Income Taxes

12 Months Ended

Dec. 31, 2025


	Years Ended December 31,
(In millions)	2025		2024	2023

Income (loss) from continuing operations before income taxes
U.S.	$	71.6	(39.3)	1.8
Foreign	282.3		305.6	234.0
Income from continuing operations before income taxes	$	353.9	266.3	235.8


Provision (benefit) for income taxes from continuing operations
Current tax expense (benefit)
U.S. federal	$	3.7	1.0	2.7
State	5.4		3.4	4.0
Foreign	112.9		106.3	109.8
Current tax expense	122.0		110.7	116.5

Deferred tax expense (benefit)
U.S. federal	$	10.6	(25.0)	30.4
State	0.5		1.4	(4.0)
Foreign	10.2		5.6	(3.7)
Deferred tax expense (benefit)	21.3		(18.0)	22.7

Total Income tax expense (benefit)
U.S. federal	$	14.3	(24.0)	33.1
State	5.9		4.8	—
Foreign	123.1		111.9	106.1
Provision for income taxes of continuing operations	$	143.3	92.7	139.2


	Years Ended December 31,
(In millions)	2025		2024	2023

Comprehensive provision (benefit) for income taxes allocable to
Continuing operations	$	143.3	92.7	139.2
Discontinued operations	—		0.4	0.5
Other comprehensive income (loss)	(13.1)		12.0	(4.5)

Comprehensive provision for income taxes	$	130.2	105.1	135.2

Rate Reconciliation

The following table reconciles the difference between the actual tax rate on continuing operations and the statutory U.S. federal income tax rate of 21% for 2025.


	Year Ended December 31,
(In percentages)	2025
	Amount		Percent

U.S. Federal Statutory Income Tax Rate	$	74.3	21.0	%

State and local tax effects, (net of federal income tax effects)(a)	5.9		1.6

Domestic Federal
Tax credits
Foreign tax credits	(18.2)		(5.1)
Others	(0.5)		(0.1)

Changes in federal valuation allowances	15.4		4.4
Effect of cross-border tax laws
Global intangible low-taxed income (net of foreign tax credits)	7.6		2.1
Foreign derived intangible income	(6.4)		(1.8)
Other	1.3		0.4
Nontaxable or nondeductible items
Nondeductible officer compensation	6.1		1.7
Excess tax benefits on share-based payments	(3.9)		(1.1)

Other	1.5		0.4
Other reconciling items	(1.8)		(0.5)

Worldwide - changes in unrecognized tax benefits	(8.3)		(2.3)

Foreign Tax Effects
Argentina
Foreign rate differential	2.6		0.7
Deductible inflation adjustment	(9.9)		(2.8)
Non-deductible hyperinflationary adjustments	12.6		3.6
Withholding taxes	10.4		2.9

Brazil	5.9		1.7

France	4.4		1.2
Mexico
Foreign rate differential	7.0		2.0

Non-deductible employee cost	5.0		1.4
Other non-deductible expenses	3.6		1.0
Withholding taxes	4.5		1.3
Other	(1.2)		(0.3)
Netherlands
Exchange gain	14.9		4.2
Change in valuation allowances	(5.6)		(1.6)
Other	(2.5)		(0.7)

Other foreign jurisdictions(b)	18.6		5.2

Effective Tax Rate	$	143.3	40.5	%

(a)State taxes in Texas, California, and the state and city of New York make up greater than 50% of the tax effects in this category.

(b)No other foreign jurisdiction contributes a reconciling tax effect item of greater than 5% of pretax income at the U.S. Federal statutory rate.

The following table reconciles the difference between the actual tax rate on continuing operations and the statutory U.S. federal income tax rate of 21% for 2025, 2024 and 2023.


	Years Ended December 31,
(In percentages)	2025		2024		2023

U.S. federal tax rate	21.0	%	21.0	%	21.0	%
Increases (reductions) in taxes due to:
Foreign rate differential	4.0		7.5		4.7
Taxes on cross border income, net of credits	3.2		2.9		7.9

Adjustments to valuation allowances	3.2		(2.8)		18.5
Foreign income taxes	5.7		(1.0)		6.0

French business tax	0.3		0.3		0.4
State income taxes, net	1.6		2.0		0.6
Share-based compensation	0.6		1.3		1.8
Acquisition costs	0.1		—		0.2
Nondeductible fines and penalties	0.1		3.8		—
Other(a)	0.7		(0.2)		(2.1)
Actual income tax rate on continuing operations	40.5	%	34.8	%	59.0	%

(a)No individual item is above a 5% threshold.

Components of Deferred Tax Assets and Liabilities


	December 31,
(In millions)	2025		2024

Deferred tax assets
Pension liabilities	$	25.8	26.9
Retirement benefits other than pensions	14.0		10.8
Lease liabilities	116.0		99.5
Workers’ compensation and other claims	25.8		26.3
Property and equipment, net	46.5		42.3
Other assets and liabilities	109.3		117.2
Net operating loss carryforwards	63.0		54.4
Interest limitations and other tax carryforwards(a)	101.0		80.2
Foreign tax and other tax credits(b)	51.7		61.1
Subtotal	553.1		518.7
Valuation allowances	(136.5)		(118.1)
Total deferred tax assets	416.6		400.6

Deferred tax liabilities


Right-of-use assets, net	107.2		93.0
Goodwill and other intangibles	107.9		101.1
Other assets and miscellaneous	30.7		30.1
Deferred tax liabilities	245.8		224.2
Net deferred tax asset	$	170.8	176.4

Included in:

Noncurrent assets	$	237.3	239.2

Noncurrent liabilities	(66.5)		(62.8)
Net deferred tax asset	$	170.8	176.4

(a)U.S. interest limitation carryforward of $63.8 million has an unlimited carryforward and is not subject to a valuation allowance. In addition, foreign interest limitation and other tax carryforwards of $37.2 million have an unlimited carryforward and are subject to a full valuation allowance.

