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1 Fourth Quarter ended September 30, 2026Quarterly Earnings Report Supplemental Financial Presentation November 4, 2026 Please view this presentation in conjunction with our Q4 2026 earnings release, which is furnished on F orm 8-K, our related pre-recorded remarks and additional information regarding our non-GAAP financial measures, including GAAP to non-GAAP reconciliations, available on our website at https:/ /investor.scotts.com.
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2 2 Safe Harbor Disclosure Statements contained in this presentation, which address activities, events and developments that the Company expects or anticipates will or may occur in the future, including, but not limited to, information regarding the future economic performance and financial condition of the Company, the plans and objectives of the Company’s management, and the Company’s assumptions regarding such performance and plans are “forward-looking statements” within the meaning of the U.S. federal securities laws that are subject to risks and uncertainties. Additional detailed information concerning a number of the important factors that could cause actual results to differ materially from the forward-looking information contained in this presentation is readily available in the Company’s publicly filed annual, quarterly and other reports. The Company disclaims any obligation to update developments of these factors or to announce publicly any revision to any of the forward-looking statements contained in this presentation, or to make updates to reflect future events or developments. This presentation contains certain non-GAAP financial measures. F or a reconciliation of GAAP to non-GAAP financial measures, please see the Appendix of this presentation.
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3 3 Todayʼs Speakers and Q&A Details MarkScheiwer EVP , CFO and CAO NateBaxter President and CEO A live Q&A session will promptly follow the prepared remarks. Review the press release for registration details. T o listen to the Q&A, please remain on the webcast link following our prepared remarks. T o ask a question, please pre-register via the audio link for call-in details and a unique PIN.
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4 FY 2026Business Update Presented by Nate BaxterPresident and Chief Executive Officer 4
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5 5 Fiscal 2026 Highlights ● T otal Company net sales grew 1% y/y (+2% 3YR CAGR) driven by U.S. Consumer branded net sales growth of 4% partially offset by expected declines in mulch and other commodity volumes ● The U.S. Consumer business delivered branded POS growth of 1% in dollars and 2% in units year to date driven by strong performance in Soils and Controls ● E-commerce POS for our branded products increased 24% in dollars and 30% in units year to date. Digital penetration of POS dollars was 13%, in line with expectations ● Delivered non-GAAP adjusted gross margin of 32.4%, an improvement of 80 bps y/y despite the impact of unplanned commodity and freight headwinds from the Iran conflict ● Delivered non-GAAP adjusted diluted EPS from continuing operations growth of 18% y/y for the full year which exceeded our fiscal 2026 guidance ● Leverage ratio of 3.89x as of the end of the fiscal year, an improvement of 0.21x vs. prior year, driven by continued use of free cash flow to debt pay down ● Generated $278M of free cash flow this year, meeting our expectations ● Deployed $25M of free cash flow in our fourth quarter to the first round of share repurchases under the $500M share repurchase program We met or exceeded our fiscal 2026 commitments for net sales, adjusted gross margin, adjusted diluted EPS, free cash flow and leverage ratio
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6 6 SMG 2.0 Foundational Pillars Brands Consumer First Belief and Purpose Modernize Portfolio Culture People First Startup Mentality High Performing T ech Enabled Innovation Speed to Market Safe and Effective Breakthrough Solutions Naturals and Organics Diversify Channel Expansion and Differentiation Demand Creation Brand Reach Digital Influence and Inspiration Trust and Loyalty Branded House Every day, we ask ourselves what a good company would do, and then we set out and do it.
