Economic Co-operation and Development (OECD) has issued Pillar Two model rules introducing a new global minimum tax of 15% on foreign profits of large multinational corporations intended to be effective in 2024. The United States has not yet adopted Pillar Two rules, however, many countries and jurisdictions have agreed to the proposal by the OECD. As part of the Company's ongoing assessment of the OECD's Pillar Two global minimum tax framework, a comprehensive review was conducted of the Company's global tax position to evaluate the potential impact on its effective tax rate. Based on this analysis, the Company determined the impact of Pillar Two to be immaterial to its financial statements.

On July 4, 2025, the One Big Beautiful Bill Act ("OBBBA") was enacted in the United States. The OBBBA includes a number of significant tax provisions, including the permanent extension of certain provisions originally enacted under the Tax Cuts and Jobs Act, such as 100% bonus depreciation, immediate expensing of domestic research and experimental expenditures, and modifications to the limitation on business interest expense deductions. During fiscal 2026, the Company elected to immediately deduct 100% of its qualifying domestic research and experimental

expenditures under Section 174 and utilized 100% bonus depreciation for eligible capital investments. As a result, the enactment of the OBBBA favorably impacted the Company's current-year taxable income and cash taxes.

The Company is subject to tax examinations for sales-based taxes. A number of these examinations are ongoing and, in certain cases, have resulted in assessments from taxing authorities. The Company assesses sales tax contingencies for each jurisdiction in which it operates, considering all relevant facts including statutes, regulations, case law and experience. Where a sales tax liability in respect to a jurisdiction is probable and can be reliably estimated for such jurisdiction, the Company has made accruals for these matters which are reflected in the Company’s Consolidated Financial Statements. These amounts are included in the Consolidated Financial Statements in Selling, general and administrative expenses. Future developments relating to the foregoing could result in adjustments being made to these accruals.