(b)U.S. foreign tax credits of $50.3 million expire in various years between 2025 and 2033 and other remaining credits of $1.3 million have various expiration periods. The U.S. foreign tax credits and other credits have a valuation allowance of $50.3 million.

Valuation Allowances

Valuation allowances relate to deferred tax assets for certain federal credit carryforwards, certain state and non-U.S. jurisdictions. Based on our analysis of positive and negative evidence including historical and expected future taxable earnings, and a consideration of available tax-planning strategies, we believe it is more-likely-than-not that we will realize the benefit of the existing deferred tax assets, net of valuation allowances, at December 31, 2025.


	Years Ended December 31,
(In millions)	2025		2024	2023

Valuation allowances:
Beginning of year	$	118.1	128.0	77.3
Expiring tax credits	(0.9)		(0.2)	(0.1)
Acquisitions and dispositions	3.2		(0.1)	(0.9)
Changes in judgment about deferred tax assets(a)	15.9		1.3	32.5
Other changes in deferred tax assets, charged to:
Income from continuing operations	(7.0)		(8.6)	11.3

Other comprehensive income (loss)	1.1		1.7	6.9

Foreign currency exchange effects	6.1		(4.0)	1.0
End of year	$	136.5	118.1	128.0

(a)Changes in judgment about valuation allowances are based on a recognition threshold of “more-likely-than-not” of realizing beginning-of-year balances of deferred tax assets. Amounts are recognized in income from continuing operations. The 2023 change in judgment includes the impact of Internal Revenue Notices which provide relief for foreign taxes paid in any taxable year beginning on or after December 28, 2021, and ending before the date that a notice or other guidance withdrawing or modifying the temporary relief is issued (or any later date specified in such notice or other guidance). We determined a significant amount of the post-2021 foreign withholding taxes will now be eligible for U.S. foreign income tax credit treatment and therefore our U.S. operations will annually be generating new foreign tax credits which should be creditable in the year generated. The 2025 change in judgment includes the impact of the One Big Beautiful Bill Act which included modifications to the U.S. taxation of worldwide income among other changes. As a result, we no longer expect to be able to utilize a substantial amount of our foreign tax credit carryforwards to offset the future tax prior to their expiration.

Net Operating Losses

The gross amount of the net operating loss carryforwards as of December 31, 2025, was $434.0 million. The tax benefit of net operating loss carryforwards, before valuation allowances, as of December 31, 2025, was $63.0 million, and expires as follows:


(In millions)	Federal		State	Foreign	Total

Years of expiration
2026-2030	$	—	—	3.6	3.6
2031-2035	—		0.6	1.0	1.6
2036 and thereafter	—		10.2	6.0	16.2
Unlimited	—		1.3	40.3	41.6
	$	—	12.1	50.9	63.0

Uncertain Tax Positions

A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows:


	Years Ended December 31,
(In millions)	2025		2024	2023

Uncertain tax positions:
Beginning of year	$	21.6	23.5	23.5
Increases related to prior-year tax positions	2.5		—	2.1
Decreases related to prior-year tax positions	(6.5)		(1.3)	(2.7)
Increases related to current-year tax positions	2.0		2.0	2.4
Increases related to acquisitions	0.5		0.8	—

Settlements	(0.9)		(0.1)	—
Effect of the expiration of statutes of limitation	(3.6)		(2.5)	(2.5)

Foreign currency exchange effects	0.2		(0.8)	0.7
End of year	$	15.8	21.6	23.5

Included in the balance of unrecognized tax benefits at December 31, 2025, are potential benefits of approximately $13.8 million that, if recognized, will reduce the effective tax rate on income from continuing operations.

We recognize accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. We reverse interest and penalty accruals when a statute of limitation lapses or when we otherwise conclude the amounts should not be accrued. The impact of interest and penalties on the 2025, 2024 and 2023 tax provisions was not significant. We had accrued interest and penalties of $2.9 million at December 31, 2025, and $5.3 million at December 31, 2024.

We file income tax returns in the U.S. federal and various state and foreign jurisdictions. With few exceptions, as of December 31, 2025, we are no longer subject to any state and local, or non-U.S. income tax examinations by tax authorities for years before 2022.

Cash Taxes

The following table provides the cash income taxes paid, net of refunds, for 2025.


	Year ended December 31,
(in millions)	2025

US Federal	$	—
US State
Others(a)	4.7
Foreign
Mexico	39.7
Argentina	18.1
Others(a)	73.2
Total	$	135.7

(a)There were no other individual jurisdictions above the 5% threshold.

- Definition

The entire disclosure for income tax.

+ References

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