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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

Form 10-K

(Mark One)


☑			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended September 30, ~~2024~~2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-11593

______________________________________________________________

The Scotts Miracle-Gro Company

(Exact name of registrant as specified in its charter)


Ohio						31-1414921
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

14111 Scottslawn Road, Marysville, Ohio 43041

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code:

(937) 644-0011

Securities registered pursuant to Section 12(b) of the Act:


Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Shares, $0.01 stated value	SMG	NYSE

Securities registered pursuant to Section 12(g) of the Act:

None

______________________________________________________________

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes þ No o

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes o No þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C.7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☑

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements. o

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No þ

The aggregate market value of Common Shares (the only common equity of the registrant) held by non-affiliates (for this purpose, executive officers and directors of the registrant are considered affiliates) as of March 28, ~~2024~~2025 (the last business day of the most recently completed second quarter) was approximately $32,~~178~~415,~~556~~372,~~405~~479.

There were 57,~~406~~995,~~064~~369 Common Shares of the registrant outstanding as of November 1821, ~~2024~~2025.

______________________________________________________________

DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the definitive Proxy Statement for the registrant’s ~~2025~~2026 Annual Meeting of Shareholders are incorporated by reference into Part III of this Annual Report on Form 10-K. Such Proxy Statement will be filed with the Securities and Exchange Commission within 120 days of the registrant’s fiscal year ended September 30, ~~2024~~2025.

Table of Contents

The Scotts Miracle-Gro Company

Annual Report on Form 10-K

For the Fiscal Year Ended September 30, ~~2024~~2025

Table of Contents

			Page
Part I	Item 1.	Business	2
	Item 1A.	Risk Factors	8
	Item 1B.	Unresolved Staff Comments	2223
	Item 1C.	Cybersecurity	2324
	Item 2.	Properties	2526
	Item 3.	Legal Proceedings	2627
	Item 4.	Mine Safety Disclosures	27
Part II	Supplemental Item	Executive Officers of the Registrant	2728
	Item 5.	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	2829
	Item 6.	[Reserved]	2930
	Item 7.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	3031
	Item 7A.	Quantitative And Qualitative Disclosures About Market Risk	4950
	Item 8.	Financial Statements and Supplementary Data	5051
	Item 9.	Changes in and Disagreements With Accountants on Accounting and Financial Disclosure	5051
	Item 9A.	Controls and Procedures	5051
	Item 9B.	Other Information	51
	Item 9C.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	5251
Part III	Item 10.	Directors, Executive Officers, and Corporate Governance	5352
	Item 11.	Executive Compensation	5453
	Item 12.	Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	5453
	Item 13.	Certain Relationships and Related Transactions, and Director Independence	5453
	Item 14.	Principal Accountant Fees and Services	54
Part IV	Item 15.	Exhibits and Financial Statement Schedules	5554
	Item 16.	Form 10-K Summary	5554
		Signatures	5655
		Index to Exhibits	~~111~~108

Table of Contents

PART I

ITEM 1. BUSINESS

Company Description and Development of the Business

The discussion below describes the business conducted by The Scotts Miracle-Gro Company, an Ohio corporation (“Scotts Miracle-Gro” and, together with its subsidiaries, the “Company,” “we,” “our” or “us”), including general developments in our business during fiscal ~~2024~~2025. Each reference in this Annual Report on Form 10-K (“Form 10-K”) to a “fiscal” year is to our fiscal year ended or ending, as applicable, on September 30 of the referenced year. For additional information on recent business developments, see “ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS” of this Form 10-K.

Through our U.S. Consumer and Other segments, we are the leading ~~manufacturer and~~ marketer of branded consumer lawn and garden products in North America. Our products are marketed under some of the most recognized brand names in the consumer lawn and garden industry. Our key consumer lawn and garden brands include Scotts® Turf Builder® lawn fertilizer and Scotts® grass seed products; Miracle-Gro® soil, plant food and gardening products; Ortho® herbicide and pesticide products; and Tomcat® rodent control and animal repellent products. We are the exclusive agent of Monsanto Company, a subsidiary of Bayer AG (“Monsanto”), for the marketing and distribution of certain of Monsanto’s consumer Roundup®1 branded products within the United States (“U.S.”) and certain other specified countries. In addition, we have an equity interest in Bonnie Plants, LLC, a joint venture with Alabama Farmers Cooperative, Inc. (“AFC”), focused on planting, growing, developing, distributing, marketing and selling live plants.

Through our Hawthorne segment, we are a leading provider of nutrients, lighting and other materials used for indoor and hydroponic gardening in North America. Our ~~key~~signature brands include General Hydroponics®, Gavita®, Botanicare®, ~~Agrolux®,~~ Gro Pro®, Mother Earth®, Grower’s Edge®, HydroLogic Purification System® and CYCO®.

Scotts Miracle-Gro traces its heritage to a company founded by O.M. Scott in Marysville, Ohio in 1868. In the mid-1900s, we became widely known for the development of quality lawn fertilizers and grass seeds that led to the creation of a new industry – consumer lawn care. In the 1990s, we significantly expanded our product offering with three leading brands in the U.S. home lawn and garden industry. In fiscal 1995, through a merger with Stern’s Miracle-Gro Products, Inc., which was founded by Horace Hagedorn and Otto Stern in Long Island, New York in 1951, we acquired the Miracle-Gro® brand, the industry leader in water-soluble garden plant foods. In fiscal 1999, we acquired the Ortho® brand in the U.S. and obtained exclusive rights to market Monsanto’s consumer Roundup® brand within the U.S. and other contractually specified countries, thereby adding industry-leading weed, pest and disease control products to our portfolio. Today, the Scotts®, ~~Turf Builder®,~~ Miracle-Gro®, Ortho® and Roundup® brands make us the most widely recognized company in the consumer lawn and garden industry in the U.S.

Business Segments

We divide our business into the following ~~reportable~~ segments:

•U.S. Consumer

•Hawthorne

•Other

U.S. Consumer consists of our consumer lawn and garden business in the United States. Hawthorne consists of our indoor and hydroponic gardening business. Other primarily consists of our consumer lawn and garden business in Canada. ~~This division of reportable segments is consistent with how the segments report to and are managed by our Chief Executive Officer (the chief operating decision maker of the Company). In addition,~~ Corporate consists of general and administrative expenses and certain other income and expense items not allocated to the reportable business segments. Financial information about ~~these~~our segments for each of the three fiscal years ended September 30, ~~2024~~2025, ~~2023~~2024 and ~~2022~~2023 is presented in “NOTE 2019. SEGMENT INFORMATION” of the Notes to Consolidated Financial Statements included in this Form 10-K.

1 Roundup® is a registered trademark of Monsanto Technology LLC, a company affiliated with Monsanto Company.

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Principal Products and Services

In our ~~reportable~~ segments, we manufacture, market and sell lawn and garden products in the following categories:

Lawn Care: The lawn care category is designed to help users grow and enjoy the lawn they want. Products within this category include lawn fertilizer products under the Scotts®, O.M. SCOTT & SonsTM and Turf Builder® brand and sub-brand names; clover and grass seed products under the O.M. SCOTT & SonsTM, Scotts®, EZ Seed®, PatchMaster® and Thick’R LawnTM brand and sub-brand names; and lawn-related weed, pest and disease control products primarily under the Scotts® brand name, including sub-brands such as GrubEx®. The lawn care category also includes spreaders and other durables under the Scotts® brand name, including Turf Builder® EdgeGuard® spreaders and WhirlTM and ~~WizzTM~~Wizz® handheld spreaders.

Gardening and Landscape: The gardening and landscape category is designed to help consumers grow and enjoy flower and vegetable gardens and beautify landscaped areas. Products within this category include a complete line of water-soluble plant foods under the Miracle-Gro® brand and sub-brands such as LiquaFeed®; continuous-release plant foods under the Miracle-Gro® brand and sub-brands such as Shake ‘N Feed®; potting mixes, garden soils, ground cover and mulches under the Miracle-Gro®, Scotts®, Hyponex® and Earthgro® brand names; ~~plant-related pest~~ and ~~disease control products under the Ortho® brand;~~ organic garden products under the Miracle-Gro® ~~Performance Organics®, Miracle-Gro®~~ Organic, Miracle-Gro® Organic ChoiceTM, Scotts® and Whitney Farms® brand names~~; and live goods and seeding solutions under the Miracle-Gro® brand~~. Hydroponic and indoor gardening focused growing media and nutrients products are marketed under the Mother Earth®, Botanicare®, General Hydroponics® and CYCO® brand names.

Hydroponic hardware and growing environments: This category is designed to provide durable goods to grow plants, flowers and vegetables using little or no soil. Products within this category include ~~growing systems,~~ trays, fans, filters, humidifiers, dehumidifiers, water pumps, ~~irrigation supplies~~ and ~~hand~~irrigation ~~tools~~supplies. These products are marketed under the Botanicare®, CAN-FANTM, CAN-FILTERS®, EcoPlus®, Gro Pro®, Grower’s Edge® and Hydro-Logic Purification System® brand names.

Lighting: The lighting category is designed to provide growers a complete selection of lighting systems and components for use in hydroponic and indoor gardening applications. Products in this category include lighting ~~sensors,~~ controls, fixtures, cords and hangars, and are marketed under the Gavita®, ~~Agrolux® and Titan®~~ brand ~~names~~name.

Controls: The controls category is designed to help consumers protect their homes from pests and maintain external home areas. Insect control products are marketed under the Ortho® brand name, including Ortho Max®, Home Defense® and Bug B Gon® sub-brands; rodent control products are marketed under the Tomcat® and Ortho® brands; selective weed control products are marketed under the Ortho Weed B GonTM sub-brand; and non-selective weed killer products are marketed under the Groundclear® brand name. Hydroponic gardening focused controls products are marketed under the Alchemist®, Grower’s Edge® and General Hydroponics® brand names.

Marketing Agreement: We are Monsanto’s exclusive agent for the marketing and distribution of certain of Monsanto’s consumer Roundup® branded products in the United States and certain other specified countries.

~~Effective~~We ~~August 1,~~are ~~2019,~~party weto ~~entered into~~ the Third Amended and Restated Exclusive Agency and Marketing Agreement (the “Third Restated Agreement”) pursuant to which we provide certain consumer and trade marketing program services, sales, merchandising, warehousing and other selling and marketing support for certain of Monsanto’s consumer Roundup® branded products. The Company also performs other services on behalf of Monsanto, including manufacturing conversion services, pursuant to ancillary agreements. For additional details regarding the Third Restated Agreement, see “ITEM 1A. RISK FACTORS — Risks Related to Our Business — In the event the Third Restated Agreement for Monsanto’s consumer Roundup® products terminates or Monsanto’s consumer Roundup® business materially declines, we would lose a substantial source of future earnings and overhead expense absorption” in this Form 10-K and “NOTE 6. MARKETING AGREEMENT” of the Notes to Consolidated Financial Statements included in this Form 10-K.

Acquisitions and Divestitures

There were no material acquisitions or divestitures during fiscal ~~2024~~2025 or fiscal ~~2023~~2024. ~~Refer~~ ~~to “NOTE 7. ACQUISITIONS AND INVESTMENTS” of the Notes to the Consolidated Financial Statements included in this Form 10-K for more information regarding fiscal 2022 acquisitions.~~

Principal Markets and Methods of Distribution

We sell our products through our direct sales force, e-commerce website and network of brokers and distributors primarily to home centers, mass merchandisers, warehouse clubs, large hardware chains, independent hardware stores, nurseries, garden centers, e-commerce platforms, food and drug stores, indoor gardening and hydroponic product distributors, retailers and growers.

The majority of our shipments to customers are made via common carriers or through distributors in the U.S. We primarily utilize third parties to manage the key distribution centers for our consumer lawn and garden business, which are strategically located across the U.S. and Canada. Growing media products are generally shipped direct-to-store without passing through a distribution center.

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Raw Materials

We purchase raw materials for our products from various sources. We are subject to market risk as a result of the fluctuating prices of raw materials, including urea and other fertilizer inputs, resins, diesel, gasoline, natural gas, sphagnum peat, bark and grass seed. Our objectives surrounding the procurement of these materials are to ensure continuous supply, minimize costs and improve supply and pricing predictability. We seek to achieve these objectives through negotiation of contracts with favorable terms directly with vendors. When appropriate, we commit to purchase a certain percentage of our needs in advance of the lawn and garden season to secure pre-determined prices. We also hedge certain commodities, particularly diesel and urea, to improve cost predictability and control. Sufficient raw materials were available during fiscal ~~2024~~2025.

Trademarks, Patents, Trade Secrets and Licenses

We believe that our trademarks, patents, trade secrets and licenses provide us with significant competitive advantages. We pursue a vigorous trademark protection strategy consisting of registration, renewal and maintenance of key trademarks and proactive monitoring and enforcement activities to protect against infringement. The Scotts®, Miracle-Gro®, Ortho®, Tomcat®, Hyponex®, Earthgro®, General Hydroponics®, Gavita®, Botanicare®, ~~Agrolux®~~ and Mother Earth® brand names and logos, as well as a number of product trademarks, including Turf Builder®, EZ Seed®, Organic ~~Choice®~~ChoiceTM, Home Defense Max®, Nature Scapes®, and Weed B Gon Max® are registered in the United States and/or internationally and are considered material to our business.

In addition, we actively develop and maintain an extensive portfolio of utility and design patents covering a variety of subject matters and technologies relevant to the business such as fertilizer, weed killer, chemical and growing media compositions and processes; grass seed varieties; mechanical dispensing devices such as applicators, spreaders and sprayers; lighting applications; and hydroponic growing systems. Our utility patents provide protection generally extending to 20 years from the date of filing, and some of our patents will continue well into the next decade. We also hold exclusive and non-exclusive patent licenses and supply arrangements permitting the use and sale of additional patented fertilizers, pesticides, electrical and mechanical devices. Although our portfolio of trade secrets, patents and patent licenses is important to our success, no single trade secret, patent or group of related patents, alone, is considered critical to the operation of any of our business segments or the business as a whole.

Seasonality and Backlog

Our North America consumer lawn and garden business is highly seasonal, with ~~approximately~~more than 75% of our annual net sales occurring in our second and third fiscal quarters combined. Our annual net sales for this business are further concentrated in our second and third fiscal quarters by retailers who rely on our ability to deliver products closer to when consumers buy our products. We anticipate significant orders for our North America consumer lawn and garden business for the upcoming spring season will start to be received late in the winter and continue through the spring season. Historically, substantially all orders have been received and shipped within the same fiscal year with minimal carryover of open orders at the end of the fiscal year.

Our Hawthorne segment is also impacted by seasonal sales patterns for certain product categories due to the timing of growing patterns in North America during our second and third fiscal quarters, and the timing of certain controlled agricultural lighting project sales during our third and fourth fiscal quarters.

Significant Customers

The Home Depot and Lowe’s are our two largest customers and are the only customers that individually represent more than 10% of reported consolidated net sales during any of the three most recent fiscal years. For additional details regarding significant customers, see “ITEM 1A. RISK FACTORS — Risks Related to Our Business — Because of the concentration of our sales to a small number of retail customers, the loss of one or more of, or a significant reduction in orders from, any of our top customers, or a material reduction in the inventory of our products that they carry, could adversely affect our financial results” of this Form 10-K and “NOTE 2019. SEGMENT INFORMATION” of the Notes to Consolidated Financial Statements included in this Form 10-K.

Competitive Marketplace

The markets in which we sell our products are highly competitive. We compete primarily on the basis of brand strength, product innovation, product quality, product performance, advertising, value, supply chain competency, field sales support, in-store sales support and the strength of our relationships with major retailers and distributors.

In the lawn and garden, pest control and indoor gardening and hydroponic markets, our products compete against branded products as well as private label products. Primary competitors include Spectrum Brands Holdings, Inc., Central Garden & Pet Company, Kellogg Garden Products, Oldcastle Retail, Inc., Lebanon Seaboard Corporation, Reckitt Benckiser Group plc, FoxFarm Soil & Fertilizer Company, Nanolux Technology, Inc., Sun Gro Horticulture, Inc., The Procter & Gamble Company, Advanced Nutrients, Ltd., Jonathan Green, Inc., SBM Life Science Corp., Woodstream Corporation, This Land, Inc. dba Sunday Lawn Care and Hydrofarm Holdings Group, Inc. In addition, we face competition from smaller regional competitors that operate in many of the areas where we compete.

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In the lawn and garden, pest control and indoor gardening and hydroponic markets, our products compete against private label as well as branded products. Primary competitors include Spectrum Brands Holdings, Inc., Central Garden & Pet Company, Kellogg Garden Products, Oldcastle Retail, Inc., Lebanon Seaboard Corporation, Reckitt Benckiser Group plc, FoxFarm Soil & Fertilizer Company, Nanolux Technology, Inc., Sun Gro Horticulture, Inc., Advanced Nutrients, Ltd., SBM Life Science Corp., Woodstream Corporation, Sunday Lawn Care and Hydrofarm Holdings Group, Inc. In addition, we face competition from smaller regional competitors that operate in many of the areas where we compete.

In Canada, we face competition in the lawn and garden market from Premier Tech Ltd. and a variety of local companies including private label brands.

Research and Development

We continually invest in research and development to design new or improve existing product formulae and packaging, as well as to streamline our manufacturing processes. Spending on research and development was $34.68 million, $3534.76 million and $4535.37 million in fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively, including product registration costs of $98.09 million, $129.40 million and $1312.04 million, respectively. In addition to our own research and development activities, we actively seek ways to leverage the research and development activities of our suppliers and other business partners.

Regulatory Considerations

Laws and regulations in the United States and other countries affect the manufacture, sale, distribution, use and/or application of our products in several ways. For example, in the United States, all pesticide products must comply with the Federal Insecticide, Fungicide, and Rodenticide Act (“FIFRA”), and most pesticide products require registration with the U.S. Environmental Protection Agency (the “U.S. EPA”) and similar state agencies before they can be sold or distributed. The use of certain pesticide products is also regulated by the U.S. EPA in addition to various local, state and federal environmental and/or public health agencies. These regulations may restrict or ban the use of certain ingredients or categories of products altogether. Analogous regulatory regimes apply to ~~certain~~ pesticides that we sell or distribute in other countries.

Fertilizer and growing media products are also subject to various laws and regulations, some of which require registration, mandate labeling requirements, and/or govern the sale and distribution of the products. Our grass seed products are regulated in the U.S. by the Federal Seed Act and ~~various~~ state regulations. In addition, governmental agencies regulate the disposal, transport, handling and storage of waste, the remediation of contaminated sites, air and water discharges from our facilities, and workplace health and safety. Similar to pesticides, analogous international regulations apply to fertilizers, growing media and seeds that we sell or distribute outside of the United States.

Governmental authorities generally require operating facilities to obtain permits (sometimes on an annual basis) relating to site-specific conditions and/or activities. For example, permits must be obtained ~~in order~~ to harvest peat and to discharge storm water run-off or water pumped from peat deposits. In some locations, these facilities have been required to create water retention ponds to control the sediment content of discharged water. The permits typically specify the condition in which the property must be left after the peat is fully harvested, with the residual use typically being natural wetland habitats combined with open water areas. We are generally required by these permits to limit our harvesting and to restore the property consistent with the intended residual use. In some locations, these facilities have been required to create water retention ponds to control the sediment content of discharged water.

InRegulatory ~~addition,~~agencies inaround ~~2021~~ the ~~Biden~~world ~~Administration~~have ~~announced~~been aestablishing ~~multi-agency~~programs ~~plan~~and restrictions relating to ~~address~~preventing the release of per- and polyfluoroalkyl substances (“PFAS”) ~~contamination~~into ~~nationwide. Agencies, including~~ the ~~U.S. EPA~~air, ~~the~~drinking ~~Department~~water ofsystems ~~Defense,~~and ~~the~~food ~~Food~~supply and ~~Drug~~to ~~Administration,~~expand ~~the~~cleanup ~~U.S.~~efforts ~~Department~~to ofremediate ~~Agriculture,~~ the ~~Department~~impacts of ~~Homeland~~PFAS ~~Security~~pollution. In 2021, ~~and~~ the ~~Department~~federal ofgovernment ~~Health~~announced ~~and~~a ~~Human~~multi-agency ~~Services,~~plan ~~will take actions~~ to ~~prevent~~address ~~the~~PFAS ~~release~~contamination ofnationwide. Further, ~~PFAS~~in ~~into~~April ~~the air~~2024, ~~drinking~~the ~~systems,~~U.S. ~~and~~EPA ~~food~~designated ~~supply~~two ~~and~~PFAS tochemicals ~~expand~~– ~~cleanup~~perfluorooctanoic ~~efforts~~acid to(“PFOA”) ~~remediate~~and ~~the~~perfluorooctanesulfonic ~~impacts~~acid of(“PFOS”), ~~PFAS~~including ~~pollution. As~~their ~~part~~salts ofand ~~this~~structural ~~announcement,~~isomers ~~the~~– ~~U.S.~~as ~~EPA~~hazardous ~~released~~substances ~~its~~under ~~PFAS~~section ~~Strategic~~102(a) ~~Roadmap: EPA’s~~of ~~Commitments~~the toComprehensive ~~Action~~Environmental ~~2021-2024~~Response, ~~which~~Compensation, ~~sets~~and ~~timelines~~Liability byAct (“CERCLA”), which ~~the~~could ~~U.S.~~have ~~EPA~~wide-ranging ~~plans~~impact toon ~~take~~companies ~~specific~~across ~~actions during the Biden Administration~~industries. Further, many states have taken independent action to address PFAS ~~concerns~~ ranging from appropriation ~~legislation~~bills tofor funding ~~scientific~~ research, to complete bans on ~~certain~~any ~~categories of consumer products~~ PFAS-containing ~~PFAS and/or broad prohibitions on PFAS across all~~ products. Complicating this patchwork of state regulation is that various jurisdictions ~~may~~ define PFAS differently with some definitions being comparatively broad. It is possible, therefore, that some of these actions will have an impact – direct or indirect – on our business.

Packaging has also become subject to increased governmental scrutiny. Several states in ~~many~~the ~~states~~U. ~~Specifically,~~S. ~~state~~have enacted legislation ~~is seeking~~ to reduce single use plastics and establish extended producer responsibility programs, which are designed to bolster the recycling industry by transferring the cost of packaging disposal to the manufacturers. Extended producer responsibility programs typically include targets and reporting responsibilities for, among other things, post-consumer recycling usage, compostable packaging, material reduction and refill strategies. Similar extended producer responsibility programs are active in several Canadian provinces.

The expansion of our business may expand the regulatory oversight to which we are subject. If we enter new product categories and/or new jurisdictions, we may become subject to additional applicable legal and regulatory requirements.

For more information regarding how compliance with local, state, federal and foreign laws and regulations may affect us, see “ITEM 1A. RISK FACTORS — Risks Related to Regulation of Our Company — Compliance with environmental and other public health regulations or changes in such regulations or regulatory enforcement priorities could increase our costs of doing business or limit our ability to market certain products” of this Form 10-K.

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Regulatory Matters

We are subject to various regulatory proceedings, none of which are expected to be material to our business. At September 30, ~~2024~~2025, $23.61 million was accrued for environmental matters. During fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, we expensed $0.15 million, $0.41 million and $0.24 million, respectively, for such environmental matters. We had no material capital expenditures during the last three fiscal years related to environmental or regulatory matters.

Human Capital

We believe our culture and commitment to our associates provides unique value to us and our shareholders. Every associate, and every job, is important to our success and helping us achieve our purpose. We seek to create an environment that values the health, safety and wellness of our teams, and we work to equip them with the knowledge and skills to serve our business and develop in their careers.

This discussion includes information regarding human capital matters that we believe may be of interest to shareholders generally. We recognize that certain other stakeholders (such as customers, associates and non-governmental organizations) may be interested in more detailed information on these topics. We encourage you to review the “Supporting Our People” section of our ~~2024~~2025 Corporate Responsibility Report, located on our website at https://scottsmiraclegro.com/responsibility/environmental-social-and-governance, for more detailed information regarding our human capital programs and initiatives. The contents of our corporate website are not incorporated by reference in this Form 10-K or in any other report or document we file with the Securities and Exchange Commission (the “SEC”).

Associates

As of September 30, ~~2024~~2025, we employed approximately 5,~~300~~200 associates. During peak sales and production periods in fiscal ~~2024~~2025, our workforce totaled approximately 76,~~100~~900, comprised of approximately 65,~~200~~900 associates including seasonal associates and approximately ~~900~~1,000 in temporary labor. Included within these numbers, during fiscal ~~2024~~2025, we employed a total of approximately 2,~~500~~100 full-time and seasonal in-store associates within the United States to help our retail partners merchandise our products in their lawn and garden departments directly to consumers.

Engagement

Our success depends on the engagement of our associates. To drive engagement, we take a purposeful approach focused on enhancing the associate experience centering on creating a positive workplace and fostering trust in leadership.

We recognize that two-way communication ~~enhances~~between our associates and our leadership team builds trust and improves collaboration and overall engagement. We gather ~~associate~~formal ~~feedback both formally~~ and ~~informally~~informal ~~throughout~~associate ~~the~~feedback ~~year~~ through ~~such initiatives as~~ pulse surveys, leadership meetings and roundtable discussions. In fiscal 2024, we ~~surveyed~~conducted ~~our~~a global associate ~~population~~engagement onsurvey ~~topics~~focused ~~spanning~~on ~~the~~ employee experience~~. Categories~~ ~~included~~that ~~positive~~provided ~~workplace, strong leadership, health & well-being, meaningful work, growth opportunity, trust in the organization and ethics. Engagement surveys provide~~ us with insight into ~~what~~both weareas ~~are~~of ~~doing~~strength ~~well~~ and ~~where we have~~ opportunities tofor ~~improve~~improvement. ~~Results~~We ~~from~~used the ~~fiscal~~results ~~2024~~from ~~Associate~~this ~~Experience~~survey ~~Survey~~to ~~highlighted~~develop ~~focus~~action ~~areas~~plans ~~for~~to ~~fiscal~~drive ~~2024 and beyond~~improvement. Another source of associate sentiment comes from exit interviews, when we ask for ratings, rankings and feedback from all salaried associates who voluntarily leave our organization. These ~~valuable~~ inputs are shared with senior leadership and integrated into practice as human capital initiatives are deployed.

We believe that an informed workforce contributes to an engaged workforce. As such, we ~~have~~ensure ~~prioritized~~that ~~ensuring~~ our associates have access to the information that we believe they need to understand ~~the~~ business decisions ~~being made~~, the reasons behind them and how ~~changes~~they ~~will~~may ~~impact~~be ~~them in their role~~impacted. Recognizing there is ~~significant~~ value in hearing directly from our leadership team, we ~~continue to~~ host Town Hall meetings each quarter to disseminate enterprise-wide information and toenable ~~allow~~direct ~~for~~communication ~~interactive~~between ~~communication~~our leadership team and our associates.

Diversity

We value our associates’ diversity and encourage them to leverage their varied life experiences at our Company. This includes diversity in terms of gender, sexuality, race, thoughts, interests, languages, beliefs and more.

Our employee resource groups (“ERGs”) are voluntary, associate-led groups typically formed by people with a common affinity such as gender, race, national origin, sexual orientation, military status or other attributes. Each ERG establishes a mission to cultivate relationships through networking and develop talent through experiences, programs and mentoring. Our ERGs consist of Scotts Associate Board, Scotts Associates For A Greener Earth, Scotts Black Employees Network, Scotts Christian Fellowship, Scotts Gro-Masters, Scotts GroPride, Scotts Veterans Network, Scotts Women’s Network and Scotts Young Professionals.

Growth and Development

We create authentic learning opportunities for our associates to develop throughout their careers through our blended development model which consists of experiential learning, exposure and formal education. By embedding learning in day-to-day work, we encourage associates to embrace a growth mindset to promote personal and professional growth.

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~~Our~~We ~~employee~~support ~~resource groups (“ERGs”) are voluntary,~~ associate~~-led~~ ~~groups~~development typically formed by people with a common affinity such as gender, race, national origin, sexual orientation, military status or other attributes. Each ERG establishes a mission to positively impact the business by cultivating relationships through ~~networking~~cross-functional ~~and~~team ~~developing talent through experiences~~assignments, ~~programs~~expanded ~~and~~roles ~~mentoring. Our ERGs drive continuous improvement of our inclusive work environment~~ and ~~are~~rotational ~~open to all associates~~opportunities. Our ~~ERGs~~ongoing ~~consist~~development ofefforts ~~the~~expand ~~Scotts Associate Board~~knowledge, ~~Scotts~~improve ~~Associates~~skills ~~For~~and Acapabilities ~~Greener~~and ~~Earth,~~achieve ~~the~~competence ~~Scotts~~in ~~Black~~specific ~~Employees~~behaviors ~~Network,~~to ~~the~~meet ~~Scotts~~performance ~~Christian~~expectations ~~Fellowship, Scotts Gro-Masters, Scotts GroPride, the Scotts Veterans Network, the Scotts Women’s Network~~ and ~~the~~prepare ~~Scotts~~for ~~Young~~future ~~Professionals~~roles.

~~Professional~~Our ~~Development~~leadership team establishes enterprise goals, and each associate is asked to identify individual goals and align them to enterprise goals. This goal-setting exercise ensures all associates are aligned with Company objectives and establishes a foundation for individual growth and development.

We view development and retention of our associates as valuable components of our business operations and critical to creating a culture of leadership throughout our Company. Our associates have the opportunity to learn new skills through exposure and involvement in business challenges. Our managers support associates as development happens on the job through cross-functional team assignments, expanded roles and rotational assignments. Our ongoing development processes are designed to grow knowledge, improve skills and capabilities, and achieve competence in specific behaviors to meet performance expectations and prepare for potential future roles within our Company. In fiscal 2024, we developed and implemented a leadership development framework for our people leaders, delivering on two key areas — leader accountabilities at the Company and critical skill training for our front line leaders.

Compensation and Benefits

We ~~believe financial health and mental wellness~~ are ~~core~~committed ~~components~~to ofcompensating our associates’ ~~overall~~fairly ~~well-being~~ and wecompetitively ~~are committed to ensuring fair and competitive compensation to our associates~~ based on their roles. Each year, we conduct an analysis of our ~~pay~~compensation amounts and ~~compensation~~ practices, from ~~both an~~ external market and internal consistency ~~perspective,~~perspectives to ensure ~~that~~ our ~~pay~~compensation decisions are fair and ~~equitable~~competitive, ~~adjusting as needed. To ensure transparency~~ and ~~understanding of our compensation programs,~~ we ~~have~~make ~~enhanced~~adjustments ~~our~~to ~~education~~those ~~opportunities~~amounts and ~~communications~~practices ~~for~~as ~~our~~we ~~managers~~deem ~~and associates~~appropriate. We also prioritize sharing our financial successes with associates through our incentive plans for eligible participants and our profit-sharing program and discretionary bonuses for those who are not incentive eligible.

~~Through~~We ~~our~~believe ~~LiveTotal Health program, we demonstrate~~ our ~~commitment~~associates toshould ~~the~~share ~~overall well-being of~~ our ~~associates~~financial success. InWe ~~response~~accomplish tothis ~~feedback~~through ~~from~~ our ~~most~~incentive ~~recent~~plans ~~Associate~~and ~~Experience Survey, we enhanced~~ our ~~benefits~~profit-sharing ~~to provide more comprehensive mental health support, including a broader range of services and improved access to mental healthcare~~program. ~~This~~These ~~focus~~compensation onprograms ~~mental~~enable ~~well-being~~us ~~is complemented by our suite of benefits, designed~~ to ~~meet~~reward ~~the diverse needs of our workforce. Our offerings include healthcare coverage~~associates, ~~family~~from ~~leave,~~frontline ~~401(k)~~hourly ~~matching,~~associates ~~and~~to ~~other essential benefits that support both~~ our ~~associates~~leadership ~~and their families. Additionally~~team, ~~we provide tailored benefits such as a discounted stock purchase plan, healthcare navigation and advocacy concierge services, structured reimbursement~~ for ~~adoption~~their ~~and~~contributions ~~surrogacy~~when ~~expenses,~~the aCompany ~~Marysville~~achieves ~~onsite~~its ~~fitness~~operational ~~facility,~~or ~~and~~financial ~~limited reimbursement for well-being expenses~~objectives.

Our benefit plans are designed to support total well-being, with healthcare coverage, wellness resources and supportive family leave and financial benefits. Of special note are our retirement benefits, with a 7.5 percent match on 401(k) contributions, and our discounted stock purchase plan that makes ownership of common shares of Scotts Miracle-Gro (“Common Shares”) more accessible by allowing associates to buy Common Shares at a 15 percent discount. We also support our associates family planning goals through fertility benefits, expert-led family planning resources and up to $30,000 in lifetime benefits for adoption or surrogacy expenses. Our family leave benefits include eight weeks of fully paid maternal leave and up to 10 weeks of bonding leave for all new parents.

Health and Safety

WeThe ~~maintain several~~ health and safety ~~programs~~of toour ~~protect~~associates is a key priority of our leadership team. ~~members,~~We ~~including~~address ~~our~~associate ~~comprehensive~~health and safety through our Environmental Health and Safety (“EHS”) ~~management~~ system~~. All~~ ~~associates~~which ~~and~~incorporates ~~business~~developed ~~partners,~~industry ~~including contractors, are covered by our EHS management system~~guidelines. Our ~~associates~~“Plan-Do-Check-Act” ~~are~~strategy ~~encouraged~~allows tous ~~participate in safety committees~~ to ~~spur~~identify ~~associate~~and ~~engagement~~address ~~with~~health ~~safety on a local~~ and ~~national~~safety ~~level~~priorities. ToOur ~~further~~safety ~~manage~~program ~~health~~encourages and ~~safety~~enables ~~risks,~~associates weto ~~develop~~submit ~~compliance~~concerns ~~calendars~~and ~~that~~share ~~highlight~~feedback ~~dates~~when ~~for~~they ~~health~~encounter behaviors and ~~safety~~conditions ~~inspections~~that ~~and~~they ~~deadlines~~perceive to ~~meet~~be ~~voluntary and regulatory requirements~~unsafe. WeOur ~~use an~~ EHS ~~scorecard~~system ~~composed~~also ofinvestigates ~~leading~~ and ~~lagging~~responds ~~indicators~~ to ~~evaluate~~associate ~~our~~concerns ~~health~~ and ~~safety~~incidents ~~performance~~and ~~including~~mitigates ~~progress~~risks ~~measurements~~to ~~for~~maintain ~~safety training, behavioral-based safety observations, near-miss reporting, total recordable incident rate~~ and ~~lost~~promote ~~time~~a ~~accident~~safer ~~rate~~workplace.

During new hire orientation, associates receive customized health and safety training based on job type and level. Our EHS training of supervisors focuses on knowledge of applicable regulations and necessary systems and leadership training elements so that each shift has a well-informed and capable safety leader. Our site leaders work to increase health and safety awareness through pre-shift meetings, tools and standards. These meetings provide an opportunity to voice and take ownership over health and safety concerns, encouraging each other to uphold a safe working environment.

To further mitigate risks and align all team members to our EHS system, we use compliance calendars that highlight important dates for EHS inspections and deadlines to meet voluntary and regulatory requirements. We assess our health and safety performance using an EHS scorecard composed of leading and lagging indicators. Our evaluation includes progress measurements for safety training, behavioral-based safety observations, near-miss reporting, total recordable incident rate and lost time accident rate.

Environmental, Social and Governance

Our Board of Directors has ultimate oversight for sustainability matters while the Nominating and Governance Committee receives quarterly environmental, social and governance (“ESG”) briefings. At the management level, our ESG Steering Committee is responsible for setting and driving progress toward our sustainability goals. This committee meets quarterly to review progress, set new program goals, benchmark peers and review third-party ESG assessments. The ESG Steering Committee contains two specialized subcommittees: the Climate Subcommittee and the Customer Sustainability Subcommittee. The Climate Subcommittee supports the ESG Steering Committee in managing our climate change-related impacts. The Customer Sustainability Subcommittee aligns customer sustainability-related requests or initiatives with our ESG program goals and disclosures to assist our retail partners with their own sustainability goals and prepare for future reporting.

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~~Environmental~~Our stakeholders, ~~Social~~including shareholders, customers, suppliers, associates, communities as well as the environment and society, are essential to our business. We endeavor to make our workforce more inclusive, our business more sustainable and our communities more engaged by maintaining strong ESG practices. In fiscal 2025, we published our annual Corporate Responsibility Report, prepared in reference to the Global Reporting Initiative Standards (2021) and with consideration for the Sustainability Accounting Standards Board’s Chemicals industry standard, the Task Force on Climate-Related Financial Disclosures and the California statutory greenhouse gas emission reporting requirements. The report maps our sustainability efforts to the United Nations Sustainable Development Goals and provides detailed information regarding our ESG strategy, focus areas and governance structure. Our ESG focus areas are Product Stewardship and Safety, Operations and Supply Chain, Associate Engagement and Wellness, Community Engagement and Governance and Transparency. We continue to benchmark, set and make progress towards goals and seek continuous improvement around these focus areas.

~~Our~~We ~~stakeholders,~~publish ~~including~~our ~~shareholders,~~Corporate ~~customers,~~Responsibility ~~suppliers,~~Report ~~associates,~~and ~~communities~~several asESG-related ~~well~~policies ~~as the environment~~ and ~~society,~~statements ~~are~~on ~~essential~~the toESG ~~our~~section ~~business. We~~of ~~endeavor to make~~ our ~~workforce~~corporate ~~more inclusive~~website, ~~our~~which ~~business~~is ~~more~~located ~~sustainable,~~at ~~and our communities more engaged by maintaining strong~~ https://scottsmiraclegro.com/responsibility/environmental, -social -and -governance ~~(“ESG”) practices~~. InThese ~~fiscal~~policies ~~2024,~~and westatements ~~published~~address ~~our annual Corporate Responsibility Report~~environmental, ~~prepared~~health inand ~~reference~~safety ~~to the Global Reporting Initiative Standards (2021)~~ and ~~with~~human ~~consideration~~rights ~~for the Sustainability Accounting Standards Board’s Chemicals industry standard~~concerns. ~~The~~We ~~report~~maintain ~~maps~~a ~~our~~Supplier ~~sustainability~~Code ~~efforts~~of toConduct ~~the~~that ~~United~~establishes ~~Nations~~the ~~Sustainable~~minimum ~~Development~~standards ~~Goals~~that ~~and~~suppliers ~~provides~~must ~~detailed~~satisfy ~~information~~to ~~regarding~~sell ~~our~~goods ~~ESG~~to ~~strategy,~~or ~~focus~~do ~~areas~~business ~~and~~with ~~governance structure~~us. ~~The~~Further ~~Company’s~~ ESG ~~focus~~initiatives ~~areas~~in ~~are~~fiscal ~~Product~~2025 ~~Stewardship~~included ~~and~~responding ~~Safety,~~to ~~Operations~~the ~~and~~Carbon ~~Supply~~Disclosure ~~Chain,~~Project’s ~~Associate~~climate ~~Engagement~~change and ~~Wellness,~~water ~~Community~~questionnaires. The ~~Engagement~~contents ~~and~~of ~~Governance~~our ~~and~~corporate ~~Transparency. The~~website ~~Company~~are ~~continues~~not toincorporated ~~benchmark,~~by ~~set~~reference ~~and~~in ~~make~~this ~~progress~~Form ~~towards~~10-K ~~goals~~or ~~and~~in ~~seek~~any ~~continuous~~other ~~improvement~~report ~~around~~or ~~these~~document ~~focus~~we ~~areas~~file with the SEC.

We publish our Corporate Responsibility Report and several ESG-related policies and statements on the ESG section of our corporate website, which is located at https://scottsmiraclegro.com/responsibility/environmental-social-and-governance. These policies and statements address environmental, health and safety and human rights concerns. We maintain a Supplier Code of Conduct that establishes the minimum standards that suppliers must satisfy to sell goods to or do business with the Company. Further ESG initiatives in fiscal 2024 included responding to the Carbon Disclosure Project’s climate change and water questionnaires. The contents of our corporate website are not incorporated by reference in this Form 10-K or in any other report or document we file with the SEC.

Website and General Information

We maintain a website at http://investor.scotts.com. Information on our websites will not be deemed incorporated by reference into, and do not form any part of, this Form 10-K or any other report or document that we file with or furnish to the SEC. We file reports with the SEC and make available, free of charge, on or through our website, our Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as well as our proxy and information statements, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.

ITEM 1A. RISK FACTORS

Cautionary Note Regarding Forward-Looking Statements

This Form 10-K, including the exhibits hereto and the information incorporated by reference herein, as well as our ~~2024~~2025 Annual Report to Shareholders (our “~~2024~~2025 Annual Report”), contain “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the ~~Securities~~ Exchange Act ~~of 1934~~, ~~as amended,~~ which are subject to risks and uncertainties. Information regarding activities, events and developments that we expect or anticipate will or may occur in the future, including, but not limited to, information relating to our future growth and profitability targets and strategies designed to increase total shareholder value, are forward-looking statements based on management’s estimates, assumptions and projections. Forward-looking statements also include, but are not limited to, statements regarding our future economic and financial condition and results of operations, the plans and objectives of management and our assumptions regarding our performance and such plans and objectives, as well as the amount and timing of dividends and repurchases of ~~common shares of Scotts Miracle-Gro (“~~Common Shares”) or other uses of cash flows. Forward-looking statements generally can be identified through the use of words such as “guidance,” “outlook,” “projected,” “believe,” “target,” “predict,” “estimate,” “forecast,” “strategy,” “may,” “goal,” “expect,” “anticipate,” “intend,” “plan,” “foresee,” “likely,” “will,” “should” and other similar words and variations.

Forward-looking statements in this Form 10-K and our ~~2024~~2025 Annual Report are predictions only and actual results could differ materially from management’s expectations due to a variety of factors, including those described below. All forward-looking statements attributable to us or persons working on our behalf are expressly qualified in their entirety by such risk factors and other cautionary statements that we make from time to time in our other SEC filings and public communications.

You should evaluate forward-looking statements in the context of these risks and uncertainties and are cautioned not to place undue reliance on such statements. These factors may not contain all of the factors that are important to you. We cannot assure you that we will realize the results or developments we expect or anticipate or, even if substantially realized, that they will result in the consequences or affect us or our operations in the way we expect. The forward-looking statements that we make in this Form 10-K and our ~~2024~~2025 Annual Report are based on management’s current views and assumptions regarding future events and speak only as of their dates. We disclaim any obligation to update developments of these risk factors or to announce publicly any revisions to any of the forward-looking statements that we make, or to make corrections to reflect future events or developments, except as required by law.

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Risks Related to Our Business

If we underestimate or overestimate demand for our products and do not maintain appropriate inventory levels, our net sales and/or working capital could be negatively impacted.

Our ability to manage our inventory levels to meet our customers’ demand for our products is important for our business. Our production levels and inventory management goals for our products are based on estimates of demand, ~~taking~~and take into account production capacity, timing of shipments, and inventory levels. Due to a number of factors, including manufacturing lead- times, seasonal purchasing patterns, and the potential for material price increases, we may carry additional inventory and increase our working capital and related financing requirements. ~~This~~Carrying additional inventory may increase our warehousing costs orand result in excess inventory that may become difficult to manage, unusable or obsolete and adversely impact our ability to realize anticipated returns from product sales. If we overestimate or underestimate either channel or retail demand for any of our products during a given season, we may not maintain appropriate inventory levels, which could negatively impact our net sales, profit margins, net earnings, working capital and/or cash flow, hinder our ability to meet customer demand, result in loss of customers, or cause us to incur excess and obsolete inventory charges or excess warehouse storage costs.

An economic downturn and economic uncertainty may adversely affect demand for our products.