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7 7 1 Portfolio Optimization & Innovation: Revitalizing core product lineups to drive premium growth 2 Omnichannel & Retail Expansion: Meeting consumers everywhere through digital scale and retail partnerships 3 Category Growth & Market Expansion: Accelerating household penetration to grow our addressable market 4 T ech-Driven Operational Excellence: Expanding margins through targeted AI, automation and supply chain efficiencies Transforming for future growth SMG 2.0 Building Blocks
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8 8 ~$12B FY2025 Source: Yipit and internal data. Includes retailers HD,LO, WM, Ace, Amz, Menards, Costco, Sam’s, TSC, T arget, Meijer, Dollar General for FY2025 Includes Lawns, Gardens and Controls POS dollars. Excludes categories that SMG doesn’t participate in. Gardens Soils, Mulch, Plant F ood $4.5B Lawns F ertilizer, Seed, Spreaders $2.0B Controls Weed (selective, non-selective), Insect (indoor, outdoor), Rodent $5.5B Our addressable market: a ~$12B DIY category
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9 9 Lawn and garden is a growing category and consumers are engaged with our brands ¹Yipit and internal data. Includes retailers HD,LO, WM, Ace, Amz, Menards, Costco, Sam’s, TSC, T arget, Meijer and Dollar General. Includes Lawns, Gardens and Controls POS dollars. Excludes categories that SMG doesn’t participate in. ²Lawn & Garden engagements. Rival IQ 2025; Dash Social 2026; Influencer Marketing Hub 2026. Engagement-rate definitions vary by provider. ³SMG Consumer Pulse — June 2026 Expanded Wave (Suzy). ⁴Google Trends Lawn & Garden vs General household CPG (U.S. web search), relative search interest on a 0–100 index 3X Search interest vs general household CPG⁴ Private label share remains Flat¹ >70% of consumers consider lawn & garden spend a necessity³ 2.5X Social media engagements vs general household CPG²5% Category 5YR CAGR¹
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10 10 Our brands and partnerships lead the way Our BrandsPartnerships #1 Brand in F ertilizers, Grass Seed, Spreaders, Mulch #1 Brand in Soils and Plant F ood #1 Brand in Rodent Control #2Brand in Selective Weed, Indoor Insect #1 Brand in Non-selective Weed #1 Brand in Veggie & Herb #1 Brand in Soil Amendments Top 10Brand in Mosquito Repellents Source: Yipit and internal data. Includes retailers HD,LO, WM, Ace, Amz, Menards, Costco, Sam’s, TSC, T arget, Meijer, Dollar General for FY2025 Includes Lawns, Gardens and Controls POS dollars. Excludes categories that SMG doesn’t participate in. Acquired in October 2026
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11 11 ~70% organic share of voice vs. all other lawn & garden brands³ We are leading the category in social commerce, and AI search and discovery ¹TikT ok Shop benchmarks and Cruva ²Yipit First major lawn & garden brands to launch on TikT ok Shop¹ 24% of SMG Amazon consumers are new to our brands² #1 ranked brands for AI search in all major lawn & garden categories⁴ ³Brightedge ⁴Based on Brand AI Index from Evertune; Proprietary score based on frequency of appearing in results and placement in the result
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12 12 The Black Kow acquisition complements Miracle-Gro and broadens our leadership in organic gardening solutions 2 3 4 1 Lawn & Garden Core or Adjacent Trusted portfolio of organic soil and soil enhancement products targeting a new consumer for SMG Synergistic with Low Execution Risk Cohesive integration into our industry leading, national growing media supply chain Strong Returns and Financially Accretive Expected to contribute 1% to 2% in net sales growth and positively support SMG’s operating margin and EPS in FY27 Neutral to Positive on Leverage $55M purchase price funded through free cash flow and EBITDA generation supports leverage goals
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13 13 Innovation drives growth in fiscal 2027