WeThere ~~have~~are ~~observed~~indications of increased economic uncertainty in the U.S. including the potential for an economic recession. Impacts of such general economic weakness include, without limitation: reduced credit availability; reduced liquidity; volatility in credit, equity and foreign exchange markets; increasing job losses, bankruptcies and rising interest rates. In ~~addition~~recent years, ~~consumers~~there ~~may~~have ~~reduce~~been ~~discretionary~~instances ~~spending~~of ~~during~~Congress ~~periods~~and ofthe ~~economic~~President ~~uncertainty,~~failing ~~which~~to ~~could~~reach ~~reduce~~agreement ~~sales~~on ~~volumes~~federal ofbudgetary ~~our~~and ~~products~~spending ormatters. A ~~result~~government inshutdown or a ~~shift~~default inby ~~our~~the ~~product~~U.S. ~~mix~~government ~~from~~on ~~higher~~its ~~margin~~debt toobligations, ~~lower~~or ~~margin~~related ~~products. Adverse~~credit-rating ~~economic~~downgrades ~~conditions~~could also have ~~included~~adverse oreffects ~~resulted,~~on ~~and~~the ~~could~~broader ~~continue~~global toeconomy ~~include~~and orcontribute ~~result~~to, inor ~~a significant increase in inflation~~worsen, ~~which~~an ~~could~~economic ~~have~~recession. We abelieve ~~material~~that ~~adverse~~any ~~impact~~extended onor ~~our~~renewed ~~business,~~economic ~~including~~disruptions ~~our~~or ~~operating~~deterioration ~~margins. Continued~~in ~~high~~the ~~inflation~~global ~~has~~economy ~~had~~could ahave ~~negative~~an adverse impact on our ~~operating margins in recent periods including~~business, ~~for~~financial ~~example,~~condition ~~through~~or ~~persistently~~results ~~high~~of ~~manufacturing costs~~operations.

In addition, consumers may reduce discretionary spending during periods of economic uncertainty, which could reduce sales volumes of our products or result in a shift in our product mix from higher margin to lower margin products. Adverse economic conditions have included or resulted, and could continue to include or result, in a significant increase in inflation, which could have a material adverse impact on our business, financial condition or results of operations.

Disruptions in availability or increases in the prices of raw materials, fuel or transportation costs could adversely affect our results of operations.

We source many of our commodities and other raw materials on a global basis. The general availability and price of those raw materials can be affected by numerous forces beyond our control, including political instability, trade restrictions and other government regulations, duties and tariffs, price controls, changes in currency exchange rates and weather. A significant disruption in the availability or price of any of our key raw materials could negatively impact our business.

Increases in the prices of key commodities and other raw materials could adversely affect our ability to manage our cost structure. Market conditions may limit our ability to raise selling prices to offset increases in our raw material costs. Further, sustained price increases may lead to declines in volume as competitors may not adjust their prices or customers and~~/or~~ consumers may decide not to pay the higher prices, which could lead to sales declines and loss of market share. Our projections may not accurately predict the volume impact of price increases, which could adversely affect our business, financial condition and results of operations.

Our proprietary technologies can limit our ability to locate or utilize alternative inputs for certain products. For certain inputs, new sources of supply may have to be qualified under regulatory standards, which can require additional investment and delay bringing a product to market. We utilize hedge agreements periodically to fix the prices of a portion of our urea and fuel needs. The hedge agreements are designed to mitigate the earnings and cash flow fluctuations associated with the costs of urea and fuel. In periods of declining prices, utilizing these hedge agreements may effectively increase our expenditures for these raw materials.

Because of the concentration of our sales to a small number of retail customers, the loss of one or more of, or a significant reduction in orders from, any of our top customers, or a material reduction in the inventory of our products that they carry, could adversely affect our financial results.

Our top two retail customers, The Home Depot and Lowe’s, together accounted for 4852% of our fiscal ~~2024~~2025 net sales and 1825% of our outstanding accounts receivable as of September 30, ~~2024~~2025. The loss of, or reduction in orders from, any major customer for any reason (including, for example, changes in a retailer’s strategy, reduction in inventories of our products that they maintain, claims or allegations that our products or products we market on behalf of third parties are unsafe, a decline in consumer demand, regulatory, legal or other external pressures or a change in marketing strategy), and customer disputes regarding shipments, fees, merchandise condition or related matters could have a material adverse effect on our business, financial condition, results of operations and cash flows. Our inability to collect accounts receivable from one of our major customers, or a significant deterioration in the financial condition of one of these customers, including a bankruptcy filing or a liquidation, could also have a material adverse effect on our financial condition, results of operations and cash flows.

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We do not have long-term sales agreements with, or other contractual assurances as to future sales to, any of our major retail customers. In addition, continued consolidation in the retail industry has resulted in an increasingly concentrated retail base, and as a result, we are significantly dependent upon sales to key retailers who have significant bargaining strength. To the extent such concentration continues to occur, our net sales and income from operations may be increasingly sensitive to deterioration in the financial condition of, or other adverse developments involving our relationship with, one or more of our key customers. In addition, our business may be negatively affected by changes in the policies of our retailers, such as inventory reductions, limitations on access to shelf space, price demands and other conditions.

We may not successfully develop new product lines and products or improve existing product lines and products.

Our future success depends on ~~creating~~our ~~and~~ability ~~successfully~~to ~~competing~~maintain inan ~~markets~~adequate ~~for~~innovation ~~our~~pipeline, ~~products including our ability to~~ improve our existing product lines and products and to develop and manufacture new product lines and products to meet evolving consumer needs. We cannot provide any assurance that we will successfully develop and manufacture new product lines and products or product innovations that satisfy consumer needs or achieve market acceptance, or that we will develop, manufacture and market new product lines and products or product innovations in a timely manner. If we fail to successfully develop and manufacture new product lines and products or product innovations, our ability to maintain or grow our market share may be adversely affected, which could materially adversely affect our business, financial condition and results of operations. In addition, the development and introduction of new product lines and products and product innovations require substantial research and development expenditures, which we may be unable to recoup if such new product lines, products or innovations do not achieve market acceptance.

Many of the products we manufacture and market contain active ingredients that are subject to regulatory approval. The need to obtain such approval could delay the launch of new products or product innovations ~~that contain active ingredients~~ or otherwise prevent us from developing and manufacturing certain products and product innovations.

Our marketing activities may not be successful.

We invest substantial resources in advertising, consumer promotions and other marketing activities to maintain, ~~extend~~ and expand our brand image. Negative publicity about us or our brands, including publicity regarding product safety, quality, efficacy, environmental impacts (including packaging, energy and water use and matters related to climate impact and waste management) and other sustainability or similar issues, whether real or perceived, could occur and could be widely and rapidly disseminated, including through the use of social media sites. There can be no assurances that our marketing strategies will be effective or that the amount we invest in ~~advertising~~marketing activities will result in a corresponding increase in sales of our products. If our marketing initiatives are unsuccessful, including our ability to leverage digital media and social networks to reach existing and potential customers ~~or our brands suffer damage to reputation due to real or perceived quality issues (which damage can be quickly multiplied by social media)~~, we will have incurred significant expenses without the benefit of higher revenues.

The highly competitive nature of our markets could adversely affect our ability to maintain or grow revenues.

Each of our operating segments participates in highly competitive markets. Our products compete against national and regional products and private label products produced by various suppliers. Many of our competitors sell their products at prices lower than ours. Our most price sensitive consumers may trade down to lower -priced products during challenging economic times or if current economic conditions worsen. We compete primarily on the basis of product innovation, product quality, product performance, value, brand strength, supply chain competency, field sales support, in-store sales support, the strength of our relationships with major retailers and advertising. Some of our competitors have significant financial resources. The strong competition that we face in all of our markets may prevent us from achieving our revenue goals, which may have a material adverse effect on our financial condition, results of operations and cash flows.

Our manufacturing operations, including our reliance on third-party manufacturers, could harm our business.

We may not be able to maintain or develop efficient, low-cost manufacturing capability and processes that will enable us to meet the quality, price, design and product standards or production volumes required to successfully manufacture our products. Our efforts to improve efficiencies in our manufacturing capabilities by investing in automation could be disruptive to our operations, divert the attention of management and require significant investments. Even if we successfully maintain and develop our manufacturing capabilities and processes, we may not be able to do so in time to satisfy the needs of our customers.

We rely on third parties to manufacture certain products. This reliance generates a number of risks, including decreased control over the production and related processes, which could lead to production delays or interruptions and inferior product quality control. In addition, performance problems at these third-party manufacturers could lead to cost overruns, shortages or other problems, which could increase our costs of production or result in delivery shortages or delays ~~to our customers~~.

In addition, if one or more of our third-party manufacturers becomes insolvent or unwilling to continue to manufacture products of acceptable quality, at acceptable costs and in a timely manner, our ability to deliver products to our retail customers could be significantly impaired. Substitute manufacturers may not be available or, if available, may be unwilling or unable to manufacture the products we need on acceptable terms. Moreover, if customer demand for our products increases, we may be unable to secure sufficient additional capacity from our current third-party manufacturers, or others, on commercially reasonable terms, or at all.

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Our business is subject to risks associated with sourcing and manufacturing outside of the U.S. and risks from tariffs and/or international trade wars.

We import many of our raw materials and finished goods from countries outside of the United States, including but not limited to China. Our import operations are subject to complex and unpredictable customs laws, regulations, tax requirements, forced labor laws and trade regulations, such as tariffs set by governments, either through mutual agreements or bilateral actions. ~~Tariffs~~The U.S. has enacted tariffs on goods imported into the U.S., ~~particularly~~which ~~goods from China,~~ have increased the cost of the goods we purchase. ~~Additional~~Significant additional tariffs and protectionist duties could be imposed by the U.S. with relatively short notice to us. These governmental actions could have, and any similar future actions may have, a material adverse effect on our business, financial condition and results of operations. The overall effect of these risks is that our costs may increase or we may experience supply disruptions, which in turn may result in lower profitability if we are unable to offset such increases through higher prices, and/or that we may suffer a decline in sales if our customers do not accept price increases.

Our reliance on a limited base of suppliers may result in disruptions to our business and adversely affect our financial results.

Although we continue to implement risk mitigation strategies for single-source suppliers, we also rely on a limited number of suppliers for certain of our raw materials, product components and other necessary supplies, including certain active ingredients used in our products. If we are unable to maintain supplier arrangements and relationships, if we are unable to contract with suppliers at the quantity and quality levels needed for our business, or if any of our key suppliers becomes insolvent or experience other financial distress, we could experience disruptions in production, which could have a material adverse effect on our financial condition, results of operations and cash flows.

A significant interruption in the operation of our or our suppliers’ facilities could adversely impact our capacity to ~~produce~~manufacture products and ~~service~~supply our customers, which could adversely affect ~~revenues~~our results of operations and ~~earnings~~financial position.

Operations at our and our suppliers’ facilities are subject to disruption for a variety of reasons, including fire, flooding or other natural disasters, ~~disease outbreaks or~~ pandemics, acts of war, terrorism, government shutdowns and work stoppages. A significant interruption in the operation of our or our suppliers’ facilities could significantly impact our capacity to ~~produce~~manufacture products and ~~service~~supply our ~~customers~~products in a timely manner, ~~which could have a material adverse effect on our revenues, earnings and financial position,~~ particularly with respect to products that we manufacture at a limited number of facilities, such as our fertilizer and liquid products, which could have a material adverse effect on our results of operations and financial position.

In the event of a disaster, our disaster recovery and business continuity plans may fail, which could adversely interrupt our operations.

Our operations are dependent on our ability to protect our infrastructure against damage from catastrophe, natural disaster, or severe weather, as well as events resulting from unauthorized security breach, power loss, telecommunications failure, terrorist attack, pandemic, or other events that could have a significant disruptive effect on our operations. We have disaster recovery and business continuity plans in place that are ready to be executed if we encounter a disruptive event. However, we cannot be certain that our plans, or those of third-party service providers we rely on, will be successful in the event of a disaster. If our disaster recovery or business continuity plans are unsuccessful in a disaster recovery scenario, we could potentially experience material adverse impacts including loss of data, damage to important facilities, disruption to our operations, regulatory intervention, reputational harm and loss of customers.

Disruptions to transportation channels that we use to distribute our products may adversely affect our margins and profitability.

We may experience disruptions to the transportation channels ~~used~~we use to distribute our products, including increased congestion, a lack of transportation capacity, increased fuel expenses, import or export controls or delays, and labor disputes or shortages. Disruptions in our trucking capacity may result in reduced sales or increased costs, including the additional use of more expensive or less efficient alternatives to meet demand. Congestion can affect previously negotiated contracts with shipping companies, resulting in unexpected increases in shipping costs, reduction in our profitability or reduced sales.

Our international operations subject us to the costs and risks associated with operating internationally.

We operate manufacturing, sales and service facilities outside of the United States, particularly in Canada and Mexico. Accordingly, we are subject to risks associated with operating in foreign countries, including:

•fluctuations in currency exchange rates;

•limitations on the remittance of dividends and other payments by foreign subsidiaries;

•additional costs of compliance with local regulations;

•historically, in certain countries, higher rates of inflation than in the United States;

•changes in the economic conditions or consumer preferences or demand for our products in these markets;

•restrictive actions by multinational governing bodies, foreign governments or subdivisions thereof;

•changes in foreign labor laws and regulations affecting our ability to hire and retain associates;

•changes in U.S. and foreign laws regarding trade and investment, including the impact of tariffs;

•less robust protection of our intellectual property under foreign laws; and

•difficulty in obtaining distribution and support for our products, including the impact of shipping port delays.

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~~Climate~~In ~~change~~addition, our operations outside the United States are subject to the risk of new and ~~unfavorable~~different ~~weather~~legal ~~conditions~~and regulatory requirements in local jurisdictions, potential difficulties in staffing and managing local operations and potentially adverse tax consequences. The costs associated with operating our continuing international business could adversely ~~impact~~affect our financial condition, results of operations and cash flows.

~~Our~~In ~~consumer lawn and garden net sales in any year are susceptible to weather conditions in~~ the ~~markets~~event inof ~~which~~a ~~our products are sold. For instance~~disaster, ~~periods~~our ofdisaster ~~abnormally~~recovery ~~wet~~and orbusiness ~~dry~~continuity ~~weather~~plans ~~can~~may ~~adversely impact the sale of certain products~~fail, ~~while~~which ~~increasing~~could ~~demand~~adversely ~~for~~interrupt ~~other~~our ~~products making the overall impact on the Company difficult to predict~~operations.

~~The~~Our ~~effects~~operations ofdepend ~~climate~~on ~~change~~our ~~could~~ability ~~include~~to ~~changes~~protect inour ~~rainfall~~infrastructure ~~patterns~~against damage from catastrophe, ~~water~~natural ~~shortages~~disaster or severe weather, ~~changing~~as ~~storm~~well ~~patterns~~as ~~and~~events ~~intensities~~resulting from unauthorized security breach, ~~and~~power ~~changing~~loss, ~~temperature~~telecommunications ~~levels. These~~failure, ~~changes~~act ~~could~~of ~~over~~war, ~~time~~terrorist ~~affect~~attack, ~~for~~pandemic ~~example~~or other events that could have a significant disruptive effect on our operations. Further, the ~~availability~~development ~~and~~of ~~cost~~artificial ofintelligence ~~raw~~is ~~materials,~~creating ~~commodities~~more sophisticated avenues to disrupt operational systems. We have disaster recovery and ~~energy,~~business ~~which~~continuity plans in ~~turn~~place ~~may~~that ~~impact~~are ~~our~~ready ~~ability~~ to ~~procure~~be ~~goods~~executed if we encounter a disruptive event. However, we cannot be certain that our plans, or ~~services~~those ~~required~~of ~~for~~third-party service providers we rely on, will be successful in the ~~operation~~event of a disaster. If our disaster recovery or business atcontinuity ~~the~~plans ~~quantities~~are ~~and~~unsuccessful ~~levels~~in a disaster recovery scenario, we ~~require~~could potentially experience material adverse impacts including loss of data, damage to important facilities, disruption to our operations, regulatory intervention, reputational harm and loss of customers.

~~Consumers~~Climate ~~and businesses may independently~~ change ~~their behavior because of concerns regarding the impact of climate change~~ and ~~public~~unfavorable ~~perceptions. For example, consumers may elect to garden less frequently than historic patterns due to the unpredictability of~~ weather ~~patterns. Those~~conditions ~~consumers~~could ~~who~~adversely ~~are less directly impacted by climate change may also engage in less gardening due to discomfort or concerns about perceptions stemming from the direct~~ impact ~~of climate change on others. Current or potential retail customers may pull back from all or parts of the lawn and garden category in response to softening consumer demand. Also,~~ our ~~ability~~financial ~~to finance the development of climate resilient product offerings may suffer if consumers become less engaged in lawn and gardening~~results.

Our consumer lawn and garden business in any year is susceptible to weather conditions in the markets in which our products are sold. These climate conditions may adversely impact the sale of certain products or increase demand for other products thereby making the overall impact of abnormal or extreme weather conditions on us difficult to predict.

The effects of climate change could include varying temperature levels, water shortages and changes to rainfall amounts, rainfall patterns, storm patterns and storm intensities. These effects could affect the availability and cost of raw materials, commodities and energy, which in turn may impact our ability to procure the quantities and levels of goods or services required to operate our business.

Consumers and businesses may independently change their behavior because of concerns regarding the impact of climate change and public perceptions. For example, consumers may elect to garden less frequently than historic patterns due to the unpredictability of weather patterns. Those consumers who are less directly impacted by climate change may also engage in less gardening due to discomfort or concerns about perceptions stemming from the direct impact of climate change on others. Current or potential retail customers may pull back from all or parts of the lawn and garden category in response to softening consumer demand. Our ability to finance the development of climate appropriate product offerings may also suffer if consumers become less engaged in lawn and gardening.

Our failure to adequately manage the consumer and retail impacts of climate change could have a material adverse effect on our financial condition, results of operations and cash flows.

Our business could be negatively impacted by corporate citizenship and sustainability matters - (including climate change) - and/or our reporting of such matters.

Certain investors, customers, consumers, associates, governmental authorities and other stakeholders are increasing their focus on corporate citizenship and sustainability matters (including climate ~~changes~~change). From time to time, we communicate certain initiatives, ~~including~~such as goals, regarding environmental matters, responsible sourcing and social investments, including pursuant to our Corporate Responsibility Report. We could fail, or be perceived to fail, to achieve such initiatives or goals, or we could fail to fully and accurately report our progress on such initiatives and goals. In addition, we could be criticized for the scope of such initiatives or goals or perceived as not acting responsibly in connection with these matters.

Moreover, there are adopted and proposed international accords and treaties, as well as federal, state and local laws and regulations, that would attempt to ~~control~~regulate orcertain ~~limit~~disclosures ~~the~~and ~~causes~~behavior ofpertaining ~~climate~~to ~~change~~sustainability matters, including the effect of greenhouse gas emissions on the environment. InIf the ~~event that the~~ U.S., ~~government~~state or foreign governments enact new climate change laws or regulations or make changes to existing laws or regulations, compliance with applicable laws or regulations may result in increased manufacturing costs for our products, ~~such~~and asmay byrequire ~~requiring~~additional investment in new pollution control equipment or ~~changing~~changes ~~the~~to ~~ways~~manufacturing inmethods ~~which~~for ~~certain of~~ our products ~~are made~~. Additional compliance burdens could be imposed by laws requiring the collection, measurement and analysis of climate-related data, ~~which~~such ~~can~~as beScope ~~costly~~1, ~~time-consuming,~~2 ~~dependent~~and on3 ~~third-party~~greenhouse ~~cooperation~~gas ~~and~~emissions ~~unreliable. Furthermore,~~similar ~~methodologies~~to ~~for~~the ~~measuring,~~California ~~tracking~~statutory ~~and~~greenhouse ~~reporting~~gas onemission ~~such~~reporting ~~matters~~requirements. Such ~~continue~~compliance tomay ~~change~~be ~~over~~costly, time,-consuming ~~which requires our processes~~ and, ~~controls~~because ~~for~~disclosures ~~such~~would ~~data~~largely todepend ~~evolve~~on asthird-party ~~well~~cooperation, uncertain. Compliance with any new or more stringent laws or regulations, or stricter interpretations of existing laws, could require additional expenditures by us or our suppliers, in which case, the costs of raw materials and component parts could increase. We may incur some of these costs directly and others may be passed on to us from our third-party suppliers.

Any failure to achieve our goals with respect to corporate citizenship and sustainability matters or a perception (whether or not valid) of our failure to act responsibly with respect to the environment or to adequately manage the political, legal and regulatory impacts of corporate citizenship or other sustainability matters could adversely affect our financial condition, results of operations, cash flows and reputation.

Product recalls or other product liability claims could materially and adversely affect our business, financial condition and results of operation.

Due to the highly regulated nature of our products, which are primarily designed for consumer use, we may be required to stop selling, return or recall products due to a variety of potential concerns including suspected or confirmed product contamination, adulteration, product mislabeling or misbranding, tampering, or other deficiencies. Product recalls or voluntary market withdrawals could result in significant losses due to their costs, the destruction of product inventory, and lost sales due to the unavailability of the product for a period of time. Adverse attention about these types of concerns, whether or not valid, may damage our reputation, discourage consumers from buying our products, or cause production and delivery disruptions that could negatively impact our sales and financial condition.

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WeAny ~~may~~failure ~~also~~or ~~suffer~~perception ~~losses~~of if our ~~products~~failure (whether or ~~operations~~not ~~violate~~valid) ~~applicable~~to ~~laws~~achieve orour ~~regulations,~~initiatives or ifgoals ~~our~~with ~~products~~respect ~~are~~to ~~alleged~~corporate tocitizenship ~~cause~~and ~~damage~~sustainability matters, to ~~property,~~act ~~injury,~~responsibly ~~illness,~~with orrespect ~~death. A~~to ~~significant~~corporate ~~product~~citizenship ~~liability,~~and ~~legal~~sustainability ~~judgment~~matters or ato ~~related~~adequately ~~regulatory~~manage ~~enforcement~~the ~~action~~political, ~~against~~legal ~~us,~~and orregulatory aimpacts ~~significant~~of ~~product~~corporate ~~recall~~citizenship or ~~voluntary~~other ~~withdrawal,~~sustainability ~~may~~matters ~~materially~~could ~~and~~ adversely affect our ~~business,~~ financial condition, ~~and~~ results of ~~operation.~~operations and cash flows.

Uncertainty surrounding legislation, regulation and governmental policy at the U.S. federal level could lead to disruptions in or have the effect of negatively impacting our financial condition, results of operations and cash flows.

Uncertainty surrounding legislation, regulation and government policy at the U.S. federal level may impact the U.S. and global economies, international trade and relations, unemployment rates, energy prices, tariffs, immigration, taxes, inflation and the general U.S. regulatory environment, among other things. Although we cannot predict the impact, if any, of these changes, they could negatively affect our financial condition, results of operations and cash flows.

Product recalls or other product liability claims could materially and adversely affect our business, financial condition and results of operations.

Due to the highly regulated nature of our products, which are primarily designed for consumer use, we may be required to stop selling, return or recall products due to a variety of potential concerns including suspected or confirmed product contamination, adulteration, product mislabeling or misbranding, tampering or other deficiencies. Product recalls or voluntary market withdrawals could result in significant losses due to their costs, the destruction of product inventory and lost sales due to the unavailability of the product for a period of time. Adverse attention about these types of concerns, whether or not valid, may damage our reputation or discourage consumers from buying our products and could negatively impact our sales and financial condition.

We may also suffer losses if our products or operations violate applicable laws or regulations, or if our products are alleged to cause damage to property, injury, illness or death. A significant product liability, legal judgment or a related regulatory enforcement action against us, or a significant product recall or voluntary withdrawal, may materially and adversely affect our business, financial condition and results of operations.

If the perception of our brands or organizational reputation are damaged, our consumers, distributors and retailers may react negatively, which could materially and adversely affect our business, financial condition and results of operations.

We believe we have built our reputation on the ~~efficacy~~trust of consumers and ~~safety~~performance of our brands. Any incident that erodes consumer affinity for our brands or our business operations could significantly reduce our value and damage our business. For example, negative third-party research or media reports on our product ~~safety~~quality, or efficacy and safety, whether accurate or not, may adversely affect consumer perceptions, which could cause the value of our brands to suffer and adversely affect our business. We may also be adversely affected by news or other negative publicity, regardless of accuracy, regarding other aspects of our business, ~~such as~~including:

• public health concerns, illness or safety;

• the perception of our environmental stewardship and the ~~effects~~impacts our business has on the environment (including packaging, energy and water use and matters related to climate impact and waste management) and other sustainability issues;

• security breaches of confidential company, customer or employee information; or

• employee related claims relating to alleged employment discrimination, health care and benefit issues.

Such negative publicity may be widely and rapidly disseminated, including through social media platforms.

As part of our marketing initiatives, we have contracted with certain public figures to market and endorse our products. While we maintain specific selection criteria and are diligent in our efforts to seek out public figures that resonate genuinely and effectively with our consumer audience, the individuals we choose to market and endorse our products may fall into negative favor with the general public. Because our consumers may associate the public figures that market and endorse our products with us, any negative publicity on behalf of such individuals may cause negative publicity about us and our products. This negative publicity could materially and adversely affect our brands and reputation and our revenue and profits.

Certain of our products may be purchased for use in new and emerging industries or segments and/or be subject to varying, inconsistent, and rapidly changing laws, regulations, administrative practices, enforcement approaches, judicial interpretations, and consumer perceptions.

We sell products, including hydroponic gardening products, that end users may purchase for use in new and emerging industries or segments, including the growing of cannabis, that may not grow or achieve market acceptance in a manner that we can predict. The demand for these products depends on the uncertain growth of these industries or segments. For example, our Hawthorne segment sales volume has decreased due to an oversupply of cannabis, which has led to a prolonged period of lower cannabis wholesale prices and reduced indoor and outdoor cannabis cultivation. The oversupply has been driven by increased licensing activity across the U.S. and significant capital investment in the cannabis production marketplace over the past several years, as well as inconsistent enforcement of regulations.

In addition, we sell products that end users may purchase for use in industries or segments, including the growing of cannabis, that are subject to varying, inconsistent, and rapidly changing laws, regulations, administrative practices, enforcement approaches, judicial interpretations, and consumer perceptions. For example, certain countries and 38 U.S. states have adopted frameworks that authorize, regulate, and tax the cultivation, processing, sale, and use of cannabis for medicinal and/or non-medicinal use, while the U.S. Controlled Substances Act and the laws of other U.S. states prohibit growing cannabis.

If we are unable to effectively execute our e-commerce business, our reputation and operating results may be harmed.

We sell certain of our products over the Internet through our online store and our retail customer’s e-commerce retail platforms. As consumers demonstrate greater reliance on e-commerce channels, the success of our business depends on our investment in e-commerce platforms, consumer preferences and buying trends relating to e-commerce, and our ability to both maintain the continuous operation of our online store and our fulfillment operations that support both our own and our retail customers’ e-commerce platforms. It is essential that these platforms provide a shopping experience that will generate orders and return visits to the respective platforms.

We are also vulnerable to certain additional risks and uncertainties associated with our e-commerce business, including: changes in required technology interfaces; website downtime and other technical failures; costs and technical issues associated with website software, systems and technology investments and upgrades; data and system security; system failures, disruptions and breaches and the costs to address and remedy such failures, disruptions or breaches; computer viruses; and changes in and compliance with applicable federal and state regulations. In addition, our efforts to remain competitive with technology trends, including the use of new or improved technology, creative user interfaces and other e-commerce marketing tools such as paid search and mobile applications, among others, may increase our costs and may not increase sales or attract consumers. Our failure to successfully respond to these risks and uncertainties might adversely affect the sales of our e-commerce business, as well as damage our reputation and brands.

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Certain of our products may be purchased for use in new and emerging industries or segments and/or be subject to varying, inconsistent and rapidly changing laws, regulations, administrative practices, enforcement approaches, judicial interpretations and consumer perceptions.

We sell products, including hydroponic gardening products, that end users may purchase for use in new and emerging industries or segments, including the growing of cannabis, that may not grow or achieve market acceptance in a manner that we can predict. The demand for these products depends on the uncertain growth of these industries or segments. For example, our Hawthorne segment sales volume has decreased due to an oversupply of cannabis, which has led to a prolonged period of lower cannabis wholesale prices, reduced indoor and outdoor cannabis cultivation and consolidation of retail establishments. The oversupply has been driven by increased licensing activity across the U.S. as well as inconsistent approaches to state regulation and enforcement.

In addition, we sell products that end users may purchase for use in industries or segments, including the growing of cannabis, that are subject to varying, inconsistent and rapidly changing laws, regulations, administrative practices, enforcement approaches, judicial interpretations and consumer perceptions. For example, certain countries and 39 U.S. states have adopted frameworks that authorize, regulate and tax the cultivation, processing, sale and use of cannabis for medicinal and/or non-medicinal use, while the U.S. Controlled Substances Act and the laws of other U.S. states prohibit growing cannabis.

If we are unable to effectively execute our e-commerce business, our reputation and operating results may be harmed.

We sell certain of our products through our online store and our retail customers’ e-commerce retail platforms. As consumers increasingly utilize e-commerce channels, the success of our business depends on our investment in e-commerce platforms, consumer preferences and buying trends relating to e-commerce, and our ability to both maintain the continuous operation of our online store and our fulfillment operations that support both our own and our retail customers’ e-commerce platforms. It is essential that these platforms provide a shopping experience that will generate orders and return visits.

Our e-commerce business is subject to various risks and uncertainties, including: changes in required technology interfaces; website downtime and other technical failures; costs and technical issues associated with website software, systems and technology investments and upgrades; data and system security; system failures, disruptions and breaches and the costs to address and remedy such failures, cyber attacks; and changes in and compliance with applicable federal and state regulations. In addition, our efforts to remain competitive with technology trends, including the use of new or improved technology such as generative artificial intelligence powered search platforms, creative user interfaces and other e-commerce marketing tools such as paid search and mobile applications may increase our costs but may not increase sales or attract consumers. Our failure to effectively address these risks and uncertainties may adversely affect the sales of our e-commerce business, as well as damage our reputation and brands.

Additionally, the success of our e-commerce business and the satisfaction of our consumers depend on the timely receipt of our products by our consumers. The efficient delivery of our products to our consumers requires that our distribution centers have adequate capacity to support the current level of e-commerce operations and any anticipated increased levels that may occur as a result of the growth of our e-commerce business. If we encounter difficulties with our distribution centers, or if any distribution centers shut down for any reason, including as a result of pandemics, acts of war, terrorism, government shut downs, work stoppages and fire or other natural disasters, we could face inventory shortages that may result in out of stock conditions in our online store, incur significantly higher costs and longer lead times associated with distributing our products to our consumers and experience dissatisfaction from our consumers. Any of these issues could have a material adverse effect on our business and harm our reputation.

Our operations, financial condition or reputation may be impaired if our information or operational technology systems fail to perform adequately or if we are the subject of a data breach or cyber- attack.

We rely on information and operational technology systems to conduct business, including communicating with associates and our key retail customers, ordering and managing materials from suppliers, shipping products to retail customers and analyzing and reporting results of operations. ~~While~~If ~~we have taken steps to ensure the security of~~ our information ~~and~~or operational technology systems, ~~including~~are ~~those~~damaged ofor ~~our~~cease ~~customers,~~to ~~vendors,~~function ~~suppliers~~properly ~~and~~for ~~other~~an ~~third-party~~extended ~~service~~period ~~providers~~of ~~on whom we rely~~time, ~~our~~whether ~~systems,~~ as ~~well~~a ~~the~~result ~~systems~~of ~~utilized~~a bysignificant ~~our~~cyber ~~customers,~~incident ~~vendors,~~or ~~suppliers~~any ~~and~~ other ~~third-party~~adverse ~~service providers~~event, ~~have,~~our inability ~~the past, been and may, in the future, be vulnerable~~ to ~~cyber~~operate ~~threats~~or ~~such~~communicate internally as ~~malware,~~well ~~security~~with ~~breaches,~~our ~~phishing~~retail ~~attacks~~customers, ~~unauthorized activity~~vendors, ~~system~~suppliers ~~failures,~~and ~~defects,~~other ~~unintentional~~parties orcritical ~~malicious~~to ~~actions~~our ~~of associates~~business, ~~contractors,~~could ~~and~~be ~~bad~~significantly ~~actors (e.g.~~impaired, ~~cyber~~which ~~criminal~~may ~~groups,~~adversely ~~nation~~impact ~~state~~our ~~actors and hacktivist organizations)~~business.

WeWhile we have ~~experienced~~taken ~~and~~steps ~~may continue~~ to ~~experience~~ensure ~~an increase in~~ the ~~number~~security of ~~such~~our ~~cyber~~information ~~threats. In~~and ~~addition~~operational technology systems, ~~while~~including wethose ~~maintain~~of ~~cyber-security~~our ~~insurance~~customers, ~~costs~~vendors, ~~related~~suppliers toand aother ~~cyber~~third-~~attack~~party ~~may~~service ~~exceed~~providers ~~the~~on ~~amount~~whom ofwe ~~insurance~~rely, ~~coverage~~our orsystems, beas ~~excluded~~well ~~under~~ the ~~terms~~systems ofutilized by our ~~cyber-security~~customers, ~~insurance~~vendors, ~~policy. As~~suppliers ~~cyber~~and other third-~~attacks~~party ~~increase~~service providers, have, in ~~frequency~~the past, been and ~~magnitude~~may, wein ~~may~~the future, be ~~unable~~vulnerable to ~~obtain~~ cyber- threats such as malware, security ~~insurance~~breaches, inphishing ~~amounts~~attacks, unauthorized activity, system failures, defects, unintentional or malicious actions of associates, contractors and onbad ~~terms~~actors we(e.g., ~~view~~cyber ascriminal ~~appropriate~~groups, ~~for~~nation ~~our~~state ~~operations~~actors and hacktivist organizations).

If our information or operational technology systems are damaged or cease to function properly for an extended period of time, whether as a result of a significant cyber-incident or any other adverse event, our ability to operate or communicate internally as well as with our retail customers, vendors, suppliers and other parties critical to our business, could be significantly impaired, which may adversely impact our business.

Additionally, in the normal course of our business, we collect, store and transmit proprietary and confidential information regarding our customers, consumers, associates, suppliers and others, including personally identifiable information. We are required to comply with increasingly complex and changing data privacy and security laws and regulations, that apply to the collection, storage, use, transmission and protection of personal information and other consumer and employee data, including particularly the transfer of personal data between or among countries. High-profile security breaches of the information systems of a number of U.S. companies and/or government agencies may result in increased regulations and new security laws.

An operational failure or breach of security from increasingly sophisticated cyber-threats could lead to loss, misuse or unauthorized disclosure of this information about our associates or consumers, which may result in regulatory or other legal proceedings, and have a material adverse effect on our business and reputation. We may not have the resources or technical sophistication to anticipate or prevent rapidly-evolving types of cyber-attacks. Any such attacks or precautionary measures taken to prevent anticipated attacks may result in increasing costs, including costs for additional technologies, training and third-party consultants. The losses incurred from a cybersecurity-related event as well as the precautionary measures required to address this evolving risk may adversely impact our financial condition, results of operations, cash flows and reputation.

Our insurance coverage may not be sufficient to avoid or effectively mitigate the material impact on our financial position or results of operations resulting from claims or liabilities against us, and we may not be able to obtain appropriate insurance coverage in the future.

We maintain insurance coverage to manage our exposure to future claims and liabilities that may adversely impact our financial position or results of operations. The extent of our insurance program is under continuous review and coverages are modified as we deem necessary to mitigate current or emerging risks. Despite our program, it is possible that claims or liabilities against us may have a material adverse impact on our financial position or results of operations. In addition, we may not be able to obtain sufficient insurance coverage, when our existing insurance policies expire.

We maintain an insurance program that includes coverage to de-risk against claims associated with property damage, management liability, cargo liability, cyber threats, workers compensation and general liability losses. While we expect to be able to continue our insurance coverages, there can be no assurance that we will be able to procure insurance coverage, or that such policy limits will be adequate to cover any liability we may incur, or that our insurance premiums will continue to be available at a cost similar to our cost today. The volatility of the insurance and reinsurance markets are also subject to macroeconomic conditions and events that are outside of our control.

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~~Additionally,~~We ithave isexperienced ~~possible~~and ~~one~~may orcontinue ~~more~~to experience an increase in the number of ~~our~~such ~~insurers~~cyber ~~could~~threats. The ~~specifically~~rapid ~~exclude~~evolution ~~from~~and growing adoption of artificial intelligence and machine learning technologies present emerging risks to the security of our ~~policy~~information, ~~certain~~as ~~chemicals~~well ~~used~~as inthe information of our ~~products~~customers and business partners. ~~Consequently~~Furthermore, wethe ~~may~~increasing ~~have~~use toof ~~cease~~artificial ~~use~~intelligence by threat actors is enhancing the sophistication, speed and effectiveness of ~~those~~cyber ~~chemicals~~attacks and~~/or~~ beamplifying ~~forced~~existing tosecurity ~~substitute~~challenges. Additionally, ~~less~~the ~~effective~~use orof ~~more~~artificial ~~expensive~~intelligence ~~alternatives~~by toour ~~continue~~employees, ~~manufacturing~~or by our customers and~~/or~~ ~~distributing~~business ~~such~~partners, ~~goods~~could increase our exposure to cyber threats. AAs ~~substantial~~cyber attacks increase in ~~liability~~frequency ~~exposure~~and ormagnitude, ~~the~~we ~~loss~~may ofbe ~~customers~~unable orto ~~product~~obtain ~~offerings~~cybersecurity ~~could~~insurance ~~each~~in ~~have~~amounts aand ~~material adverse effect~~ on ~~our~~terms ~~results~~we ofview ~~operations~~as ~~and~~appropriate ~~financial~~for ~~condition~~our operations.

~~Our~~Additionally, ~~international~~in ~~operations~~the ~~make~~normal uscourse ~~susceptible~~of our business, we collect, store and transmit proprietary and confidential information regarding our customers, consumers, associates, suppliers and others, including personally identifiable information. We are required to comply with increasingly complex and changing data privacy and security laws and regulations, that apply to the ~~costs~~collection, storage, use, transmission and ~~risks~~protection ~~associated~~of ~~with~~personal ~~operating~~information ~~internationally~~and other consumer and employee data, including particularly the transfer of personal data between or among countries. High profile security breaches of the information systems of a number of U.S. companies and/or government agencies may result in increased regulations and new data privacy and security laws.

We ~~operate~~An ~~manufacturing,~~operational ~~sales~~failure ~~and~~or ~~service~~breach ~~facilities~~of ~~outside~~security offrom increasingly sophisticated cyber threats could lead to the ~~United~~loss, ~~States~~misuse or unauthorized disclosure of this information about our customers, ~~particularly~~consumers, inassociates ~~Canada~~and suppliers, ~~the~~which ~~Netherlands~~may result in regulatory or other legal proceedings, ~~Mexico~~and have a material adverse effect on our business and ~~China~~reputation. ~~Accordingly,~~We wemay ~~are~~not ~~subject~~have the resources or technical sophistication to ~~risks~~anticipate ~~associated~~or ~~with~~prevent ~~operating~~rapidly evolving types of cyber attacks. Any such attacks or precautionary measures taken to prevent attacks may result in ~~foreign~~increasing ~~countries~~costs, including: costs for additional technologies, training and third-party consultants. The losses incurred from a cybersecurity-related event as well as the precautionary measures required to address this evolving risk may adversely impact our financial condition, results of operations, cash flows and reputation.

~~•fluctuations~~Our insurance coverage may not be sufficient to avoid or effectively mitigate or transfer the adverse impact of claims or liabilities against us on our financial position or results of operations and we may not be able to obtain appropriate insurance coverage in ~~currency~~the ~~exchange~~future. ~~rates;~~

~~•limitations~~We onmaintain ~~the~~insurance ~~remittance~~coverage to manage our exposure to future claims and liabilities that may adversely impact our financial position or results of ~~dividends~~operations. The extent of our insurance program is under continuous review and ~~other~~coverages ~~payments~~are bymodified ~~foreign~~as ~~subsidiaries;~~we deem necessary to mitigate current or emerging risks. Despite our program, it is possible that claims or liabilities against us may have a material adverse impact on our financial position or results of operations. In addition, we may not be able to obtain sufficient insurance coverage, when our existing insurance policies expire.

~~•additional~~We ~~costs~~maintain ofan ~~compliance~~insurance program that includes coverage to de-risk against claims associated with ~~local~~property ~~regulations;~~damage, management liability, cargo liability, cyber threats, workers compensation and general liability losses. While we expect to be able to continue our insurance coverages, there can be no assurance that we will be able to procure insurance coverage, or that such policy limits will be adequate to cover any liability we may incur, or that our insurance premiums will continue to be available at a cost similar to our cost today. The volatility of the insurance and reinsurance markets are also subject to macroeconomic conditions and events that are outside of our control.

~~•historically~~Additionally, init is possible one or more of our insurers could specifically exclude from our policy certain ~~countries~~chemicals used in our products. Consequently, ~~higher~~we ~~rates~~may have to cease use of ~~inflation~~those ~~than~~chemicals and/or substitute less effective or more expensive alternatives to continue manufacturing and/or distributing such goods. A substantial increase in liability exposure or the ~~United~~loss ~~States;~~of customers or product offerings could have a material adverse effect on our results of operations and financial condition.

•changes in the economic conditions or consumer preferences or demand for our products in these markets;

•restrictive actions by multinational governing bodies, foreign governments or subdivisions thereof;

•changes in foreign labor laws and regulations affecting our ability to hire and retain associates;

•changes in U.S. and foreign laws regarding trade and investment, including the impact of tariffs;

•less robust protection of our intellectual property under foreign laws; and

•difficulty in obtaining distribution and support for our products, including the impact of shipping port delays.

In addition, our operations outside the United States are subject to the risk of new and different legal and regulatory requirements in local jurisdictions, potential difficulties in staffing and managing local operations and potentially adverse tax consequences. The costs associated with operating our continuing international business could adversely affect our results of operations, financial condition and cash flows in the future.

In the event the Third Restated Agreement for Monsanto’s consumer Roundup® products terminates or Monsanto’s consumer Roundup® business materially declines, we would lose a substantial source of future earnings and overhead expense absorption.

If we (i) become insolvent, (ii) commit a material breach, material fraud or material willful misconduct under the Third Restated Agreement, (iii) experience a change of control (subject to certain exceptions), or (iv) impermissibly assign our rights or delegate our obligations under the Third Restated Agreement, Monsanto may terminate the Third Restated Agreement without paying a termination fee to the Company, subject to certain terms and conditions as set forth therein. In addition, if Program EBIT (as defined in the Third Restated Agreement) falls below $50.0 million in any program year, Monsanto may terminate the Third Restated Agreement without paying a termination fee to the Company, subject to certain terms and conditions as set forth therein.

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Monsanto may also terminate the Third Restated Agreement in the event of (a) a change of control of Monsanto or a sale of the Roundup® business effective at the end of the fifth full year after providing notice of termination, subject to certain terms and conditions as set forth in the applicable agreements, or (b) Monsanto’s decision to decommission the permits, licenses and registrations needed for, and the trademarks, trade names, packages, copyrights and designs used in, the sale of the Roundup® products in the lawn and garden market (a “Brand Decommissioning Event”), but, in each case, Monsanto would have to pay a termination fee to the Company.

If circumstances exist or otherwise develop that result in a material decline in Monsanto’s consumer Roundup® business, or in the event of Monsanto’s insolvency or bankruptcy, we would seek to mitigate the impact on us by exercising various rights and remedies under the Third Restated Agreement and applicable law. We cannot, however, provide any assurance that our exercise of such rights or remedies would produce the desired outcomes or that a material decline in Monsanto’s consumer Roundup® business would not have a material adverse effect on our business, financial condition or results of operations.

In the event that the Third Restated Agreement terminates or Monsanto’s consumer Roundup® business materially declines, we would lose all, or a substantial portion, of the significant source of earnings and overhead expense absorption the Third Restated Agreement provides.

For additional information regarding the Third Restated Agreement including certain of our rights and remedies under the Third Restated Agreement, see “NOTE 6. MARKETING AGREEMENT” of the Notes to Consolidated Financial Statements included in this Form 10-K.

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We may not be able to adequately protect our intellectual property and other proprietary rights that are material to our business.

Our ability to compete effectively depends in part on our rights to service marks, trademarks, trade names and other intellectual property rights we own or license, particularly our registered brand names and issued patents. Although we have a robust portfolio of registered trademarks, we have not sought to register each of our marks either in the United States or in every country in which each such mark is used. Furthermore, because of the differences in foreign trademark, patent and other intellectual property or proprietary rights laws, we may not receive the same protection in other countries as we would in the United States with respect to the registered brand names and issued patents we hold. If we are unable to protect our intellectual property, proprietary information and/or brand names, we could suffer a material adverse effect on our business, financial condition and results of operations.