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14 14 Technology investments support SMG 2.0 goals Kinaxis Supply Chain Planning “Always on” supply chain planning to enable agility, orchestration, and operational efficiency 2 SAP S/4HANA ERP Transformation 3 year investment in SAP S/ 4HANA to transform our business • Optimize business processes • Enable process automation, • Drive business velocity (e.g. M&A) Adopted a “clean core” mindset which will: 1 Unified Data Platform Multi-year journey, in parallel with our SAP investment, to: • Improve data visibility • Increase decision velocity • Expand consumer insights 3 1 2 3 4 5 AI for the Consumer Self-Service Analytics Pricing & Promo Optimization Demand Intelligence Intelligent Automation The F oundation Enabling AI Across the Enterprise
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15 15 Annual supply chain savings of at least $35M 1 Network Optimization & Logistics 2 Manufacturing Automation & Efficiency 3 Product Cost Savings 4 Strategic Sourcing
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16 FY 2026Financial Update Presented by Mark ScheiwerEVP , Chief Financial Officer and Chief Accounting Officer 16
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17 17 17 17 Net Sales $3.29 billion +1% Adjusted Gross Margin Rate 32.4% +80 bps Adjusted SG&A $581.2 million +3% Adjusted Net Income from Continuing Operations $264.8 million +19% Interest Expense $112.6 million -13% Adjusted Effective T ax Rate 26% vs. 29% Adjusted Diluted EPS from Continuing Operations $4.48 +18% Adjusted EBITDA $579.9 million vs. $569.7 million Leverage 3.89x vs. 4.10x Fiscal 2026Performance Summary Twelve Months ended September 30, 2026 Total Company Non-GAAP Results FY 2026 Non-GAAP Measures. Comparisons are to the recasted FY 2025 results unless otherwise indicated.
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18 18 Net Sales Performance Q4 2026: Three and Twelve Months ended September 30, 2026 Quarter Drivers ● Vol/Mix - U.S. Consumer: Volume declines in-line with our projections as retailers slowed their purchasing activities as a result of their earlier season load in plans ● Vol/Mix - Canada: Volume declines related to elevated retailer inventories as expected ● Price: Reflects the impact of market-wide price increases on targeted U.S. Consumer SKUs Y ear-to-Date Drivers 1% Increase T otal Company Fiscal 2026 Net Sales in millions + 0.4% Flat + 0.6% $3,255. 8 11% Decrease T otal Company 4Q26 Net Sales in millions + 0.5% - 0.1% - 11.4%$340.1 $302.9 $3,288.9 ● Vol/Mix - U.S. Consumer: Consumer demand of our higher-margin branded products in all categories, expanded listings across select retailers, and continued e-commerce expansion; partially offset by expected declines in non-branded products including Mulch ● Vol/Mix - Canada: Strong retailer support drove increased volume for Grass Seed, F ertilizers and Outdoor Insect ● Price: Reflects the impact of market-wide price increases on targeted U.S. Consumer SKUs
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19 19 ¹Branded POS includes our largest strategic customers, e-commerce and only branded products and excludes Mulch, Private Label and Commodity products. This POS data represents >80% of U.S. Consumer net sales. Lawns ● POS Dollars1: ⬇-3% Less promotion and unfavorable weather conditions across the category ● POS Units1: ⬇-3% Less promotion and unfavorable weather conditions across the category Gardens ● POS Dollars1: ⬆+2% Positive consumer activation programs and growth from Miracle-Gro Organics product line ● POS Units1: ⬆+4% Growth from Miracle-Gro Organics product line in addition to growth in Soils across key channels Controls ● POS Dollars1: ⬆+3% Growth in Roundup and Ortho Insect from favorable weather in the West in addition to pricing actions and innovation, partially offset by Rodent ● POS Units1: ⬇-2% Growth in Ortho Insect offset by Weed Control and Rodent. Rodent has the highest unit volume on the lowest average selling price Overall ● POS Dollars¹: +1% ● POS Units¹: +2% Branded POS1 Performance Q4 2026: Twelve Months ended September 30, 2026