In addition, advances in artificial intelligence and the increasingly widespread use of such technology by us, our third parties or others, including generative artificial intelligence tools, may increase the risk of (a) claims against us for infringing third party intellectual property rights, and (b) the unauthorized access to, or use of, our intellectual property and unauthorized or unintended exposure of our confidential and proprietary information, all of which could adversely affect the value of our intellectual property, including our brands, our trade secrets and our investment in research and development. If we are unable to protect our intellectual property, proprietary information and/or brand names, we could suffer a material adverse effect on our business, financial condition and results of operations.

Litigation may be necessary to enforce our intellectual property rights and protect our proprietary information, or to defend against claims by third parties that our products or services infringe their intellectual property rights. Any litigation or claims brought by or against us could result in substantial costs and diversion of our resources. A successful claim of trademark, patent or other intellectual property infringement against us, or any other successful challenge to the use of our intellectual property, could subject us to damages or prevent us from providing certain products or services, or using certain of our recognized brand names, which could have a material adverse effect on our business, financial condition and results of operations.

Our success depends upon the retention and availability of key personnel and the effective succession of senior management.

Our success largely depends on the performance of our management team and other key personnel. Our future operations could be harmed if we are unable to attract and retain talented, highly qualified senior executives and other key personnel. In ~~fiscal~~recent ~~2023 and fiscal 2024~~years, we experienced management transitions involving our Chief Financial Officer, Chief Operating Officer, Chief Human Resources Officer and ~~General~~Chief ~~Counsel~~Legal Officer. InIf ~~addition,~~we ~~our~~are ~~current~~unable ~~Chief~~to ~~Financial~~effectively ~~Officer~~provide ~~will~~for ~~be departing~~ the ~~Company~~succession ~~effective~~of ~~December~~senior 31management, ~~2024. For~~including ~~additional~~our ~~information~~Chief ~~regarding~~Executive ~~this departure~~Officer, ~~see~~our ~~“ITEM~~business, ~~9B.~~prospects, ~~OTHER~~financial ~~INFORMATION”~~condition, results of ~~this~~operations ~~Form~~and ~~10-K.~~cash flows may be materially adversely affected.

If we are unable to effectively provide for the succession of senior management, including our chief executive officer, our business, prospects, results of operations, financial condition and cash flows may be materially adversely affected.

Our workforce reductions may cause undesirable consequences and adversely affect our business and results of operations.

During fiscal 2024, fiscal 2023 and fiscal 2022, we undertook strategic reductions in our workforce as part of an on-going series of organizational changes and initiatives intended to create operational and management-level efficiencies. This workforce reduction may yield unintended consequences, such as attrition beyond our intended reduction in workforce and reduced employee morale, which may cause our associates who were not affected by the reduction in workforce to seek alternate employment. Associates whose positions were eliminated or those who determine to seek alternate employment may seek employment with our competitors.

We cannot provide assurance that we will not undertake additional workforce reductions or that we will be able to realize the cost savings and other anticipated benefits from our previous or any future workforce reduction plans. In addition, if we continue to reduce our workforce, it may adversely impact our ability to respond rapidly to any new product, growth or revenue opportunities and to execute our business plans. Additionally, reductions in workforce may make it more difficult to recruit and retain associates if they perceive uncertainty in employment. If we need to increase the size of our workforce in the future, we may encounter a competitive hiring market due to labor shortages, increased employee turnover, changes in the availability of workers and increased wage costs.

We are involved in a number of legal proceedings and, while we cannot predict the outcomes of such proceedings and other contingencies with certainty, some of these outcomes could adversely affect our business, financial condition, results of operations and cash flows.

We are involved in legal proceedings and are subject to investigations, inspections, audits, inquiries and similar actions by governmental authorities, arising in the course of our business (see the discussion in “ITEM 3. LEGAL PROCEEDINGS” of this Form 10-K). Legal proceedings, in general, can be expensive and disruptive. Some of these suits may purport or may be determined to be class actions and/or involve parties seeking large and/or indeterminate amounts of damages, including punitive or exemplary damages, and may remain unresolved for several years. For example, product liability claims challenging the safety of our products or products we market on behalf of third parties may also result in a decline in sales for a particular product and could damage the reputation or the value of related brands, involve us in litigation and have a material adverse effect on our business.

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~~From~~Our ~~time~~workforce toreductions ~~time,~~may wecause ~~are~~undesirable ~~also~~consequences ~~involved in legal proceedings involving contract, intellectual property~~ and ~~other~~adversely ~~matters~~affect including, for example, the securities litigation and shareholder derivative suits discussed in “ITEM 3. LEGAL PROCEEDINGS” of this Form 10-K. We cannot predict with certainty the outcomes of these legal proceedings and other contingencies, and the costs incurred in litigation can be substantial, regardless of the outcome. Substantial unanticipated verdicts, fines and rulings do sometimes occur. As a result, we could from time to time incur judgments, enter into settlements or revise our ~~expectations~~business ~~regarding the outcome of certain matters,~~ and ~~such developments could have a material adverse effect on our~~ results of operations ~~in the period in which the amounts are accrued and/or our cash flows in the period in which the amounts are paid~~. The outcome of some of these legal proceedings and other contingencies could require us to take, or refrain from taking, actions which could negatively affect our operations and, depending on the nature of the allegations, could negatively impact our reputation or the reputation of products we market on behalf of third parties. Additionally, defending against these legal proceedings may involve significant expense and diversion of management’s attention and resources.

In recent years, we have undertaken strategic reductions in our workforce as part of a series of organizational changes and initiatives intended to create operational and management-level efficiencies. These workforce reductions may yield unintended consequences, such as attrition beyond our intended reduction in workforce and reduced employee morale, which may cause our associates who were not affected by the workforce reductions to seek alternate employment. Associates whose positions were eliminated or those who determine to seek alternate employment may seek employment with our competitors.

We cannot provide any assurance that we will not undertake additional workforce reductions or that we will be able to realize the cost savings and other anticipated benefits from any of our previous or future workforce reduction plans. In addition, continued workforce reductions may adversely impact our ability to respond rapidly to any new product, growth or revenue opportunities and to execute our business plans. Additionally, workforce reductions may make it more difficult to recruit and retain associates if they perceive uncertainty in employment. If we need to increase the size of our workforce in the future, we may encounter a competitive hiring market due to labor shortages, increased employee turnover, changes in the availability of workers and increased wage costs.

We are involved in legal proceedings and are subject to investigations, inspections, audits, inquiries and similar actions by governmental authorities, arising in the course of our business (see the discussion in “ITEM 3. LEGAL PROCEEDINGS” of this Form 10-K). Legal proceedings, in general, can be expensive and disruptive. Some of these suits may purport or be determined to be class actions and/or involve parties seeking large and/or indeterminate amounts of damages, including punitive or exemplary damages, and may remain unresolved for several years. For example, product liability claims challenging the safety of our products or products we market on behalf of third parties may also result in a decline in sales for a particular product and could damage the reputation or the value of related brands, involve us in litigation and have a material adverse effect on our business.

From time to time, we are also involved in legal proceedings involving contract, employment, intellectual property and other matters including, for example, the securities litigation and shareholder derivative suits discussed in “ITEM 3. LEGAL PROCEEDINGS” of this Form 10-K. We cannot predict with certainty the outcomes of these legal proceedings and other contingencies, and the costs incurred in litigation can be substantial, regardless of the outcome. Substantial unanticipated verdicts, fines and rulings do sometimes occur. As a result, we could from time to time incur judgments, enter into settlements or revise our expectations regarding the outcome of certain matters, and such developments could have a material adverse effect on our results of operations in the period in which the amounts are accrued and/or our cash flows in the period in which the amounts are paid. The outcome of some of these legal proceedings and other contingencies could require us to take, or refrain from taking, actions which could negatively affect our operations and, depending on the nature of the allegations, could negatively impact our reputation or the reputation of products we market on behalf of third parties. Additionally, defending against these legal proceedings may involve significant expense and diversion of management’s attention and resources.

Risks Related to Our M&A, Lending and Financing Activities

Our indebtedness could limit our flexibility and adversely affect our financial condition.

As of September 30, ~~2024~~2025, we had $2,~~242~~119.87 million of debt and $1,~~167~~166.09 million in available borrowings under ~~our~~the sixth amended and restated credit ~~facility~~agreement (the “Sixth A&R Credit Agreement”), which was in effect during the entirety of fiscal 2025. On November 21, 2025, the Company entered into a seventh amended and restated credit agreement (the “Seventh A&R Credit Agreement”), which replaced the Sixth A&R Credit Agreement. Our inability to meet restrictive financial and non-financial covenants associated with ~~that~~our debt, or to generate sufficient cash flow to repay maturing debt, could adversely affect our financial condition. For example, our debt level could:

•make it more difficult for us to satisfy our obligations with respect to our indebtedness;

•make us more vulnerable to general adverse economic and industry conditions;

•require us to dedicate a substantial portion of cash flows from operating activities to payments on our indebtedness, which would reduce the cash flows available to fund working capital, capital expenditures, advertising, research and development efforts, ~~pay~~ dividends, ~~repurchase our~~ Common ~~Shares~~Share repurchases and other general corporate activities;

•limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate;

•limit our ability to borrow additional funds;

•expose us to risks inherent in interest rate fluctuations because some of our borrowings are at variable rates of interest, which could result in higher interest expense in the event of increases in interest rates; and

•place us at a competitive disadvantage compared to our competitors that have less debt.

Our ability to make payments on or to refinance our indebtedness, fund planned capital expenditures and acquisitions, pay dividends and repurchase our Common Shares will depend on our ability to generate cash in the future which, to some extent, is subject to general economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. We cannot provide any assurance that our business will generate sufficient cash flow from operating activities or that future borrowings will be available to us in amounts sufficient to enable us to pay our indebtedness or to fund our other liquidity needs.

Our credit facility and the indentures governing our 5.250% Senior Notes due 2026 (the “5.250% Senior Notes”), our 4.500% Senior Notes due 2029 (the “4.500% Senior Notes”), our 4.000% Senior Notes due 2031 (the “4.000% Senior Notes”) and our 4.375% Senior Notes due 2032 (the “4.375% Senior Notes” and, collectively with the 5.250% Senior Notes, the 4.500% Senior Notes and the 4.000% Senior Notes, the “Senior Notes”) contain restrictive covenants and cross-default provisions. For example, under our credit facility the maximum permitted leverage ratio is (i) 6.00 for the fourth quarter of fiscal 2024, (ii) 5.50 for the first quarter of fiscal 2025, (iii) 5.25 for the second quarter of fiscal 2025, (iv) 5.00 for the third quarter of fiscal 2025, (v) 4.75 for the fourth quarter of fiscal 2025 and (vi) 4.50 for the first quarter of fiscal 2026 and thereafter. Our leverage ratio was 4.86 at September 30, 2024. In addition, our credit facility contains a fixed charge coverage ratio covenant which sets the minimum permitted fixed charge coverage ratio at 1.00. Our fixed charge coverage ratio was 1.27 for the twelve months ended September 30, 2024. The Senior Notes contain an interest coverage ratio covenant which sets the minimum permitted interest coverage ratio at 2.00. Our interest coverage ratio was 3.57 for the twelve months ended September 30, 2024. A breach of any of these financial ratio covenants or other covenants could result in a default and/or a cross default under the credit facility and Senior Notes, as applicable. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, and could cease making further loans and institute foreclosure proceedings against our assets. We cannot provide any assurance that the holders of such indebtedness would waive a default or that we would have the resources to pay the accelerated indebtedness in full.

Subject to compliance with certain covenants under our credit facility and the indentures governing the Senior Notes, we may incur additional debt in the future. If we incur additional debt, the risks described above could intensify.

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~~Significant~~•expose orus ~~prolonged~~to ~~periods~~risks ofinherent ~~higher~~in interest ~~rates~~rate ~~may~~fluctuations ~~have~~because ansome ~~adverse~~of ~~effect~~our onborrowings ~~our~~are ~~results~~at variable rates of ~~operations~~interest, ~~financial~~which ~~condition~~could ~~and~~result ~~cash~~in ~~flows.~~higher interest expense in the event of increases in interest rates; and

~~Interest~~•place ~~rates~~us ~~have~~at a ~~direct~~competitive ~~impact~~disadvantage oncompared ~~our business due~~ to ~~the~~our ~~amount~~competitors ofthat ~~variable rate debt the Company utilizes in its operations. Prolonged periods of higher interest rates may~~ have aless ~~negative impact on the Company’s results of operations, financial condition and cash flows. All of our~~ debt under the sixth amended and restated credit agreement (the “Sixth A&R Credit Agreement”) bears interest at variable rates primarily derived from, as defined therein, the (i) the Alternate Base Rate, (ii) the Adjusted Term SOFR Rate or (iii) the Swingline Rate. In a rising interest rate environment, debt financing will become more expensive and may have higher transactional and servicing costs. For example, the weighted average interest rates on average borrowings under the Sixth A&R Credit Agreement, excluding the impact of interest rate swaps, were 9.1%, 7.6% and 2.8% for fiscal 2024, fiscal 2023 and fiscal 2022, respectively.

~~Although~~Our ~~the~~ability ~~Company~~to ~~has~~make ~~taken~~payments ~~steps~~on or to ~~reduce~~refinance our ~~exposure~~indebtedness to(including, ~~variable~~for ~~rate~~example, ~~debt~~our ~~instruments~~5.250% Senior Notes due 2026 (the “5.250% Senior Notes”)), iffund ~~interest~~planned ~~rates~~capital ~~remain~~expenditures ~~relatively~~and ~~high~~acquisitions, orpay ~~increase~~dividends and repurchase our Common Shares will depend on our ability to generate cash in the future which, weto ~~could~~some ~~see~~extent, ~~increases~~is insubject ~~our~~to ~~borrowing~~general ~~costs~~economic, ~~which~~financial, ~~could~~competitive, ~~have~~legislative, aregulatory ~~material~~and ~~adverse~~other ~~effect~~factors onthat are beyond our ~~results~~control. We ofcannot ~~operations,~~provide ~~financial~~any ~~condition~~assurance ~~and~~that our business will generate sufficient cash ~~flows.~~flow from operating activities or that future borrowings will be available to us in amounts sufficient to enable us to pay our indebtedness or to fund our other liquidity needs.

The Sixth A&R Credit Agreement, Seventh A&R Credit Agreement and the indentures governing our 5.250% Senior Notes, our 4.500% Senior Notes due 2029 (the “4.500% Senior Notes”), our 4.000% Senior Notes due 2031 (the “4.000% Senior Notes”) and our 4.375% Senior Notes due 2032 (the “4.375% Senior Notes” and, collectively with the 5.250% Senior Notes, the 4.500% Senior Notes and the 4.000% Senior Notes, the “Senior Notes”) contain restrictive covenants and cross-default provisions. For example, under the Sixth A&R Credit Agreement, the maximum permitted leverage ratio was 4.75 for the fourth quarter of fiscal 2025. Our leverage ratio was 4.10 at September 30, 2025. In addition, the Sixth A&R Credit Agreement contained a fixed charge coverage ratio covenant which set the minimum permitted fixed charge coverage ratio at 1.00. Our fixed charge coverage ratio was 1.42 for the twelve months ended September 30, 2025. Under the Seventh A&R Credit Agreement, the maximum permitted leverage ratio is 5.00 for the first quarter of fiscal 2026 and thereafter. The Seventh A&R Credit Agreement also contains a minimum interest coverage ratio of (i) 3.00 for each of the fiscal quarters within fiscal 2026, (ii) 3.25 for each of the fiscal quarters within fiscal 2027 and (iii) 3.50 for fiscal quarters thereafter. The Senior Notes contain an independently calculated interest coverage ratio covenant which sets the minimum permitted interest coverage ratio at 2.00. Our interest coverage ratio was 4.78 for the twelve months ended September 30, 2025. A breach of any of the financial ratio covenants or other covenants in the Seventh A&R Credit Agreement or Senior Notes could result in a default and/or a cross default under the Seventh A&R Credit Agreement or Senior Notes, as applicable. In the event of such default, the holders of such indebtedness could elect to declare all the funds borrowed thereunder to be due and payable, together with accrued and unpaid interest, and could cease making further loans and institute foreclosure proceedings against our assets. We cannot provide any assurance that the holders of such indebtedness would waive a default or that we would have the resources to pay the accelerated indebtedness in full.

Subject to compliance with certain covenants under the Seventh A&R Credit Agreement and the indentures governing the Senior Notes, we may incur additional debt in the future. If we incur additional debt, the risks described above could intensify.

Significant or prolonged periods of higher interest rates may have an adverse effect on our financial condition, results of operations and cash flows.

Interest rates have a direct impact on our business due to the amount of variable rate debt the Company utilizes in its operations. Prolonged periods of higher interest rates may have a negative impact on our financial condition, results of operations and cash flows. All of our debt under the Seventh A&R Credit Agreement bears interest at variable rates primarily derived from the U.S. Prime Rate, Federal Reserve Bank of New York Rate, Secured Overnight Financing Rate, Euro Interbank Offered Rate, Canadian Prime Rate or Canadian Overnight Repo Rate Average (all as defined in the Seventh A&R Credit Agreement), based on our election, plus a spread that depends on our quarterly-tested leverage ratio. In a rising interest rate environment, debt financing will become more expensive and may have higher transactional and servicing costs.

Although the Company has taken steps to reduce our exposure to variable rate debt instruments, if interest rates remain relatively high or increase in the future, we could see increases in our borrowing costs which could have a material adverse effect on our financial condition, results of operations and cash flows.

Global economic and capital market conditions may limit our access to capital and/or increase the costs of such capital.

In the future, we may need new or additional financing to provide liquidity to conduct our operations, expand our business or refinance existing indebtedness. Any sustained weakness in general economic conditions and/or U.S. or global capital markets could adversely affect our ability to raise capital on favorable terms or at all. From time to time we have relied, and we may also rely in the future, on access to financial markets as a source of liquidity for working capital requirements, acquisitions and general corporate purposes. Our access to funds under ~~our~~the ~~credit~~Seventh ~~facility~~A&R Credit Agreement depends on the ability of the lenders that are parties to that facility to meet their funding commitments. Moreover, the obligations of the lenders under ~~our~~the ~~credit~~Seventh ~~facility~~A&R Credit Agreement are several and not joint and, as a result, a funding default by one lender does not need to be made up by the others. Longer term volatility in the capital and credit markets as a result of uncertainty, changing or increased regulation of financial institutions or reduced alternatives could adversely affect our access to the liquidity needed for our businesses in the longer term. Such disruptions could require us to take measures to conserve cash until the markets stabilize or until alternative credit arrangements or other funding for our business needs can be arranged.

Acquisitions, other strategic alliances and investments could result in operating difficulties, dilution, and other harmful consequences that may adversely impact our business and results of operations.18

~~Acquisitions,~~Table ~~strategic alliances and investments are an important element~~ of ~~our~~Contents long-term corporate strategy and use of capital, and these transactions could be material to our financial condition and results of operations. We expect to continue to evaluate and enter into discussions regarding a wide array of potential strategic transactions. The process of integrating an acquired company, business, or product has created, and will continue to create, unforeseen operating difficulties and expenditures. The areas where we face risks include:

Acquisitions, other strategic alliances and investments could result in operating difficulties, dilution and other harmful consequences that may adversely impact our business and results of operations.

Acquisitions, strategic alliances and investments are an important element of our long-term corporate strategy and use of capital, and these transactions could be material to our financial condition and results of operations. We expect to continue to evaluate and enter into discussions regarding a wide array of potential strategic transactions. The process of integrating an acquired company, business or product has created, and will continue to create unforeseen operating difficulties and expenditures. The areas where we face risks include:

•Assumptions implicit to our acquisition strategy or valuations are not realized.

•Diversion of management time and focus from operating our business to acquisition integration challenges.

•Failure to successfully further develop the acquired business or product lines.

•Implementation or remediation of controls, procedures and policies at the acquired company.

•Integration of the acquired company’s accounting, human resources and other administrative systems, and coordination of product, engineering and sales and marketing functions.

•Transition of operations, users and customers onto our existing platforms.

•Reliance on the expertise of our strategic partners with respect to market development, sales, local regulatory compliance and other operational matters.

•Failure to obtain required approvals on a timely basis, if at all, from governmental authorities, or conditions placed upon approval, under competition and antitrust laws which could, among other things, delay or prevent us from completing a transaction, or otherwise restrict our ability to realize the expected financial or strategic goals of an acquisition.

•In the case of foreign acquisitions, the need to integrate operations across different cultures and languages and to address the particular economic, currency, political and regulatory risks associated with specific countries.

•Cultural challenges associated with integrating associates from the acquired company into our organization, and retention of associates from the businesses we acquire.

18•Strategic investments in which we have a minority ownership stake and that we do not control may from time to time have economic, business or legal interests or goals that are inconsistent with our goals or the goals of regulators or business partners. As a result, business decisions or other actions or omissions of controlling owners, management or other persons or entities who control companies in which we invest may adversely affect the value of our investment, result in litigation, commercial or regulatory action against us or otherwise damage our reputation.

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•Strategic investments in which we have a minority ownership stake and that we do not control may from time to time have economic, business, or legal interests or goals that are inconsistent with our goals. As a result, business decisions or other actions or omissions of controlling owners, management, or other persons or entities who control companies in which we invest may adversely affect the value of our investment, result in litigation or regulatory action against us, or otherwise damage our reputation.

•Liability for or reputational harm from activities of the acquired company before the acquisition or from our strategic partners, including patent and trademark infringement claims, violations of laws, commercial disputes, tax liabilities and other known and unknown liabilities.

•Litigation or other claims in connection with the acquired company, including claims from terminated associates, customers, former shareholders or other third parties.

Our failure to address these risks or other problems encountered in connection with our past or future acquisitions and investments or strategic alliances could cause us to fail to realize the anticipated benefits of such acquisitions, investments or alliances, incur unanticipated liabilities, and harm our business generally.

Our acquisitions, strategic alliances and investments could also result in dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities or amortization expenses, or impairment of goodwill and purchased long-lived assets, and restructuring charges, any of which could harm our financial condition, or results of operations and cash flows. Also, the anticipated benefits of many of our acquisitions may not materialize.

Changes in credit ratings issued by nationally recognized statistical rating organizations (NRSROs) could adversely affect our cost of financing and the market price of our Senior Notes.

NRSROs rate the Senior Notes and the Company based on factors that include our operating results, actions that we take, their view of the general outlook for our industry and their view of the general outlook for the economy. Actions taken by the NRSROs can include maintaining, upgrading or downgrading the current rating or placing us on a watch list for possible future downgrading. Downgrading the credit rating of the Senior Notes or placing us on a watch list for possible future downgrading could increase our cost of financing, limit our access to the capital markets and have an adverse effect on the market price of the Senior Notes.

In August 2023, S&P Global Ratings lowered our issuer credit rating to B+ from BB- and lowered its rating on our Senior Notes to B- from B. Also in August 2023, Moody’s Investors Service lowered (i) our Corporate Family Rating to B1 from Ba3, (ii) our Probability of Default Rating to B1-PD from Ba3-PD and (iii) its rating on the Senior Notes to B2 from B1.

A failure to dispose of assets or businesses in a timely manner may cause the results of the Company to suffer.

We evaluate as necessary the potential disposition of assets and businesses that may no longer help meet our objectives. When we decide to sell assets or a business, we may encounter difficulty in finding buyers or alternative exit strategies on acceptable terms in a timely manner, which could delay the achievement of our strategic objectives. Alternatively, we may dispose of a business at a price or on terms that are less than we had anticipated. After reaching an agreement with a buyer for the disposition of a business, the pre-closing conditions must also be satisfied or waived, which may prevent us from completing the transaction. Dispositions may also involve continued financial involvement in the divested business, such as through continuing equity ownership, guarantees, indemnities or other financial obligations. Under these arrangements, performance by the divested businesses or other conditions outside our control could affect our future financial results.

Our lending activities may adversely impact our business and results of operations.

As part of our strategic initiatives, we have provided financing to certain strategic partners. Our exposure to credit losses on these financing balances and strategic investments will depend on the financial condition of these counterparties as well as legal, regulatory and macroeconomic factors beyond our control, such as deteriorating conditions in the world economy or in the industries served by the borrowers and federal legalization of the U.S. cannabis market. While we monitor our exposure, there can be no guarantee we will be able to successfully mitigate all of these risks. For example, during fiscal 2024 and fiscal 2023, the Company recorded non-cash, pre-tax other-than-temporary impairment charges related to its convertible debt investments of $64.6 million and $101.3 million, respectively. These or other credit losses, if significant, could have a material adverse effect on our business, financial condition, results of operations and cash flows.

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~~Our~~A ~~hedging~~failure ~~arrangements~~to ~~expose~~dispose usof toassets ~~certain~~or ~~counterparty~~businesses ~~risks~~in a timely manner may have an adverse effect on our results of operations and financial condition.

InWe ~~addition~~evaluate as necessary the potential disposition of assets and businesses that may no longer help meet our objectives. When we decide to ~~commodity~~sell ~~hedge~~assets ~~agreements~~or a business, we ~~utilize~~may ~~interest~~encounter ~~rate~~difficulty ~~swap~~in ~~agreements~~finding tobuyers ~~manage~~or ~~the~~alternative ~~net~~exit ~~interest~~strategies ~~rate~~on ~~risk~~acceptable ~~inherent~~terms in ~~our~~a ~~sources~~timely ofmanner, ~~borrowing~~which ascould ~~well~~delay asthe ~~foreign~~achievement ~~currency~~of ~~forward~~our ~~contracts~~strategic toobjectives. Alternatively, ~~manage~~we ~~the~~may ~~exchange~~dispose ~~rate~~of ~~risk~~a ~~associated~~business ~~with~~at ~~certain~~a ~~intercompany~~price ~~loans~~or ~~with~~on ~~foreign~~terms ~~subsidiaries~~that ~~and~~are ~~other~~less ~~approved~~than ~~transactional~~we ~~currency~~had ~~exposures~~anticipated. ~~Utilizing~~After ~~these~~reaching ~~hedge~~an ~~agreements~~agreement ~~exposes~~with usa tobuyer ~~certain~~for ~~counterparty~~the ~~risks. The~~disposition ~~failure~~ of ~~one~~a business, the pre-closing conditions must also be satisfied or ~~more~~waived, ofwhich may prevent us from completing the ~~counterparties~~transaction. Dispositions tomay ~~fulfill~~also ~~their~~involve ~~obligations~~continued ~~under~~financial involvement in the ~~hedge~~divested ~~agreements~~business, ~~whether~~such as athrough ~~result~~continuing ofequity ~~weakening~~ownership, ~~financial~~guarantees, ~~stability~~indemnities or ~~otherwise,~~other ~~could~~financial ~~adversely~~obligations. Under ~~affect~~these ~~our~~arrangements, ~~financial~~performance ~~condition,~~by ~~results~~the ofdivested ~~operations~~businesses or ~~cash~~other ~~flows~~conditions outside our control could affect our future financial results.

Our lending activities may adversely impact our business and results of operations.

As part of our strategic initiatives, we have provided financing to certain strategic partners. Our exposure to credit losses on these financing balances and strategic investments will depend on the financial condition of these counterparties as well as legal, regulatory and macroeconomic factors beyond our control, such as deteriorating conditions in the world economy or in the industries served by the borrowers. While we monitor our exposure, there can be no guarantee we will be able to successfully mitigate all of these risks. For example, during fiscal 2024 and fiscal 2023, the Company recorded non-cash, pre-tax other-than-temporary impairment charges related to its convertible debt investments of $64.6 million and $101.3 million, respectively. These or other credit losses, if significant, could have a material adverse effect on our business, financial condition, results of operations and cash flows.

Changes in credit ratings issued by nationally recognized statistical rating organizations (“NRSROs”) could adversely affect our cost of financing and the market price of our Senior Notes.

Our hedging arrangements expose us to certain counterparty and market risks.

We periodically utilize hedging agreements to fix the prices of a portion of our urea and fuel needs. The hedging agreements are designed to mitigate the earnings and cash flow fluctuations associated with the costs of urea and fuel. In periods of declining prices, utilizing these hedge agreements may effectively increase our expenditure for these raw materials.

In addition to commodity hedge agreements, we utilize interest rate swap agreements to manage the net interest rate risk inherent in our sources of borrowing, as well as foreign currency forward contracts to manage the exchange rate risk associated with certain intercompany loans with foreign subsidiaries and other approved transactional currency exposures.

Utilizing these hedge agreements exposes us to certain counterparty risks. The failure of one or more of the counterparties to fulfill their obligations under the hedge agreements, whether because of weakening financial stability or otherwise, could adversely affect our financial condition, results of operations and cash flows.

Our postretirement-related costs and funding requirements could increase as a result of volatility in the financial markets, changes in interest rates and actuarial assumptions.

We sponsor a number of defined benefit pension plans associated with our U.S. and former international businesses, as well as a postretirement medical plan in the United States for certain retired associates and their dependents. The performance of the financial markets and changes in interest rates impact the funded status of these plans and may cause volatility in our postretirement-related costs and future funding requirements. If the financial markets do not provide the expected long-term returns on invested assets, we could be required to make significant pension contributions. Additionally, changes in interest rates and legislation enacted by governmental authorities can impact the timing and amounts of contribution requirements.

We utilize third-party actuaries to evaluate assumptions used in determining projected benefit obligations and the fair value of plan assets for our pension and other postretirement benefit plans. In the event we determine that our assumptions should be revised, such as the discount rate or expected return on assets, our future pension and postretirement benefit expenses could increase or decrease. The assumptions we use may differ from actual results, which could have a significant impact on our pension and postretirement liabilities and related costs and funding requirements.

Risks Related to Regulation of Our Company

Compliance with environmental and other public health regulations or changes in such regulations or regulatory enforcement priorities could increase our costs of doing business or limit our ability to market all of our products.

Laws and regulations relating to environmental matters affect us in several ways. All pesticide products sold in the United States must comply with FIFRA and most must be registered with the U.S. EPA and similar state agencies. Our inability to obtain or maintain such registrations, or the cancellation of any such registration of our products, could have an adverse effect on our business, the severity of which would depend on a variety of factors, including the product(s) involved, whether another product could be substituted and whether our competitors were similarly affected. We attempt to anticipate regulatory developments and maintain registrations of, and access to, substitute active ingredients, but there can be no assurance that we will be able to avoid these risks. For example, there are indications that federal agencies in the U.S. may take more restrictive positions on pesticides. In addition, several provinces in Canada have adopted regulations that substantially restrict our ability to market and sell certain consumer pesticide products.

Under the Food Quality Protection Act, enacted by the U.S. Congress in 1996, food-use pesticides are evaluated to determine whether there is reasonable certainty that no harm will result from the cumulative effects of pesticide exposures. Under this Act, the U.S. EPA is evaluating the cumulative and aggregate risks from dietary and non-dietary exposures to pesticides. The pesticides in our products, certain of which may be also used on crops processed into various food products, are manufactured by independent third parties and continue to be evaluated by the U.S. EPA as part of this exposure risk assessment. The U.S. EPA or the third-party registrant may decide that a pesticide we use in our products will be limited or made unavailable to us. We cannot predict the outcome or the severity of the effect of these continuing evaluations.

In addition, the use of certain fertilizer and pesticide products (including pesticide products that contain glyphosate) is regulated by various environmental and public health agencies. These regulations may, among other things, limit or ban the use of certain ingredients contained in such products or require (i) that only certified or professional users apply the product, (ii) that certain products be used only on certain types of locations, (iii) users to post notices on properties to which products have been or will be applied, and/or (iv) notification to individuals in the vicinity that products will be applied in the future. Even if we are able to comply with all such regulations and obtain all necessary registrations and licenses, we cannot provide assurance that our products, particularly pesticide products, will not cause or be alleged to cause injury to the environment or to people under all circumstances, particularly when used improperly or contrary to instructions. The costs of compliance, remediation or products liability have adversely affected operating results in the past and could materially adversely affect future quarterly or annual operating results.

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Risks Related to Regulation of Our Company

Under the Food Quality Protection Act, food-use pesticides are evaluated to determine whether there is reasonable certainty that no harm will result from the cumulative effects of pesticide exposures. Under this Act, the U.S. EPA is evaluating the cumulative and aggregate risks from dietary and non-dietary exposures to pesticides. The pesticides in our products, certain of which may be also used on crops processed into various food products, are manufactured by independent third parties and continue to be evaluated by the U.S. EPA as part of this exposure risk assessment. The U.S. EPA or the third-party registrant may decide that a pesticide we use in our products will be limited or made unavailable to us. We cannot predict the outcome or the severity of the effect of these continuing evaluations.

In addition, the use of certain fertilizer and pesticide products is regulated by various environmental and public health agencies. These regulations may, among other things, limit or ban the use of certain ingredients contained in such products or require (i) that only certified or professional users apply the product, (ii) that certain products be used only on certain types of locations, (iii) users to post notices on properties to which products have been or will be applied and/or (iv) notification to individuals in the vicinity that products will be applied in the future. Even if we are able to comply with all such regulations and obtain all necessary registrations and licenses, we cannot provide assurance that our products, particularly pesticide products, will not cause or be alleged to cause injury to the environment or to people under all circumstances, particularly when used improperly or contrary to instructions. The costs of compliance, remediation or products liability have adversely affected operating results in the past and could adversely affect our financial condition, results of operations and cash flows.

Our products and operations may be subject to increased regulatory and environmental scrutiny in jurisdictions in which we do business. For example, we are subject to regulations relating to our harvesting of peat for our growing media business which has come under increasing regulatory and environmental scrutiny. In the United States, state regulations frequently require us to limit our harvesting and to restore the property to an agreed-upon condition. In some locations, we have been required to create water retention ponds to control the sediment content of discharged water. In Canada, our peat extraction efforts are also the subject of regulation.

In addition to the laws and regulations already described, various governmental agencies regulate the disposal, transport, handling and storage of waste, the remediation of contaminated sites, air and water discharges from our facilities, and workplace health and safety. Under certain environmental laws and regulations, we may be liable for the costs of investigation and remediation of the presence of certain regulated materials or damage to natural resources, at various properties, including current and former properties we have owned or operated, as well as offsite waste handling or disposal sites that we have used. Liability may be imposed upon us without regard to whether we knew of or caused the presence of such materials and, under certain circumstances, on a joint and several basis. There can be no assurances that the presence of such regulated materials at any such locations, or locations that we may acquire in the future, will not result in liability to us under such laws or regulations or expose us to third-party actions such as tort suits based on alleged conduct or environmental conditions.

InRegulatory ~~2021, the Biden Administration announced a multi-agency plan to address PFAS contamination. Various federal~~ agencies, ~~including~~around the ~~U.S.~~world ~~EPA,~~ have ~~and~~been ~~are~~establishing ~~expected~~programs toand ~~continue~~restrictions torelating ~~take actions~~ to ~~prevent~~preventing the release of PFAS into the air, drinking water systems, and food supply and to expand cleanup efforts to remediate the impacts of PFAS pollution. AsIn ~~part of this announcement~~2021, the ~~U.S.~~federal ~~EPA~~government ~~released~~announced ~~its~~a ~~PFAS Strategic Roadmap: EPA’s Commitments to Action 2021~~multi-~~2024,~~agency ~~which~~plan ~~identifies timelines by which the U.S. EPA plans~~ to ~~take~~address ~~specific~~PFAS ~~actions~~contamination ~~during the Biden Administration~~nationwide. ~~For example~~Further, in ~~August~~April ~~2022~~2024, the U.S. EPA ~~proposed~~designated toPFOA ~~designate~~and ~~PFAS chemicals~~PFOS, ~~PFOA~~including their salts and ~~PFOS,~~structural isomers – as hazardous substances under section 102(a) of CERCLA, which could have wide-ranging impact on companies across ~~various~~ industries. ~~Until further detail is provided, including whether the rule is enacted as proposed, we cannot predict the outcome or the severity of the impact of these proposed actions.~~ Further, many states have taken independent action to address PFAS ~~concerns with actions~~ ranging from appropriation ~~legislation~~bills tofor ~~fund~~funding ~~scientific~~ research, to complete bans on ~~certain~~any ~~categories of consumer products~~ PFAS-containing ~~PFAS and/or broad prohibitions on PFAS across all~~ products. Complicating this patchwork of state regulation is that various jurisdictions ~~may~~define ~~differ~~PFAS asdifferently towith ~~what~~some ~~they~~definitions ~~consider~~being ~~PFAS~~comparatively broad. It is possible, therefore, that some of these actions will have an impact – direct or indirect – on our business.

Many states are increasingly scrutinizing packaging, including seeking to reduce single use plastics and establish extended producer responsibility programs, which are designed to bolster the recycling industry by transferring the cost of packaging disposal to the manufacturers. Extended producer responsibility programs typically include targets and reporting responsibilities for, among other things, post-consumer recycling usage, compostable packaging, material reduction and refill strategies.

The adequacy of our current non-FIFRA compliance-related environmental accruals and future provisions depends upon our operating in substantial compliance with applicable environmental and public health laws and regulations, as well as the assumptions that we have both identified the significant sites that must be remediated and that there are no significant conditions of potential contamination that are unknown to us. A significant change in the facts and circumstances underlying these assumptions or in current enforcement policies or requirements, or a finding that we are not in substantial compliance with applicable environmental and public health laws and regulations, could have a material adverse effect on future environmental capital expenditures and other environmental expenses, as well as our financial condition, results of operations and cash flows.

Unanticipated changes in our tax provisions, the adoption of new tax legislation or exposure to additional tax liabilities could affect our profitability and cash flows.

We are subject to income and other taxes in the United States federal jurisdiction and various local, state and foreign jurisdictions. Our effective tax rate in the future could be adversely affected by changes to our operating structure, changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets (such as net operating losses and tax credits) and liabilities, changes in tax laws and the discovery of new information in the course of our tax return preparation process. In particular, the carrying value of deferred tax assets, which are predominantly related to our operations in the United States, is dependent on our ability to generate future taxable income of the appropriate character in the relevant jurisdiction.

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~~From~~Packaging ~~time~~has toalso ~~time,~~become ~~tax~~subject ~~proposals~~to ~~are~~increased ~~introduced~~governmental orscrutiny. Several ~~considered~~states byin the U.S. ~~Congress~~have orenacted ~~the~~legislation ~~legislative~~to ~~bodies~~reduce insingle ~~local,~~use ~~state~~plastics and ~~foreign~~establish ~~jurisdictions~~extended ~~that~~producer ~~could~~responsibility ~~also affect our tax rate~~programs, ~~the~~which ~~carrying value of our deferred tax assets, or our tax liabilities. Our tax liabilities~~ are ~~also~~designed ~~affected~~to bybolster the ~~amounts~~recycling weindustry ~~charge~~by ~~for~~transferring ~~inventory,~~the ~~services,~~cost ~~licenses,~~of ~~funding~~packaging ~~and~~disposal ~~other~~to ~~items~~the ~~in intercompany transactions~~manufacturers. WeExtended ~~are~~producer ~~subject~~responsibility toprograms ~~ongoing~~typically ~~tax~~include ~~audits~~targets inand ~~various~~reporting ~~jurisdictions. In~~responsibilities ~~connection with these audits (or future audits)~~for, ~~tax~~among ~~authorities~~other ~~may disagree with our intercompany charges~~things, ~~cross~~post-~~jurisdictional~~consumer ~~transfer~~recycling ~~pricing~~usage, orcompostable ~~other~~packaging, ~~matters~~material reduction and ~~assess~~refill ~~additional taxes~~strategies. WeSimilar ~~regularly~~extended ~~assess~~producer ~~the~~responsibility ~~likely~~programs ~~outcomes~~are ofactive ~~our audits~~ in ~~order~~several toCanadian ~~determine the appropriateness of our tax provision~~provinces. As a result, the ultimate resolution of our tax audits, changes in tax laws or tax rates, and the ability to utilize our deferred tax assets could materially affect our tax provision, net income and cash flows in future periods.

Unanticipated changes in our tax provisions, the adoption of new tax legislation or exposure to additional tax liabilities could affect our financial condition, results of operations and cash flows.

From time to time, tax proposals are introduced or considered by the U.S. Congress or the legislative bodies in local, state and foreign jurisdictions that could also affect our tax rate, the carrying value of our deferred tax assets or our tax liabilities. Our tax liabilities are also affected by the amounts we charge for inventory, services, licenses, funding and other items in intercompany transactions. We are subject to ongoing tax audits in various jurisdictions. In connection with these audits (or future audits), tax authorities may disagree with our intercompany charges, cross-jurisdictional transfer pricing or other matters and assess additional taxes. We regularly assess the likely outcomes of our audits in order to determine the appropriateness of our tax provision. As a result, the ultimate resolution of our tax audits, changes in tax laws or tax rates and the ability to utilize our deferred tax assets could materially affect our tax provision, net income and cash flows in future periods.

Risks Related to Our Common Shares

The Company’s decision to maintain, reduce or discontinue paying cash dividends to our shareholders or repurchasing our Common Shares could cause the market price for our Common Shares to decline.

Our payment of quarterly cash dividends on and repurchase of our Common Shares pursuant to a stock repurchase program are subject to, among other things, our financial position and results of operations, available cash and cash flow, capital requirements, credit facility provisions and other factors. Prior to fiscal 2022, we generally increased the cash dividends on our Common Shares as well as engaged in share repurchase activity. Since fiscal 2022, we have not changed the dividend amount nor have we engaged in share repurchase activity outside of our compensation programs. As of September 30, ~~2024~~2025, we do not have a board authorized share repurchase program.

We may maintain, or increase or decrease (including eliminating) the amount of cash dividends on, and increase or decrease the amount of repurchases of, our Common Shares in the future. Any decision by us regarding the payment of quarterly cash dividends or repurchases of our Common Shares could cause the market price of our Common Shares to decline. A failure to pay dividends, an inability to resume increases of our cash dividends or an inability to begin repurchasing Common Shares at historical levels could result in a lower market valuation of our Common Shares.

~~Hagedorn Partnership, L.P. beneficially owns approximately 24% of our Common Shares and can significantly influence decisions that require the approval of shareholders.~~22

~~Hagedorn~~Table ~~Partnership, L.P. beneficially owned approximately 24%~~ of ~~our~~Contents outstanding Common Shares as of November 18, 2024. As a result, it has sufficient voting power to significantly influence the election of directors and the approval of other actions requiring the approval of our shareholders, including entering into certain business combination transactions. In addition, because of the percentage of ownership and voting concentration in Hagedorn Partnership, L.P., elections of our Board of Directors will generally be within the control of Hagedorn Partnership, L.P. While all of our shareholders are entitled to vote on matters submitted to our shareholders for approval, the concentration of our Common Shares and voting control presently lies with Hagedorn Partnership, L.P. As such, it would be difficult for shareholders to propose and have approved proposals not supported by Hagedorn Partnership, L.P. Hagedorn Partnership, L.P.’s interests could differ from, or conflict with, the interests of other shareholders.

Hagedorn Partnership, L.P. beneficially owns approximately 23% of our Common Shares and can significantly influence decisions that require the approval of shareholders.

Hagedorn Partnership, L.P. beneficially owned approximately 23% of our outstanding Common Shares as of November 21, 2025. As a result, it has sufficient voting power to significantly influence the election of directors and the approval of other actions requiring the approval of our shareholders, including entering into certain business combination transactions. In addition, because of the percentage of ownership and voting concentration in Hagedorn Partnership, L.P., elections of our Board of Directors will generally be within the control of Hagedorn Partnership, L.P. While all of our shareholders are entitled to vote on matters submitted to our shareholders for approval, the concentration of our Common Shares and voting control presently lies with Hagedorn Partnership, L.P. As such, it would be difficult for shareholders to propose and have approved proposals not supported by Hagedorn Partnership, L.P. Hagedorn Partnership, L.P.’s interests could differ from, or conflict with, the interests of other shareholders.

ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

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ITEM 1C. CYBERSECURITY

Risk Management and Strategy

Cybersecurity risk was identified as a significant enterprise risk based on the results of our most recent enterprise risk assessment. As a significant enterprise risk, ~~management~~we ~~has~~have worked to identify the underlying drivers of cybersecurity risk, identify the activities in place to manage it, and assess its residual risk level. We have developed and implemented comprehensive strategies and processes to assess, identify, manage and mitigate cybersecurity risks, aligning with the National Institute of Standards and Technology Cybersecurity Framework (“NIST- CSF”). These processes include:

•implementing security event monitoring, incident response processes, access management controls, vulnerability identification and remediation, third-party risk monitoring, and user awareness and training;

•providing regular security training and awareness content for all associates, with mandatory training for new hires;

•maintaining cybersecurity risk insurance to mitigate potential breach-related costs;

•engaging consultants to perform periodic external assessments using industry-recognized frameworks like NIST- CSF; and

•monitoring program maturity through periodic reviews against the Capability Maturity Model Integration framework.

Mitigating Risks Posed by Third Parties

Risk Assessments

We identify and categorize existing third-party service providers based on criticality to our operations and prioritize those that pose the highest risks. We leverage a third-party risk management solution to facilitate our risk assessment process for new third parties which includes interviews and questionnaires with internal business contacts and contacts from the third party to perform an inherent risk assessment. We determine applicable security controls based on the inherent risk level to drive the residual risk score to an acceptable level where possible. The goal of the risk assessment process is to evaluate the risks associated with each third party, including operational, financial, legal, and reputational risks.

Ongoing Monitoring

Based on the residual risk score of a third party, we conduct assessments on a periodic basis to help ensure that we maintain current, ~~up-to-date~~ information on our vendors. We leverage an external third-party monitoring service to conduct continuous monitoring of our critical vendors to provide additional visibility and response efforts and work directly with vendors to remediate identified vulnerabilities. Finally, we review contracts that outline risk management responsibilities, compliance requirements, data protection, and incident management protocols.

Incident Management

We have developed an incident response plan that ~~includes~~establishes a process for addressing issues arising from third-party relationships ~~which~~and ~~includes~~ communication channels for reporting and managing incidents involving third parties.

Documentation and Reporting

We maintain detailed records of our third-party assessments and any ~~evidence~~information or documentation that is provided during the assessment process. We regularly review and report on third-party risk management activities and any significant issues to senior management and/or our Audit Committee ~~or Board of Directors~~.

External Resources; Associate Training and Awareness

We have developed a comprehensive information security ~~protocol~~program that relies on support from third-party experts and an internal training and awareness program aligned with industry standards and best practices.

Given the complex and evolving nature of cybersecurity threats, we engage third-party advisors and consultants to assist us in developing and maintaining effective cybersecurity risk management processes. Partnering with these third parties allows us to leverage specialized knowledge and insights, better ensuring our cybersecurity strategies and processes are well-designed and effective. For example, we work with third parties to regularly conduct simulated attack exercises to identify additional needs for training and overall program refinement.

Internally, our training and awareness program creates multi-layered defenses by empowering associates with knowledge and tools to recognize and respond to security risks. Through role-specific and comprehensive training, we seek to maintain a workforce that actively contributes to our cybersecurity goals. Key components of our training program include:24

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Internally, our training and awareness program creates multi-layered defenses by empowering associates with knowledge and tools to recognize and respond to security risks. Through role-specific and comprehensive training, we seek to maintain a workforce that actively contributes to the achievement of our cybersecurity goals. Key components of our training program include:

•Onboarding Training — All new associates participate in an initial cybersecurity training module at onboarding. This training covers the Company’s security policies, data protection standards and foundational security practices helping to ensure that new hires are equipped to meet the Company’s expectations pertaining to its security protocols.

•Articles — We publish articles on our intranet site for all associates to easily access. These articles highlight emerging threats, industry trends, and actionable tips to help associates enhance their personal and professional security posture. We target critical topics such as ransomware, social engineering, data management, and the latest threats and best practices.

•Phishing Simulations — Our phishing awareness program includes continuous phishing simulations conducted on a routine basis. This program helps associates develop the skills to effectively identify and mitigate phishing attempts. Associates who fail a threshold number of simulations during a calendar year are required to undergo additional training.

•Cybersecurity Awareness Month Activities — We have implemented interactive, virtual and on-site awareness activities during Cybersecurity Awareness Month in October. These activities include phishing simulations, articles, lunch and learns, and gamification to serve as refreshers on critical security concepts and reinforce our commitment to maintaining a security-conscious culture.

Governance

Our Board of Directors has overall oversight responsibility for our risk management and has delegated oversight of cybersecurity risks to our Audit Committee, including overseeing the actions management has taken to identify, monitor, and control such exposure. ~~Our~~On a quarterly basis, our Audit Committee reviews the measures implemented by the Company to identify and mitigate data protection and cybersecurity risks ~~on a quarterly basis~~. As part of our continued investment in developing our overall enterprise risk management program, our Audit Committee receives reports and presentations from management which address a range of cybersecurity topics including recent developments, evolving standards, vulnerability assessments, third-party and independent reviews, the threat environment, and technological trends. Our ~~Audit~~Chief ~~Committee~~Information ~~reports~~Security Officer (“CISO”) and information security management team report to our ~~Board~~Audit ofCommittee ~~Directors~~on ata ~~least~~quarterly ~~annually~~basis on cybersecurity matters.

At the management level, our ~~Chief Information Security Officer (“~~CISO”) leads the team responsible for implementing, monitoring, and maintaining information security, including data protection practices across our business. Our CISO receives reports on cybersecurity threats from both our internal personnel and external partners on a regular basis. Our Chief Operating Officer and Chief ~~Administrative~~Financial Officer receive regular reports from our CISO on the ~~cyber~~information security program and measures implemented by the Company to identify and mitigate cybersecurity risks. Our CISO works closely with our ~~Company’s~~ legal team to ensure compliance with legal and regulatory ~~cybersecurity~~ requirements related to cybersecurity. Our CISO has over a decade of cybersecurity and risk management experience and holds CISA, CISM, and CISSP certifications as well as a bachelor’s degree in Business Information Systems.

Cybersecurity Threats and Incidents

To date, ~~risks from~~ cybersecurity ~~threats, including as a result of previous cybersecurity~~ incidents, have not materially affected us, including our business strategy, results of operations, or financial condition. During fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, the Company did not experience any cybersecurity threats or incidents that have materially affected or are reasonably likely to materially affect the Company or its business strategy, results of operations and/or financial condition. Despite our efforts, we cannot eliminate all risks from cybersecurity threats or incidents or provide assurances that we have not experienced undetected cybersecurity incidents. For additional details regarding the risks the Company faces from cybersecurity threats, see “ITEM 1A. RISK FACTORS — Risks Related to Our Business — Our operations, financial condition or reputation may be impaired if our information or operational technology systems fail to perform adequately or if we are the subject of a data breach or cyber- attack” in this Form 10-K.

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ITEM 2. PROPERTIES

Our corporate headquarters is located in Marysville, Ohio, where we own approximately 729 acres of land. In addition, we own and lease numerous industrial, commercial and office properties located in North America, ~~Europe~~ and Asia that support the management, manufacturing, distribution and research and development of our products and services. We believe our properties are suitable and adequate to serve the needs of our business and that our leased properties are subject to appropriate lease agreements.

The following is a summary of owned and leased primary operating properties by country as of September 30, ~~2024~~2025:

Location	Owned	Leased
United States	352	~~553~~483,4
Canada	10115	1311
Mexico	—	1
China	—	65
The Netherlands	—	3
Total	46	65
Total	45	78

We own or lease 45 manufacturing properties, 1612 distribution properties and 4 research and development properties in the United States. We own or lease 1516 manufacturing properties, 1 distribution property and 1 research and development property in Canada, ~~2 manufacturing properties in the Netherlands~~ and 1 research and development property in China. Most of the manufacturing properties, which include growing media properties and peat harvesting properties, have production lines, warehouses, offices and field processing areas.

2 Includes one manufacturing location that is not operational.

3 Includes one manufacturing and one distribution location under development with operations scheduled to begin in fiscal ~~2025~~2026.

4 Includes ~~ten~~five distribution centers that are not operational. Disposition and sublease efforts are underway or in place.

255 Includes one research and development property that is not operational. Disposition efforts are underway.

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ITEM 3. LEGAL PROCEEDINGS

As noted in the discussion in “ITEM 1. BUSINESS — Regulatory Considerations — Regulatory Matters” of this Form 10-K, we are involved in several pending environmental and regulatory matters. We believe that our assessment of contingencies is reasonable and that the related accruals, in the aggregate, are adequate; however, there can be no assurance that the final resolution of these matters will not have a material effect on our financial condition, results of operations or cash flows.

On June 6, 2024, a purported shareholder filed a lawsuit in the United States District Court for the Southern District of Ohio (Case No. 2:24-cv-03132) on behalf of a proposed class of purchasers of Common Shares between November 3, 2021, and August 1, 2023. On July 26, 2024, another purported shareholder filed a lawsuit in the United States District Court for the Southern District of Ohio (Case No. 2:24-cv-03766) on behalf of a proposed class of purchasers of Common Shares between June 2, 2021, and August 1, 2023. ~~These~~The lawsuits, ~~which~~were ~~will~~consolidated ~~likely~~by bethe ~~consolidated~~court ~~with~~as ~~any~~In ~~subsequently~~re The Scotts Miracle-Gro Company Securities Litigation (Case No. 2:24-cv-03132). The amended consolidated complaint was filed ~~lawsuits~~on ~~alleging~~May ~~similar~~9, ~~facts~~2025 on behalf of a proposed class of purchasers of Common Shares between May 5, ~~assert~~2021, and August 1, 2023, and asserts claims under Section 10(b), Rule 10b-5 and Section 20(a) of the ~~Securities~~ Exchange Act against the Company and certain of its current and former officers based on alleged misstatements about the Company’s inventories, sales and business prospects. The ~~actions~~action ~~seek~~seeks, among other things, unspecified monetary damages, reasonable costs and expenses and equitable/injunctive or other relief as deemed appropriate by the Court. The Company believes that the claims asserted are without merit and intends to vigorously defend the ~~actions~~action.

OnBeginning ~~July 3, 2024, a purported shareholder filed a shareholder derivative lawsuit~~ in the United States District Court for the Southern District of Ohio (Case No. 2:24-cv-03636), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors. On July ~~30,~~ 2024, ~~a second~~ purported ~~shareholder~~shareholders filed a ~~shareholder~~series ~~derivative lawsuit in the United States District Court for the Southern District~~ of ~~Ohio (Case No.1:24-cv-00402), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors. On August 23, 2024, a third purported~~ shareholder ~~filed a shareholder~~ derivative ~~lawsuit~~lawsuits in ~~the~~state ~~United States District Court for the Southern District of Ohio (Case No. 2:24-cv-03880), purportedly on behalf of the Company against certain of the Company’s current~~ and ~~former~~federal ~~officers~~courts ~~and directors. On September 9, 2024, a fourth purported shareholder filed a shareholder derivative lawsuit~~ in ~~the Union County (~~Ohio) ~~Court of Common Pleas (Case No. 24CV0193), purportedly on behalf of the Company~~ against certain of the Company’s current and former ~~officers and~~ directors~~. On~~ September 26, 2024, a fifth purported shareholder filed a shareholder derivative lawsuit in the Union County (Ohio) Court of Common Pleas (Case No. 24CV0203), purportedly on behalf of the Company against certain of the Company’s current and ~~former~~ officers ~~and directors~~. On November 19, 2024, a sixth purported shareholder filed a shareholder derivative lawsuit in the United States District Court for the Southern District of Ohio (Case No. 2:24-cv-04180), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors. On November 22, 2024, a seventh purported shareholder filed a shareholder derivative lawsuit in the United States District Court for the Southern District of Ohio (Case No. 2:24-cv-04190), purportedly on behalf of the Company against certain of the Company’s current and former officers and directors. The ~~federal~~ lawsuits will likely be consolidated with one another, along with any subsequently filed federal lawsuits alleging similar facts, and the state court lawsuits will likely be consolidated with one another, along with any subsequently filed state lawsuits alleging similar facts. All of the lawsuits include allegations that generally mirror those asserted in the securities lawsuits described above and assert claims for ~~breaches~~breach of fiduciary duties, ~~and~~ unjust enrichment, ~~as well as~~ abuse of control, gross mismanagement, and waste of corporate assets. The federal lawsuits also assert claims under ~~Section 10(b), Rule 10b-5, Section 14(a), Rule 14a-9, and Section 20(a) of~~ the ~~Securities~~ Exchange Act~~, and contribution under Sections 10(b) and 21D of the Securities Exchange Act~~. The actions seek a judgment in favor of the Company for ~~damages in an~~ unspecified ~~amount~~damages, disgorgement, interest, and costs and expenses, including attorneys’ and experts’ fees.

The Company has been named as a defendant in a number of cases alleging injuries that the lawsuits claim resulted from exposure to asbestos-containing products, apparently based on the Company’s historic use of vermiculite in certain of its products. In many of these cases, the complaints are not specific about the plaintiffs’ contacts with the Company or its products. The cases vary, but complaints in these cases generally seek unspecified monetary damages (actual, compensatory, consequential and punitive) from multiple defendants. The Company believes that the claims against it are without merit and is vigorously defending against them. The Company has not recorded any accruals in its consolidated financial statements as the likelihood of a loss from these cases is not probable at this time. The Company does not believe a reasonably possible loss would be material to the Company’s financial condition, results of operations or cash flows. In addition, the Company does not believe the ultimate resolution of these cases will have a material adverse effect on the Company’s financial condition, results of operations or cash flows. There can be no assurance that future developments related to pending claims or claims filed in the future, whether as a result of adverse outcomes or as a result of significant defense costs, will not have a material effect on the Company’s financial condition, results of operations or cash flows.

We are involved in other lawsuits and claims which arise in the normal course of our business ~~including~~relating ~~the~~to ~~initiation~~advertising ~~and~~claims, ~~defense~~securities ofmatters, ~~proceedings~~employment todisputes ~~protect~~and ~~intellectual~~the ~~property~~enforcement ~~rights,~~and ~~advertising~~defense ~~claims,~~of ~~securities~~intellectual ~~matters~~property ~~and employment disputes~~rights. In our opinion, these claims individually and in the aggregate are not expected to have a material adverse effect on our financial condition, results of operations or cash flows.

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ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II

SUPPLEMENTAL ITEM. EXECUTIVE OFFICERS OF THE REGISTRANT

The executive officers of Scotts Miracle-Gro, their positions and, as of November 2019, ~~2024~~2025, their ages and years with Scotts Miracle-Gro (and its predecessors) are set forth below.

Name	Age	Position(s) Held	Years withCompany
James Hagedorn	6970	Chairman & Chief Executive Officer	3738
Nathan E. Baxter	5253	President & Chief Operating Officer	12
Matthew E. Garth	50	Executive Vice President, Chief Financial Officer & Chief Administrative Officer	2
Mark J. Scheiwer	50	Executive Vice President, Chief Financial Officer & Chief Accounting Officer	14
Christopher J. Hagedorn	4041	Executive Vice President & Chief of Staff	1314
Dimiter Todorov	5253	Executive Vice President, Chief Legal Officer & Corporate Secretary	1617

Executive officers serve at the discretion of the Board of Directors of Scotts Miracle-Gro and pursuant to executive severance agreements or other arrangements. The business experience of each of the individuals listed above during at least the past five years is as follows:

Mr. Hagedorn was named Chairman of the Board of Scotts Miracle-Gro’s predecessor in January 2003 and Chief Executive Officer of Scotts Miracle-Gro’s predecessor in May 2001. Prior to these appointments, Mr. Hagedorn held several senior leadership positions at the Company including President from October 2023 until November 2024. Mr. Hagedorn serves on Scotts Miracle-Gro’s Board of Directors, a position he has held with Scotts Miracle-Gro (or its predecessor) since 1995. Mr. Hagedorn is the brother of Katherine Hagedorn Littlefield, a director of Scotts Miracle-Gro, and is the father of Christopher J. Hagedorn, an executive officer of the Company. Mr. Hagedorn is a general partner of the Hagedorn Partnership, L.P., the largest shareholder of the Company.

Mr. Baxter was named ~~Executive Vice~~ President & Chief Operating Officer of Scotts Miracle-Gro in ~~August 2023 and President in~~ November 2024. Prior to ~~August~~this ~~2023~~appointment, Mr. Baxter served as Executive Vice President & Chief Operating Officer from August 2023 until November 2024 and Executive Vice President, Technology & Operations, afrom ~~position~~April he2023 ~~held~~until ~~since~~August ~~April~~ 2023. Previously, Mr. Baxter served as President of Tokyo Electron U.S. Holdings, a semiconductor manufacturing equipment company. Mr. Baxter is a general partner of the Hagedorn Partnership, L.P., the largest shareholder of the Company.

Mr. ~~Garth~~Scheiwer was named Executive Vice President, Chief Financial Officer & Chief ~~Administrative~~Accounting Officer of Scotts Miracle-Gro in ~~October~~May ~~2023~~2025. Prior to this appointment, Mr. ~~Garth~~Scheiwer served as ~~Executive~~Interim ~~Vice~~Chief ~~President~~Financial Officer & Chief ~~Financial~~Accounting Officer, afrom ~~position~~January he2025 ~~held~~until ~~since~~May ~~December 2022~~2025. Previously, Mr. ~~Garth~~Scheiwer served as ~~Senior~~ Vice President, ~~Finance~~Corporate ~~and~~Treasurer ~~Treasury,~~& ~~and~~Assistant ~~Chief~~Secretary ~~Financial~~from ~~Officer~~October ~~for~~2023 ~~Mineral~~until ~~Technologies~~January ~~Inc.,~~2025; aVice ~~specialty~~President ~~mineral~~and ~~company.~~Corporate ~~Mr.~~Treasurer ~~Garth~~from ~~will~~December be2022 ~~departing~~until ~~the~~October ~~Company~~2023; ~~effective~~Vice ~~December~~President, 31Finance Lead, ~~2024.~~Hawthorne ~~For~~from ~~additional~~January ~~information~~2021 ~~regarding~~until ~~this~~December ~~departure,~~2022; ~~see~~and ~~“ITEM~~Vice ~~9B.~~President, ~~OTHER~~Corporate ~~INFORMATION”~~Controller, offrom ~~this~~December ~~Form~~2018 ~~10-K~~until January 2021.

Mr. C. Hagedorn was named Executive Vice President & Chief of Staff of Scotts Miracle-Gro in November 2024. Prior to this appointment, Mr. C. Hagedorn served as Division President ~~of Scotts Miracle-Gro~~ from January 2021 ~~through~~until November 2024. Previously, Mr. C. Hagedorn served as Senior Vice President & General Manager, Hawthorne, afrom ~~position~~January he2017 ~~held~~until ~~since~~ January ~~2017~~2021. Mr. C. Hagedorn is the son of Mr. Hagedorn, the Chairman & Chief Executive Officer, ~~President & Chairman~~ of ~~the Board of~~ Scotts Miracle-Gro.

Mr. Todorov was named Executive Vice President, Chief Legal Officer & Corporate Secretary of Scotts Miracle-Gro in November 2024. Prior to this appointment, Mr. Todorov served as Executive Vice President, General Counsel, Corporate Secretary & Chief Ethics and Compliance Officer offrom ~~Scotts~~October ~~Miracle-Gro,~~2024 auntil ~~position~~November he2024. Previously, ~~held~~Mr. ~~since~~Todorov ~~October~~served ~~2024,~~as ~~and~~ Executive Vice President, General Counsel, Corporate Secretary & Chief Compliance Officer, afrom ~~position he held since~~ December 2022~~. Previously,~~ ~~Mr.~~until ~~Todorov~~October ~~served~~2024 asand Vice President, Legal, afrom ~~position~~June he2015 ~~held~~until ~~since~~December ~~June 2015~~2022.

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ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

The Common Shares trade on the New York Stock Exchange under the symbol “SMG.” The payment of future dividends, if any, on the Common Shares will be determined by the Board of Directors in light of conditions then existing, including the Company’s earnings, financial condition and capital requirements, restrictions in financing agreements, business conditions and other factors.

~~Amendment~~The ~~No.~~Seventh ~~2 to the Sixth~~ A&R Credit Agreement ~~(“Amendment~~allows ~~No. 2”) limits~~ the Company’s ~~ability~~ to ~~declare~~make orunlimited ~~pay any discretionary dividends, distributions or other~~ restricted payments to(as ~~only~~defined in the ~~payment~~Seventh ofA&R (iCredit Agreement), ~~regularly~~including ~~scheduled~~dividend ~~cash~~payments ~~dividends~~on, toand ~~holders~~repurchases of, ~~its~~ Common Shares, inas anlong ~~aggregate~~as ~~amount~~the ~~not~~leverage toratio ~~exceed~~resulting ~~$225.0~~from ~~million~~the ~~per~~making ~~fiscal~~of ~~year~~such ~~and~~restricted ~~(ii)~~payments ~~other~~is ~~dividends~~4.00 or less. Otherwise, ~~distributions~~the orCompany is limited to restricted payments in an aggregate amount for each fiscal year not to exceed $25225.0 million.

On September 4, 2024, September 13, 2023 and December 14, 2022, Scotts Miracle-Gro issued 286,204, 373,831 and 388,878 Common Shares, respectively, with each issuance having a contractual value of $20.0 million ~~each~~, to a vendor who is an accredited investor as consideration for advertising services. ~~The~~These issuances of ~~the~~ Common Shares were exempt from the registration requirements of the Securities Act of 1933, as amended, pursuant to Section 4(a)(2). Scotts Miracle-Gro issued the Common Shares in privately negotiated transactions, and such restricted shares were acquired for the recipient’s account for investment purposes.

As of November 1821, ~~2024~~2025, there were approximately ~~226~~141,000 shareholders, including holders of record and our estimate of beneficial holders.

The following table shows the purchases of Common Shares made by or on behalf of Scotts Miracle-Gro or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the ~~Securities~~ Exchange Act ~~of 1934, as amended~~) of Scotts Miracle-Gro for each of the three fiscal months in the quarter ended September 30, ~~2024~~2025:

Period	Total Number ofCommon SharesPurchased(1)	Average PricePaid perCommon Share(2)		Total Number of Common SharesPurchased asPart of PubliclyAnnounced Plans orPrograms(3)	Approximate DollarValue of Common SharesThat May Yet BePurchased Under thePlans or Programs(3)
June 30, 2024 through July 27, 2024	1,295	$	70.29	—	N/A
June 29, 2025 through July 26, 2025	—	$	—	—	N/A
July 28, 2024 through August 24, 2024	—	$	—	—	N/A
July 27, 2025 through August 23, 2025	1,319	$	69.42	—	N/A
August 25, 2024 through September 30, 2024	2,350	$	77.46	—	N/A
August 24, 2025 through September 30, 2025	3,076	$	59.35	—	N/A
Total	34,~~645~~395	$	7462.9137	—

(1)All of the Common Shares purchased during the fourth quarter of fiscal ~~2024~~2025 were purchased in open market transactions. The Common Shares purchased during the quarter consisted of 34,~~645~~395 Common Shares purchased by the trustee of the rabbi trust established by the Company as permitted pursuant to the terms of The Scotts Company LLC Executive Retirement Plan.

(2)The average price paid per Common Share is calculated on a settlement basis and includes commissions.

(3)~~On February 6, 2020, the Company announced a repurchase program allowing for repurchases of up to $750.0 million of Common Shares from April 30, 2020 through March 25, 2023.~~ The ~~program expired on March 25, 2023 and, as of September 30, 2024, the~~ Company does not have an active repurchase program.

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Comparison of Cumulative Five-Year Total Return*

The following graph compares the yearly change in the cumulative total stockholder return on our Common Shares for the past five fiscal years with the cumulative total return of the Russell 2000 Index and the S&P 500 Household Products Index.

ITEM 6. RESERVED

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The purpose of this Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is to provide an understanding of our financial condition and results of operations by focusing on changes in certain key measures from year-to-year. This MD&A includes the following sections:

•Executive summary

•Results of operations

•Segment results

•Liquidity and capital resources

•Regulatory matters

•Critical accounting estimates

Executive Summary

~~Our operations are divided into three reportable segments:~~ U.S. Consumer, ~~Hawthorne and Other. U.S. Consumer~~ consists of our consumer lawn and garden business in the United States. Hawthorne consists of our indoor and hydroponic gardening business. Other primarily consists of our consumer lawn and garden business in Canada. ~~This division of reportable segments is consistent with how the segments report to and are managed by our chief operating decision maker. In addition,~~ Corporate consists of general and administrative expenses and certain other income and expense items not allocated to the ~~business~~operating segments. See “SEGMENT RESULTS” below for additional information regarding our evaluation of segment performance.

Through our U.S. Consumer and Other segments, we are the leading ~~manufacturer and~~ marketer of branded consumer lawn and garden products in North America. Our products are marketed under some of the most recognized brand names in the industry. Our key consumer lawn and garden brands include Scotts® Turf Builder® lawn fertilizer and Scotts® grass seed products; Miracle-Gro® soil, plant food and gardening products; Ortho® herbicide and pesticide products; and Tomcat® rodent control and animal repellent products. We are the exclusive agent of Monsanto for the marketing and distribution of certain of Monsanto’s consumer Roundup® branded products within the United States and certain other specified countries. In addition, we have an equity interest in Bonnie Plants, LLC, a joint venture with AFC, focused on planting, growing, developing, distributing, marketing and selling live plants.

As a leading consumer branded lawn and garden company, our product development and marketing efforts are largely focused on providing innovative and differentiated products and continually increasing brand and product awareness to inspire consumers to create retail demand. We have implemented this model for a number of years by focusing on research and development, advertising and ~~investing~~consumer ~~approximately 3-5%~~activation ofprograms with our ~~U.S.~~customers ~~Consumer segment annual net sales in advertising~~ to support and promote our consumer lawn and garden products and brands. We continually explore new and innovative ways to communicate with consumers. We believe that we receive a significant benefit from these expenditures and we anticipate acontinued ~~similar~~growth ~~commitment~~in tothese ~~research and development, advertising and marketing~~ investments in the future, with the continuing objective of driving category growth and profitably maintaining and/or increasing market share.

Our consumer lawn and garden ~~net~~business ~~sales~~ in any ~~one~~ year ~~are~~is susceptible to weather conditions in the markets in which our products are sold. ~~For~~These ~~instance,~~climate ~~periods~~conditions ofmay ~~abnormally wet or dry weather can~~ adversely impact the sale of certain products, ~~while~~or ~~increasing~~increase demand for other products thereby making the overall impact of abnormal or extreme weather conditions on us difficult to predict. We believe that our diversified product line and our geographic diversification reduce this risk, although to a lesser extent in a year in which unfavorable weather is geographically widespread and extends across a significant portion of the lawn and garden season. We also believe that weather conditions in any one year, positive or negative, do not materially impact longer-term category growth trends.

30Due to the seasonal nature of the consumer lawn and garden business, significant portions of our U.S. Consumer and Other segment net sales ship to our retail customers during our second and third fiscal quarters, as noted in the following table. Our annual net sales are further concentrated in the second and third fiscal quarters by retailers who rely on our ability to deliver products closer to when consumers buy our products.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

Due to the seasonal nature of the consumer lawn and garden business, significant portions of our U.S. Consumer and Other segment net sales ship to our retail customers during our second and third fiscal quarters, as noted in the following table. Our annual net sales are further concentrated in the second and third fiscal quarters by retailers who rely on our ability to deliver products closer to when consumers buy our products. Our Hawthorne segment is also impacted by seasonal sales patterns for certain product categories due to the timing of growing patterns in North America during our second and third fiscal quarters, and the timing of certain controlled agricultural lighting project sales during our third and fourth fiscal quarters.


	Percent of Net Sales by Quarter
	2025		2024		2023
First Quarter	12.2	%	11.6	%	14.8	%
Second Quarter	41.6	%	42.9	%	43.2	%
Third Quarter	34.8	%	33.8	%	31.5	%
Fourth Quarter	11.4	%	11.7	%	10.5	%

	Percent of Net Sales from Continuing Operations by Quarter
	2024		2023		2022
First Quarter	11.6	%	14.8	%	14.4	%
Second Quarter	42.9	%	43.2	%	42.8	%
Third Quarter	33.8	%	31.5	%	30.2	%
Fourth Quarter	11.7	%	10.5	%	12.6	%

Management focuses on a variety of key indicators and operating metrics to monitor the financial condition and performance of the continuing operations of our business. These metrics include consumer purchases (point-of-sale data), market share, category growth, e-commerce penetration, household penetration, net sales (including unit volume, mix, pricing and other drivers), gross margins, advertising to net sales ratios, income (loss) from operations, net income (loss), earnings per share, earnings before interest, taxes, depreciation and amortization (“EBITDA”), leverage ratio, fixed charge coverage ratio and interest coverage ratio. We also focus on measures to optimize cash flow and return on invested capital, including the management of working capital and capital expenditures.

~~Management~~Trends ~~focuses~~Affecting ~~on a variety of key indicators and operating metrics to monitor the financial condition and performance of the continuing operations of~~ our business. These metrics include consumer purchases (point-of-sale data), market share, category growth, net sales (including unit volume, mix, pricing and foreign exchange movements), gross margins, advertising to net sales ratios, income (loss) from operations, net income (loss), earnings per share, earnings before interest, taxes, depreciation and amortization (“EBITDA”), leverage ratio, fixed charge coverage ratio and interest coverage ratio. We also focus on measures to optimize cash flow and return on invested capital, including the management of working capital and capital expenditures. Business

~~Recent~~During ~~Events~~fiscal 2025, our Hawthorne segment continued to experience decreased sales volume. This was partially attributable to an oversupply of cannabis, which has led to a prolonged period of lower cannabis wholesale prices, reduced indoor and outdoor cannabis cultivation and consolidation of retail establishments. The oversupply has been driven by increased licensing activity across the U.S. as well as inconsistent approaches to state regulation and enforcement. We expect that the oversupply of cannabis will continue to adversely impact our Hawthorne segment. If the oversupply of cannabis persists longer, or is more significant than we expect, our results of operations could be materially and adversely impacted for a longer period and to a greater extent than we currently anticipate.

During fiscal ~~2022~~2024, weour ~~began~~Hawthorne ~~implementing~~segment adiscontinued ~~series~~distribution of ~~Company-wide~~other ~~organizational~~companies’ ~~changes~~products ~~and~~in ~~initiatives~~order ~~intended~~ to ~~create~~shift ~~operational~~its ~~and~~focus ~~management-level~~solely ~~efficiencies. As~~to ~~part of this restructuring initiative~~marketing, weinnovating ~~reduced the size of our supply chain network, reduced staffing levels~~ and ~~implemented~~supporting ~~other~~its ~~cost-reduction~~portfolio ~~initiatives. We also accelerated the reduction~~ of ~~certain~~signature ~~Hawthorne inventory, primarily lighting, growing environments and hardware products, to reduce our on hand inventory to align with the reduced network capacity~~brands. ~~These~~The ~~efforts~~discontinuation ~~have~~of ~~delivered~~sales ~~run-rate annualized savings~~ of ~~more~~other ~~than~~companies’ ~~$300.0,~~products ~~which~~ has ~~increased~~resulted ~~our gross margin rate and lowered SG&A. During fiscal 2024, we incurred costs of $83.5~~ in ~~the~~lower ~~“Cost of~~ sales~~—impairment,~~ ~~restructuring~~volume ~~and~~when ~~other”~~compared ~~line and $6.0 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations associated with this restructuring initiative primarily related~~ to ~~inventory~~historical ~~write-down charges~~periods, ~~employee~~but ~~termination~~has ~~benefits,~~enabled ~~facility~~continued ~~closure~~optimization ~~costs and impairment~~ of ~~right-of-use~~Hawthorne’s ~~assets,~~operations ~~intangible assets, property, plant~~ and ~~equipment~~improvement ~~and software. Costs incurred from the inception~~ of ~~this~~its ~~restructuring initiative through September 30, 2024 were $383~~profitability.~~5. Future costs associated with this restructuring initiative are not expected to be material.~~

~~During~~We ~~fiscal~~continue ~~2024, our Hawthorne segment continued~~ to ~~experience~~monitor ~~adverse~~the ~~financial~~impacts ~~results primarily due to decreased sales volume. The decrease in sales volume is attributable to an oversupply~~ of ~~cannabis~~macroeconomic conditions, ~~which~~including ~~has~~elevated ~~led~~interest torates aand ~~prolonged~~the ~~period~~impact of ~~lower~~inflationary ~~cannabis~~pressures ~~wholesale~~on ~~prices~~input ~~and~~costs ~~reduced indoor~~ and ~~outdoor~~consumer ~~cannabis~~behavior; ~~cultivation. The~~as ~~oversupply~~well ~~has~~as ~~been~~geopolitical ~~driven~~uncertainty, byincluding ~~increased licensing activity across~~ the ~~U.S.~~duration and ~~significant~~resolution ~~capital~~of ~~investment~~ongoing inconflicts, ~~the~~potential ~~cannabis~~escalation ~~production~~of ~~marketplace~~tensions ~~over~~and ~~the~~global ~~past~~supply ~~several~~chain ~~years, as well as inconsistent enforcement of regulations~~disruptions. We ~~expect~~are ~~that~~also ~~the~~continuing ~~oversupply~~to ofmonitor ~~cannabis~~ongoing ~~will~~changes ~~continue~~ to ~~adversely~~global ~~impact~~trade ~~our~~policies, ~~Hawthorne~~including ~~segment. If~~ the ~~oversupply~~imposition of ~~cannabis~~tariffs. The ~~persists~~impact ~~longer,~~that orthese isevents ~~more~~and ~~significant~~conditions ~~than~~will wehave ~~expect,~~on our ~~results~~operational ofand ~~operations~~financial ~~could~~performance bewill ~~materially~~depend ~~and~~on ~~adversely~~future ~~impacted~~developments, ~~for~~which aare ~~longer~~difficult ~~period and~~ to ~~a greater extent than we currently anticipate~~predict.

During fiscal 2024, our Hawthorne segment announced a strategic partnership with BFG Supply (“BFG”), a leading national horticultural and agricultural product distributor, under which BFG will distribute Hawthorne’s proprietary Signature brand cultivation supplies and solutions. Our Hawthorne segment also announced it is discontinuing the distribution of other companies’ products and shifting its focus solely to marketing, innovating and supporting its portfolio of Signature brands, including General Hydroponics®, Gavita®, Botanicare®, Gro Pro®, Mother Earth®, Grower’s Edge®, HydroLogic Purification System® and CYCO®. We expect the discontinuation of sales of other companies’ products will decrease the sales volume of our Hawthorne segment in future periods, but will enable continued optimization of its operations and improvement of its profitability. 32

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

During fiscal 2024, we continued to experience the impacts of cost inflation and uncertain macroeconomic and geopolitical conditions (including the ongoing conflicts in Ukraine and the Middle East), resulting in persistently high manufacturing costs, elevated interest rates and volatile commodity costs. Higher costs over the past several years required us to implement significant price increases across our business in fiscal 2022 and fiscal 2023, and we implemented targeted price reductions on certain products during fiscal 2024. We expect inflationary headwinds, volatile commodity costs and elevated interest rates to continue. The impact that these trends will continue to have on our operational and financial performance will depend on future developments, including inflationary, macroeconomic and geopolitical conditions, and their potential impact on consumer behavior, which are difficult to predict.

During fiscal 2024, we recorded a non-cash, pre-tax other-than-temporary impairment charge of $64.6 related to our convertible debt investments in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations. Refer to “NOTE 16. FAIR VALUE MEASUREMENTS” of the Notes to the Consolidated Financial Statements included in this Form 10-K for more information regarding convertible debt investments. In addition, we recorded pre-tax impairment charges of $61.9 associated with our investment in Bonnie Plants, LLC in the “Equity in loss of unconsolidated affiliates” line in the Consolidated Statements of Operations during fiscal 2024. Refer to “NOTE 8. INVESTMENT IN UNCONSOLIDATED AFFILIATES” of the Notes to the Consolidated Financial Statements included in this Form 10-K for more information regarding our investment in Bonnie Plants, LLC.

Results of Operations

The following table sets forth the components of earnings as a percentage of net sales:

	Year Ended September 30,
	2024		% of Net Sales		2023		% of Net Sales		2022		% of Net Sales
	2025		% of Net Sales		2024		% of Net Sales		2023		% of Net Sales
Net sales	$	3,~~552~~413.71	100.0	%	$	3,~~551~~552.37	100.0	%	$	3,~~924~~551.13	100.0	%
Cost of sales	2,~~618~~348.76		7368.78		2,~~708~~618.37		7673.37		2,~~891~~708.13		7376.73
Cost of sales—impairment, restructuring and other	8320.53		20.46		~~185~~83.75		5.2.4		~~160~~185.17		45.12
Gross margin	~~850~~1,044.52		2330.96		~~657~~850.35		1823.59		~~872~~657.93		2218.25
Operating expenses:
Selling, general and administrative	~~559~~603.04		1517.7		~~551~~559.30		15.57		~~613~~551.03		15.65
Impairment, restructuring and other	6263.84		1.89		~~280~~62.58		71.98		~~693~~280.15		~~17.~~7.9
Other (income) expense, net	1918.98		0.6		(019.1)9		—0.6		(0.81)		—
Income (loss) from operations	~~208~~358.86		510.95		~~(174~~208.4)8		(45.9)		(~~434~~174.04)		(114.19)
Equity in loss of unconsolidated affiliates	682.18		10.91		~~101~~68.1		21.89		12101.91		02.38
Interest expense	~~158~~128.8		43.58		~~178~~158.18		54.05		~~118~~178.1		35.0
Other non-operating (income) expense, net	5.53		0.2		(05.3)5		—0.2		(60.93)		~~(0.2)~~—
Loss before income taxes	(23.6)		(0.7)		(453.3)		(12.8)		(558.1)		(14.2)
Income (loss) before income taxes	221.7		6.5		(23.6)		(0.7)		(453.3)		(12.8)
Income tax expense (benefit)	1176.35		02.32		~~(73~~11.2)3		(20.1)3		(~~120~~73.62)		(32.1)
Net loss	$	(34.9)	(1.0)	%	$	(380.1)	(10.7)	%	$	(437.5)	(11.1)	%
Net income (loss)	$	145.2	4.3	%	$	(34.9)	(1.0)	%	$	(380.1)	(10.7)	%

The sum of the components may not equal due to rounding.

Net Sales

Net sales for fiscal ~~2024~~2025 were $3,~~552~~413.71, asa ~~compared~~decrease toof 3.9% from net sales of $3,~~551~~552.37 for fiscal ~~2023~~2024. Net sales for fiscal ~~2023~~2024 ~~decreased~~were ~~9.5%~~flat ~~from~~to net sales of $3,~~924~~551.13 for fiscal ~~2022~~2023. Factors contributing to the change in net sales are outlined in the following table:

	Year Ended September 30,
	2024		2023
	2025		2024
Volume and mix	1(3.13)	%	~~(14~~1.3)1	%
Foreign exchange rates	—		(0.4)
Pricing	(0.6)		(1.1)
Pricing	(1.1)		5.0
Change in net sales	(3.9)	%	—	%
Acquisitions	—		0.2
Change in net sales	—	%	(9.5)	%

32The decrease in net sales for fiscal 2025 as compared to fiscal 2024 was primarily driven by:

~~Table~~•decreased net sales of ~~Contents~~2.1% included within “volume and mix” related to nonrecurring fiscal 2024 sales of bulk raw materials and AeroGarden® products in our U.S. Consumer segment and the discontinuation of sales of other companies’ products in our Hawthorne segment;

~~THE~~•decreased ~~SCOTTS~~sales ~~MIRACLE-GRO~~volume ~~COMPANY~~of 1.0% comprised of the net impact of lower volume in our Hawthorne segment driven by all product categories, partially offset by higher volume in our U.S. Consumer segment driven by soils, mulch, grass seed and spreader products; and

~~(Dollars~~•decreased pricing, primarily driven by additional investments in ~~millions,~~consumer ~~except~~activation ~~per~~activities ~~share~~in ~~data)~~our U.S. Consumer segment.

Net sales for fiscal 2024 as compared to fiscal 2023 were primarily driven by the offsetting changes below:

•increased sales volume, comprised of the net impact of higher volume in our U.S. Consumer segment driven by mulch, soils and controls products, partially offset by lower volume in our Hawthorne segment driven by the discontinuation of sales of other companies’ products; and

•increased net sales associated with the Roundup® marketing agreement;

•offset by decreased pricing in our U.S. Consumer, Hawthorne and Other segments.

~~The decrease in net sales for fiscal 2023 as compared to fiscal 2022 was primarily driven by:~~33

~~•decreased~~Table ~~sales~~of volume across all segments driven by growing environments, growing media, hardware, nutrients and lighting products in our Hawthorne segment; and lawn care, plant food and controls products in our U.S. Consumer segment; and Contents

~~•the~~THE ~~unfavorable~~SCOTTS ~~impact~~MIRACLE-GRO ~~of foreign exchange rates as a result of the strengthening of the U.S. dollar relative to the Canadian dollar;~~COMPANY

~~•partially~~(Dollars ~~offset by increased pricing~~ in ~~our U.S. Consumer~~millions, ~~Hawthorne~~except ~~and~~per ~~Other~~share ~~segments.~~data)

Cost of Sales

The following table shows the major components of cost of sales:

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Materials	$	1,~~401~~179.7	$	1,~~524~~401.17	$	1,~~616~~524.71
Manufacturing labor and overhead	~~610~~591.81		~~545~~610.48		~~546~~545.4
Distribution and warehousing	~~515~~490.08		~~556~~515.30		~~660~~556.13
Costs associated with Roundup® marketing agreement	9187.20		8291.52		6782.95
Cost of sales	2,~~618~~348.76		2,~~708~~618.37		2,~~891~~708.13
Cost of sales—impairment, restructuring and other	8320.53		~~185~~83.75		~~160~~185.17
	$	2,~~702~~368.29	$	2,~~894~~702.02	$	32,~~051~~894.20

Factors contributing to the change in cost of sales are outlined in the following table:

	Year Ended September 30,
	2024		2023
	2025		2024
Volume, mix and other	$	(71197.46)	$	(~~299~~71.74)
Material cost changes	(2664.62)		~~112~~(26.76)
Foreign exchange rates	(0.3)		(10.4)
Costs associated with Roundup® marketing agreement	(4.2)		8.7
Costs associated with Roundup® marketing agreement	8.7		14.6
Foreign exchange rates	(4.1)		(0.3)
	(89.6)		(182.8)
	(270.1)		(89.6)
Impairment, restructuring and other	(~~102~~63.2)		25(102.62)
Change in cost of sales	$	(~~191~~333.83)	$	(~~157~~191.28)

The decrease in cost of sales for fiscal 2025 as compared to fiscal 2024 was primarily driven by:

•lower material costs in our U.S. Consumer segment;

•lower sales volume in our Hawthorne segment;

•nonrecurring fiscal 2024 sales of bulk raw materials and AeroGarden® products in our U.S. Consumer segment and the discontinuation of sales of other companies’ products in our Hawthorne segment;

•lower warehousing and transportation costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments;

•lower manufacturing costs included within “volume, mix and other” in our U.S. Consumer, Hawthorne and Other segments;

•lower inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment; and

•a decrease in impairment, restructuring and other charges;

•partially offset by higher sales volume in our U.S. Consumer segment.

The decrease in cost of sales for fiscal 2024 as compared to fiscal 2023 was primarily driven by:

•lower warehousing and transportation costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments;

•lower material costs in our U.S. Consumer segment;

•lower sales volume in our Hawthorne segment; and

•a decrease in impairment, restructuring and other charges;

•partially offset by higher sales volume in our U.S. Consumer segment;

•inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment; and

33•an increase in costs associated with the Roundup® marketing agreement.

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•an increase in costs associated with the Roundup® marketing agreement.

The decrease in cost of sales for fiscal 2023 as compared to fiscal 2022 was primarily driven by:

•lower sales volume in our U.S. Consumer, Hawthorne and Other segments;

•lower warehousing costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments; and

•the favorable impact of foreign exchange rates as a result of the strengthening of the U.S. dollar relative to the Canadian dollar;

•partially offset by higher material costs in our U.S. Consumer, Hawthorne and Other segments;

•higher manufacturing costs, primarily labor, included within “volume, mix and other” in our U.S. Consumer, Hawthorne and Other segments;

•inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment;

•an increase in costs associated with the Roundup® marketing agreement; and

•an increase in impairment, restructuring and other charges.