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20 20 ● Vol/Mix/Other: Favorable mix from sales of higher-margin branded products and supply chain efficiencies more than offset by higher freight costs and unfavorable fixed cost leverage from lower volume ● Materials: Favorable material costs driven by supply chain savings initiatives more than offset by the impact of higher commodity costs ● Roundup Commission: Lower commission associated with the Roundup® marketing agreement ● Price: Reflects the impact of market-wide price increases on targeted U.S. Consumer SKUs 590 bps Decrease T otal Company 4Q26 Adjusted Gross Margin - 1.3% - 2.4% + 0.4%5.2% -0.7% ● Vol/Mix/Other: Favorable mix from sales of higher-margin branded products and supply chain efficiencies, partially offset by higher freight costs ● Materials: Favorable material costs driven by supply chain savings initiatives fully offset by the impact of higher commodity costs ● Roundup Commission: Higher commission associated with the Roundup® marketing agreement ● Price: Reflects the impact of market-wide price increases on targeted U.S. Consumer SKUs - 2.6% 80 bps Increase T otal Company Fiscal 2026 Adjusted Gross Margin Flat + 0.4% + 0.2% 31.6% 32.4%+ 0.2% Gross Margin Performance Quarter Drivers Y ear-to-Date Drivers Q4 2026: Three and Twelve Months ended September 30, 2026
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21 21 FISCAL 2026 Our Fiscal 2027 Guidance Net Sales ● +2% to 4% Adjusted Gross Margin Rate ● Continued expansion y/y Adjusted EPS from Continuing Operations ● $4.70 to $4.90 per share Free Cash Flow ● Approximately $275 million Leverage Ratio ● Continued improvement y/y Non-GAAP Measures. On track to reach the Company’s target leverage range of 3.0x to 3.5x by fiscal 2029
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22 22 Net Sales +2-4% Adjusted Gross Margin Rate +50-100 bps Adjusted EPS +5-8% Free Cash Flow >$275M Leverage T arget 3.0-3.5x Long-term leverage target below 3.0x SMG 2.0 mid-term growth algorithm FY27-FY29
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23 Reconciliationof Non-GAAPFinancial Measures 2 3
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24 24 Use of Non-GAAP Measures To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (“GAAP”), the Company uses non-GAAP financial measures. The reconciliations of these non-GAAP financial measures to the most directly comparable financial measures calculated and presented in accordance with GAAP are shown in the following tables. These non-GAAP financial measures should not be considered in isolation from, or as a substitute for or superior to, financial measures reported in accordance with GAAP. Moreover, these non-GAAP financial measures have limitations in that they do not reflect all the items associated with the operations of the business as determined in accordance with GAAP. Other companies may calculate similarly titled non-GAAP financial measures differently than the Company, limiting the usefulness of those measures for comparative purposes. In addition to GAAP measures, management uses these non-GAAP financial measures to evaluate the Companyʼs performance, engage in financial and operational planning, determine incentive compensation and monitor compliance with the financial covenants contained in the Companyʼs borrowing agreements because it believes that these non-GAAP financial measures provide additional perspective on and, in some circumstances are more closely correlated to, the performance of the Companyʼs underlying, ongoing business. Management believes that these non-GAAP financial measures are useful to investors in their assessment of operating performance and the valuation of the Company. In addition, these non-GAAP financial measures address questions routinely received from analysts and investors and, in order to ensure that all investors have access to the same data, management has determined that it is appropriate to make this data available to all investors. Non-GAAP financial measures exclude the impact of certain items (as further described below) and provide supplemental information regarding operating performance. By disclosing these non-GAAP financial measures, management intends to provide investors with a supplemental comparison of operating results and trends for the periods presented. Management believes these non-GAAP financial measures are also useful to investors as such measures allow investors to evaluate performance using the same metrics that management uses to evaluate past performance and prospects for future performance. Management views free cash flow as an important measure because it is one factor used in determining the amount of cash available for dividends and discretionary investment. Reconciliation of Non-GAAP Financial Measures