Gross Margin

As a percentage of net sales, our gross margin rate was 2330.96%, 1823.59% and 2218.25% for fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively. Factors contributing to the change in gross margin rate are outlined in the following table:

	Year Ended September 30,
	2024		2023
	2025		2024
Volume, mix and other	23.45	%	(42.0)4	%
Material costs	01.79		(30.3)7
Roundup® commissions and reimbursements	0.31		(0.3)
Pricing	(0.86)		5.(0.8)
	2.6		(2.6)
	4.9		2.6
Impairment, restructuring and other	21.8		(12.1)8
Change in gross margin rate	56.47	%	(35.7)4	%

The increase in gross margin rate for fiscal 2025 as compared to fiscal 2024 was primarily driven by:

•lower material costs in our U.S. Consumer segment;

•favorable mix associated with our U.S. Consumer and Hawthorne segments;

•lower warehousing and transportation costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments;

•lower manufacturing costs included within “volume, mix and other” in our U.S. Consumer, Hawthorne and Other segments;

•lower inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment; and

•a decrease in impairment, restructuring and other charges;

•partially offset by decreased pricing, primarily driven by additional investments in consumer activation activities in our U.S. Consumer segment; and

•unfavorable leverage of fixed costs, included within “volume, mix and other” driven by lower sales volume in our Hawthorne segment.

The increase in gross margin rate for fiscal 2024 as compared to fiscal 2023 was primarily driven by:

•lower warehousing and transportation costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments;

•favorable mix driven by lower sales in our Hawthorne segment relative to our U.S. Consumer segment;

•lower material costs in our U.S. Consumer segment; and

•a decrease in impairment, restructuring and other charges;

•partially offset by decreased pricing in our U.S. Consumer, Hawthorne and Other segments; and

•inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment.

~~The decrease in gross margin rate for fiscal 2023 as compared to fiscal 2022 was primarily driven by:~~ 35

•higher material costs in our U.S. Consumer, Hawthorne and Other segments;

•higher manufacturing costs, primarily labor, included within “volume, mix and other” in our U.S. Consumer, Hawthorne and Other segments;

•unfavorable leverage of fixed costs, included within “volume, mix and other,” driven by lower sales and production volume in our U.S. Consumer, Hawthorne and Other segments;

•inventory write-down charges included within “volume, mix and other” associated with our U.S. Consumer segment; and

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•an increase in impairment, restructuring and other charges;

•partially offset by increased pricing in our U.S. Consumer, Hawthorne and Other segments; and

•lower warehousing costs included within “volume, mix and other” in our U.S. Consumer and Hawthorne segments.

Selling, General and Administrative Expenses

The following table sets forth the components of selling, general and administrative expenses (“SG&A”):

	Year Ended September 30,
	2024			2023			2022
	2025			2024			2023
Advertising	$	~~141~~152.03		$	~~123~~141.70		$	~~120~~123.37
Advertising as a percentage of net sales	4.05		%	34.50		%	3.15		%
Share-based compensation	5746.27			4957.72			3449.37
Research and development	34.68			3534.76			4535.37
Amortization of intangibles	1311.97			2213.69			3122.06
Other selling, general and administrative	~~312~~357.39			~~319~~312.63			~~382~~319.16
	$	~~559~~603.04		$	~~551~~559.30		$	~~613~~551.03

SG&A increased $44.4, or 7.9%, during fiscal 2025 compared to fiscal 2024. Advertising expense increased $11.3, or 8.0%, in fiscal 2025 due to higher media spending in our U.S. Consumer segment. Share-based compensation expense, which excludes certain advertising expenses paid for in Common Shares, decreased $10.5, or 18.4%, primarily due to lower long-term incentive compensation expense. Other SG&A increased by $45.6, or 14.6%, driven by higher short-term variable cash incentive compensation expense and higher marketing spend.

SG&A increased $7.7, or 1.4%, during fiscal 2024 compared to fiscal 2023. Advertising expense increased $17.3, or 14.0%, in fiscal 2024 driven by increased media spending in our U.S. Consumer segment. Share-based compensation expense, which excludes certain advertising expenses paid for in Common Shares, increased $7.5, or 15.1%, due to a cumulative adjustment recognized during fiscal 2023 for certain performance-based award units to reflect management’s assessment of a lower probability of achievement of performance goals. Amortization expense decreased $8.7, or 38.5%, driven by the impairment of certain Hawthorne segment intangible assets during fiscal 2023. Other SG&A decreased by $7.3, or 2.3%, driven by reductions in staffing levels and other cost-reduction initiatives.

SG&A decreased $61.7, or 10.1%, during fiscal 2023 compared to fiscal 2022. Advertising expense increased $3.4, or 2.8%, in fiscal 2023 driven by increased media spending in our U.S. Consumer segment. Share-based compensation expense, which excludes certain advertising expenses paid for in Common Shares, increased $15.4, or 44.9%, driven by short-term variable incentive compensation that was provided to associates as share-based awards for fiscal 2023 in lieu of a cash-based program, partially offset by the recognition of a cumulative adjustment for certain performance-based award units to reflect management’s assessment of a lower probability of achievement of performance goals. Amortization expense decreased $8.4, or 27.1%, driven by the impairment of certain Hawthorne segment intangible assets during fiscal 2022 and fiscal 2023. Other SG&A and research and development costs decreased by a combined $72.1, or 16.9%, driven by reductions in staffing levels and other cost-reduction initiatives.

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Impairment, Restructuring and Other

Activity described herein is classified within the “Cost of sales—impairment, restructuring and other” and “Impairment, restructuring and other” lines in the Consolidated Statements of Operations. The following table details impairment, restructuring and other charges (recoveries) for each of the periods presented:

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Cost of sales—impairment, restructuring and other:
Restructuring and other charges, net	$	7211.9	$	~~148~~72.59	$	~~143~~148.65
Property, plant and equipment impairments	5.3		11.4		16.6
Right-of-use asset impairments	4.5		5.3		25.8
Right-of-use asset impairments	5.3		25.8		—
Property, plant and equipment impairments	3.9		5.3		11.4
Operating expenses—impairment, restructuring and other:
Convertible debt other-than-temporary impairments	64.6		101.3		—
Restructuring and other charges (recoveries), net	35.2		(4.3)		51.2
Goodwill and intangible asset impairments	2.5		127.9		668.3
Loss on sale of business	17.7		—		—
Restructuring and other charges (recoveries), net	(4.3)		51.2		40.9
Loss on exchange of convertible debt investment	7.0		—		—
Gains on sale of property, plant and equipment	—		—		(16.2)
Goodwill and intangible asset impairments	3.6		2.5		127.9
Total impairment, restructuring and other charges	$	146.3	$	466.1	$	853.2
Convertible debt other-than-temporary impairments	—		64.6		101.3
Total impairment, restructuring and other charges	$	83.8	$	146.3	$	466.1

~~During~~On ~~fiscal~~September 30, ~~2024 and fiscal 2023~~2025, we ~~recorded~~completed ~~non-cash,~~the ~~pre-tax~~divestiture ~~other-than-temporary~~of ~~impairment~~our ~~charges~~Hawthorne ~~related~~professional tohorticulture ~~our~~business ~~convertible~~based ~~debt~~in ~~investments~~the ofNetherlands for $648.65, ~~and~~which ~~$101~~was financed by us in the form of a loan bearing interest at 6.3,0% ~~respectively~~with a maturity date of December 31, 2029. The seller financing loan is recorded in the “~~Impairment,~~Other ~~restructuring~~assets” line in the Consolidated Balance Sheets and ~~other”~~was ~~line~~classified as an investing activity in the Consolidated Statements of ~~Operations~~Cash Flows. ~~Refer~~We toincurred ~~“NOTE~~a ~~16. FAIR~~non ~~VALUE~~tax-deductible ~~MEASUREMENTS”~~loss on the sale of $17.7 in the ~~Notes~~“Impairment, torestructuring and other” line in the Consolidated ~~Financial~~ Statements ~~included~~of inOperations ~~this~~during ~~Form~~fiscal 102025. The loss included a write-Koff ~~for~~of ~~more~~accumulated ~~information~~foreign ~~regarding~~currency ~~convertible~~translation ~~debt~~adjustments ~~investments~~of $9.5.

During fiscal 2024, we recorded a gain of $12.1 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations associated with a payment received in resolution of a dispute with the former ownership group of a business that was acquired in fiscal 2022.

During fiscal 2022, we 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, we reduced the size of our supply chain network, reduced staffing levels and implemented other cost-reduction initiatives. We also accelerated the reduction of certain Hawthorne inventory, primarily lighting, growing environments and hardware products, to reduce on hand inventory to align with the reduced network capacity. During fiscal 2024, we incurred costs of $89.4 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets, intangible assets, property, plant and equipment and software. We incurred costs of $11.3 in our U.S. Consumer segment and $71.8 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. We incurred costs of $1.5 in our U.S. Consumer segment, $1.0 in our Hawthorne segment, $1.1 in our Other segment and $2.4 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. During fiscal 2023, we incurred costs of $229.0 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets and property, plant and equipment. We incurred costs of $16.3 in our U.S. Consumer segment and $168.5 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2023. We incurred costs of $7.7 in our U.S. Consumer segment, $20.7 in our Hawthorne segment, $0.8 in our Other segment and $14.9 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2023. During fiscal 2022, we incurred costs of $65.2 associated with this restructuring initiative primarily related to employee termination benefits and impairment of property, plant and equipment. We incurred costs of $9.7 in our U.S. Consumer segment and $27.1 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2022. We incurred costs of $11.9 in our U.S. Consumer segment, $8.1 in our Hawthorne segment, $0.7 in our Other segment and $7.7 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2022. Costs incurred since the inception of this restructuring initiative through September 30, 2024 were $58.3 for our U.S. Consumer segment, $297.2 for our Hawthorne segment, $2.9 for our Other segment and $25.1 at Corporate.

During fiscal 2023, we recorded non-cash, pre-tax goodwill and intangible asset impairment charges of $127.9 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations, comprised of $117.7 of finite-lived intangible asset impairment charges associated with our Hawthorne segment and $10.3 of goodwill impairment charges associated with our Other segment.

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During fiscal ~~2022~~2025, we ~~recorded~~incurred ~~non-cash,~~employee ~~pre-tax~~and ~~goodwill~~executive ~~and~~severance ~~intangible~~charges ~~asset~~of ~~impairment~~$25.3. We incurred charges of $~~632~~6.41 asin aour ~~result~~U.S. ofConsumer ~~interim~~segment ~~impairment~~and ~~testing~~$1.2 ofin our Hawthorne segment in the “~~Impairment~~Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations, ~~comprised~~during fiscal 2025. We incurred charges of $~~522~~2.43 ofin ~~goodwill~~our ~~impairment~~U.S. ~~charges~~Consumer ~~and~~segment, $~~110~~3.0 ofin ~~finite-lived~~our ~~intangible~~Hawthorne ~~asset~~segment, ~~impairment~~$1.1 ~~charges~~in our Other segment and $11.6 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2025.

During fiscal ~~2022~~2025, we incurred ~~inventory~~a ~~write-down~~charge ~~charges~~ of $~~120~~7.95 in the “~~Cost of sales—impairment~~Impairment, restructuring and other” line in the Consolidated Statements of Operations ~~and~~associated ~~finite-lived~~with ~~intangible~~a ~~asset~~settlement ~~impairment~~agreement ~~charges~~to ofresolve ~~$35.3~~litigation inwith the ~~“Impairment,~~former ~~restructuring~~shareholders ~~and other” line in the Consolidated Statements~~ of ~~Operations~~a ~~associated~~business ~~with~~that ~~our~~was ~~decision~~acquired toin ~~discontinue~~fiscal ~~and exit the market for certain Hawthorne lighting products and brands~~2021.

During fiscal ~~2022~~2025, we ~~recorded~~incurred ~~gains~~a non-cash loss of $167.20 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations ~~associated~~related ~~with~~to the ~~sale~~exchange of ~~property,~~our ~~plant~~convertible ~~and~~debt ~~equipment~~investment in RIV Capital Inc. (“RIV Capital”) for non-voting exchangeable shares of FLUENT Corp. (formerly Cansortium Inc.) (“FLUENT”). Refer to “NOTE 7. INVESTMENT IN UNCONSOLIDATED AFFILIATES” of the Notes to the Consolidated Financial Statements included in this Form 10-K for further details.

During fiscal 2025, we incurred impairment charges of $3.6 associated with Hawthorne finite-lived intangible assets in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations.

During fiscal 2022, we 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, we reduced the size of our supply chain network, reduced staffing levels and implemented other cost-reduction initiatives. We also accelerated the reduction of certain Hawthorne inventory, primarily lighting, growing environments and hardware products, to reduce on hand inventory to align with the reduced network capacity. During fiscal 2025, we incurred costs of $13.0 associated with this restructuring initiative primarily related to facility closure costs and impairment of right-of-use assets and property, plant and equipment. We incurred costs of $4.0 in our U.S. Consumer segment and $9.0 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2025. During fiscal 2024, we incurred costs of $89.4 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets, intangible assets, property, plant and equipment and software. We incurred costs of $11.3 in our U.S. Consumer segment and $71.8 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. We incurred costs of $1.5 in our U.S. Consumer segment, $1.0 in our Hawthorne segment, $1.1 in our Other segment and $2.4 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. During fiscal 2023, we incurred costs of $229.0 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets and property, plant and equipment. We incurred costs of $16.3 in our U.S. Consumer segment and $168.5 in our Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2023. We incurred costs of $7.7 in our U.S. Consumer segment, $20.7 in our Hawthorne segment, $0.8 in our Other segment and $14.9 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2023. Costs incurred since the inception of this restructuring initiative through September 30, 2025 were $62.4 for our U.S. Consumer segment, $306.2 for our Hawthorne segment, $2.9 for our Other segment and $25.1 at Corporate.

During fiscal 2024 and fiscal 2023, we recorded non-cash, pre-tax other-than-temporary impairment charges related to our convertible debt investments of $64.6 and $101.3, respectively, in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations. Refer to “NOTE 15. FAIR VALUE MEASUREMENTS” of the Notes to the Consolidated Financial Statements included in this Form 10-K for further details.

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Other (Income) Expense, net

Other (income) expense is comprised of activities such as the discount on sales of accounts receivable under the Master Receivables Purchase Agreement, royalty income from the licensing of certain of our brand names and foreign exchange transaction gains and losses. Other (income) expense was $1918.98, $(019.1)9 and $(0.81) in fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively. The increase in other expense ~~during~~for fiscal 2025 and fiscal 2024 compared to fiscal 2023 was primarily due to the discount on sales of accounts receivable under the Master Receivables Purchase Agreement.

Income (Loss) from Operations

Income (loss) from operations was $358.6 in fiscal 2025 compared to $208.8 in fiscal 2024. The increase was primarily driven by a higher gross margin rate, partially offset by lower net sales and higher SG&A.

Income (loss) from operations was $208.8 in fiscal 2024 compared to $(174.4) in fiscal 2023. The increase was primarily driven by lower impairment, restructuring and other charges and a higher gross margin rate, partially offset by higher other expense and higher SG&A.

Loss from operations was $(174.4) in fiscal 2023 compared to $(434.0) in fiscal 2022. The decrease was driven by lower impairment, restructuring and other charges and lower SG&A, partially offset by lower net sales and a decrease in gross margin rate.

Equity in Loss of Unconsolidated Affiliates

Equity in loss of unconsolidated affiliates was $2.8, $68.1 and $101.1 in fiscal 2025, fiscal 2024 and fiscal 2023, respectively. Equity in (income) loss of unconsolidated affiliates associated with Bonnie Plants, LLC was $68(5.14), $~~101~~68.1 and $12101.91 in fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively. We recorded pre-tax impairment charges associated with our investment in Bonnie Plants, LLC of $61.9 and $94.7 during fiscal 2024 and fiscal 2023, respectively. Equity in loss of unconsolidated affiliates associated with FLUENT was $8.2 in fiscal 2025. Refer to “NOTE 87. INVESTMENT IN UNCONSOLIDATED AFFILIATES” of the Notes to the Consolidated Financial Statements included in this Form 10-K for ~~more~~further ~~information regarding Bonnie Plants, LLC~~details.

Interest Expense

Interest expense was $128.8 in fiscal 2025, a decrease of 18.9% compared to $158.8 in fiscal 2024. The decrease was driven by lower average borrowings of $301.4 and a decrease in our weighted average interest rate, net of the impact of interest rate swaps, of 50 basis points. The decrease in average borrowings was driven by our focus on using available cash flow to reduce our debt. The decrease in our weighted average interest rate was primarily driven by lower borrowing rates under the Sixth A&R Credit Agreement.

Interest expense was $158.8 in fiscal 2024, a decrease of 10.8% compared to $178.1 in fiscal 2023. The decrease was driven by lower average borrowings of $554.8, partially offset by an increase in our weighted average interest rate, net of the impact of interest rate swaps, of 40 basis points. The decrease in average borrowings was driven by our focus on using available cash flow to reduce our debt as well as the impact of the expiration of the Receivables Facility and the execution of the Master Receivables Purchase Agreement. The increase in our weighted average interest rate was primarily driven by higher borrowing rates under the Sixth A&R Credit Agreement.

~~Interest~~Income ~~expense~~Tax ~~was~~Expense $178.1 in fiscal 2023, an increase of 50.8% compared to $118.1 in fiscal 2022. The increase was driven by an increase in our weighted average interest rate, net of the impact of interest rate swaps, of 180 basis points, primarily driven by higher borrowing rates under the Sixth A&R Credit Agreement. While we had net debt repayments of $353.6 during fiscal 2023, our seasonal borrowing and repayment pattern resulted in an average debt balance for fiscal 2023 that was consistent with fiscal 2022.(Benefit)

37A reconciliation of the federal corporate income tax rate and the effective tax rate on income (loss) before income taxes is summarized below:


	Year Ended September 30,
	2025		2024		2023
Statutory income tax rate	21.0	%	21.0	%	21.0	%
Effect of foreign operations	0.3		(2.0)		0.2
State taxes, net of federal benefit	5.5		8.0		3.2

Effect of other permanent differences	2.2		(32.8)		(0.8)
Research and Experimentation and other federal tax credits	(0.3)		2.9		0.2
Effect of tax contingencies	(0.5)		3.7		0.1

Change in valuation allowances	5.4		(57.4)		(8.7)
Other	0.9		8.7		1.0
Effective income tax rate	34.5	%	(47.9)	%	16.2	%

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~~Income~~During ~~Tax~~fiscal ~~Expense~~2025, ~~(Benefit)~~we incurred a non tax-deductible loss on the sale of our Hawthorne professional horticulture business of $17.7 and this impact is included in the “Effect of other permanent differences” line in the table above. We also recorded a full valuation allowance during fiscal 2025 against deferred tax assets related to $8.2 of equity in loss of unconsolidated affiliates associated with FLUENT and $7.0 of non-cash loss related to the exchange of our convertible debt investment in RIV Capital, and this impact is included in the “Change in valuation allowances” line in the table above.

AFor ~~reconciliation~~fiscal of2024, the ~~federal~~impact ~~corporate~~on ~~income~~the effective tax rate ~~and~~of the ~~effective~~items ~~tax~~noted ~~rate~~in onthe table above increased due to the decrease in loss before income taxes for fiscal 2024 as compared to fiscal 2023. Deferred tax assets related to unrealized losses on convertible debt investments were $43.6 and $33.4 at September 30, 2024 and 2023, respectively. A full valuation allowance was recorded against these losses at September 30, 2024 and 2023 as we do not expect to utilize them prior to their expiration, and this impact is ~~summarized~~included ~~below:~~in the “Change in valuation allowances” line in the table above.

	Year Ended September 30,
	2024		2023		2022
Statutory income tax rate	21.0	%	21.0	%	21.0	%
Effect of foreign operations	(2.0)		0.2		(1.6)
State taxes, net of federal benefit	8.0		3.2		2.6
Effect of other permanent differences	(32.8)		(0.8)		2.8
Research and Experimentation and other federal tax credits	2.9		0.2		0.2
Effect of tax contingencies	3.7		0.1		(1.8)
Change in valuation allowances	(57.4)		(8.7)		(0.9)
Other	8.7		1.0		(0.7)
Effective income tax rate	(47.9)	%	16.2	%	21.6	%

Net Income (Loss)

~~For~~Net ~~fiscal~~income ~~2024,~~(loss) ~~the~~was ~~impact~~$145.2, onor ~~the~~$2.47 ~~effective~~per ~~tax~~diluted ~~rate~~share, ~~of the items noted~~ in ~~the table above increased due to the decrease in loss before income taxes for~~ fiscal ~~2024~~2025 as compared to ~~fiscal 2023 and fiscal 2022. Deferred tax assets related to unrealized losses on convertible debt investments were~~ $43(34.69), ~~and~~or $33(0.461) atper ~~September 30~~diluted share, ~~2024~~in ~~and~~fiscal ~~2023, respectively~~2024. AThe ~~full~~increase ~~valuation allowance~~ was ~~recorded~~driven ~~against~~by ~~these~~a ~~losses~~higher atgross ~~September 30~~margin rate, ~~2024~~lower ~~and~~equity ~~2023~~in asloss weof dounconsolidated ~~not~~affiliates ~~expect~~and tolower ~~utilize~~interest ~~them prior to their expiration~~expense, ~~and~~partially ~~this~~offset ~~impact~~by islower ~~included~~net insales, ~~the~~higher ~~“Change~~income intax ~~valuation~~expense ~~allowances”~~and ~~line~~higher ~~in the table above~~SG&A.

~~Net~~Diluted ~~Loss~~average common shares used in the diluted net income per common share calculation for fiscal 2025 were 58.7 million, which included dilutive potential common shares of 1.1 million. Diluted average common shares used in the diluted net loss per common share calculation for fiscal 2024 were 56.8 million, which excluded potential common shares of 0.9 million because the effect of their inclusion would be anti-dilutive as we incurred a net loss for fiscal 2024. The increase in diluted average common shares was also driven by the exercise and issuance of share-based compensation awards.

Net income (loss) was $(34.9), or $(0.61) per diluted share, in fiscal 2024 compared to $(380.1), or $(6.79) per diluted share, in fiscal 2023. The decrease was driven by lower impairment, restructuring and other charges, a higher gross margin rate, lower equity in loss of unconsolidated affiliates and lower interest expense, partially offset by higher other expense, higher income tax expense and higher SG&A.

~~Net~~Diluted ~~loss~~average ~~was~~common ~~$380.1,~~shares orused ~~$6.79~~in ~~per~~the diluted net loss per common share, incalculation for fiscal ~~2023~~2024 ~~compared~~and tofiscal ~~$437.5,~~2023 orwere $756.888 ~~per~~million ~~diluted~~and ~~share~~56.0 million, inrespectively, ~~fiscal~~which ~~2022. The~~excluded ~~decrease~~potential ~~was~~common ~~driven~~shares byof ~~lower~~0.9 ~~impairment,~~million ~~restructuring~~ and ~~other~~0.4 ~~charges~~million, ~~and~~respectively, ~~lower~~because ~~SG&A,~~the ~~partially~~effect ~~offset~~of bytheir ~~lower~~inclusion ~~net~~would ~~sales,~~be anti-dilutive as we incurred a ~~decrease~~net inloss ~~gross~~for ~~margin~~fiscal ~~rate,~~2024 ~~higher~~and ~~equity~~2023. The increase in ~~loss~~diluted ofaverage ~~unconsolidated~~common ~~affiliates,~~shares ~~higher~~was ~~interest~~primarily ~~expense,~~the ~~lower~~result ~~other~~of ~~non-operating~~the ~~income~~exercise and ~~lower~~issuance ~~income~~of ~~tax~~share-based ~~benefit.~~compensation awards.

Diluted average common shares used in the diluted loss per common share calculation for fiscal 2024, fiscal 2023 and fiscal 2022 were 56.8 million, 56.0 million and 55.5 million, respectively, which excluded potential common shares of 0.9 million, 0.4 million and 0.6 million, respectively, because the effect of their inclusion would be anti-dilutive as we incurred a net loss for fiscal 2024, 2023 and 2022.

Segment Results

~~The~~We ~~performance~~have ofthree ~~each~~operating ~~reportable~~segments ~~segment~~and istwo ~~evaluated~~reportable ~~based~~segments: onU.S. ~~several~~Consumer ~~factors,~~and ~~including~~Hawthorne. U.S. ~~income~~Consumer ~~(loss)~~consists ~~before~~of ~~income~~our ~~taxes,~~consumer ~~amortization,~~lawn ~~impairment,~~and ~~restructuring~~garden ~~and~~business ~~other~~in ~~charges~~the ~~(“Segment~~United ~~Profit~~States. Hawthorne ~~(Loss)”),~~consists ~~which~~of isour aindoor ~~non-GAAP~~and ~~financial~~hydroponic ~~measure~~gardening business. ~~Senior~~We ~~management~~have ~~uses~~chosen ~~Segment~~to ~~Profit~~provide ~~(Loss)~~separate toreportable ~~evaluate~~ segment ~~performance~~disclosures ~~because~~for ~~they~~Hawthorne ~~believe~~notwithstanding ~~this~~the ~~measure~~fact isthat ~~indicative~~it does not meet any of ~~performance~~the ~~trends~~quantitative thresholds requiring such disclosure. The Other operating segment primarily consists of our consumer lawn and ~~the~~garden ~~overall~~business ~~earnings~~in ~~potential~~Canada and does not meet any of ~~each~~the quantitative thresholds requiring separate reportable segment disclosures.

Segment performance is evaluated based on several factors, including income (loss) before income taxes, amortization, impairment, restructuring and other charges (“Segment Profit (Loss)”), which is a non-GAAP financial measure. We believe this measure is indicative of performance trends and the overall earnings potential of each segment.

The following table sets forth net sales by segment:

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
U.S. Consumer	$	32,~~013~~993.7	$	23,~~843~~013.7	$	2,~~928~~843.87
Hawthorne	~~294~~165.78		~~467~~294.37		~~716~~467.23
Other	244.3		240.3		279.1
Reportable segment total	3,159.5		3,308.4		3,311.0
Consolidated	$	3,552.7	$	3,551.3	$	3,924.1
Other	253.6		244.3		240.3
Consolidated	$	3,413.1	$	3,552.7	$	3,551.3

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(Dollars in millions, except per share data)

The following table sets forth Segment Profit (Loss) as well as a reconciliation to income (loss) before income taxes, the most directly comparable measure prepared in accordance with U.S. generally accepted accounting principles (“GAAP”):

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
U.S. Consumer	$	~~498~~572.06	$	~~454~~498.10	$	~~568~~454.61
Hawthorne	~~(14.~~2).8		(4814.12)		(2148.1)
Other	4.7		12.4		20.2
Reportable segment total	575.4		483.8		406.0
Total Segment Profit (Non-GAAP)	488.5		418.4		567.7
Other	12.7		4.7		12.4
Corporate	(~~117~~133.74)		(~~101~~117.67)		(~~112~~101.46)
Intangible asset amortization	(1512.73)		(2515.27)		(3725.12)
Impairment, restructuring and other	(~~146~~83.38)		(~~466~~146.03)		(~~852~~466.20)
Equity in loss of unconsolidated affiliates	(682.18)		(~~101~~68.1)		(12101.91)
Interest expense	(~~158~~128.8)		(~~178~~158.18)		(~~118~~178.1)
Other non-operating income (expense), net	(5.53)		0(5.35)		60.93
Loss before income taxes (GAAP)	$	(23.6)	$	(453.3)	$	(558.1)
Income (loss) before income taxes (GAAP)	$	221.7	$	(23.6)	$	(453.3)

U.S. Consumer

U.S. Consumer segment net sales were $2,993.7 in fiscal 2025, a decrease of 0.7% from fiscal 2024 net sales of $3,013.7. The decrease was driven by nonrecurring fiscal 2024 sales of bulk raw materials and AeroGarden® products of 1.4% and decreased pricing of 0.6%, partially offset by higher sales volume of 1.4%. The increase in sales volume for fiscal 2025 was driven by soils, mulch, grass seed and spreader products. Decreased pricing in fiscal 2025 was due to additional investments in consumer activation activities.

U.S. Consumer Segment Profit was $572.6 in fiscal 2025, an increase of 15.0% from fiscal 2024 Segment Profit of $498.0. The increase for fiscal 2025 was primarily due to a higher gross margin rate, partially offset by higher SG&A and lower net sales.

U.S. Consumer segment net sales were $3,013.7 in fiscal 2024, an increase of 6.0% from fiscal 2023 net sales of $2,843.7. The increase was driven by higher sales volume of 7.3%, partially offset by decreased pricing of 1.3%. The increase in sales volume for fiscal 2024 was driven by mulch, soils and controls products as well as increased net sales associated with the Roundup® marketing agreement.

U.S. Consumer Segment Profit was $498.0 in fiscal 2024, an increase of 9.7% from fiscal 2023 Segment Profit of $454.1. The increase for fiscal 2024 was primarily due to higher net sales and a higher gross margin rate, partially offset by higher SG&A driven by advertising expense and higher other expense driven by the discount on sales of accounts receivable.

U.S. Consumer segment net sales were $2,843.7 in fiscal 2023, a decrease of 2.9% from fiscal 2022 net sales of $2,928.8. The decrease was driven by lower sales volume of 8.3%, partially offset by increased pricing of 5.4%. The decrease in sales volume for fiscal 2023 was driven by lawn care, plant food and controls products.

U.S. Consumer Segment Profit was $454.1 in fiscal 2023, a decrease of 20.1% from fiscal 2022 Segment Profit of $568.6. The decrease for fiscal 2023 was primarily due to lower net sales and a lower gross margin rate, partially offset by lower SG&A.

Hawthorne

Hawthorne segment net sales were $165.8 in fiscal 2025, a decrease of 43.7% from fiscal 2024 net sales of $294.7. The decrease was driven by lower sales volume of 32.8%, the discontinuation of sales of other companies’ products of 9.9% and decreased pricing of 1.4%.

Hawthorne Segment Profit was $2.8 in fiscal 2025 compared to fiscal 2024 Segment Loss of $(14.2). The improvement was driven by a higher gross margin rate and lower SG&A, partially offset by lower net sales.

Hawthorne segment net sales were $294.7 in fiscal 2024, a decrease of 36.9% from fiscal 2023 net sales of $467.3. The decrease was driven by lower sales volume of 36.8% and decreased pricing of 0.5%, partially offset by favorable foreign exchange rates of 0.4%. The decrease in sales volume for fiscal 2024 was driven by all product categories and the impact of the discontinuation of sales of other companies’ products.

Hawthorne Segment Loss was $14.2 in fiscal 2024 compared to fiscal 2023 Segment Loss of $48.1. The improvement was driven by a higher gross margin rate and lower SG&A, partially offset by lower net sales.

Hawthorne segment net sales were $467.3 in fiscal 2023, a decrease of 34.8% from fiscal 2022 net sales of $716.2. The decrease was driven by lower sales volume of 38.1%, partially offset by increased pricing of 2.5% and acquisitions of 0.8%. The decrease in sales volume for fiscal 2023 was driven by growing environments, growing media, hardware, nutrients and lighting products.

Hawthorne Segment Loss was $48.1 in fiscal 2023 compared to fiscal 2022 Segment Loss of $21.1. The increase for fiscal 2023 was driven by lower net sales and a lower gross margin rate, partially offset by lower SG&A.

Other

Other segment net sales were $~~244~~253.36 in fiscal ~~2024~~2025, an increase of 13.78% from fiscal ~~2023~~2024 net sales of $~~240~~244.3. The increase was driven by higher sales volume of 36.5%, ~~partially~~and ~~offset~~increased ~~by decreased~~ pricing of 1.0.3%, ~~and~~partially offset by unfavorable foreign exchange rates of 02.85%.

Other Segment Profit was $4.7 in fiscal 2024, a decrease of 62.1% from fiscal 2023 Segment Profit of $12.4. The decrease was driven by a lower gross margin rate and higher SG&A, partially offset by higher net sales.40

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(Dollars in millions, except per share data)

Other segment ~~net~~profit ~~sales~~was ~~were~~ $~~240~~12.37 in fiscal ~~2023~~2025, aan ~~decrease~~increase of 13170.92% from fiscal ~~2022~~2024 ~~net~~segment ~~sales~~profit of $~~279~~4.17. The ~~decrease~~increase was driven by ~~lower~~higher net sales ~~volume of 16.0%~~ and ~~unfavorable~~a ~~foreign~~higher ~~exchange~~gross ~~rates~~margin ~~of 4.8%~~rate, partially offset by ~~increased~~higher ~~pricing of 6~~SG&A.~~9%.~~

Other ~~Segment~~segment ~~Profit~~net ~~was~~sales were $12244.43 in fiscal ~~2023~~2024, aan ~~decrease~~increase of 381.67% from fiscal ~~2022~~2023 ~~Segment~~net ~~Profit~~sales of $20240.23. The ~~decrease~~increase was driven by ~~lower~~higher ~~net~~ sales ~~and~~volume aof ~~lower~~3.5%, ~~gross~~partially ~~margin~~offset ~~rate~~by decreased pricing of 1.0% and unfavorable foreign exchange rates of 0.8%.

Other segment profit was $4.7 in fiscal 2024, a decrease of 62.1% from fiscal 2023 segment profit of $12.4. The decrease was driven by a lower gross margin rate and higher SG&A, partially offset by higher net sales.

Corporate

Corporate expenses were $133.4 in fiscal 2025, an increase of 13.3% from fiscal 2024 expenses of $117.7. The increase was primarily driven by higher short-term variable incentive compensation expense, partially offset by lower share-based compensation expense.

Corporate expenses were $117.7 in fiscal 2024, an increase of 15.8% from fiscal 2023 expenses of $101.6. The increase was primarily driven by higher share-based compensation expense due to the recognition of a cumulative adjustment in fiscal 2023 for certain performance-based award units to reflect management’s assessment of a lower probability of achievement of performance goals, partially offset by reductions in staffing levels and other cost-reduction initiatives.

Corporate expenses were $101.6 in fiscal 2023, a decrease of 9.6% from fiscal 2022 expenses of $112.4. The decrease was driven by lower share-based compensation expense due to the recognition of a cumulative adjustment for certain performance-based award units to reflect management’s assessment of a lower probability of achievement of performance goals, and reductions in staffing levels and other cost-reduction initiatives.

Liquidity and Capital Resources

The following table summarizes cash activities for the years ended September 30:

	2024		2023		2022
	2025		2024		2023
Net cash provided by (used in) operating activities	$	667.5	$	531.0	$	(129.0)
Net cash provided by operating activities	$	371.3	$	667.5	$	531.0
Net cash used in investing activities	(~~100~~112.41)		(65100.74)		(~~283~~65.27)
Net cash (used in) provided by financing activities	(527.9)		(520.1)		255.3
Net cash used in financing activities	(294.0)		(527.9)		(520.1)

Operating Activities

Cash provided by operating activities totaled $~~667~~371.53 for fiscal ~~2024,~~2025 ~~an increase of $136.5~~ compared to $~~531~~667.05 for fiscal ~~2023~~2024. ~~This~~The ~~increase~~decrease was driven by ~~lower~~higher ~~accounts~~inventory ~~receivable~~production, ~~higher~~the ~~gross~~timing ~~margin,~~of accounts ~~payable~~receivable ~~timing~~sales, ~~lower~~higher ~~payments~~short-term ~~associated~~variable ~~with~~cash ~~restructuring~~incentive ~~activities~~compensation payments and ~~lower~~higher ~~interest payments~~SG&A, partially offset by higher ~~inventory~~gross ~~production,~~margin ~~higher payments to customers related to promotional programs~~ and lower ~~income~~interest ~~tax refunds received~~payments. ~~Lower~~Accounts ~~accounts~~ receivable issale ~~driven by the favorable impact of accounts receivable sold under the Master Receivables Purchase Agreement. Accounts payable~~ timing iswas driven by ~~the~~our ~~impact~~entry ofinto ~~extended payment terms with vendors for payments originally due in~~ the ~~final~~Master ~~weeks~~Receivable ofPurchasing ~~fiscal~~Agreement ~~2022~~during ~~that were paid in the first quarter of~~ fiscal ~~2023~~2024.

Cash provided by operating activities totaled $~~531~~667.05 for fiscal ~~2023,~~2024 ~~an increase of $660.0~~ compared to ~~cash used in operating activities of~~ $~~129~~531.0 for fiscal ~~2022~~2023. This increase was driven by alower ~~reduction~~accounts ~~in inventory~~receivable, ~~lower~~higher ~~short-term~~gross ~~variable~~margin, ~~cash~~accounts ~~incentive~~payable ~~compensation payouts~~timing, ~~higher~~lower ~~income~~payments ~~tax~~associated ~~refunds~~with restructuring activities and lower ~~SG&A~~interest payments, partially offset by ~~lower~~higher ~~gross~~inventory ~~margin~~production, higher ~~interest~~ payments, ~~higher~~to ~~payments~~customers ~~associated~~related ~~with~~to ~~restructuring~~promotional ~~activities~~programs and lower income tax refunds received. Lower accounts ~~payable~~receivable ~~timing~~is driven by the favorable impact of accounts receivable sold under the Master Receivables Purchase Agreement. Accounts payable timing is driven by the ~~unfavorable~~ impact of extended payment terms with vendors for payments originally due in the final weeks of fiscal 2022 that were paid in the first quarter of fiscal 2023.

The seasonal nature of our North America consumer lawn and garden business generally requires cash to fund significant increases in inventories during the first half of the fiscal year. Receivables and payables also build substantially in our second quarter of the fiscal year in line with the timing of sales to support our retailers’ spring selling season.

Investing Activities

Cash used in investing activities totaled $~~100~~112.41 for fiscal ~~2024,~~2025 ~~an increase of $34.7~~ compared to $65100.74 for fiscal ~~2023~~2024. Cash used for investments in property, plant and equipment during fiscal ~~2024~~2025 and fiscal ~~2023~~2024 was $8497.04 and $9284.80, respectively~~. We~~, ~~also~~driven ~~acquired~~by anhigher ~~additional~~spending ~~equity~~on ~~interest~~capital projects in ~~Bonnie~~fiscal ~~Plants~~2025. On September 30, ~~LLC~~2025, we completed the divestiture of our Hawthorne professional horticulture business based in the Netherlands for $218.45, ~~and~~which was financed by us in the form of an interest bearing loan that was classified as an investing activity in the Consolidated Statements of Cash Flows. We also had other investing cash ~~inflows~~outflows of $23.67 during fiscal ~~2024~~2025.

Cash used in investing activities totaled $65100.74 for fiscal ~~2023~~2024, aan ~~decrease~~increase of $~~217~~34.57 compared to $~~283~~65.27 for fiscal ~~2022~~2023. Cash used for investments in property, plant and equipment during fiscal 2024 and fiscal 2023 was $9284.8,0 aand ~~decrease from~~ $~~113~~92.58, ~~in fiscal 2022 due to higher spending in fiscal 2022 on capital projects to expand network capacity~~respectively. We also ~~received~~acquired ~~proceeds~~an ofadditional ~~$37.0~~equity ~~during~~interest ~~fiscal 2023 related to the payoff of seller financing that we provided~~ in ~~connection~~Bonnie ~~with~~Plants, aLLC ~~fiscal~~for ~~2017~~$21.4 ~~divestiture,~~ and had other investing cash ~~outflows~~inflows of $125.40 ~~primarily~~during ~~associated~~fiscal ~~with currency forward contracts~~2024.

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(Dollars in millions, except per share data)

For the three fiscal years ended September 30, ~~2024~~2025, we allocated our capital spending as follows: 7068% for maintenance of existing productive assets; 2022% for cost savings projects, focused primarily on supply chain and information technology; and 10% for innovation and expansion. We expect fiscal ~~2025~~2026 capital expenditures to be approximately $100.0 and we expect to allocate approximately 6046% to maintenance of existing productive assets, 3028% to cost savings projects and 1026% to innovation and expansion projects.

Financing Activities

Cash used in financing activities totaled $294.0 for fiscal 2025 compared to $527.9 for fiscal 2024. During fiscal 2025, we had net debt repayments of $122.1, paid dividends of $154.3 and repurchased Common Shares for $18.4 (which includes cash paid to tax authorities to satisfy statutory income tax withholding obligations related to share-based compensation). In addition, we received cash from the exercise of stock options of $11.9 (which also includes amounts received from employee purchases under the employee stock purchase plan) during fiscal 2025. We also had other financing cash outflows of $11.1 during fiscal 2025 primarily related to prior year collections of previously sold accounts receivable that were submitted to the buyer in the current year.

Cash used in financing activities totaled $527.9 for fiscal 2024 compared to $520.1 for fiscal 2023. During fiscal 2024, we had net debt repayments of $391.0, paid dividends of $151.3 and repurchased Common Shares for $5.1 (which includes cash paid to tax authorities to satisfy statutory income tax withholding obligations related to share-based compensation). We also had other financing cash inflows of $15.7 during fiscal 2024 related to collections of previously sold accounts receivable not yet submitted to the buyer. Higher debt repayment is driven by our focus on using available cash flow to reduce our debt.

Cash used in financing activities totaled $520.1 for fiscal 2023 compared to cash provided by financing activities of $255.3 for fiscal 2022. During fiscal 2023, we had net debt repayments of $353.6, paid dividends of $149.1, paid financing and issuance fees of $6.4 and repurchased Common Shares for $9.3 (which includes cash paid to tax authorities to satisfy statutory income tax withholding obligations related to share-based compensation).

Accounts Receivable Sales

On October 27, 2023, we entered into the Master Receivables Purchase Agreement, under which we could sell up to $600.0 of available and eligible outstanding customer accounts receivable generated by sales to four specified customers. On September 1, 2024, we amended the Master Receivables Purchase Agreement to permit us to sell up to $750.0 of available and eligible outstanding customer accounts receivable generated by sales to five specified customers. ~~The~~On ~~agreement~~August ~~is uncommitted and expires on September 1~~28, 2025~~. The receivable sales are non-recourse to the Company~~, ~~other than with respect to (i) repurchase obligations and indemnification obligations for any violations by~~ the ~~Company~~Master ofReceivables ~~its~~Purchase ~~respective~~Agreement, ~~representations~~which oris ~~obligations~~uncommitted, aswas ~~seller~~extended ~~or servicer~~ and ~~(ii)~~now ~~certain~~expires ~~repurchase~~on ~~and payment obligations arising from any dilution of~~September 1, or dispute with respect to, any purchased receivables that arise after the sale of such purchased receivables to the purchaser not contemplated in the applicable purchase price of such purchased receivable2026. ~~The recourse obligations of the Company that may arise from time to time are supported by standby letters of credit of $75.0.~~ Transactions under the Master Receivables Purchase Agreement are accounted for as sales of accounts receivable, and the receivables sold are removed from the Consolidated Balance Sheets at the time of the sales transaction. Proceeds received from the sales of accounts receivable are classified as operating cash flows and collections of previously sold accounts receivable not yet submitted to the buyer are classified as financing cash flows in the Consolidated Statements of Cash Flows. We record the discount on sales in the “Other (income) expense, net” line in the Consolidated Statements of Operations. At September 30, 2025 and 2024, net receivables ofderecognized were $163.3 and $186.6, ~~were derecognized~~respectively. During fiscal 2025 and fiscal 2024, proceeds from the sale of receivables under the Master Receivables Purchase Agreement totaled $1,906.1 and $1,938.6, respectively, and the total discount recorded on sales was $20.7 and $24.6, respectively.

Supplier Finance Program

We have an agreement to provide a supplier finance program which facilitates participating suppliers’ ability to finance our payment obligations with a designated third-party financial institution. Participating suppliers may, at their sole discretion, elect to finance our payment obligations prior to their scheduled due dates at a discounted price to the participating financial institution. Our obligations to our suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to finance amounts under this arrangement. The payment terms that we negotiate with our suppliers are consistent, regardless of whether a supplier participates in the program. Our current payment terms with a majority of our suppliers generally range from 30 to 60 days, which we deem to be commercially reasonable. Our outstanding payment obligations under our supplier finance program ~~were $12.5 and $18.3 at September 30, 2024 and 2023, respectively, and~~ are recorded within accounts payable in the Consolidated Balance Sheets~~. The~~ ~~associated payments were $245.5~~ and ~~$185.3~~the ~~for~~associated ~~fiscal~~payments ~~2024 and fiscal 2023, respectively, and~~ are classified as operating activities in the Consolidated Statements of Cash Flows.