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25 25 Definitions of Non-GAAP Financial Measures The reconciliations of non-GAAP disclosure items include the following financial measures that are not calculated in accordance with GAAP: • Adjusted gross margin: Gross margin excluding impairment, restructuring and other charges / recoveries. • Adjusted selling, general and administrative: Selling, general and administrative excluding IT transformation costs. • Adjusted income (loss) from continuing operations before income taxes: Income (loss) from continuing operations before income taxes excluding impairment, restructuring and other charges / recoveries, IT transformation costs, unrealized gains and losses on non-core equity and other investments, costs related to refinancing and certain other non-operating income / expense items. • Adjusted income tax expense (benefit) from continuing operations: Income tax expense (benefit) from continuing operations excluding the tax effect of impairment, restructuring and other charges / recoveries, IT transformation costs, unrealized gains and losses on non-core equity and other investments, costs related to refinancing and certain other non-operating income / expense items. • Adjusted net income (loss) from continuing operations: Net income (loss) from continuing operations excluding impairment, restructuring and other charges / recoveries, IT transformation costs, unrealized gains and losses on non-core equity and other investments, costs related to refinancing and certain other non-operating income / expense items, each net of tax. • Adjusted diluted net income (loss) per common share from continuing operations: Diluted net income (loss) per common share from continuing operations excluding impairment, restructuring and other charges / recoveries, IT transformation costs, unrealized gains and losses on non-core equity and other investments, costs related to refinancing and certain other non-operating income / expense items, each net of tax. • Adjusted EBITDA: Net income (loss) before interest, taxes, depreciation and amortization as well as certain other items such as discontinued operations, the impact of the cumulative effect of changes in accounting, costs associated with debt refinancing and other non-recurring or non-cash items affecting net income (loss). A form of Adjusted EBITDA is used in agreements governing the Companyʼs outstanding indebtedness for debt covenant compliance purposes. Adjusted EBITDA as used in those agreements includes additional adjustments to the Adjusted EBITDA presented in the reconciliations above which may decrease or increase Adjusted EBITDA for purposes of the Companyʼs financial covenants. • Free cash flow: Net cash provided by (used in) operating activities reduced by investments in property, plant and equipment. F orward Looking Non-GAAP Measures In this presentation, the Company presents certain forward-looking non-GAAP measures. The Company does not provide outlook on a GAAP basis because changes in the items that the Company excludes from GAAP to calculate the comparable non-GAAP measure, described above, can be dependent on future events that are less capable of being controlled or reliably predicted by management and are not part of the Companyʼs routine operating activities. Additionally, due to their unpredictability, management does not forecast many of the excluded items for internal use and therefore cannot create or rely on a GAAP outlook without unreasonable efforts. The occurrence, timing and amount of any of the items excluded from GAAP to calculate non-GAAP could significantly impact the Companyʼs GAAP results. As a result, the Company does not provide a reconciliation of forward-looking non-GAAP measures to GAAP measures, in reliance on the unreasonable efforts exception provided under Item 10(e)(1)(i)(B) of Regulation S-K. Reconciliation of Non-GAAP Financial Measures
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26 26 Reconciliation of Non-GAAP Financial Measures Q4 2026: THREE AND TWEL VE MONTHS ENDED SEPTEMBER 30, 2026 RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (IN MILLIONS, EXCEPT PER SHARE DATA - UNAUDITED) Three Months Ended September 30, 2026 Three Months Ended September 30, 2025 As Reported (GAAP) Non-GAAP Adj. Adjusted (Non-GAAP) As Reported (GAAP) Non-GAAP Adj. Adjusted (Non-GAAP) Gross margin $(2.1) - $(2.1) $16.3 $(1.5) $17.7 Gross margin as a % of sales (0.7)% (0.7)% 4.8% 5.2% Selling, general and administrative 144.0 (13.5) 130.4 127.7 - 127.7 Loss from continuing operations before income taxes (178.9) (10.7) (168.2) (164.2) (14.6) (149.6) Income tax benefit from continuing operations (54.7) (11.9) (42.8) (36.9) (1.2) (35.7) Effective tax rate 30.6% 25.4% 22.5% 23.9% Net loss from continuing operations (124.2) 1.1 (125.4) (127.3) (13.4) (113.9) Diluted net loss per common share from continuing operations (2.14) 0.02 (2.16) (2.21) (0.24) (1.97) RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (IN MILLIONS, EXCEPT PER SHARE DATA - UNAUDITED) Twelve Months Ended September 30, 2026 Twelve Months Ended September 30, 2025 As Reported (GAAP) Non-GAAP Adj. Adjusted (Non-GAAP) As Reported (GAAP) Non-GAAP Adj. Adjusted (Non-GAAP) Gross margin $1,063.0 $(2.5) $1,065.4 $1,019.6 $(10.1) $1,029.7 Gross margin as a % of sales 32.3% 32.4% 31.3% 31.6% Selling, general and administrative 594.7 (13.5) 581.2 563.8 - 563.8 Income from continuing operations before income taxes 278.0 (79.9) 357.9 264.9 (49.2) 314.1 Income tax expense from continuing operations 83.1 (10.0) 93.0 82.8 (8.3) 91.1 Effective tax rate 29.9% 26.0% 31.3% 29.0% Net income from continuing operations 194.9 (69.9) 264.8 182.1 (40.9) 223.0 Diluted net income per common share from continuing operations 3.30 (1.18) 4.48 3.10 (0.70) 3.80
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27 27 Reconciliation of Non-GAAP Financial Measures Q4 2026: TWEL VE MONTHS ENDED SEPTEMBER 30, 2026 CALCULA TION OF ADJUSTED EBITDA Twelve Months Ended Sept 30, 2026 Twelve Months Ended Sept 30, 2025 Net income (GAAP) $103.9 $145.2 Income tax expense from continuing operations 83.1 82.8 Loss from discontinued operations, net of tax 91.0 36.9 Interest expense 112.6 129.0 Depreciation 62.4 58.6 Amortization 2.7 2.7 Impairment, restructuring and other 51.6 45.3 IT transformation costs 13.5 - Equity in (income) loss of unconsolidated affiliates (3.0) 2.8 Unrealized losses on non-core equity and other investments 14.7 - Interest income (0.3) - Share-based compensation expense 47.7 66.4 Adjusted EBITDA (Non-GAAP) $579.9 $569.7 RECONCILIATION OF FREE CASH FLOW (NON-GAAP) (In millions) Year Ended September 30, 2026 Net cash provided by operating activities (GAAP) $373.0 Investments in property, plant and equipment (94.6) Free cash flow (Non-GAAP) $278.4 Note: See accompanying footnotes. The sum of the components may not equal due to rounding.
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28 28 Reconciliation of Non-GAAPFinancial Measures For the three and twelve months ended September 30, 2026, the following items were adjusted, in accordance with the definitions above, to arrive at the non-GAAP financial measures: • Income (loss) from discontinued operations, net of tax, associated with the Hawthorne business was $2.3 million and $(91.0) million for the three and twelve months ended September 30, 2026, respectively. This includes a pre-tax loss of $106.2 million for the twelve months ended September 30, 2026 related to the sale of the Hawthorne business in North America. During the three months ended September 30, 2026, post-closing adjustments related to the sale were finalized and the Company recorded an increase to the cumulative pre-tax loss of $4.3 million. • During the three and twelve months ended September 30, 2026, the Company recorded employee and executive severance charges of $0.0 million and $1.7 million, respectively, in the “Cost of sales—impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations and $4.8 million and $26.4 million, respectively, in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2026, the Company recorded unrealized gains (losses) on non-core equity and other investments of $0.9 million and $(14.7) million, respectively, in the “Other non-operating expense, net” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2026, the Company recorded a non-cash impairment charge of $3.5 million related to other investments in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2026, the Company recorded a non-cash impairment charge of $0.0 million and $8.7 million, respectively, related to a seller financing loan in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2026, the Company recorded a non-cash impairment charge of $0.0 million and $7.9 million, respectively, related to a convertible debt investment in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded.