~~Share~~Cash ~~Repurchases~~and Cash Equivalents

OnOur ~~February 6,~~cash ~~2020,~~and ~~Scotts~~cash ~~Miracle-Gro~~equivalents ~~announced~~were ~~that~~held ~~its~~in ~~Board~~cash ofdepository ~~Directors~~accounts ~~authorized~~with ~~the~~major ~~repurchase~~financial ofinstitutions uparound tothe ~~$750.0~~world ofor ~~Common~~invested ~~Shares~~in ~~from~~high ~~April 30~~quality, ~~2020~~short-term ~~through~~liquid ~~March 25,~~investments ~~2023. There~~having ~~were~~original nomaturities ~~share~~of ~~repurchases~~three ~~under~~months ~~this~~or ~~share~~less. The ~~repurchase~~cash ~~authorization~~and ~~during~~cash ~~fiscal~~equivalents ~~2023~~balances ~~through~~of ~~its~~$36.6 ~~expiration~~and on$71.6 ~~March~~at September 2530, ~~2023. During~~2025 ~~fiscal~~and ~~2022~~2024, ~~Scotts~~respectively, ~~Miracle-Gro~~included ~~repurchased 1~~$4.12 ~~million~~and ~~Common~~$15.9, ~~Shares~~respectively, ~~under~~held ~~this~~by ~~share~~controlled ~~repurchase~~foreign ~~authorization for $175~~corporations.0. ~~Treasury~~As ~~share~~of ~~purchases~~September 30, ~~also~~2025, ~~include~~we ~~cash~~maintain ~~paid~~our toassertion ~~tax~~of ~~authorities~~indefinite toreinvestment ~~satisfy~~of ~~statutory~~the ~~income~~earnings ~~tax withholding obligations related to share-based compensation~~ of ~~$5.1,~~all ~~$9.3~~material ~~and~~foreign ~~$82~~subsidiaries.~~9 for fiscal 2024, fiscal 2023 and fiscal 2022, respectively.~~

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(Dollars in millions, except per share data)

Cash and Cash Equivalents

Our cash and cash equivalents were held in cash depository accounts with major financial institutions around the world or invested in high quality, short-term liquid investments having original maturities of three months or less. The cash and cash equivalents balances of $71.6 and $31.9 at September 30, 2024 and 2023, respectively, included $15.9 and $26.6, respectively, held by controlled foreign corporations. As of September 30, 2024, we maintain our assertion of indefinite reinvestment of the earnings of all material foreign subsidiaries.

Borrowing Agreements

Credit Facilities

Our primary sources of liquidity are cash generated by operations and borrowings under our credit facilities, which are guaranteed by substantially all of Scotts Miracle-Gro’s domestic subsidiaries. On April 8, 2022, we entered into the Sixth A&R Credit Agreement, ~~providing~~which provided the Company and certain of its subsidiaries with five-year senior secured loan facilities in the aggregate principal amount of $2,500.0, comprised of a revolving credit facility of $1,500.0 and a term loan in the original principal amount of $1,000.0 ~~(the “Sixth A&R Credit Facilities”)~~. The Sixth A&R Credit Agreement will terminate on April 8, 2027. The Sixth A&R Credit Facilities are available for the issuance of letters of credit up to $100.0. The terms of the Sixth A&R Credit Agreement include customary representations and warranties, affirmative and negative covenants, financial covenants, and events of default.

~~Under the terms of the Sixth A&R Credit Agreement~~At September 30, ~~loans bear interest~~2025, atwe ~~our~~had ~~election,~~letters atof acredit ~~rate~~outstanding ~~per~~in ~~annum equal to either (i)~~ the ~~Alternate~~aggregate ~~Base~~principal ~~Rate~~amount ~~plus~~of $83.1, ~~the~~and ~~Applicable Spread (each~~had $1,166.9 of ~~as defined in the Sixth A&R Credit Agreement) or (ii) the Adjusted Term SOFR Rate for the Interest Period in effect for such~~ borrowing ~~plus~~availability ~~the~~under ~~Applicable Spread (all as defined in~~ the Sixth A&R Credit Agreement). ~~Swingline~~The ~~Loans~~weighted ~~bear~~average interest atrates ~~the~~on ~~applicable~~average ~~Swingline~~borrowings ~~Rate~~under ~~set forth in~~ the ~~Sixth~~credit ~~A&R~~facilities, ~~Credit~~excluding ~~Agreement. Interest~~the ~~rates~~impact ~~for~~of ~~other~~interest ~~select~~rate ~~non-U.S. dollar borrowings~~swaps, ~~including borrowings denominated in euro~~were 7.9%, ~~Pounds~~9.1% ~~Sterling~~ and ~~Canadian~~7.6% ~~dollars,~~for ~~are~~fiscal ~~based~~2025, onfiscal ~~separate~~2024 ~~interest~~and ~~rate~~fiscal ~~indices~~2023, ~~as set forth in the Sixth A&R Credit Agreement~~respectively.

OnDuring ~~June 8,~~fiscal ~~2022,~~2025 weand ~~entered~~fiscal ~~into Amendment No. 1 to the Sixth A&R Credit Agreement (“Amendment No. 1”). Amendment No. 1 increased the maximum permitted leverage ratio for the quarterly leverage covenant until April 1~~2024, ~~2024. Amendment~~we ~~No.~~used 1available ~~also~~cash ~~increased~~on ~~the~~hand ~~interest rate applicable~~ to ~~borrowings~~make ~~under~~prepayments ~~the~~on ~~revolving credit facility by 35 bps and~~ the term loan ~~facility~~of ~~by 50 bps, and increased~~ the ~~annual~~Sixth ~~facility~~A&R ~~fee~~Credit ~~rate~~Agreement onin the ~~revolving~~amount ~~credit~~of ~~facility~~$75.0 byand ~~15 bps~~$250.0, ~~in each case~~respectively, ~~when~~which ~~our~~was ~~quarterly-tested~~applied ~~leverage~~to ~~ratio~~the ~~exceeded~~outstanding 4principal amount.~~75.~~

OnThe ~~July 31, 2023, we entered into Amendment No. 2 to the~~ Sixth A&R Credit Agreement~~. Amendment~~, ~~No.~~as 2amended ~~(i)~~on ~~reduces the revolving loan commitments by $250.0; (ii) increases the maximum permitted leverage ratio for the quarterly leverage covenant until the earlier of (a) October~~June 18, ~~2025~~2022 and ~~(b)~~July 31, ~~subject~~2023, ~~to certain conditions specified in Amendment No. 2~~contained, ~~the~~among ~~termination~~other ~~by the Company of such adjustment (such period~~obligations, ~~the~~an ~~“Leverage~~affirmative ~~Adjustment Period”); (iii) replaces the interest coverage~~ covenant ~~with~~regarding aour fixed charge coverage covenant; (iv) increases the interest rate applicable to borrowings under the revolving credit facility and the term loan facility by 25 bps for each existing pricing tier and adds a pricing tier applicable to periods when the leverage ratio ~~exceeds~~determined ~~6.00;~~as ~~(v)~~of ~~limits~~ the ~~amount~~end of ~~certain~~each ~~incremental~~of ~~investments, loans and advances to $25.0 during the Leverage Adjustment Period; and (vi) adds~~ our ~~intellectual~~fiscal ~~property (subject to certain exceptions) as collateral to secure our obligations under the Sixth A&R Credit Agreement~~quarters. ~~Additionally,~~The ~~Amendment~~maximum ~~No.~~permitted 2leverage ~~limits~~ratio ~~our~~was ~~ability~~4.75 tofor ~~declare or pay any discretionary dividends, distributions or other restricted payments during~~ the ~~Leverage~~fourth ~~Adjustment~~quarter ~~Period to only the payment~~ of ~~(i) regularly scheduled cash dividends to holders of our Common Shares in an aggregate amount not to exceed $225.0 per~~ fiscal ~~year and (ii) other dividends, distributions or restricted payments in an aggregate amount not to exceed $25~~2025.0. ~~Amendment~~Our ~~No. 2 also subjects our ability to make certain investments to pro forma compliance with certain~~ leverage ~~levels~~ratio ~~specified~~was in4.10 ~~Amendment~~at ~~No.~~September 30, 22025. ~~Pursuant~~The ~~to Amendment No. 2, the~~ Sixth A&R Credit Agreement isalso ~~secured~~contained byan ~~(i)~~affirmative acovenant ~~perfected~~regarding ~~first~~our ~~priority~~fixed ~~security~~charge ~~interest~~coverage inratio ~~all~~determined as of the ~~accounts~~end ~~receivable, inventory, equipment and intellectual property (subject to certain exceptions)~~ of ~~Scotts~~each ~~Miracle-Gro and certain~~ of ~~its~~our ~~domestic~~fiscal ~~subsidiaries~~quarters. The ~~and~~minimum ~~(ii)~~required ~~the~~fixed ~~pledge~~charge ofcoverage ~~all~~ratio ofwas ~~the~~1.00. Our ~~capital~~fixed ~~stock~~charge ofcoverage ~~certain~~ratio ofwas ~~Scotts~~1.42 ~~Miracle-Gro’s~~for ~~domestic subsidiaries and a portion of~~ the ~~capital~~twelve ~~stock~~months ofended ~~certain~~September 30, ~~of its foreign subsidiaries~~2025.

AtOn November ~~September 30~~21, ~~2024~~2025, we ~~had~~entered ~~letters~~into the Seventh A&R Credit Agreement, providing the Company and certain of ~~credit~~its ~~outstanding~~subsidiaries with five-year senior secured loan facilities in the aggregate principal amount of $832,000.0, ~~and~~comprised ~~had~~ of a revolving credit facility of $1,~~167~~500.0 and a term loan in the original principal amount of ~~borrowing~~$500.0. The ~~availability~~Seventh A&R Credit Agreement also provides us with the right to seek additional committed credit under the agreement in an aggregate amount of up to $500.0 plus an unlimited additional amount, subject to certain specified financial and other conditions. The Seventh A&R Credit Agreement replaces the Sixth A&R Credit Agreement and will terminate on November 21, 2030. The ~~weighted~~Seventh ~~average~~A&R ~~interest~~Credit ~~rates~~Agreement onwill ~~average~~be ~~borrowings~~available ~~under~~for ~~the~~issuance of letters of credit ~~facilities,~~up ~~excluding~~to ~~the~~$100.0. The ~~impact~~terms of ~~interest~~the ~~rate~~Seventh ~~swaps,~~A&R ~~were 9.1%,~~Credit ~~7.6%~~Agreement include customary representations and ~~2.8%~~warranties, ~~for~~affirmative ~~fiscal~~and ~~2024~~negative covenants, ~~fiscal~~financial ~~2023~~covenants and ~~fiscal~~events ~~2022,~~of ~~respectively~~default.

~~During~~Borrowings ~~fiscal~~under ~~2024,~~the weSeventh ~~used~~A&R ~~available~~Credit ~~cash~~Agreement onbear ~~hand~~interest toat ~~make~~variable ~~repayments~~rates onderived from the ~~term~~prevailing ~~loan~~U.S. Prime Rate, Federal Reserve Bank of New York Rate, Secured Overnight Financing Rate, Euro Interbank Offered Rate, Canadian Prime Rate or Canadian Overnight Repo Rate Average (all as defined in the ~~Sixth~~Seventh A&R Credit Agreement), inbased ~~the~~on ~~amount~~our ~~of $250.0~~election, ~~which~~plus ~~was~~a ~~applied~~spread tothat ~~the~~depends ~~outstanding~~on ~~principal~~our ~~amount~~quarterly-tested leverage ratio.

42The Seventh A&R Credit Agreement contains, among other obligations, an affirmative covenant regarding our leverage ratio determined as of the end of each of our fiscal quarters, calculated as average total indebtedness, divided by our EBITDA, as adjusted pursuant to the terms of the Seventh A&R Credit Agreement (“Adjusted EBITDA”). The maximum permitted leverage ratio is 5.00 for the first quarter of fiscal 2026 and thereafter. The Seventh A&R Credit Agreement also contains an affirmative covenant regarding our interest coverage ratio determined as of the end of each of our fiscal quarters, calculated as Adjusted EBITDA divided by interest expense, as described in the Seventh A&R Credit Agreement. The minimum required interest coverage ratio is (i) 3.00 for each of the fiscal quarters within fiscal 2026, (ii) 3.25 for each of the fiscal quarters within fiscal 2027 and (iii) 3.50 for fiscal quarters thereafter.

The Seventh A&R Credit Agreement allows us to make unlimited restricted payments (as defined in the Seventh A&R Credit Agreement), including dividend payments on, and repurchases of, Common Shares, as long as the leverage ratio resulting from the making of such restricted payments is 4.00 or less. Otherwise, we are limited to restricted payments in an aggregate amount for each fiscal year not to exceed $225.0.

Senior Notes

On December 15, 2016, Scotts Miracle-Gro issued $250.0 aggregate principal amount of 5.250% Senior Notes due 2026. The 5.250% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with our existing and future unsecured senior debt. The 5.250% Senior Notes have interest payment dates of June 15 and December 15 of each year.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

The Sixth A&R Credit Agreement contains, among other obligations, an affirmative covenant regarding our leverage ratio determined as of the end of each of our fiscal quarters calculated as average total indebtedness, divided by our earnings before interest, taxes, depreciation and amortization, as adjusted pursuant to the terms of Amendment No. 2 (“Adjusted EBITDA”). Pursuant to Amendment No. 2, the maximum permitted leverage ratio is (i) 6.00 for the fourth quarter of fiscal 2024, (ii) 5.50 for the first quarter of fiscal 2025, (iii) 5.25 for the second quarter of fiscal 2025, (iv) 5.00 for the third quarter of fiscal 2025, (v) 4.75 for the fourth quarter of fiscal 2025 and (vi) 4.50 for the first quarter of fiscal 2026 and thereafter. Our leverage ratio was 4.86 at September 30, 2024. Pursuant to Amendment No. 2, the Sixth A&R Credit Agreement also contains an affirmative covenant regarding our fixed charge coverage ratio determined as of the end of each of our fiscal quarters, calculated as Adjusted EBITDA minus capital expenditures and expense for taxes paid in cash, divided by the sum of interest expense plus restricted payments, as described in Amendment No. 2. The minimum required fixed charge coverage ratio is 1.00. Our fixed charge coverage ratio was 1.27 for the twelve months ended September 30, 2024.

As of September 30, 2024, we were in compliance with all applicable covenants in the agreements governing our debt. Based on our projections of financial performance for the twelve-month period subsequent to the date of the filing of this Form 10-K, we expect to remain in compliance with the financial covenants under the Sixth A&R Credit Agreement. However, our assessment of our ability to meet our future obligations is inherently subjective, judgment-based, and susceptible to change based on future events. A covenant violation may result in an event of default. Such a default would allow the lenders under the Sixth A&R Credit Agreement to accelerate the maturity of the indebtedness thereunder and would also implicate cross-default provisions under the Senior Notes and cause the Senior Notes to become due and payable at that time. As of September 30, 2024, our indebtedness under the Sixth A&R Credit Agreement and Senior Notes was $2,225.0. We do not have sufficient cash on hand or available liquidity that can be utilized to repay these outstanding amounts in the event of default.

As part of our contingency planning to address potential future circumstances that could result in noncompliance, we have contemplated alternative plans including additional restructuring activities to reduce operating expenses and certain cash management strategies that are within our control. Additionally, we have contemplated alternative plans that are subject to market conditions and not in our control, including, among others, discussions with our lenders to amend the terms of our financial covenants under the Sixth A&R Credit Agreement and generating cash by completing other financing transactions, which may include issuing equity. There is no assurance that we will be successful in implementing these alternative plans.

Senior Notes

On October 22, 2019, Scotts Miracle-Gro issued $450.0 aggregate principal amount of 4.500% Senior Notes due 2029. The 4.500% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with our existing and future unsecured senior debt. The 4.500% Senior Notes have interest payment dates of April 15 and October 15 of each year.

On March 17, 2021, Scotts Miracle-Gro issued $500.0 aggregate principal amount of 4.000% Senior Notes due 2031. The 4.000% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with our existing and future unsecured senior debt. The 4.000% Senior Notes have interest payment dates of April 1 and October 1 of each year.

On August 13, 2021, Scotts Miracle-Gro issued $400.0 aggregate principal amount of 4.375% Senior Notes due 2032. The 4.375% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with our existing and future unsecured senior debt. The 4.375% Senior Notes have interest payment dates of February 1 and August 1 of each year.

Substantially all of Scotts Miracle-Gro’s directly and indirectly owned domestic subsidiaries serve as guarantors of the 5.250% Senior Notes, the 4.500% Senior Notes, the 4.000% Senior Notes and the 4.375% Senior Notes.

The Senior Notes contain an affirmative covenant regarding our interest coverage ratio determined as of the end of each of our fiscal quarters, calculated as Adjusted EBITDA divided by interest expense excluding costs related to refinancings. The minimum required interest coverage ratio is 2.00. Our interest coverage ratio was 34.5778 for the twelve months ended September 30, ~~2024~~2025.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

Receivables Facility

We also maintained a Master Repurchase Agreement (including the annexes thereto, the “Repurchase Agreement”) and a Master Framework Agreement, as amended (the “Framework Agreement” and, together with the Repurchase Agreement, the “Receivables Facility”) under which we could sell a portfolio of available and eligible outstanding customer accounts receivable to the purchasers subject to agreeing to repurchase the receivables on a weekly basis. The eligible accounts receivable consisted of accounts receivable generated by sales to three specified customers. The eligible amount of customer accounts receivables which could be sold under the Receivables Facility was $400.0. The Receivables Facility expired on August 18, 2023. The sale of receivables under the Receivables Facility was accounted for as short-term debt and we continued to carry the receivables on our Consolidated Balance Sheets, primarily as a result of our requirement to repurchase receivables sold.

Interest Rate Swap Agreements

We enter into interest rate swap agreements with major financial institutions that effectively convert a portion of our variable -rate debt to a fixed rate. Interest payments made between the effective date and expiration date are hedged by the swap agreements. Swap agreements that were hedging interest payments as of September 30, ~~2024~~2025 and ~~2023~~2024 had a maximum total U.S. dollar equivalent notional amount of $450.0 ~~and $600~~.~~0, respectively.~~ During fiscal 2024, we terminated an interest rate swap agreement in exchange for a cash payment of $11.0. The notional amount, effective date, expiration date and rate of each of the swap agreements outstanding at September 30, ~~2024~~2025 are shown in the table below:

NotionalAmount ($)		EffectiveDate (a)	ExpirationDate	FixedRate
150		6/7/2023	4/7/2027	3.37	%
50		6/7/2023	4/7/2027	3.34	%
100	(b)	11/20/2023	3/22/2027	4.74	%
150	(b)	9/20/2024	9/20/2029	4.25	%
100		4/8/2027	4/8/2030	3.40	%

(a)The effective date refers to the date on which interest payments are first hedged by the applicable swap agreement.

(b)Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time.

Availability and Use of Cash

We believe that our cash flows from operations and borrowings under our agreements described herein will be sufficient to meet debt service, capital expenditures and working capital needs for the foreseeable future. However, we cannot ensure that our business will generate sufficient cash flow from operations or that future borrowings will be available under our borrowing agreements in amounts sufficient to pay indebtedness or fund other liquidity needs. Actual results of operations will depend on numerous factors, many of which are beyond our control as further discussed in “ITEM 1A. RISK FACTORS — Risks Related to Our M&A, Lending and Financing Activities — Our indebtedness could limit our flexibility and adversely affect our financial condition” of this Form 10-K.

Financial Disclosures About Guarantors and Issuers of Guaranteed Securities

The 5.250% Senior Notes, 4.500% Senior Notes, 4.000% Senior Notes and 4.375% Senior Notes were issued by Scotts Miracle-Gro on December 15, 2016, October 22, 2019, March 17, 2021 and August 13, 2021, respectively. The Senior Notes are guaranteed by certain consolidated domestic subsidiaries of Scotts Miracle-Gro (collectively, the “Guarantors”) and, therefore, we report summarized financial information in accordance with SEC Regulation S-X, Rule 13-01, “Guarantors and Issuers of Guaranteed Securities Registered or Being Registered.”

The guarantees are “full and unconditional,” as those terms are used in Regulation S-X, Rule 3-10(b)(3), except that a Guarantor’s guarantee will be released in certain circumstances set forth in the indentures governing the Senior Notes, such as: (i) upon any sale or other disposition of all or substantially all of the assets of the Guarantor (including by way of merger or consolidation) to any person other than Scotts Miracle-Gro or any “restricted subsidiary” under the applicable indenture; (ii) if the Guarantor merges with and into Scotts Miracle-Gro, with Scotts Miracle-Gro surviving such merger; (iii) if the Guarantor is designated an “unrestricted subsidiary” in accordance with the applicable indenture or otherwise ceases to be a “restricted subsidiary” (including by way of liquidation or dissolution) in a transaction permitted by such indenture; (iv) upon legal or covenant defeasance; (v) at the election of Scotts Miracle-Gro following the Guarantor’s release as a guarantor under the Sixth A&R Credit Agreement, except a release by or as a result of the repayment of the Sixth A&R Credit Agreement; or (vi) if the Guarantor ceases to be a “restricted subsidiary” and the Guarantor is not otherwise required to provide a guarantee of the Senior Notes pursuant to the applicable indenture.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

Availability and Use of Cash

Financial Disclosures About Guarantors and Issuers of Guaranteed Securities

The guarantees are “full and unconditional,” as those terms are used in Regulation S-X, Rule 3-10(b)(3), except that a Guarantor’s guarantee will be released in certain circumstances set forth in the indentures governing the Senior Notes, such as: (i) upon any sale or other disposition of all or substantially all of the assets of the Guarantor (including by way of merger or consolidation) to any person other than Scotts Miracle-Gro or any “restricted subsidiary” under the applicable indenture; (ii) if the Guarantor merges with and into Scotts Miracle-Gro, with Scotts Miracle-Gro surviving such merger; (iii) if the Guarantor is designated an “unrestricted subsidiary” in accordance with the applicable indenture or otherwise ceases to be a “restricted subsidiary” (including by way of liquidation or dissolution) in a transaction permitted by such indenture; (iv) upon legal or covenant defeasance; (v) at the election of Scotts Miracle-Gro following the Guarantor’s release as a guarantor under the Seventh A&R Credit Agreement, except a release by or as a result of the repayment of the Seventh A&R Credit Agreement; or (vi) if the Guarantor ceases to be a “restricted subsidiary” and the Guarantor is not otherwise required to provide a guarantee of the Senior Notes pursuant to the applicable indenture.

Our foreign subsidiaries and certain of our domestic subsidiaries are not guarantors (collectively, the “Non-Guarantors”) of the Senior Notes. Payments on the Senior Notes are only required to be made by Scotts Miracle-Gro and the Guarantors. As a result, no payments are required to be made from the assets of the Non-Guarantors, unless those assets are transferred by dividend or otherwise to Scotts Miracle-Gro or a Guarantor. In the event of a bankruptcy, insolvency, liquidation or reorganization of any of the Non-Guarantors, holders of their indebtedness, including their trade creditors and other obligations, will be entitled to payment of their claims from the assets of the Non-Guarantors before any assets are made available for distribution to Scotts Miracle-Gro or the Guarantors. As a result, the Senior Notes are effectively subordinated to all the liabilities of the Non-Guarantors.

The guarantees may be subject to review under federal bankruptcy laws or relevant state fraudulent conveyance or fraudulent transfer laws. In certain circumstances, the court could void the guarantee, subordinate the amounts owing under the guarantee, or take other actions detrimental to the holders of the Senior Notes.

As a general matter, value is given for a transfer or an obligation if, in exchange for the transfer or obligation, property is transferred or a valid antecedent debt is satisfied. A court would likely find that a Guarantor did not receive reasonably equivalent value or fair consideration for its guarantee to the extent such Guarantor did not obtain a reasonably equivalent benefit from the issuance of the Senior Notes.

The measure of insolvency varies depending upon the law of the jurisdiction that is being applied. Regardless of the measure being applied, a court could determine that a Guarantor was insolvent on the date the guarantee was issued, so that payments to the holders of the Senior Notes would constitute a preference, fraudulent transfer or conveyances on other grounds. If a guarantee is voided as a fraudulent conveyance or is found to be unenforceable for any other reason, the holders of the Senior Notes will not have a claim against the Guarantor.

Each guarantee contains a provision intended to limit the Guarantor’s liability to the maximum amount that it could incur without causing the incurrence of obligations under its guarantee to be a fraudulent conveyance. However, there can be no assurance as to what standard a court will apply in making a determination of the maximum liability of each Guarantor. Moreover, this provision may not be effective to protect the guarantees from being voided under fraudulent conveyance laws. There is a possibility that the entire guarantee may be set aside, in which case the entire liability may be extinguished.

The following tables present summarized financial information on a combined basis for Scotts Miracle-Gro and the Guarantors. Transactions between Scotts Miracle-Gro and the Guarantors have been eliminated and the summarized financial information does not reflect investments of the Scotts Miracle-Gro and the Guarantors in the Non-Guarantor subsidiaries.

	September 30, 2024
Current assets	$	838.4
Non-current assets (a)	1,805.1
Current liabilities	667.3
Non-current liabilities	2,471.6

(a)Includes amounts due from Non-Guarantor subsidiaries of $49.5.

	Year Ended
	September 30, 2024
Net sales	$	3,248.6
Gross margin	809.5
Net loss (a)	(16.1)

(a)Includes intercompany income from Non-Guarantor subsidiaries of $12.5.

Judicial and Administrative Proceedings

We are party to various pending judicial and administrative proceedings arising in the ordinary course of business, including, among others, proceedings based on accidents or product liability claims and alleged violations of environmental laws. We have reviewed these pending judicial and administrative proceedings, including the probable outcomes, reasonably anticipated costs and expenses, and the availability and limits of our insurance coverage, and have established what we believe to be appropriate accruals. We believe that our assessment of contingencies is reasonable and that the related accruals, in the aggregate, are adequate; however, there can be no assurance that future quarterly or annual operating results will not be materially affected by these proceedings, whether as a result of adverse outcomes or as a result of significant defense costs.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)


	September 30, 2025

Current assets	$	831.9
Non-current assets (a)	1,657.4
Current liabilities	640.9
Non-current liabilities	2,297.4

(a)Includes amounts due from Non-Guarantor subsidiaries of $11.4.


	Year Ended
	September 30, 2025

Net sales	$	3,132.7
Gross margin	999.4

Net income (a)	173.5

(a)Includes intercompany income from Non-Guarantor subsidiaries of $5.7.

Judicial and Administrative Proceedings

We are party to various pending judicial and administrative proceedings and claims arising in the ordinary course of business relating to, among others, product and general liabilities, workers’ compensation, property losses and other liabilities for which we are self-insured or retain a high exposure limit. We have reviewed these pending judicial and administrative proceedings, including the probable outcomes, reasonably anticipated costs and expenses, and the availability and limits of our insurance coverage, and have established what we believe to be appropriate accruals. We believe that our assessment of contingencies is reasonable and related accruals are adequate, both individually and in the aggregate; however, there can be no assurance that final resolution of these matters will not have a material effect on our financial condition, results of operations or cash flows.

Contractual Obligations

The following table summarizes our future cash outflows for contractual obligations as of September 30, ~~2024~~2025:

			Payments Due by Period
Contractual Cash Obligations	Total		Less Than 1 Year		1-3 Years		3-5 Years		More Than5 Years
Debt obligations	$	2,~~225~~105.02	$	5055.02	$	~~825~~700.0	$	—450.0	$	~~1,350~~900.0
Interest expense on debt obligations	~~501~~376.02		~~112~~97.74		~~194~~141.80		~~121~~104.73		7133.85
Finance lease obligations	2117.54		32.46		54.64		3.94		87.60
Operating lease obligations	~~340~~326.94		8987.85		~~122~~121.74		6566.92		6251.53
Purchase obligations	~~681~~747.28		~~310~~236.96		~~272~~319.78		63116.94		3375.70
Other, primarily retirement plan obligations	4636.59		54.19		95.72		95.68		2221.10
Total contractual cash obligations	$	3,~~816~~609.19	$	~~571~~484.92	$	1,~~430~~291.58	$	~~265~~746.01	$	1,~~548~~087.78

We had long-term debt obligations and interest payments due primarily under the 5.250% Senior Notes, 4.500% Senior Notes, 4.000% Senior Notes, 4.375% Senior Notes and our credit facilities. Amounts in the table represent scheduled future maturities of debt principal for the periods indicated.

The interest payments for our credit facilities are based on outstanding borrowings as of September 30, ~~2024~~2025. Actual interest expense will likely be higher due to the seasonality of our business and associated higher average borrowings.

Purchase obligations primarily represent commitments for materials used in our manufacturing processes, including urea and packaging, as well as commitments for warehouse services, grass seed, marketing services and information technology services which comprise the unconditional purchase obligations disclosed in “NOTE 1817. COMMITMENTS” of the Notes to Consolidated Financial Statements included in this Form 10-K.

Other obligations include actuarially determined retiree benefit payments and pension funding to comply with local funding requirements. Pension funding requirements are based on preliminary estimates using actuarial assumptions determined as of September 30, 2024. These amounts represent expected payments through 2034. Based on the accounting rules for defined benefit pension plans and retirement health care plans, the liabilities reflected in our Consolidated Balance Sheets differ from these expected future payments (see “NOTE 9. RETIREMENT PLANS” and “NOTE 10. ASSOCIATE MEDICAL BENEFITS” of the Notes to Consolidated Financial Statements included in this Form 10-K). The above table excludes liabilities for unrecognized tax benefits and insurance accruals as we are unable to estimate the timing of payments for these items.

Regulatory Matters

We are subject to local, state, federal and foreign environmental protection laws and regulations with respect to our business operations and believe we are operating in substantial compliance, or taking actions aimed at ensuring compliance with, such laws and regulations. We are involved in several legal actions with various governmental agencies related to environmental matters. While it is difficult to quantify the potential financial impact of actions involving these environmental matters, particularly remediation costs at waste disposal sites and future capital expenditures for environmental control equipment, in the opinion of management, the ultimate liability arising from such environmental matters, taking into account established accruals, is not expected to have a material effect on our financial condition, results of operations or cash flows. However, there can be no assurance that the resolution of these matters will not materially affect our future quarterly or annual results of operations, financial condition or cash flows. Additional information on environmental matters affecting us is provided in “ITEM 1. BUSINESS — Regulatory Considerations” and “ITEM 3. LEGAL PROCEEDINGS” of this Form 10-K.

Critical Accounting Estimates

Our audited consolidated financial statements have been prepared in accordance with GAAP. The preparation of financial statements and related disclosures in accordance with GAAP requires management to use judgment and make estimates that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosures of contingent assets and liabilities. We evaluate our estimates on an ongoing basis. By their nature, these judgments are subject to uncertainty. We base our estimates on historical experience, current trends and other factors that we believe to be relevant under the circumstances at the time the estimate was made. Certain accounting estimates are particularly significant, including those related to revenue recognition and promotional allowances, income taxes and goodwill and indefinite-lived intangible assets.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

WeOther ~~believe~~obligations ~~that~~include ~~our~~actuarially ~~estimates,~~determined ~~assumptions,~~retiree benefit payments and ~~judgments~~pension ~~are~~funding ~~reasonable~~to incomply ~~that~~with ~~they~~local ~~were~~funding requirements. Pension funding requirements are based on ~~information~~preliminary ~~available~~estimates ~~when~~using ~~the~~actuarial ~~estimates~~assumptions determined as of September 30, ~~assumptions~~2025. These ~~and~~amounts ~~judgments~~represent ~~were~~expected ~~made~~payments through 2035. ~~However~~Based on the accounting rules for defined benefit pension plans and retirement health care plans, ~~because~~the liabilities reflected in our Consolidated Balance Sheets differ from these expected future ~~events~~payments (see “NOTE 8. RETIREMENT PLANS” and ~~their~~“NOTE 9. ASSOCIATE ~~effects~~MEDICAL ~~cannot~~BENEFITS” beof ~~determined~~the ~~with~~Notes ~~certainty,~~to ~~actual~~Consolidated ~~results~~Financial ~~could~~Statements ~~differ~~included ~~materially~~in ~~from~~this ~~those~~Form 10-K). The ~~implied~~above bytable ~~our~~excludes ~~assumptions~~liabilities for unrecognized tax benefits and ~~estimates~~insurance accruals as we are unable to estimate the timing of payments for these items.

Regulatory Matters

Critical Accounting Estimates

We believe that our estimates, assumptions and judgments are reasonable in that they were based on information available when the estimates, assumptions and judgments were made. However, because future events and their effects cannot be determined with certainty, actual results could differ materially from those implied by our assumptions and estimates.

The Audit Committee of the Board of Directors of Scotts Miracle-Gro reviews our critical accounting estimates on an ongoing basis, including those related to revenue recognition and promotional allowances, income taxes and goodwill and indefinite-lived intangible assets.

Revenue Recognition and Promotional Allowances

Our revenue is primarily generated from sales of branded and private label lawn and garden care and indoor and hydroponic gardening finished products. Product sales are recognized at a point in time when control of products transfers to customers and we have no further obligation to provide services related to such products. Sales are typically recognized when products are delivered to or picked up by the customer. We are generally the principal in a transaction and, therefore, primarily record revenue on a gross basis. Revenue for product sales is recorded net of sales returns and allowances. Revenues are measured based on the amount of consideration that we expect to receive as derived from a list price, reduced by estimates for variable consideration. Variable consideration includes the cost of current and continuing promotional programs and expected sales returns.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

Our promotional programs primarily include rebates based on sales volumes, in-store promotional allowances, cooperative advertising programs, direct consumer rebate programs and special purchasing incentives. The cost of promotional programs is estimated considering all reasonably available information, including current expectations and historical experience. Promotional costs (including allowances and rebates) incurred during the year are expensed to interim periods in relation to revenues and are recorded as a reduction of net sales. Provisions for estimated returns and allowances are recorded at the time revenue is recognized based on historical rates and are periodically adjusted for known changes in return levels. Shipping and handling costs are accounted for as contract fulfillment costs and included in the “Cost of sales” line in the Consolidated Statements of Operations. We exclude from revenue any amounts collected from customers for sales or other taxes.

Income Taxes

Our annual effective tax rate is established based on our pre-tax income (loss), statutory tax rates and the tax impacts of items treated differently for tax purposes than for financial reporting purposes. We record income tax liabilities utilizing known obligations and estimates of potential obligations. A deferred tax asset or liability is recognized whenever there are future tax effects from existing temporary differences and operating loss and tax credit carryforwards. Valuation allowances are used to reduce deferred tax assets to the balances that are more likely than not to be realized. In determining whether a valuation allowance is warranted, we take into account many factors, including the specific tax jurisdiction, both historical and projected future earnings, carryback and carryforward periods and tax planning strategies. Many of the judgments made in adjusting valuation allowances involve assumptions and estimates that are highly subjective. When we determine that deferred tax assets could be realized in greater or lesser amounts than recorded, the asset balance and Consolidated Statements of Operations reflect the change in the period such determination is made. Due to changes in facts and circumstances and the estimates and judgments involved in determining the proper valuation allowances, differences between actual future events and prior estimates and judgments could result in adjustments to these valuation allowances.

We also establish a liability for tax return positions in which there is uncertainty as to whether or not the position will ultimately be sustained. These uncertain tax positions are adjusted as a result of changes in factors such as tax legislation, interpretations of laws by courts, rulings by tax authorities, new audit developments, changes in estimates and the expiration of the statute of limitations. Amounts for uncertain tax positions are adjusted in quarters when new information becomes available or when positions are effectively settled. Many of the judgments made in adjusting uncertain tax positions involve assumptions and estimates regarding audit outcomes and the timing of audit settlements, which are often uncertain and subject to change.

Goodwill and Indefinite-Lived Intangible Assets

We have significant investments in intangible assets and goodwill. We perform our annual goodwill and indefinite-lived intangible asset testing as of the first day of our fiscal fourth quarter or more frequently if circumstances indicate potential impairment. In our evaluation of impairment for goodwill and indefinite-lived intangible assets, we perform either ana ~~initial~~ qualitative or quantitative evaluation for each of our reporting units and indefinite-lived intangible assets. Factors considered in the qualitative test include operating results as well as new events and circumstances impacting the operations or cash flows of the reporting unit or indefinite-lived intangible assets. For the quantitative test, the review for impairment of goodwill and indefinite-lived intangible assets is based on an income-based approach, including the relief-from-royalty method for indefinite-lived trade names. If it is determined that an impairment has occurred, an impairment loss is recognized in earnings for the amount by which the carrying value of the reporting unit or intangible asset exceeds its estimated fair value.

47Under the income-based approach, we determine fair value using a discounted cash flow approach that requires significant judgment with respect to revenue and profitability growth rates, based upon annual budgets and longer-range strategic plans, and the selection of an appropriate discount rate. These budgets and plans are used for internal purposes and are also the basis for communication with outside parties about future business trends. Fair value estimates employed in our annual impairment review of indefinite-lived intangible assets and goodwill were determined using models involving several assumptions. Changes in our assumptions could materially impact our fair value estimates. Assumptions critical to our fair value estimates were: (i) discount rates; (ii) royalty rates used in our intangible asset valuations; (iii) projected future revenues and profitability; and (iv) projected long-term growth rates used in the derivation of terminal year values. These and other assumptions are impacted by economic conditions and expectations of management and may change in the future based on period specific facts and circumstances. While we believe the assumptions we used to estimate future cash flows are reasonable, there can be no assurance that the expected future cash flows will be realized. As a result, impairment charges that possibly would have been recognized in earlier periods may not be recognized until later periods if actual results deviate unfavorably from earlier estimates. The use of different assumptions would increase or decrease discounted cash flows or earnings projections and, therefore, could change impairment determinations.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

~~Under~~At ~~the income-based approach~~September 30, ~~we determine fair value using a discounted cash flow approach that requires significant judgment with respect to revenue and profitability growth rates~~2025, ~~based~~goodwill ~~upon~~totaled ~~annual budgets and longer-range strategic plans~~$243.9, ~~and~~all ~~the selection~~ of anwhich ~~appropriate~~was ~~discount~~associated ~~rate. These budgets and plans are used for internal purposes and are also the basis for communication~~ with ~~outside~~our ~~parties~~U.S. ~~about~~Consumer ~~future business trends~~segment. ~~Fair~~Based ~~value~~on ~~estimates~~the ~~employed~~results inof ~~our~~the annual ~~impairment~~quantitative ~~review~~evaluation offor ~~indefinite-lived~~fiscal ~~intangible~~2025, ~~assets~~the ~~and goodwill were determined using models involving several assumptions. Changes in our assumptions could materially impact our~~ fair value ~~estimates. Assumptions~~of ~~critical to~~ our ~~fair~~U.S. ~~value~~Consumer ~~estimates~~segment ~~were:~~reporting ~~(i) discount~~unit ~~rates;~~substantially ~~(ii) royalty~~exceeded ~~rates~~its ~~used~~carrying ~~in our intangible asset valuations; (iii) projected future revenues and profitability; and (iv) projected long-term growth rates used in the derivation of terminal year values~~value. ~~These~~A ~~and~~100 ~~other~~basis ~~assumptions~~point ~~are impacted by economic conditions and expectations of management and may~~ change in the ~~future~~discount ~~based~~rate on period specific facts and circumstances. While we believe the assumptions we used to estimate future cash flows are reasonable, there can be no assurance that the expected future cash flows will be realized. As a result, impairment charges that possibly would not have ~~been~~resulted ~~recognized~~ in ~~earlier~~an ~~periods~~impairment ~~may~~for ~~not~~this bereporting ~~recognized until later periods if actual results deviate unfavorably from earlier estimates~~unit. ~~The use of different assumptions would increase or decrease discounted cash flows or earnings projections and, therefore, could change impairment determinations.~~

At September 30, ~~2024~~2025, ~~goodwill~~indefinite-lived ~~totaled~~intangible assets consisted of trade names of $~~243~~168.92 and the Roundup® marketing agreement amendment of $155.7, all of which ~~was~~were associated with our U.S. Consumer segment. Based on the results of the annual quantitative evaluation for fiscal ~~2024~~2025, the fair ~~value~~values of our ~~U.S.~~indefinite-lived ~~Consumer~~intangible ~~segment~~assets ~~reporting unit~~ substantially exceeded ~~its~~their respective carrying ~~value~~values. A 100 basis point change in the discount rate would not have resulted in an impairment ~~for~~of ~~this~~any ~~reporting~~of ~~unit~~our indefinite-lived intangible assets.

At September 30, 2024, indefinite-lived intangible assets consisted of trade names of $168.2 and the Roundup® marketing agreement amendment of $155.7, all of which were associated with our U.S. Consumer segment. Based on the results of the annual quantitative evaluation for fiscal 2024, the fair values of our indefinite-lived intangible assets substantially exceeded their respective carrying values. A 100 basis point change in the discount rate would not have resulted in an impairment of any of our indefinite-lived intangible assets.

Other Significant Accounting Policies

Other significant accounting policies, primarily those with lower levels of uncertainty than those discussed above, are also critical to understanding the consolidated financial statements. The Notes to Consolidated Financial Statements included in this Form 10-K contain additional information related to our accounting policies, including recent accounting pronouncements, and should be read in conjunction with this discussion.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

As part of our ongoing business, we are exposed to certain market risks, including fluctuations in interest rates, foreign currency exchange rates and commodity prices. Financial derivatives and other instruments are used to manage these risks. These instruments are not used for trading or speculative purposes.

Interest Rate Risk

The following table summarizes information about our debt instruments and derivative financial instruments that are sensitive to changes in interest rates as of September 30, ~~2024~~2025 and ~~2023~~2024. For debt instruments, the table presents principal cash flows and related weighted-average interest rates by expected maturity dates. For interest rate swap agreements, the table presents expected cash flows based on notional amounts and weighted-average interest rates by contractual maturity dates. We have outstanding interest rate swap agreements with major financial institutions that effectively convert a portion of the Company’s variable-rate debt to a fixed rate. The swap agreements had a maximum total U.S. dollar equivalent notional amount of $450.0 ~~and $600.0~~ at September 30, ~~2024~~2025 and ~~2023, respectively~~2024. Weighted-average variable rates are based on rates in effect at September 30, ~~2024~~2025 and ~~2023~~2024. Assuming average unhedged variable interest rate borrowing levels during fiscal ~~2024~~2025 of $~~575~~525.0, a change in our variable interest rate of 100 basis points for a full twelve-month period would have an impact of $5.83 on interest expense.


	Expected Maturity Date (Fiscal Year)																		Total			Fair Value
2025	2026			2027			2028			2029			2030			After
Long-term debt:
Fixed rate debt	$	—		$	250.0		$	—		$	—		$	450.0		$	900.0		$	1,600.0		$	1,512.9
Average rate	—			5.3		%	—			—			4.5		%	4.2		%	4.4		%	—
Variable rate debt	$	50.0		$	450.0		$	—		$	—		$	—		$	—		$	500.0		$	500.0
Average rate	6.0		%	6.0		%	—			—			—			—			6.0		%	—
Interest rate derivatives:
Interest rate swaps	$	(0.8)		$	(1.1)		$	(0.8)		$	(0.8)		$	—		$	—		$	(3.5)		$	(3.5)
Average rate	3.7		%	3.8		%	3.8		%	3.8		%	—			—			3.7		%	—


	Expected Maturity Date (Fiscal Year)																		Total			Fair Value
2024	2025			2026			2027			2028			2029			After
Long-term debt:
Fixed rate debt	$	—		$	—		$	250.0		$	—		$	—		$	1,350.0		$	1,600.0		$	1,507.1
Average rate	—			—			5.3		%	—			—			4.3		%	4.4		%	—
Variable rate debt	$	50.0		$	50.0		$	525.0		$	—		$	—		$	—		$	625.0		$	625.0
Average rate	7.5		%	7.5		%	7.5		%	—			—			—			7.5		%	—
Interest rate derivatives:
Interest rate swaps	$	(1.0)		$	(1.0)		$	(1.1)		$	(0.7)		$	(0.6)		$	—		$	(4.4)		$	(4.4)
Average rate	3.7		%	3.7		%	3.9		%	4.2		%	4.2		%	—			3.9		%	—

	Expected Maturity Date (Fiscal Year)																	Total			FairValue
2023	2024			2025			2026			2027			2028		After
Long-term debt:
Fixed rate debt	$	—		$	—		$	—		$	250.0		$	—	$	1,350.0		$	1,600.0		$	1,283.9
Average rate	—			—			—			5.3		%	—		4.3		%	4.4		%	—
Variable rate debt	$	50.0		$	50.0		$	50.0		$	863.3		$	—	$	—		$	1,013.3		$	1,013.3
Average rate	8.2		%	8.2		%	8.2		%	8.1		%	—		—			8.1		%	—
Interest rate derivatives:
Interest rate swaps	$	13.1		$	9.3		$	7.5		$	1.5		$	—	$	—		$	31.4		$	31.4
Average rate	1.6		%	2.1		%	2.3		%	3.4		%	—		—			2.1		%	—

Excluded from the information provided above are miscellaneous debt instruments of $5.2 and $0.0 and finance lease obligations of $14.5 and $17.8 at September 30, 2025 and 2024, respectively.