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29 29 Reconciliation of Non-GAAPFinancial Measures For the three and twelve months ended September 30, 2026, the following items were adjusted, in accordance with the definitions above, to arrive at the non-GAAP financial measures: • During the three and twelve months ended September 30, 2026, the Company recorded pre-tax gains on the sale of land and real estate facilities of $6.6 million and $7.6 million, respectively, in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2026, the Company recorded a charge of $0.0 million and $4.0 million, respectively, in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations associated with a settlement agreement to resolve a dispute with former shareholders of a business that was acquired in fiscal 2021. • During fiscal year 2026, the Company commenced a multi-year project to transform its information technology (“IT”) infrastructure, including replacing its enterprise resource planning system and implementing complementary software across critical business functions. The Company plans to invest over $100.0 million associated with these IT implementations over the course of the project, which is expected to be substantially complete during fiscal year 2028. The majority of these costs are expected to be third-party consulting and implementation fees. Other anticipated costs include dedicated incremental internal labor and other discrete costs incurred in connection with the project. Due to the nature, scope and magnitude of this investment, these costs are considered by management to represent incremental transformational costs above the historical normal level of spending for IT to support operations. These costs will cease at the end of the investment period, are not expected to recur in the foreseeable future, and are not considered representative of the Company's underlying operating performance. During the three and twelve months ended September 30, 2026, the Company recorded IT transformation costs of $13.5 million in the “Selling, general and administrative” line in the Condensed Consolidated Statements of Operations associated with this initiative. The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded.
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30 30 Reconciliation of Non-GAAPFinancial Measures For the three and twelve months ended September 30, 2025, the following items were adjusted, in accordance with the definitions above, to arrive at the non-GAAP financial measures: • Loss from discontinued operations, net of tax, associated with the Hawthorne business was $24.5 million and $36.9 million for the three and twelve months ended September 30, 2025, respectively. This includes a non tax-deductible loss of $17.7 million for the three and twelve months ended September 30, 2025 related to the divestiture of the Hawthorne professional horticulture business based in the Netherlands • During the three and twelve months ended September 30, 2025, the Company recorded employee and executive severance charges of $1.1 million and $6.1 million, respectively, in the “Cost of sales—impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations and $1.5 million and $15.0 million, respectively, in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. • During the three and twelve months ended September 30, 2025, the Company recorded a charge of $7.5 million in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations associated with a settlement agreement to resolve litigation with the former shareholders of a business that was acquired in fiscal 2021. • During the three and twelve months ended September 30, 2025, the Company recorded a non-cash loss of $0.0 million and $7.0 million, respectively, in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations related to the exchange of its convertible debt investment in RIV Capital Inc. for non-voting exchangeable shares of FLUENT Corp. (formerly Cansortium Inc.). • During fiscal 2022, the Company began implementing a series of Company-wide organizational changes and initiatives intended to create operational and management-level efficiencies. As part of this restructuring initiative, the Company reduced the size of its supply chain network, reduced staffing levels and implemented other cost-reduction initiatives. During the three months ended September 30, 2025, costs associated with this restructuring initiative were not material. During the twelve months ended September 30, 2025, the Company recorded costs of $4.0 million in the “Cost of sales—impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations associated with this restructuring initiative. • During the three and twelve months ended September 30, 2025, the Company recorded an impairment charge of $3.8 million associated with an equity method investment in the “Equity in (income) loss of unconsolidated affiliates” line in the Condensed Consolidated Statements of Operations. The tax effect for each of the items listed above is determined using the tax rate and other tax attributes applicable to the item and the jurisdiction(s) in which the item is recorded.