Excluded from the information provided above are miscellaneous debt instruments of $0.0 and $0.4 and finance lease obligations of $17.8 and $16.9 at September 30, 2024 and 2023, respectively.

Other Market Risks

We are subject to market risk from fluctuations in foreign currency exchange rates and fluctuating prices of certain raw materials, including urea and other fertilizer inputs, resins, diesel, gasoline, natural gas, sphagnum peat, bark and grass seed. Refer to “NOTE 1514. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES” of the Notes to Consolidated Financial Statements included in this Form 10-K for discussion of these market risks and the derivatives used to manage these risks.

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THE SCOTTS MIRACLE-GRO COMPANY

(Dollars in millions, except per share data)

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements and other information required by this Item are contained in the Consolidated Financial Statements, Notes to Consolidated Financial Statements and Schedules Supporting the Consolidated Financial Statements listed in the “Index to Consolidated Financial Statements and Financial Statement Schedules” on page 5857 of this Form 10-K.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

With the participation of the principal executive officer and the principal financial officer of The Scotts Miracle-Gro Company (the “Registrant”), the Registrant’s management has evaluated the effectiveness of the Registrant’s disclosure controls and procedures (as defined in Rule 13a-15(e) under the ~~Securities~~ Exchange Act ~~of 1934~~), as of the end of the fiscal year covered by this Form 10-K. Based upon that evaluation, the Registrant’s principal executive officer and principal financial officer have concluded that the Registrant’s disclosure controls and procedures were effective as of the end of the fiscal year covered by this Form 10-K.

Management’s Annual Report on Internal Control Over Financial Reporting

The “Annual Report of Management on Internal Control Over Financial Reporting” required by Item 308(a) of SEC Regulation S-K is included on page 5958 of this Form 10-K.

Attestation Report of Independent Registered Public Accounting Firm

The “Report of Independent Registered Public Accounting Firm” required by Item 308(b) of SEC Regulation S-K is included on page 6059 of this Form 10-K.

Changes in Internal Control Over Financial Reporting

No changes in the Registrant’s internal control over financial reporting (as defined in Rule 13a-15(f) under the ~~Securities~~ Exchange Act ~~of 1934~~) occurred during the Registrant’s fiscal quarter ended September 30, ~~2024~~2025, that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting.

ITEM 9B. OTHER INFORMATION

On ~~November~~September 2616, ~~2024~~2025, the ~~Company~~Hagedorn Partnership, asL.P., ~~part~~on behalf of Katherine Littlefield, a ~~series~~member of ~~executive~~our ~~and~~board ~~senior~~of ~~leadership enhancements~~directors, ~~announced~~adopted ~~that~~a ~~Nathan~~Rule E.10b5-1 ~~Baxter,~~plan ~~currently~~providing ~~Executive~~for ~~Vice~~the ~~President~~sale &of ~~Chief~~up ~~Operating~~to ~~Officer~~130,000 ~~has~~Common ~~been~~Shares. ~~named~~Pursuant ~~President~~to ~~and~~this ~~Chief~~plan, ~~Operating~~the ~~Officer~~Hagedorn Partnership, L.P. ~~The~~may ~~position~~sell ofCommon ~~President~~Shares ~~was~~beginning ~~previously~~December ~~held~~18, by2025 ~~James~~and ~~Hagedorn~~ending December 17, ~~the~~2026 ~~Company’s~~if ~~Chairman~~certain ~~and~~price ~~Chief~~targets ~~Executive~~are ~~Officer,~~met. The ~~who~~trading ~~will~~arrangement ~~continue~~is inintended ~~those~~to ~~roles~~satisfy the affirmative defense of Rule 10b5-1(c) under the Exchange Act.

In connection with his appointment to President, Mr. Baxter’s annual base salary was increased from $950,000 to $1,000,000. His target incentive percentage under The Scotts Company LLC Executive Incentive Plan was increased from 125% to 150%. Finally, Mr. Baxter’s annual target under the Company’s Long Term Incentive Plan will increase from $2,000,000 to $2,500,000.

The Company also announced that Matthew Garth, Executive Vice President, Chief Financial Officer & Chief Administrative Officer, will be departing the Company effective December 31, 2024 (the “Termination Date”).

In a corresponding move, Mark J. Scheiwer, currently Vice President and Treasurer, will assume the role of interim Chief Financial Officer & Chief Accounting Officer upon Mr. Garth’s departure. Mr. Scheiwer, 49, has been with the Company since 2011. His previous leadership roles at the Company include Vice President, Finance Lead – Hawthorne and Vice President, Corporate Controller.

In connection with his appointment to interim Chief Financial Officer & Chief Accounting Officer, Mr. Scheiwer will receive an annual base salary of $550,000, a target incentive percentage of 90% under The Scotts Company LLC Executive Incentive Plan and an annual target under the Company’s Long Term Incentive Plan of $600,000. In addition, Mr. Scheiwer will be a Tier 2 Participant under the Company’s Executive Severance Plan and will be entitled to purchase up to 25 hours on Company aircraft for personal use on an annual basis.

The Company is carrying out a search process to fill the Chief Financial Officer role on a permanent basis with the help of an executive search firm that is expected to consider internal and external candidates.

A copy of the Company’s news release announcing these changes is included as Exhibit 99.1 to this Annual Report on Form 10-K and is incorporated herein by reference.

In connection with Mr. Garth’s departure on the Termination Date, the Scotts Company LLC, a subsidiary of the Company (“Scotts LLC”), entered into a Separation Agreement and Release of All Claims (the “Separation Agreement”) with Mr. Garth on November 25, 2024. The Separation Agreement addresses the payments and benefits to which Mr. Garth is entitled in connection with his departure.

The Company will pay or make the following benefits available to Mr. Garth in connection with his departure that are generally consistent with the “Severance Benefits” under his Tier 1 Participation Agreement (the “Participation Agreement”) under the Company’s Executive Severance Plan pursuant to a termination without Cause: (a) pay equal to 24 months of salary, at Mr. Garth’s regular monthly base pay, payable in accordance with Scotts LLC’s standard payroll procedures; (b) in lieu of outplacement services, a lump sum payment of $30,000; (c) for a period of 24 months, a benefits offset payment in an amount equal to the excess of the COBRA premium charged by the Company to terminated employees over the premium Mr. Garth paid as an active employee; and (d) an amount equal to two times Mr. Garth’s Target Bonus Opportunity for the fiscal year ending September 30, 2025, 50% of which is payable on the first scheduled pay date following the first anniversary of Mr. Garth’s Termination Date and 50% of which is payable on the first scheduled pay date following the second anniversary of Mr. Garth’s Termination Date, subject to Mr. Garth’s continued compliance as of the payment date with all of his post-employment obligations to the Company.

In addition to the benefits Mr. Garth is entitled to receive pursuant to the Company’s Executive Severance Plan and his Participation Agreement as summarized above, the Compensation and Organization Committee has elected to provide partial vesting for certain equity-based awards to the extent of Mr. Garth’s service, as follows:

•The 28,599 non-qualified stock options granted to Mr. Garth on February 3, 2023, the 79,982 non-qualified stock options granted to Mr. Garth on November 16, 2023 and the 14,935 non-qualified stock options granted to Mr. Garth on February 16, 2024, all of which are unvested, will vest on a prorated basis on the Termination Date based on the number of days of active service between the grant date and the Termination Date over 1,097 days and will expire on the second anniversary of the Termination Date;

•The unvested 10,940 performance units and related dividend equivalents granted to Mr. Garth on February 3, 2023 will vest on a prorated basis on February 3, 2026 based on the number of days of active service between the grant date and the Termination Date over 1,097 days with the Company confirming that the performance criteria for this award having been satisfied as of the Termination Date; and

•The unvested 27,098 performance units and related dividend equivalents granted to Mr. Garth on February 16, 2024 will vest on a prorated basis on February 16, 2027, to the extent that the underlying performance criteria have been satisfied as of that date, based on the number of days of active service between the grant date and the Termination Date over 1,097 days.

Pursuant to the terms of the applicable award agreements entered into between the Company and Mr. Garth at the time of grant, the following equity-based awards will either naturally vest and settle or forfeit based on the applicable terms and conditions, without modification:

•The 13,580 restricted stock units and related dividend equivalents granted to Mr. Garth on December 1, 2022, will fully vest and settle on December 1, 2024, to the extent not previously settled; and

•The 42,017 unvested non-qualified stock options granted to Mr. Garth on November 8, 2024, will be cancelled as of the Termination Date.

All amounts payable to Mr. Garth under the Separation Agreement and the applicable award agreements will be subject to all applicable withholdings and deductions required by federal, state and local taxing authorities.

The payments and benefits described above are the only amounts to which Mr. Garth is entitled under the Separation Agreement (or any other agreement). He also remains entitled to any vested benefits he had as of his Termination Date under other benefit plans or programs maintained by the Company or its subsidiaries, including The Scotts Company LLC Retirement Savings Plan and The Scotts Company LLC Executive Retirement Plan.

The Separation Agreement, together with the Employee Confidentiality, Noncompetition, Nonsolicitation Agreement previously executed by Mr. Garth on April 12, 2023 which will continue in effect following his departure, also contains various restrictive covenants, including covenants relating to noncompetition, confidentiality, cooperation and nonsolicitation.

ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS

Not applicable.

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PART III

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

Directors, Executive Officers and Persons Nominated or Chosen to Become Directors or Executive Officers

The information required by Item 401 of SEC Regulation S-K concerning the directors of Scotts Miracle-Gro and the nominees for election or re-election as directors of Scotts Miracle-Gro at its Annual Meeting of Shareholders to be held on January 2726, ~~2025~~2026 (the “~~2025~~2026 Annual Meeting”) is incorporated herein by reference from the disclosure which will be included under the caption “PROPOSAL NUMBER 1 — ELECTION OF DIRECTORS” in Scotts Miracle-Gro’s definitive Proxy Statement relating to the ~~2025~~2026 Annual Meeting (the “Proxy Statement”), which will be filed pursuant to SEC Regulation 14A not later than 120 days after the end of Scotts Miracle-Gro’s fiscal year ended September 30, ~~2024~~2025.

The information required by Item 401 of SEC Regulation S-K concerning the executive officers of Scotts Miracle-Gro is incorporated herein by reference from the disclosure included under the caption “SUPPLEMENTAL ITEM. EXECUTIVE OFFICERS OF THE REGISTRANT” in Part II of this Form 10-K.

Compliance with Section 16(a) of the Securities Exchange Act of 1934

The information required by Item 405 of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “DELINQUENT SECTION 16(a) REPORTS” in its Proxy Statement.

Procedures for Recommending Director Nominees

Information concerning the procedures by which shareholders of Scotts Miracle-Gro may recommend nominees to Scotts Miracle-Gro’s Board of Directors is incorporated herein by reference from the disclosures which will be included under the captions “CORPORATE GOVERNANCE — Nominations of Directors” and “MEETINGS AND COMMITTEES OF THE BOARD — Committees of the Board — Nominating and Governance Committee” in the Proxy Statement. These procedures have not materially changed from those described in Scotts Miracle-Gro’s definitive Proxy Statement for the ~~2024~~2025 Annual Meeting of Shareholders held on January 2227, ~~2024~~2025.

Audit Committee

The information required by Items 407(d)(4) and 407(d)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “MEETINGS AND COMMITTEES OF THE BOARD — Committees of the Board” in the Proxy Statement.

Committee Charters; Code of Business Conduct & Ethics; Corporate Governance Guidelines

The Board of Directors of Scotts Miracle-Gro has adopted charters for each of the Audit Committee, the Nominating and Governance Committee, the Compensation and Organization Committee, the Innovation and Technology Committee and the Finance Committee, as well as Corporate Governance Guidelines, as contemplated by the applicable sections of the New York Stock Exchange Listed Company Manual.

In accordance with the requirements of Section 303A.10 of the New York Stock Exchange Listed Company Manual and Item 406 of SEC Regulation S-K, the Board of Directors of Scotts Miracle-Gro has adopted a Code of Business Conduct & Ethics covering the members of Scotts Miracle-Gro’s Board of Directors and associates of Scotts Miracle-Gro and its subsidiaries, including, without limitation, Scotts Miracle-Gro’s principal executive officer, principal financial officer and principal accounting officer. Scotts Miracle-Gro intends to disclose the following events, if they occur, on its Internet website located at http://investor.scotts.com within four business days following their occurrence: (A) the date and nature of any amendment to a provision of Scotts Miracle-Gro’s Code of Business Conduct & Ethics that (i) applies to Scotts Miracle-Gro’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, (ii) relates to any element of the code of ethics definition enumerated in Item 406(b) of SEC Regulation S-K, and (iii) is not a technical, administrative or other non-substantive amendment; and (B) a description of any waiver (including the nature of the waiver, the name of the person to whom the waiver was granted and the date of the waiver), including an implicit waiver, from a provision of the Code of Business Conduct & Ethics granted to Scotts Miracle-Gro’s principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions, that relates to one or more of the elements of the code of ethics definition enumerated in Item 406(b) of SEC Regulation S-K. In addition, Scotts Miracle-Gro will disclose any waivers from the provisions of the Code of Business Conduct & Ethics granted to an executive officer or a director of Scotts Miracle-Gro on Scotts Miracle-Gro’s Internet website located at http://investor.scotts.com within four business days of the determination to grant any such waiver.

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The text of Scotts Miracle-Gro’s Code of Business Conduct & Ethics, Scotts Miracle-Gro’s Corporate Governance Guidelines, the Audit Committee charter, the Nominating and Governance Committee charter, the Compensation and Organization Committee charter, the Innovation and Technology Committee charter and the Finance Committee charter are posted under the “Corporate Governance” link on Scotts Miracle-Gro’s Internet website located at http://investor.scotts.com. Interested persons and shareholders of Scotts Miracle-Gro may also obtain copies of each of these documents without charge by writing to The Scotts Miracle-Gro Company, Attention: Corporate Secretary, 14111 Scottslawn Road, Marysville, Ohio 43041.

Insider Trading Policy

The information required by Item 408(b) of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “EXECUTIVE COMPENSATION — Other Executive Compensation Policies, Practices and Guidelines — Insider Trading Policy and Anti-Hedging Policy” in the Proxy Statement.

ITEM 11. EXECUTIVE COMPENSATION

The information required by Item 402 of SEC Regulation S-K is incorporated herein by reference from the disclosures which will be included under the captions “EXECUTIVE COMPENSATION,” “NON-EMPLOYEE DIRECTOR COMPENSATION,” “EXECUTIVE COMPENSATION TABLES,” “SEVERANCE AND CHANGE IN CONTROL (CIC) ARRANGEMENTS,” ~~and~~ “PAYMENTS ON TERMINATION OF EMPLOYMENT AND/OR CHANGE IN CONTROL,” and “CEO PAY RATIO DISCLOSURE” in the Proxy Statement.

The information required by Item 407(e)(4) of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “MEETINGS AND COMMITTEES OF THE BOARD — Compensation and Organization Committee Interlocks and Insider Participation” in the Proxy Statement.

The information required by Item 407(e)(5) of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “COMPENSATION COMMITTEE REPORT” in the Proxy Statement.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

Ownership of Common Shares of Scotts Miracle-Gro

The information required by Item 403 of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT” in the Proxy Statement.

Equity Compensation Plan Information

The information required by Item 201(d) of SEC Regulation S-K is incorporated herein by reference from the disclosure which will be included under the caption “EQUITY COMPENSATION PLAN INFORMATION” in the Proxy Statement.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

Certain Relationships and Related Person Transactions

The information required by Item 404 of SEC Regulation S-K is incorporated herein by reference from the disclosures which will be included under the caption “CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS” in the Proxy Statement.

Director Independence

The information required by Item 407(a) of SEC Regulation S-K is incorporated herein by reference from the disclosures which will be included under the captions “CORPORATE GOVERNANCE — Director Independence” and “MEETINGS AND COMMITTEES OF THE BOARD” in the Proxy Statement.

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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES

The information required by this Item 14 is incorporated herein by reference from the disclosures which will be included under the captions “AUDIT COMMITTEE MATTERS — Fees of the Independent Registered Public Accounting Firm” and “AUDIT COMMITTEE MATTERS — Pre-Approval of Services Performed by the Independent Registered Public Accounting Firm” in the Proxy Statement.

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PART IV

ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES

(a) LIST OF DOCUMENTS FILED AS PART OF THIS REPORT

1 and 2. Financial Statements and Financial Statement Schedules:

The response to this portion of Item 15 is submitted as a separate section of this Form 10-K. Reference is made to the “Index to Consolidated Financial Statements and Financial Statement Schedules” on page 5857 of this Form 10-K.

(b) EXHIBITS

The exhibits listed on the “Index to Exhibits” beginning on page ~~111~~108 of this Form 10-K are filed or furnished with this Form 10-K or incorporated herein by reference as noted in the “Index to Exhibits.”

The financial statement schedule filed with this Form 10-K is submitted in a separate section hereof. For a description of such financial statement schedules, see “Index to Consolidated Financial Statements and Financial Statement Schedules” on page 5857 of this Form 10-K.

ITEM 16. FORM 10-K SUMMARY

None.

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SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.


			THE SCOTTS MIRACLE-GRO COMPANY

			By:						/s/ JAMES HAGEDORN
									James Hagedorn, Chairman and Chief Executive Officer

Dated: November 2625, ~~2024~~2025

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

Signature

Title

Date

/s/ MATTHEW E. GARTH

Executive Vice President, Chief Financial Officer & Chief Administrative Officer

November 26, 2024

/s/ MARK J. SCHEIWER

Executive Vice President, Chief Financial Officer & Chief Accounting Officer

November 25, 2025

Matthew E. Garth

(Principal Financial Officer and Principal Accounting Officer)

Mark J. Scheiwer

(Principal Financial Officer and Principal Accounting Officer)

/s/ JAMES HAGEDORN

Chairman and Chief Executive Officer

November 2625, ~~2024~~2025

James Hagedorn

(Principal Executive Officer)

/s/ EDITH AVILES*

Director

November 2625, ~~2024~~2025

Edith Aviles

/s/ ROBERTO CANDELINO*

Director

November 2625, ~~2024~~2025

Roberto Candelino

/s/ DAVID C. EVANS*

Director

November 2625, ~~2024~~2025

David C. Evans

/s/ ADAM HANFT*

Director

November 2625, ~~2024~~2025

Adam Hanft

/s/ STEPHEN L. JOHNSON*

Director

November 2625, ~~2024~~2025

Stephen L. Johnson

/s/ THOMAS N. KELLY JR.*

Director

November 26, 2024

/s/ MARK D. KINGDON*

Director

November 25, 2025

Thomas N. Kelly Jr.

/s/ MARK D. KINGDON*

Director

November 26, 2024

Mark D. Kingdon

/s/ KATHERINE HAGEDORN LITTLEFIELD*

Director

November 2625, ~~2024~~2025

Katherine Hagedorn Littlefield

/s/ NICK MIARITIS*

Director

November 25, 2025

Nick Miaritis

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Signature

Title

Date

/s/ BRIAN E. SANDOVAL*

Director

November 26, 2024

/s/ A. SCOTT MILLER*

Director

November 25, 2025

A. Scott Miller

/s/ BRIAN E. SANDOVAL*

Director

November 25, 2025

Brian E. Sandoval

/s/ PETER E. SHUMLIN*

Director

November 2625, ~~2024~~2025

Peter E. Shumlin

/s/ JOHN R. VINES*

Director

November 26, 2024

John R. Vines


*			The undersigned, by signing his name hereto, does hereby sign this Report on behalf of each of the directors of the Registrant identified above pursuant to Powers of Attorney executed by the directors identified above, which Powers of Attorney are filed with this Report as exhibits.

By: /s/ ~~MATTHEW~~MARK EJ. ~~GARTH~~SCHEIWER ~~Matthew~~Mark EJ. ~~Garth~~Scheiwer, Attorney-in-Fact

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THE SCOTTS MIRACLE-GRO COMPANY

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

AND FINANCIAL STATEMENT SCHEDULES

			Page
Consolidated Financial Statements of The Scotts Miracle-Gro Company and Subsidiaries:
Annual Report of Management on Internal Control Over Financial Reporting			5958
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 34)			6059
Consolidated Statements of Operations for the fiscal years ended September 30, 2024, 2023 and 2022			64
Consolidated Statements of Operations for the fiscal years ended September 30, 2025, 2024 and 2023			62
Consolidated Statements of Comprehensive Income (Loss) for the fiscal years ended September 30, 2024, 2023 and 2022			65
Consolidated Statements of Comprehensive Income (Loss) for the fiscal years ended September 30, 2025, 2024 and 2023			63
Consolidated Statements of Cash Flows for the fiscal years ended September 30, 2024, 2023 and 2022			66
Consolidated Statements of Cash Flows for the fiscal years ended September 30, 2025, 2024 and 2023			64
Consolidated Balance Sheets at September 30, 2024 and 2023			67
Consolidated Balance Sheets at September 30, 2025 and 2024			65
Consolidated Statements of Shareholders’ Equity (Deficit) for the fiscal years ended September 30, 2024, 2023 and 2022			68
Consolidated Statements of Shareholders’ Equity (Deficit) for the fiscal years ended September 30, 2025, 2024 and 2023			66
Notes to Consolidated Financial Statements			6967
Schedules Supporting the Consolidated Financial Statements:
Schedule II—Valuation and Qualifying Accounts for the fiscal years ended September 30, 2024, 2023 and 2022			110
Schedule II—Valuation and Qualifying Accounts for the fiscal years ended September 30, 2025, 2024 and 2023			107

All other financial statement schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are omitted because they are not required or are not applicable, or the required information has been presented in the Consolidated Financial Statements or Notes thereto.

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ANNUAL REPORT OF MANAGEMENT ON INTERNAL

CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America. Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of The Scotts Miracle-Gro Company and our consolidated subsidiaries; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of The Scotts Miracle-Gro Company and our consolidated subsidiaries are being made only in accordance with authorizations of management and directors of The Scotts Miracle-Gro Company and our consolidated subsidiaries, as appropriate; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the assets of The Scotts Miracle-Gro Company and our consolidated subsidiaries that could have a material effect on our consolidated financial statements.

Management, with the participation of our principal executive officer and principal financial officer, assessed the effectiveness of our internal control over financial reporting as of September 30, ~~2024~~2025, the end of our fiscal year. Management based its assessment on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Management’s assessment included evaluation of such elements as the design and operating effectiveness of key financial reporting controls, process documentation, accounting policies and our overall control environment. This assessment is supported by testing and monitoring performed under the direction of management.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluations 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. Accordingly, even an effective system of internal control over financial reporting will provide only reasonable assurance with respect to financial statement preparation.

Based on our assessment, management has concluded that our internal control over financial reporting was effective as of September 30, ~~2024~~2025, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America. We reviewed the results of management’s assessment with the Audit Committee of the Board of Directors of The Scotts Miracle-Gro Company.

Our independent registered public accounting firm, Deloitte & Touche LLP, independently audited our internal control over financial reporting as of September 30, ~~2024~~2025 and has issued their attestation report which appears herein.

/s/ JAMES HAGEDORN

/s/ ~~MATTHEW~~MARK EJ. ~~GARTH~~SCHEIWER

James Hagedorn

~~Matthew~~Mark EJ. ~~Garth~~Scheiwer

Chairman & Chief Executive Officer

Executive Vice President, Chief Financial Officer & Chief ~~Administrative~~Accounting Officer

Dated:

November 2625, ~~2024~~2025

Dated:

November 2625, ~~2024~~2025

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of The Scotts Miracle-Gro Company

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of The Scotts Miracle‐Gro Company and subsidiaries (the “Company”) as of September 30, ~~2024~~2025 and ~~2023~~2024, the related consolidated statements of operations, comprehensive income (loss), shareholders’ equity (deficit), and cash flows, for each of the three years in the period ended September 30, ~~2024~~2025, and the related notes and the schedules 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 September 30, ~~2024~~2025 and ~~2023~~2024, and the results of its operations and its cash flows for each of the three years in the period ended September 30, ~~2024~~2025, 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 September 30, ~~2024~~2025, 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 November 2625, ~~2024~~2025, 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 ~~Matters~~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.

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~~Investment~~Promotional inPrograms ~~Unconsolidated~~and ~~Affiliates~~Allowances — Refer to ~~Notes~~Note 12 ~~and 8~~ to the financial statements.

Critical Audit Matter Description

The Company’s ~~equity~~offers ~~method~~various ~~investment~~promotional inprograms ~~Bonnie~~to ~~Plants~~customers, ~~LLC~~which ~~(“Bonnie~~include ~~Investment”)~~rebates isbased ~~recorded~~on insales ~~the “Investment in unconsolidated affiliates” line in the Consolidated Balance Sheets. During the year ended September 30~~volumes, ~~2024,~~other ~~the~~promotional ~~Company~~programs ~~recorded~~and ~~pre-tax~~special ~~impairment~~purchasing ~~charges of $61~~incentives.~~9 million associated with this investment in the “Equity in loss of unconsolidated affiliates” line in the Consolidated Statements of Operations.~~ The ~~impairment~~cost ~~charges~~of ~~were~~promotional ~~driven~~programs byis ~~revisions~~estimated toconsidering ~~the~~all ~~Company’s~~reasonably ~~internal~~available ~~forecasts for Bonnie Plants~~information, ~~LLC~~including incurrent ~~response~~expectations ~~to decreased sales volume~~ and ~~inflationary~~historical ~~cost pressures~~experience. ~~The~~Promotional ~~estimated~~costs ~~fair~~(including ~~value~~allowances ofand ~~the~~rebates) ~~Bonnie~~incurred ~~Investment~~during ~~was based upon an equal weighting of~~ the ~~income-based~~year ~~and~~are ~~market-based~~expensed ~~approaches,~~in ~~utilizing~~relation ~~estimated~~to ~~cash~~revenues ~~flows~~ and aare ~~terminal~~recorded ~~value,~~as ~~discounted at~~ a ~~rate~~reduction of ~~return~~net ~~that~~sales. Accruals ~~reflects~~for ~~the~~expected ~~relative~~payouts ~~risk~~under ofthese ~~the~~programs ~~cash flows, as well as valuation multiples derived from comparable publicly traded companies that~~ are ~~applied~~included toin the ~~forecasted~~“Other ~~operating~~current ~~performance~~liabilities” ofline in the ~~Bonnie~~Consolidated ~~Investment. The~~Balance ~~fair value estimate utilizes significant unobservable inputs and thus represents a Level 3 fair value measurement~~Sheets.

~~Evaluating~~We identified the ~~indicators~~promotional ofprograms ~~potential other-than-temporary impairment~~ and ~~calculating~~allowances anas ~~other-than-temporary~~a ~~impairment~~critical ~~involves~~audit ~~significant~~matter ~~and~~because ~~complex management judgment. Therefore, a high degree~~ of ~~auditor~~the ~~judgment~~complexity and anvolume ~~increased extent~~ of ~~effort~~the ~~was~~Company’s ~~required~~activities ~~when~~related ~~performing audit procedures~~ to ~~evaluate~~promotional ~~the~~programs. This ~~conclusions~~required ~~reached~~significant ~~around~~audit ~~whether~~effort ~~these~~due ~~impairment~~to ~~indicators resulted in an other-than-temporary impairment and~~ the ~~appropriateness~~various oftypes ~~management’s assumptions used in the calculation~~ of ~~the~~promotional ~~other-than-temporary~~programs ~~impairment~~and ~~charge,~~significant ~~including~~data ~~the~~utilized ~~need~~ to ~~involve~~track ~~fair~~and ~~value~~record ~~specialists~~promotional activities.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to ~~management’s~~promotional ~~assessment~~programs ~~of identified impairment indicators, the conclusions reached around whether these impairment indicators resulted in an other-than-temporary impairment,~~ and ~~the~~allowances ~~determination of the fair value of the investment,~~ included the following, among others:

•We tested the effectiveness of ~~controls~~relevant ~~over management’s other-than-temporary impairment evaluation of the Bonnie Investment, and~~ controls over ~~management’s~~promotional ~~determination of various critical assumptions used to determine the estimated fair value of the investment~~programs, ~~such~~including asautomated ~~the~~ controls ~~related~~within torelevant the development of revenue and EBITDA forecasts, valuation multiples, long-term growth rate, discount for lack of marketability, the selection of an appropriate discount rate, and the guideline public companiessystems.

•We ~~performed~~evaluated ~~inquiries~~the ~~with~~appropriateness ~~relevant members~~ of management topromotional ~~obtain~~program anprocesses ~~understanding~~and ofmethodology ~~their~~by ~~current~~performing ~~and~~a ~~expected~~lookback ~~performance~~analysis ~~for~~on ~~the~~prior ~~investment~~year accrual estimates, ~~including~~comparing ~~their~~management’s ~~understanding~~previously ofrecorded ~~any~~accrual ~~operational~~as ~~and~~of ~~strategic~~September ~~changes~~30, ~~corroborated~~2024 byto ~~inspection~~actual ofcustomer ~~the~~settlements ~~investee’s~~during ~~internal~~the ~~communications~~year-ended toSeptember ~~its~~30, ~~board of directors~~2025.

•We ~~evaluated~~selected ~~management’s~~a ~~impairment~~sample ~~analysis~~of bycustomer ~~assessing~~settlements ~~whether~~during ~~certain~~the ~~indicators~~year-ended ~~were~~September ~~present~~30, 2025 and ~~whether~~traced ~~those~~them ~~indicators~~to ~~implied~~promotional anprograms ~~other-than-temporary~~to ~~loss~~validate the completeness and accuracy of ~~value.~~the Company’s promotional programs.

•We ~~evaluated~~performed ~~the~~a ~~sensitivity~~retrospective review of ~~various~~customer ~~key~~settlements ~~assumptions~~after ~~used~~September ~~in the valuation~~30, ~~such as the revenue growth rate~~2025, ~~EBITDA margin, revenue~~ and ~~EBITDA~~compared ~~multiples,~~them ~~long-term~~to ~~growth~~management’s ~~rate,~~promotional ~~discount~~program ~~for~~accrual ~~lack~~as of ~~marketability,~~September ~~and the discount rate~~30, ~~including the company specific risk premium~~2025.

•We ~~evaluated~~developed ~~the~~an ~~reasonableness~~expectation of the ~~assumptions~~reduction ~~within~~to net sales associated with promotional programs for the ~~valuation~~year-ended ~~analysis~~September ~~by:~~30, 2025 and the related accrual as of September 30, 2025, and compared each to the recorded balances.

•~~Evaluating~~We ~~the~~obtained ~~reasonableness~~and ofevaluated ~~management’s~~external ~~forecasts~~confirmations byfrom ~~comparing~~selected ~~the~~customers ~~forecasts~~ to ~~(1)~~independently ~~historical~~evaluate ~~results, (2)~~ the ~~investee’s~~completeness ~~internal~~of ~~communications~~promotional toprograms, ~~management~~including ~~and~~assessing ~~its~~the ~~board~~reliability of ~~directors,~~responses and ~~(3)~~performing ~~forecasted~~appropriate ~~information~~follow-up ~~included in industry reports~~ and ~~companies~~alternative inprocedures ~~its~~on ~~peer group~~non-responses.

~~•Evaluating~~/s/ ~~the~~DELOITTE ~~impact~~& ofTOUCHE ~~changes~~LLP inColumbus, ~~management’s~~Ohio ~~assumptions~~November ~~from~~25, ~~prior~~2025 ~~estimates~~We ofhave ~~fair~~served ~~value~~as the Company’s auditor since 2005.

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•With the assistance of our fair value specialists, we evaluated the reasonableness of the valuation methodology and valuation assumptions by:

•Testing the source information and verifying the mathematical accuracy of the calculations.

•Developing a range of independent estimates for significant assumptions, such as, the long-term growth rate, discount for lack of marketability, and the discount rate, which considers the company specific risk premium, and comparing those to the assumptions selected by management.

•Evaluating the selected revenue and 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.

•We tested the mathematical accuracy of the overall valuation analysis and the resulting estimated fair value of the investment, in comparison to the investment’s carrying value, to calculate the resulting impairment.

/s/ DELOITTE & TOUCHE LLP Columbus, Ohio November 26, 2024 We have served as the Company’s auditor since 2005.

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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the shareholders and the Board of Directors of The Scotts Miracle-Gro Company

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of The Scotts Miracle-Gro Company and subsidiaries (the “Company”) as of September 30, ~~2024~~2025, 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 September 30, ~~2024~~2025, 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 September 30, ~~2024~~2025, of the Company and our report dated November 2625, ~~2024~~2025, 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 Annual Report of Management 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 Columbus, Ohio November 2625, ~~2024~~2025

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THE SCOTTS MIRACLE-GRO COMPANY

Consolidated Statements of Operations

(In millions, except per share data)

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Net sales	$	3,~~552~~413.71	$	3,~~551~~552.37	$	3,~~924~~551.13
Cost of sales	2,~~618~~348.76		2,~~708~~618.37		2,~~891~~708.13
Cost of sales—impairment, restructuring and other	8320.53		~~185~~83.75		~~160~~185.17
Gross margin	~~850~~1,044.52		~~657~~850.35		~~872~~657.93
Operating expenses:
Selling, general and administrative	~~559~~603.04		~~551~~559.30		~~613~~551.03
Impairment, restructuring and other	6263.84		~~280~~62.58		~~693~~280.15
Other (income) expense, net	1918.98		(019.1)9		(0.81)
Income (loss) from operations	~~208~~358.86		~~(174~~208.4)8		(~~434~~174.04)
Equity in loss of unconsolidated affiliates	682.18		~~101~~68.1		12101.91
Interest expense	~~158~~128.8		~~178~~158.18		~~118~~178.1
Other non-operating (income) expense, net	5.53		(05.3)5		(60.93)
Loss before income taxes	(23.6)		(453.3)		(558.1)
Income (loss) before income taxes	221.7		(23.6)		(453.3)
Income tax expense (benefit)	1176.35		~~(73~~11.2)3		(~~120~~73.62)
Net loss	$	(34.9)	$	(380.1)	$	(437.5)
Net income (loss)	$	145.2	$	(34.9)	$	(380.1)
Basic net loss per common share	$	(0.61)	$	(6.79)	$	(7.88)
Basic net income (loss) per common share	$	2.52	$	(0.61)	$	(6.79)
Diluted net loss per common share	$	(0.61)	$	(6.79)	$	(7.88)
Diluted net income (loss) per common share	$	2.47	$	(0.61)	$	(6.79)

See Notes to Consolidated Financial Statements.

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THE SCOTTS MIRACLE-GRO COMPANY

Consolidated Statements of Comprehensive Income (Loss)

(In millions)

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Net loss	$	(34.9)	$	(380.1)	$	(437.5)
Net income (loss)	$	145.2	$	(34.9)	$	(380.1)
Other comprehensive income (loss):
Net foreign currency translation adjustment	09.60		7.0.6		~~(27~~7.2)0
Net unrealized gain (loss) on derivative instruments, net of tax	(72.9)		4(7.29)		294.92
Reclassification of net unrealized gain on derivative instruments to net loss, net of tax	(7.3)		(17.4)		(6.8)
Reclassification of net unrealized gain on derivative instruments to net income (loss), net of tax	(7.4)		(7.3)		(17.4)
Net unrealized loss on securities, net of tax	(403.45)		(3440.94)		(7734.49)
Reclassification of net unrealized loss on securities to net loss, net of tax	64.6		76.0		—
Reclassification of net unrealized loss on securities to net income (loss), net of tax	—		64.6		76.0
Net unrealized loss in pension and other post-retirement benefits, net of tax	(2.1)		(1.8)		(5.4)
Net unrealized loss on pension and other post-retirement benefits, net of tax	(5.0)		(2.1)		(1.8)
Pension and other post-retirement benefit adjustments, net of tax	(21.0)6		(12.30)		8(1.73)
Total other comprehensive income (loss)	5(2.54)		315.85		~~(78~~31.2)8
Comprehensive loss	$	(29.4)	$	(348.3)	$	(515.7)
Comprehensive income (loss)	$	142.8	$	(29.4)	$	(348.3)

See Notes to Consolidated Financial Statements.

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THE SCOTTS MIRACLE-GRO COMPANY

Consolidated Statements of Cash Flows

	Year Ended September 30,
	2024		2023		2022
OPERATING ACTIVITIES
Net loss	$	(34.9)	$	(380.1)	$	(437.5)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Impairment, restructuring and other	84.3		288.6		666.8
Share-based compensation expense	80.4		68.9		34.3
Depreciation	64.9		67.3		68.1
Amortization	15.7		25.2		37.1
Deferred taxes	9.3		(58.7)		(182.8)
Equity in loss of unconsolidated affiliates	68.1		101.1		12.9
Changes in assets and liabilities, net of acquisitions:
Accounts receivable	128.2		77.7		102.8
Inventories	293.8		450.5		(203.8)
Prepaid and other current assets	10.2		18.6		(3.3)
Accounts payable	(1.6)		(153.6)		(171.2)
Other current liabilities	(45.4)		52.0		(68.4)
Other non-current items	(6.2)		(30.7)		20.1
Other, net	0.7		4.2		(4.1)
Net cash provided by (used in) operating activities	667.5		531.0		(129.0)
INVESTING ACTIVITIES
Proceeds from sale of long-lived assets	2.4		2.5		63.3
Investments in property, plant and equipment	(84.0)		(92.8)		(113.5)
Proceeds from loans receivable	—		37.0		—
Investments in unconsolidated affiliates	(21.4)		—		—
Payment for acquisitions, net of cash acquired	—		—		(237.3)
Purchase of convertible debt investments	—		—		(25.0)
Other investing, net	2.6		(12.4)		29.3
Net cash used in investing activities	(100.4)		(65.7)		(283.2)
FINANCING ACTIVITIES
Borrowings under revolving and bank lines of credit and term loans	648.5		1,336.2		3,617.4
Repayments under revolving and bank lines of credit and term loans	(1,039.5)		(1,689.8)		(2,937.3)
Financing and issuance fees	—		(6.4)		(9.6)
Dividends paid	(151.3)		(149.1)		(166.2)
Purchase of Common Shares	(5.1)		(9.3)		(257.9)
Cash received from exercise of stock options	3.8		2.3		3.3
Other financing, net	15.7		(4.0)		5.6
Net cash (used in) provided by financing activities	(527.9)		(520.1)		255.3
Effect of exchange rate changes on cash	0.5		(0.1)		(0.4)
Net increase (decrease) in cash and cash equivalents	39.7		(54.9)		(157.3)
Cash and cash equivalents at beginning of year	31.9		86.8		244.1
Cash and cash equivalents at end of year	$	71.6	$	31.9	$	86.8

(In millions)


	Year Ended September 30,
	2025		2024		2023
OPERATING ACTIVITIES
Net income (loss)	$	145.2	$	(34.9)	$	(380.1)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Impairment, restructuring and other	21.7		84.3		288.6

Share-based compensation expense	69.0		80.4		68.9
Depreciation	62.7		64.9		67.3
Amortization	12.3		15.7		25.2
Deferred taxes	70.8		9.3		(58.7)

Loss on sale of business	17.7		—		—
Equity in loss of unconsolidated affiliates	2.8		68.1		101.1

Changes in assets and liabilities, net of dispositions:
Accounts receivable	(16.6)		128.2		77.7
Inventories	(17.9)		293.8		450.5
Prepaid and other current assets	(2.3)		10.2		18.6
Accounts payable	(0.3)		(1.6)		(153.6)
Other current liabilities	16.0		(45.4)		52.0
Other non-current items	(9.2)		(6.2)		(30.7)
Other, net	(0.6)		0.7		4.2
Net cash provided by operating activities	371.3		667.5		531.0
INVESTING ACTIVITIES

Investments in property, plant and equipment	(97.4)		(84.0)		(92.8)
Investments in loans receivable	(8.5)		—		—
Proceeds from loans receivable	—		—		37.0
Investments in unconsolidated affiliates	—		(21.4)		—

Net cash disposed of on sale of business	(2.5)		—		—

Other investing, net	(3.7)		5.0		(9.9)
Net cash used in investing activities	(112.1)		(100.4)		(65.7)
FINANCING ACTIVITIES
Borrowings under revolving and bank lines of credit and term loans	702.7		648.5		1,336.2
Repayments under revolving and bank lines of credit and term loans	(824.8)		(1,039.5)		(1,689.8)



Dividends paid	(154.3)		(151.3)		(149.1)
Purchase of Common Shares	(18.4)		(5.1)		(9.3)

Cash received from exercise of stock options	11.9		3.8		2.3

Other financing, net	(11.1)		15.7		(10.4)
Net cash used in financing activities	(294.0)		(527.9)		(520.1)
Effect of exchange rate changes on cash	(0.2)		0.5		(0.1)
Net increase (decrease) in cash and cash equivalents	(35.0)		39.7		(54.9)
Cash and cash equivalents at beginning of year	71.6		31.9		86.8
Cash and cash equivalents at end of year	$	36.6	$	71.6	$	31.9

See Notes to Consolidated Financial Statements.

6664

Table of Contents

THE SCOTTS MIRACLE-GRO COMPANY

Consolidated Balance Sheets

(In millions, except per share data)

	September 30,
	2024		2023
	2025		2024
ASSETS
Current assets:
Cash and cash equivalents	$	7136.6	$	3171.96
Accounts receivable, less allowances of $9.6 in 2024 and $15.1 in 2023	176.8		304.2
Accounts receivable, less allowances of $12.0 in 2025 and $9.6 in 2024	186.9		176.8
Inventories	~~587~~592.58		~~880~~587.35
Prepaid and other current assets	~~144~~124.50		~~181~~144.45
Total current assets	~~980~~940.43		~~1,397~~980.84
Investment in unconsolidated affiliates	4553.26		9145.92
Property, plant and equipment, net	~~609~~631.56		~~610~~609.35
Goodwill	243.9		243.9
Intangible assets, net	~~418~~401.8		~~436~~418.78
Other assets	~~574~~470.18		~~633~~574.1
Total assets	$	2,~~871~~742.90	$	32,~~413~~871.79
LIABILITIES AND EQUITY (DEFICIT)
Current liabilities:
Current portion of debt	$	5257.62	$	52.36
Accounts payable	~~254~~229.72		~~271~~254.27
Other current liabilities	~~443~~453.03		~~450~~443.20
Total current liabilities	~~750~~739.37		~~773~~750.73
Long-term debt	2,~~174~~049.2		2,~~557~~174.42
Other liabilities	~~338~~310.06		~~349~~338.90
Total liabilities	3,~~262~~099.5		3,~~681~~262.05
Commitments and contingencies (Notes 17, 18 and 19)
Commitments and contingencies (Notes 16, 17 and 18)
Equity (deficit):
Common shares and capital in excess of $0.01 stated value per share; shares outstanding of 57.1 and 56.5, respectively	362.0		353.1
Common shares and capital in excess of $0.01 stated value per share; shares outstanding of 57.8 and 57.1, respectively	351.6		362.0
Retained earnings	~~303~~294.87		~~490~~303.98
Treasury shares, at cost; 11.0 and 11.6 shares, respectively	(949.1)		(998.5)
Treasury shares, at cost; 10.4 and 11.0 shares, respectively	(894.1)		(949.1)
Accumulated other comprehensive loss	(~~107~~109.37)		(~~112~~107.83)
Total equity (deficit)	(~~390~~357.65)		(~~267~~390.36)
Total liabilities and equity (deficit)	$	2,~~871~~742.90	$	32,~~413~~871.79

See Notes to Consolidated Financial Statements.

6765

Table of Contents

THE SCOTTS MIRACLE-GRO COMPANY

Consolidated Statements of Shareholders’ Equity (Deficit)

(In millions, except per share data)

	Common Shares			Capital in Excess ofStated Value		RetainedEarnings		Treasury Shares			Accumulated OtherComprehensive Income (Loss)		TotalEquity (Deficit)
	Shares	Amount						Shares	Amount
Balance at September 30, 2021	68.1	$	0.3	$	476.7	$	1,605.1	12.6	$	(1,002.4)	$	(66.4)	$	1,013.3
Balance at September 30, 2022	68.1	$	0.3	$	363.7	$	1,020.1	12.8	$	(1,091.8)	$	(144.6)	$	147.7
Net income (loss)	—	—		—		(437.5)		—	—		—		(437.5)
Other comprehensive income (loss)	—	—		—		—		—	—		(78.2)		(78.2)
Share-based compensation	—	—		30.3		—		—	—		—		30.3
Dividends declared ($2.64 per share)	—	—		—		(147.5)		—	—		—		(147.5)
Treasury share purchases	—	—		—		—		1.7	(257.9)		—		(257.9)
Treasury share issuances	—	—		(143.3)		—		(1.5)	168.4		—		25.1
Balance at September 30, 2022	68.1	0.3		363.7		1,020.1		12.8	(1,091.8)		(144.6)		147.7
Net income (loss)	—	—		—		(380.1)		—	—		—		(380.1)
Other comprehensive income (loss)	—	—		—		—		—	—		31.8		31.8
Share-based compensation	—	—		68.1		—		—	—		—		68.1
Dividends declared ($2.64 per share)	—	—		—		(149.1)		—	—		—		(149.1)
Treasury share purchases	—	—		—		—		0.1	(9.3)		—		(9.3)
Treasury share issuances	—	—		(78.9)		—		(1.3)	102.6		—		23.7
Balance at September 30, 2023	68.1	0.3		352.8		490.9		11.6	(998.5)		(112.8)		(267.3)
Net income (loss)	—	—		—		(34.9)		—	—		—		(34.9)
Other comprehensive income (loss)	—	—		—		—		—	—		5.5		5.5
Share-based compensation	—	—		38.9		—		—	—		—		38.9
Dividends declared ($2.64 per share)	—	—		—		(152.2)		—	—		—		(152.2)
Treasury share purchases	—	—		—		—		0.1	(5.1)		—		(5.1)
Treasury share issuances	—	—		(30.0)		—		(0.7)	54.5		—		24.5
Balance at September 30, 2024	68.1	$0.3	~~0.3~~	$361.7	~~361.7~~	$303.8	~~303.8~~	11.0	$(949.1)	~~(949.1)~~	$(107.3)	~~(107.3)~~	$(390.6)	~~(390.6)~~
Net income (loss)	—	—		—		145.2		—	—		—		145.2
Other comprehensive income (loss)	—	—		—		—		—	—		(2.4)		(2.4)
Share-based compensation	—	—		50.6		—		—	—		—		50.6
Dividends declared ($2.64 per share)	—	—		—		(154.3)		—	—		—		(154.3)
Treasury share purchases	—	—		—		—		0.2	(18.4)		—		(18.4)
Treasury share issuances	—	—		(61.0)		—		(0.8)	73.4		—		12.4
Balance at September 30, 2025	68.1	$	0.3	$	351.3	$	294.7	10.4	$	(894.1)	$	(109.7)	$	(357.5)

The sum of the components may not equal due to rounding.

See Notes to Consolidated Financial Statements.

6866


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Dollars in millions, except per share data)

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

The Scotts Miracle-Gro Company (“Scotts Miracle-Gro”) and its subsidiaries (collectively, with Scotts Miracle-Gro, the “Company”) are engaged in the manufacturing, marketing and sale of products for lawn and garden care and indoor and hydroponic gardening. The Company’s products are primarily sold in North America. The Company’s North America consumer lawn and garden business is highly seasonal, ~~Europe~~with more than 75% of its annual net sales occurring in the second and ~~Asia.~~third fiscal quarters.

The Company’s North America consumer lawn and garden business is highly seasonal, with approximately 75% of its annual net sales occurring in the second and third fiscal quarters. The Company’s Hawthorne segment is also impacted by seasonal sales patterns for certain product categories due to the timing of growing patterns in North America during the second and third fiscal quarters, and the timing of certain controlled agricultural lighting project sales during the third and fourth fiscal quarters.

Organization and Basis of Presentation

The Company’s consolidated financial statements are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The consolidated financial statements include the accounts of Scotts Miracle-Gro and its consolidated subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s ~~consolidation~~consolidates ~~criteria~~all ~~are based on~~ majority-owned ~~ownership~~subsidiaries ~~(as~~and ~~evidenced~~variable ~~by a majority voting~~ interest inentities where the ~~entity)~~Company ~~and~~has anbeen ~~objective~~determined ~~evaluation~~to ~~and~~be ~~determination~~the ofprimary ~~effective management control~~beneficiary. The results of businesses acquired or disposed of are included in the consolidated financial statements from the date of each acquisition or up to the date of disposal, respectively.

On March 14, 2025, the Company sold all of the issued and outstanding shares of capital stock of its formerly wholly-owned subsidiary The Hawthorne Collective, Inc. (“THC”) to Bad Dog Holdings LLC (“BDH”) in exchange for a promissory note with a principal amount of $39.0. BDH is a newly formed legal entity owned and controlled by a strategic partner of the Company that is intended to hold and manage the investments held by THC. THC was created during fiscal 2021 as a vehicle to invest in areas of the cannabis industry that are not pursued by the Company’s Hawthorne segment. At the time of the sale, THC held non-voting exchangeable shares of FLUENT (CSE: FNT.U) (OTCQB: CNTMF), a vertically-integrated, multi-state cannabis company, and other minority non-equity investments with a total book value of $39.0. BDH granted the Company a call option that enables the Company, subject to certain restrictions, to reacquire all of the issued and outstanding shares of capital stock of THC in exchange for canceling the principal amount of the promissory note and making an additional payment to BDH equal to 5% of any appreciation in the fair value of THC. The Company may exercise the call option in its sole and absolute discretion, until the earlier of (i) March 14, 2035 and (ii) the date of the consummation of a merger, change in control or consolidation of BDH or a sale, lease, transfer, exclusive license or other disposition of all or substantially all of the assets of BDH. The Company also granted BDH a put option providing BDH with the right to cause the Company to reacquire all the issued and outstanding shares of capital stock of THC in exchange for canceling the principal amount of the promissory note. The Company has determined that it has a variable interest in BDH and that BDH is a variable interest entity. Additionally, based on its assessment of the characteristics of its variable interest in BDH, including the involvement of its de facto agents, the Company has determined it is the primary beneficiary of BDH and, as a result, is required to consolidate BDH in its consolidated financial statements. As of September 30, 2025, BDH had assets of $2.6 and $24.6 recorded in the “Investment in unconsolidated affiliates” and “Other assets” lines in the Consolidated Balance Sheets, respectively, and total liabilities of $39.0 associated with the promissory note due to the Company, which is eliminated in consolidation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes and related disclosures. Although these estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future, actual results ultimately may differ from the estimates.

Advertising

Advertising costs incurred during the year are expensed to interim periods in relation to revenues. Advertising costs, except for external production costs, are generally expensed within the fiscal year in which such costs are incurred. External production costs for advertising programs are deferred until the period in which the advertising is first aired, and deferrals of these costs were not material at September 30, ~~2024~~2025 and ~~2023~~2024. On September 4, 2024, the Company issued 0.3 million restricted shares to a vendor in exchange for advertising services that ~~will~~were be performed during fiscal 2025. As of September 30, 2025 and 2024, deferred advertising costs associated with the issuance of these restricted shares were $0.0 and $20.0, respectively. Advertising expenses were $~~141~~152.03, $~~123~~141.70 and $~~120~~123.37 for fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively.


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (Dollars in millions, except per share data)

Research and Development

Costs associated with research and development are generally charged to expense as incurred. Expenses for fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023 were $34.68, $3534.76 and $4535.37, respectively, including product registration costs of $98.09, $129.40 and $1312.04, respectively.

Environmental Costs

The Company recognizes environmental liabilities when conditions requiring remediation are probable and the amounts can be reasonably estimated. Expenditures which extend the life of the related property or mitigate or prevent future environmental contamination are capitalized. Environmental liabilities are not discounted or reduced for possible recoveries from insurance carriers.

Earnings per Common Share

Basic net income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding each period. Diluted income (loss) per common share is computed by dividing net income (loss) by the weighted average number of common shares outstanding plus all dilutive potential common shares (stock options, restricted stock units, deferred stock units and performance-based award units) outstanding each period.

Table of Contents THE SCOTTS MIRACLE-GRO COMPANYNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)(Dollars in millions, except per share data)

Share-Based Compensation Awards

Scotts Miracle-Gro grants share-based awards annually to officers and certain other associates and to the non-employee directors of Scotts Miracle-Gro. The share-based awards have consisted of stock options, restricted stock units, deferred stock units and performance-based award units. Performance-based award units are subject to performance and service conditions, and certain awards contain a market condition based on the Company’s absolute total shareholder return or total shareholder return relative to a Company selected peer group. All of these share-based awards have been made under plans approved by the shareholders. The fair value of awards is expensed over the requisite service period, which is typically the vesting period, generally three years for awards granted to officers and other associates and one year for awards granted to non-employee directors.

For restricted stock units, deferred stock units and performance-based award units that do not contain a market condition, the fair value of each award is estimated on the grant date based on the current market price of the Common Shares. For performance-based award units that contain a market condition, the fair value of each award is estimated using a Monte Carlo simulation model. Expected market price volatility is based on historical volatility specific to the Common Shares. The risk-free rate is based on the U.S. Treasury yield curve in effect at the time of grant. The grant date fair value of stock option awards is estimated using a binomial model. Expected market price volatility is based on implied volatilities from traded options on Common Shares and historical volatility specific to the Common Shares. Historical data, including demographic factors impacting historical exercise behavior, is used to estimate stock option exercises and employee terminations within the valuation model. The risk-free rate for periods within the contractual life of the stock option is based on the U.S. Treasury yield curve in effect at the time of grant. The expected life of stock options is based on historical experience and expectations for grants outstanding.

Vesting of performance-based award units depends on service and achievement of specified performance targets. Based on the extent to which the targets are achieved, vested shares may range from 0% to 325% of the target award amount. For performance-based award units that do not contain a market condition, the total amount of compensation expense recognized reflects management’s assessment of the probability that performance goals will be achieved. A cumulative adjustment is recognized to compensation expense in the current period to reflect any changes in the probability of achievement of performance goals. For performance-based award units that contain a market condition, compensation expense is recognized regardless of the extent to which the targets are achieved.


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (Dollars in millions, except per share data)

Restricted stock units, deferred stock units and performance-based award units receive dividend equivalents equal to the cash dividends earned during the vesting period that are only paid out upon vesting. Share-based award units are generally forfeited if a holder terminates employment or service with the Company prior to the vesting date, except in cases where associates are eligible for accelerated vesting based on having satisfied retirement requirements relating to age and years of service. The Company estimates that 15% of its share-based awards will be forfeited based on an analysis of historical trends. The Company evaluates the estimated forfeiture rate on an annual basis and makes adjustments as appropriate. Stock options have exercise prices equal to the market price of the underlying Common Shares on the grant date and a term of 10 years. If available, Scotts Miracle-Gro typically uses treasury shares, or if not available, newly-issued Common Shares, to settle vested share-based awards. The Company classifies share-based compensation expense within cost of sales or selling, general and administrative expenses to correspond with the same line item as cash compensation paid to associates. Cash flows resulting from tax deductions in excess of the cumulative compensation cost recognized for share-based awards (excess tax benefits) are classified as operating cash inflows.

Cash and Cash Equivalents

Cash and cash equivalents are held in cash depository accounts with major financial institutions around the world or invested in high quality, short-term liquid investments. The Company considers all highly liquid financial instruments with original maturities of three months or less to be cash equivalents. The Company maintains cash deposits in banks which from time to time exceed the amount of deposit insurance available. Management periodically assesses the financial condition of the Company’s banks and believes that the risk of any potential credit loss is minimal.

Accounts Receivable and Allowances

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. Allowances for doubtful accounts reflect the Company’s estimate of amounts in its existing accounts receivable that may not be collected due to customer claims or customer inability or unwillingness to pay. The allowance is determined based on a combination of factors, including the Company’s ongoing risk assessment regarding the credit worthiness of its customers, historical collection experience and length of time the receivables are past due. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered.

70On October 27, 2023, the Company entered into the Master Receivables Purchase Agreement under which the Company could sell up to $600.0 of available and eligible outstanding customer accounts receivable generated by sales to four specified customers. On September 1, 2024, the Company amended the Master Receivables Purchase Agreement to permit the Company to sell up to $750.0 of available and eligible outstanding customer accounts receivable generated by sales to five specified customers. On August 28, 2025, the Master Receivables Purchase Agreement, which is uncommitted, was extended and now expires on September 1, 2026. The receivable sales are non-recourse to the Company, other than with respect to (i) repurchase obligations and indemnification obligations for any violations by the Company of its respective representations or obligations as seller or servicer and (ii) certain repurchase and payment obligations arising from any dilution of, or dispute with respect to, any purchased receivables that arise after the sale of such purchased receivables to the purchaser not contemplated in the applicable purchase price of such purchased receivable. The recourse obligations of the Company that may arise from time to time are supported by standby letters of credit of $75.0. Transactions under the Master Receivables Purchase Agreement are accounted for as sales of accounts receivable, and the receivables sold are removed from the Consolidated Balance Sheets at the time of the sales transaction. Proceeds received from the sales of accounts receivable are classified as operating cash flows and collections of previously sold accounts receivable not yet submitted to the buyer are classified as financing cash flows in the Consolidated Statements of Cash Flows. The Company records the discount on sales in the “Other (income) expense, net” line in the Consolidated Statements of Operations. At September 30, 2025 and 2024, net receivables derecognized were $163.3 and $186.6, respectively. During fiscal 2025 and fiscal 2024, proceeds from the sale of receivables under the Master Receivables Purchase Agreement totaled $1,906.1 and $1,938.6, respectively, and the total discount recorded on sales was $20.7 and $24.6, respectively.

Table of Contents THE SCOTTS MIRACLE-GRO COMPANYNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)(Dollars in millions, except per share data)

On October 27, 2023, the Company entered into the Master Receivables Purchase Agreement, under which the Company could sell up to $600.0 of available and eligible outstanding customer accounts receivable generated by sales to four specified customers. On September 1, 2024, the Company amended the Master Receivables Purchase Agreement to permit the Company to sell up to $750.0 of available and eligible outstanding customer accounts receivable generated by sales to five specified customers. The agreement is uncommitted and expires on September 1, 2025. The receivable sales are non-recourse to the Company, other than with respect to (i) repurchase obligations and indemnification obligations for any violations by the Company of its respective representations or obligations as seller or servicer and (ii) certain repurchase and payment obligations arising from any dilution of, or dispute with respect to, any purchased receivables that arise after the sale of such purchased receivables to the purchaser not contemplated in the applicable purchase price of such purchased receivable. The recourse obligations of the Company that may arise from time to time are supported by standby letters of credit of $75.0. Transactions under the Master Receivables Purchase Agreement are accounted for as sales of accounts receivable, and the receivables sold are removed from the Consolidated Balance Sheets at the time of the sales transaction. Proceeds received from the sales of accounts receivable are classified as operating cash flows and collections of previously sold accounts receivable not yet submitted to the buyer are classified as financing cash flows in the Consolidated Statements of Cash Flows. The Company records the discount on sales in the “Other (income) expense, net” line in the Consolidated Statements of Operations. At September 30, 2024, net receivables of $186.6 were derecognized. During fiscal 2024, proceeds from the sale of receivables under the Master Receivables Purchase Agreement totaled $1,938.6 and the total discount recorded on sales was $24.6.

Inventories

Inventories are stated at the lower of cost or net realizable value and include the cost of raw materials, labor, manufacturing overhead and freight and inbound handling costs incurred to pre-position goods in the Company’s warehouse network. The Company makes provisions for obsolete or slow-moving inventories as necessary to properly reflect inventory at the lower of cost or net realizable value. Inventories are valued using the first in, first out method.


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (Dollars in millions, except per share data)

Investment in Unconsolidated Affiliates

Non-marketable equity investments in which the Company has the ability to exercise significant influence, but does not control, are accounted for using the equity method of accounting, with the Company’s proportionate share of the earnings and losses of these entities reflected in the Consolidated Statements of Operations. The Company evaluates its equity method investments for impairment whenever events or changes in circumstances indicate that the carrying amounts of such investments may be impaired. If a decline in the value of an equity method investment is determined to be other than temporary, an impairment loss is recognized in earnings for the amount by which the carrying amount of the investment exceeds its estimated fair value.

Long-Lived Assets

Property, plant and equipment are stated at cost. Interest capitalized in property, plant and equipment amounted to $1.1, $21.1 and $2.21 during fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively. Expenditures for maintenance and repairs are charged to expense as incurred. When properties are retired or otherwise disposed of, the cost of the asset and the related accumulated depreciation are removed from the accounts with the resulting gain or loss being reflected in income (loss) from operations.

Depreciation of property, plant and equipment is provided on the straight-line method and is based on the estimated useful economic lives of the assets as follows:


Land improvements			10 – 25 years
Buildings			10 – 40 years
Machinery and equipment			3 – 15 years
Furniture and fixtures			6 – 10 years
Software			3 – 8 years

71Intangible assets subject to amortization include technology, patents, customer relationships, non-compete agreements and certain trade names. These intangible assets are amortized over their estimated useful economic lives, which typically range from 3 to 25 years. The Company’s fixed assets and intangible assets subject to amortization are required to be tested for recoverability whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset group would be compared to the asset group carrying amount to determine if a write-down is required. If the undiscounted cash flows are less than the carrying amount, an impairment loss is recognized in earnings to the extent that the carrying amount exceeds fair value.

~~Table~~The Company had non-cash investing activities of ~~Contents~~$8.4, ~~THE~~$16.3 ~~SCOTTS~~and ~~MIRACLE-GRO~~$32.1 ~~COMPANYNOTES~~during TOfiscal ~~CONSOLIDATED~~2025, ~~FINANCIAL~~fiscal ~~STATEMENTS~~2024 —and ~~(Continued)(Dollars~~fiscal in2023, ~~millions~~respectively, ~~except~~representing ~~per~~unpaid ~~share~~liabilities ~~data)~~to acquire property, plant and equipment.

Intangible assets subject to amortization include technology, patents, customer relationships, non-compete agreements and certain trade names. These intangible assets are amortized over their estimated useful economic lives, which typically range from 3 to 25 years. The Company’s fixed assets and intangible assets subject to amortization are required to be tested for recoverability whenever events or changes in circumstances indicate that carrying amounts may not be recoverable. If an evaluation of recoverability is required, the estimated undiscounted future cash flows associated with the asset group would be compared to the asset group carrying amount to determine if a write-down is required. If the undiscounted cash flows are less than the carrying amount, an impairment loss is recorded to the extent that the carrying amount exceeds fair value and classified as “Impairment, restructuring and other” within “Operating expenses” in the Consolidated Statements of Operations.

The Company had non-cash investing activities of $16.3, $32.1 and $33.3 during fiscal 2024, fiscal 2023 and fiscal 2022, respectively, representing unpaid liabilities to acquire property, plant and equipment.

Internal Use Software

The Company capitalizes certain qualifying costs incurred in the acquisition and development of software for internal use, including the costs of the software, materials, consultants, interest and payroll and payroll-related costs for associates during the application development stage. Internal and external costs incurred during the preliminary project stage and post implementation-operation stage, mainly training and maintenance costs, are expensed as incurred. Once the application is substantially complete and ready for its intended use, qualifying costs are amortized on a straight-line basis over the software’s estimated useful life. Capitalized internal use software is included in the “Property, plant and equipment, net” line in the Consolidated Balance Sheets. Capitalized software as a service is included in the “Prepaid and other current assets” line in the Consolidated Balance Sheets and is amortized using the straight-line method over the term of the hosting arrangement which typically ranges from 3 to 8 years.

~~Goodwill and Indefinite-lived Intangible Assets~~70


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Goodwill and Indefinite-Lived Intangible Assets

Goodwill and indefinite-lived intangible assets are not subject to amortization. These assets are reviewed for impairment by applying a fair-value based test on an annual basis as of the first day of the Company’s fiscal fourth quarter or more frequently if circumstances indicate impairment may have occurred. With respect to goodwill, the Company performs either a qualitative or quantitative evaluation for each of its reporting units. Factors considered in the qualitative test include reporting unit specific operating results as well as new events and circumstances impacting the operations or cash flows of the reporting units. For the quantitative test, the Company assesses goodwill for impairment by comparing the carrying value of its reporting units to their respective fair values. A reporting unit is defined as an operating segment or one level below an operating segment. The Company determines the fair value of its reporting units using an income-based approach incorporating assumptions it believes market participants would utilize. The income-based approach utilizes discounted cash flows that depend upon internally-developed forecasts based on annual budgets and longer-range strategic plans. The Company uses discount rates that are commensurate with the risks and uncertainties inherent in the respective reporting units and in the internally-developed forecasts. To further substantiate fair value, the Company compares the aggregate fair value of the reporting units to the Company’s total market capitalization.

With respect to indefinite-lived intangible assets, the Company performs either a qualitative or quantitative evaluation for each asset. Factors considered in the qualitative test include asset specific operating results as well as new events and circumstances impacting the cash flows of the assets. For the quantitative test, the fair value of the Company’s indefinite-lived intangible assets is determined using an income-based approach utilizing discounted cash flows and incorporating assumptions the Company believes market participants would utilize. For trade names, fair value is determined using a relief-from-royalty methodology similar to that employed when the associated businesses were acquired but using updated estimates of sales, cash flow and profitability.

If it is determined that an impairment has occurred, an impairment loss is recognized in earnings for the amount by which the carrying value of the reporting unit or intangible asset exceeds its estimated fair value ~~and classified as “Impairment, restructuring and other” within “Operating expenses” in the Consolidated Statements of Operations~~.

Table of Contents THE SCOTTS MIRACLE-GRO COMPANYNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)(Dollars in millions, except per share data)

Investments in Securities

Convertible debt investments are classified as “available for sale,” are reported at fair value and are presented in the “Other assets” line in the Consolidated Balance Sheets. If the fair value of an available for sale investment is less than its amortized cost basis at the balance sheet date, the impairment is either temporary or other-than-temporary. If a decline in fair value is considered to be temporary at the balance sheet date, unrealized gains and losses are included in accumulated other comprehensive loss (“AOCL”) in the Consolidated Balance Sheets. If management intends to sell the security or if it is more likely than not that the Company will have to sell the security, an other-than-temporary impairment is considered to have occurred and an amount equal to the difference between the investment’s amortized cost basis and its fair value at the balance sheet date will be charged to earnings. If a decline in fair value is considered to be other-than-temporary at the balance sheet date and management can assert that it does not intend to sell the security and it is not more likely than not that it will have to sell the security before recovering its amortized cost basis (net of allowance), an allowance for credit losses (impairment), including any write-off of accrued interest receivable, is charged to earnings. This impairment allowance is separated into two components: (i) the amount related to credit losses (recorded in earnings) and (ii) the amount related to all other factors (recorded in other comprehensive income / loss). Interest income is recorded on an accrual basis and is classified in the “Other non-operating (income) expense, net” line in the Consolidated Statements of Operations.

Supplier Finance Program

The Company has an agreement to provide a supplier finance program which facilitates participating suppliers’ ability to finance payment obligations of the Company with a designated third-party financial institution. Participating suppliers may, at their sole discretion, elect to finance payment obligations of the Company prior to their scheduled due dates at a discounted price to the participating financial institution. The Company’s obligations to its suppliers, including amounts due and scheduled payment dates, are not impacted by suppliers’ decisions to finance amounts under this arrangement. The payment terms that the Company negotiates with its suppliers are consistent, regardless of whether a supplier participates in the program. The Company’s current payment terms with a majority of its suppliers generally range from 30 to 60 days, which the Company deems to be commercially reasonable. The Company’s outstanding payment obligations under its supplier finance program ~~were $12.5 and $18.3 at September 30, 2024 and 2023, respectively, and~~ are recorded within accounts payable in the Consolidated Balance Sheets~~. The~~ ~~associated payments were $245.5~~ and ~~$185.3~~the ~~for~~associated ~~fiscal~~payments ~~2024 and fiscal 2023, respectively, and~~ are classified as operating activities in the Consolidated Statements of Cash Flows.


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (Dollars in millions, except per share data)

The following table summarizes a roll-forward of the supplier finance program for the periods presented:


	Year Ended September 30,
	2025		2024
Obligations outstanding at beginning of year	$	12.5	$	18.3
Invoices	244.5		245.5
Invoices paid	(242.9)		(251.3)
Obligations outstanding at end of year	$	14.1	$	12.5

Insurance and Self-Insurance

The Company maintains insurance for certain risks, including property damage, management liability, cargo liability, cyber threats, workers compensation and general liability losses, and is self-insured for employee-related health care benefits up to a specified level for individual claims. The Company accrues for the expected costs associated with these risks by considering historical claims experience, demographic factors, severity factors and other relevant information. Costs are recognized in the period the claim is incurred, and accruals include an actuarially determined estimate of claims incurred but not yet reported.

Income Taxes

The Company uses the asset and liability method to account for income taxes. Deferred tax assets and liabilities are recognized for the anticipated future tax consequences attributable to differences between financial statement amounts and their respective tax bases. Management reviews the Company’s deferred tax assets to determine whether their value can be realized based upon available evidence. A valuation allowance is established when management believes that it is more likely than not that some portion of its deferred tax assets will not be realized. Changes in valuation allowances from period to period are included in the Company’s tax provision in the period of change.

The Company establishes a liability for tax return positions in which there is uncertainty as to whether or not the position will ultimately be sustained. Amounts for uncertain tax positions are adjusted in quarters when new information becomes available or when positions are effectively settled. The Company recognizes interest expense and penalties related to these unrecognized tax benefits within income tax expense. GAAP provides that a tax benefit from an uncertain tax position may be recognized when it is more likely than not that the position will be sustained upon examination, including resolutions of any related appeals or litigation processes, based on the technical merits of the position. The amount recognized is measured as the largest amount of tax benefit that is greater than 50% likely of being realized upon settlement.

Table of Contents THE SCOTTS MIRACLE-GRO COMPANYNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)(Dollars in millions, except per share data)

U.S. income tax expense and foreign withholding taxes are provided on unremitted foreign earnings that are not indefinitely reinvested at the time the earnings are generated. Where foreign earnings are indefinitely reinvested, no provision for U.S. income or foreign withholding taxes is made. When circumstances change and the Company determines that some or all of the undistributed earnings will be remitted in the foreseeable future, the Company accrues an expense in the current period for U.S. income taxes and foreign withholding taxes attributable to the anticipated remittance.

Translation of Foreign Currencies

The functional currency for each Scotts Miracle-Gro subsidiary is generally its local currency. Assets and liabilities of these subsidiaries are translated at the exchange rate in effect at each fiscal year-end. Income and expense accounts are translated at the average rate of exchange prevailing during the year. Translation gains and losses arising from the use of differing exchange rates from period to period are included in AOCL within shareholders’ equity (deficit). Foreign exchange transaction gains and losses are included in the determination of net income and classified as “Other (income) expense, net” in the Consolidated Statements of Operations. The Company recognized foreign exchange transaction (gains) losses of $(0.45), $1(0.34) and $1.3 during fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively.

Derivative Instruments

The Company is exposed to market risks, such as changes in interest rates, currency exchange rates and commodity prices. A variety of financial instruments, including forwards, futures and swap contracts, are used to manage these exposures. These financial instruments are recognized at fair value in the Consolidated Balance Sheets, and all changes in fair value are recognized in net income (loss) or shareholders’ equity (deficit) through AOCL. The Company’s objective in managing these exposures is to better control these elements of cost and mitigate the earnings and cash flow volatility associated with changes in the applicable rates and prices.

The Company has established policies and procedures that encompass risk-management philosophy and objectives, guidelines for derivative instrument usage, counterparty credit approval, and the monitoring and reporting of derivative activity. The Company does not enter into derivative instruments for the purpose of speculation.72


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The Company has established policies and procedures that encompass risk-management philosophy and objectives, guidelines for derivative instrument usage, counterparty credit approval and the monitoring and reporting of derivative activity. The Company does not enter into derivative instruments for the purpose of speculation.

The Company formally designates and documents instruments at inception that qualify for hedge accounting of underlying exposures in accordance with GAAP. The Company formally assesses, both at inception and at least quarterly, whether the financial instruments used in hedging transactions are effective at offsetting changes in cash flows of the related underlying exposure. Fluctuations in the value of these instruments generally are offset by changes in the expected cash flows of the underlying exposures being hedged. This offset is driven by the high degree of effectiveness between the exposure being hedged and the hedging instrument. The Company designates certain commodity hedges as cash flow hedges of forecasted purchases of commodities and interest rate swap agreements as cash flow hedges of interest payments on variable rate borrowings. Changes in the fair value of derivative contracts that qualify for hedge accounting are recorded in AOCL. For commodity hedges, realized gains or losses remain as a component of AOCL until the related inventory is sold. Cash flows associated with commodity and interest rate swap hedges are classified as operating activities in the Consolidated Statements of Cash Flows.

Leases

The Company determines whether an arrangement contains a lease at inception by determining if the contract conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration and other facts and circumstances. Right-of-use (“ROU”) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are calculated based on the lease liability adjusted for any lease payments paid to the lessor at or before the commencement date and initial direct costs incurred by the Company and exclude any lease incentives received from the lessor. Lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term. The lease term may include options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. As the Company’s leases typically do not contain a readily determinable implicit rate, the Company determines the present value of the lease liability using its incremental borrowing rate at the lease commencement date based on the lease term. The Company considers its credit rating and the current economic environment in determining this collateralized rate. Variable lease payments are the portion of lease payments that are not fixed over the lease term. Variable lease payments are expensed as incurred and include certain non-lease components, such as maintenance and other services provided by the lessor, and other charges included in the lease, as applicable. The Company elected to exclude short-term leases, defined as leases with initial terms of 12 months or less, from its Consolidated Balance Sheets.

Table of Contents THE SCOTTS MIRACLE-GRO COMPANYNOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued)(Dollars in millions, except per share data)

Statements of Cash Flows

Supplemental cash flow information was as follows:

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Interest paid	$	~~157~~131.74	$	~~173~~157.57	$	~~112~~173.5
Income taxes paid (refunded), net	912.49		~~(18~~9.2)4		27(18.2)

During fiscal 2024, the Company acquired an additional equity interest in Bonnie Plants, LLC for $21.4, which was classified as an investing activity in the Consolidated Statements of Cash Flows. During fiscal 2023, the Company received proceeds of $37.0 related to the payoff of seller financing that the Company provided in connection with a fiscal 2017 divestiture, which was classified as an investing activity in the Consolidated Statements of Cash Flows. ~~During~~ fiscal 2022, the Company made an additional investment in RIV Capital Inc. (“RIV Capital”) in the form of a $25.0 convertible note, which was classified as an investing activity in the Consolidated Statements of Cash Flows. The Company received (paid) cash of $2(3.67), $~~(12~~5.4)0 and $29(9.39) during fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively, primarily associated with currency forward contracts, which was classified as an investing activity in the “Other investing, net” line in the Consolidated Statements of Cash Flows. The “Purchase of Common Shares” line in the Consolidated Statements of Cash Flows includes cash paid to tax authorities to satisfy statutory income tax withholding obligations related to share-based compensation of $18.4, $5.1 and $9.3 for fiscal 2025, fiscal 2024 and fiscal 2023, respectively. Cash flow from operating activities in fiscal ~~2022~~2023 was ~~favorably~~unfavorably impacted by extended payment terms with vendors for payments originally due in the final weeks of fiscal 2022 that were paid in the first quarter of fiscal 2023.

The Company uses the “cumulative earnings” approach for determining cash flow presentation of distributions from unconsolidated affiliates. Distributions received are included in the Consolidated Statements of Cash Flows as operating activities, unless the cumulative distributions exceed the portion of the cumulative equity in the net earnings of the unconsolidated affiliate, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in the Consolidated Statements of Cash Flows.


Table of Contents			THE SCOTTS MIRACLE-GRO COMPANY NOTES TO CONSOLIDATED FINANCIAL STATEMENTS — (Continued) (Dollars in millions, except per share data)

RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS

In September 2022, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2022-04, “Liabilities — Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations.” This ASU requires disclosure of the key terms of outstanding supplier finance programs and a roll-forward of the related obligations. ~~ASU~~The ~~No.~~Company ~~2022-04~~adopted isthe ~~effective~~required disclosure of key terms for the fiscal ~~years~~year ~~beginning~~ended ~~after~~September ~~December 15~~30, ~~2022,~~2024 ~~except~~and ~~for~~ the ~~amendment~~required on roll-forward information, ~~which is effective~~ for ~~fiscal years beginning after December 15, 2023. The Company adopted~~ the ~~ASU~~fiscal asyear ofended ~~October~~September 130, ~~2023~~2025. The adoption relates to disclosures only and does not have any impact on the Company’s consolidated financial position, results of operations or cash flows.

In November 2023, the FASB issued ASU No. 2023-07, “Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures.” This ASU requires enhanced disclosures about significant segment expenses regularly provided to the chief operating decision maker that are included within each reported measure of segment profit or loss, and also requires all annual disclosures currently required by Topic 280 to be included in interim periods. ASU No. 2023-07 is to be applied retrospectively for all periods presented in the financial statements. The Company adopted this guidance for the fiscal year ended September 30, 2025. The adoption relates to disclosures only and does not have any impact on the Company’s consolidated financial position, results of operations or cash flows. The additional disclosures required by this guidance are presented within “NOTE 19. SEGMENT INFORMATION.”

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In ~~November~~December 2023, the FASB issued ASU No. 2023-0709, “~~Segment~~Income ~~Reporting~~Taxes (Topic ~~280~~740): Improvements to ~~Reportable~~Income ~~Segment~~Tax Disclosures.” This ASU primarily requires enhanced disclosures ~~about~~and ~~significant~~disaggregation ~~segment~~of ~~expenses~~income ~~regularly~~tax ~~provided~~information toby ~~the~~jurisdiction ~~chief~~in ~~operating~~the ~~decision~~annual ~~maker~~income ~~that~~tax ~~are~~reconciliation ~~included~~and ~~within~~quantitative ~~each reported measure of segment profit or loss,~~ and ~~also~~qualitative ~~requires all annual~~ disclosures ~~currently~~regarding ~~required~~income bytaxes ~~Topic 280 to be included in interim periods~~paid. ASU No. 2023-0709 is to be applied ~~retrospectively~~prospectively, ~~for~~with ~~all~~the ~~periods~~option ~~presented~~to inapply the ~~financial~~standard ~~statements~~retrospectively, ~~and is~~ effective for ~~fiscal~~the ~~years~~Company’s ~~beginning after December 15, 2023, and interim periods within~~ fiscal ~~years~~year ~~beginning~~ending ~~after~~September ~~December 15~~30, ~~2024, with early adoption permitted~~2026. The Company is currently evaluating the impact that the adoption of this guidance will have on the Company’s disclosures.

In ~~December~~November ~~2023~~2024, the FASB issued ASU No. ~~2023~~2024-0903, “Income ~~Taxes~~Statement — Reporting Comprehensive Income — Expense Disaggregation Disclosures (~~Topic~~Subtopic ~~740~~220-40): ~~Improvements~~Disaggregation toof Income ~~Tax~~Statement ~~Disclosures~~Expenses.” This ASU ~~primarily~~ requires ~~enhanced~~disaggregated disclosures ~~and~~on ~~disaggregation~~an ofannual ~~income~~and ~~tax~~interim ~~information~~basis, byin ~~jurisdiction~~the innotes to the ~~annual~~financial ~~income~~statements, ~~tax~~of ~~reconciliation~~certain ~~and~~categories ~~quantitative~~of ~~and~~expenses ~~qualitative~~that ~~disclosures~~are ~~regarding~~included ~~income~~in ~~taxes~~expense ~~paid~~line items on the face of the statement of operations. ASU No. ~~2023~~2024-0903 is to be applied prospectively, with the option to apply the standard retrospectively, effective for the Company’s fiscal ~~years~~year ~~beginning~~ending ~~after~~September ~~December~~30, 152028 and interim periods within the fiscal year ending September 30, ~~2024~~2029. The Company is currently evaluating the impact that the adoption of this guidance will have on the Company’s disclosures.

In ~~November~~September ~~2024~~2025, the FASB issued ASU No. ~~2024~~2025-0306, “~~Income~~Intangibles ~~Statement~~ — ~~Reporting~~Goodwill ~~Comprehensive~~and ~~Income~~Other — ~~Expense~~Internal-Use ~~Disaggregation~~Software: ~~Disclosures~~Targeted ~~(Subtopic~~Improvements ~~220-40):~~to ~~Disaggregation~~the ofAccounting ~~Income~~for ~~Statement~~Internal-Use ~~Expenses~~Software.” This ASU ~~requires~~amends ~~disaggregated~~the ~~disclosures~~accounting onfor ~~an annual~~ and ~~interim~~disclosure ~~basis, in the notes to the financial statements,~~ of ~~certain~~software ~~categories of expenses that are included in expense line items on the face of the statement of operations~~costs. ASU No. ~~2024~~2025-0306 is toeffective befor ~~applied prospectively, with~~ the ~~option~~Company’s ~~to apply the standard retrospectively, effective for~~ fiscal ~~years~~year ~~beginning~~ending ~~after~~September ~~December 15~~30, ~~2026,~~2029 and interim periods within that fiscal ~~years~~year, ~~beginning~~with ~~after~~early ~~December~~adoption ~~15, 2027~~permitted. The Company is currently evaluating the impact that the adoption of this guidance will have on the Company’s consolidated financial statements and disclosures.

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NOTE 2. REVENUE RECOGNITION

Nature of Goods and Services

The Company’s revenue is primarily generated from sales of branded and private label lawn and garden care and indoor and hydroponic gardening finished products to home centers, mass merchandisers, warehouse clubs, large hardware chains, independent hardware stores, nurseries, garden centers, e-commerce platforms, food and drug stores, indoor gardening and hydroponic product distributors, retailers and growers. In addition to product sales, the Company acts as the exclusive agent of Monsanto for the marketing and distribution of certain of Monsanto’s consumer Roundup® branded products in the United States and certain other specified countries, and performs certain other services under ancillary agreements with Monsanto. Refer to “NOTE 2019. SEGMENT INFORMATION” for disaggregated revenue information and “NOTE 6. MARKETING AGREEMENT” for revenue information related to the Monsanto agreements.

Identification and Satisfaction of Performance Obligations

The Company recognizes product sales at a point in time when it transfers control of products to customers and has no further obligation to provide services related to such products. Control is the ability of customers to direct the “use of” and “obtain” the benefit from the Company’s products. In evaluating the timing of the transfer of control of products to customers, the Company considers several control indicators, including significant risks and rewards of products, the Company’s right to payment and the legal title of the products. Based on the assessment of control indicators, sales are typically recognized when products are delivered to or picked up by the customer. The Company is generally the principal in a transaction and, therefore, primarily records revenue on a gross basis. When the Company is a principal in a transaction, it has determined that it controls the ability to direct the use of the product prior to transfer to a customer, is primarily responsible for fulfilling the promise to provide the product or service to the customer, has discretion in establishing prices, and ultimately controls the transfer of the product or services provided to the customer.

Under the terms of the Third Restated Agreement, pursuant to which the Company serves as the exclusive agent of Monsanto for the marketing and distribution of certain of Monsanto’s consumer Roundup® branded products in the United States and certain other specified countries, the Company is entitled to receive an annual commission from Monsanto as consideration for the performance of the Company’s duties as agent. The Third Restated Agreement also requires the Company to make annual payments to Monsanto as a contribution against the overall expenses of its consumer Roundup® business. The gross commission earned under the Third Restated Agreement and the contribution payments to Monsanto are included in the “Net sales” line in the Consolidated Statements of Operations. The Company performs other services, including conversion services, pursuant to ancillary agreements with Monsanto. The actual costs incurred for these activities are charged to and reimbursed by Monsanto. The Company records costs incurred for which the Company is the primary obligor on a gross basis, recognizing such costs in the “Cost of sales” line and the reimbursement of these costs in the “Net sales” line in the Consolidated Statements of Operations, with no effect on gross margin dollars or net income.

Transactional Price and Promotional Allowances

Revenue for product sales is recorded net of sales returns and allowances. Revenues are measured based on the amount of consideration that the Company expects to receive as derived from a list price, reduced by estimates for variable consideration. Variable consideration includes the cost of current and continuing promotional programs and expected sales returns. Commission income related to the Monsanto agreements is recognized over the program year as the services are performed based upon the commission income formula in the agreements.

The Company’s promotional programs primarily include rebates based on sales volumes, in-store promotional allowances, cooperative advertising programs, direct consumer rebate programs and special purchasing incentives. The cost of promotional programs is estimated considering all reasonably available information, including current expectations and historical experience. Promotional costs (including allowances and rebates) incurred during the year are expensed to interim periods in relation to revenues and are recorded as a reduction of net sales. Accruals for expected payouts under these programs are included in the “Other current liabilities” line in the Consolidated Balance Sheets. Provisions for estimated returns and allowances are recorded at the time revenue is recognized based on historical rates and are periodically adjusted for known changes in return levels. Shipping and handling costs are accounted for as contract fulfillment costs and included in the “Cost of sales” line in the Consolidated Statements of Operations. The Company excludes from revenue any amounts collected from customers for sales or other taxes.

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NOTE 3. IMPAIRMENT, RESTRUCTURING AND OTHER

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Cost of sales—impairment, restructuring and other:
Restructuring and other charges, net	$	7211.9	$	~~148~~72.59	$	~~143~~148.65
Property, plant and equipment impairments	5.3		11.4		16.6
Right-of-use asset impairments	4.5		5.3		25.8
Right-of-use asset impairments	5.3		25.8		—
Property, plant and equipment impairments	3.9		5.3		11.4
Operating expenses—impairment, restructuring and other:
Convertible debt other-than-temporary impairments	64.6		101.3		—
Restructuring and other charges (recoveries), net	35.2		(4.3)		51.2
Goodwill and intangible asset impairments	2.5		127.9		668.3
Loss on sale of business	17.7		—		—
Restructuring and other charges (recoveries), net	(4.3)		51.2		40.9
Loss on exchange of convertible debt investment	7.0		—		—
Gains on sale of property, plant and equipment	—		—		(16.2)
Goodwill and intangible asset impairments	3.6		2.5		127.9
Total impairment, restructuring and other charges	$	146.3	$	466.1	$	853.2
Convertible debt other-than-temporary impairments	—		64.6		101.3
Total impairment, restructuring and other charges	$	83.8	$	146.3	$	466.1

The following table summarizes the activity related to liabilities associated with restructuring activities for each of the periods presented:

	Year Ended September 30,
	2024		2023		2022
	2025		2024		2023
Amounts accrued at beginning of year	$	4018.59	$	3140.5	$	131.95
Restructuring charges	1136.82		5511.68		4755.16
Payments	(3336.40)		(4633.64)		(1746.56)
Amounts accrued at end of year	$	1819.91	$	4018.59	$	3140.5

As of September 30, ~~2024~~2025, restructuring accruals include $54.75 that is classified as long-term.

~~During~~On ~~fiscal~~September 30, ~~2024~~2025, ~~and~~the ~~fiscal~~Company ~~2023~~completed the divestiture of its Hawthorne professional horticulture business based in the Netherlands for $8.5, which was financed by the Company ~~recorded~~in ~~non-cash,~~the ~~pre-tax~~form ~~other-than-temporary~~of ~~impairment~~a ~~charges~~loan ~~related~~bearing tointerest ~~its~~at ~~convertible~~6.0% ~~debt~~with ~~investments~~a maturity date of ~~$64~~December 31, 2029.6 The seller financing loan is recorded in the “Other assets” line in the Consolidated Balance Sheets and ~~$101~~was classified as an investing activity in the Consolidated Statements of Cash Flows.3, The ~~respectively,~~Company incurred a non tax-deductible loss on the sale of $17.7 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations~~. Refer~~ toduring ~~“NOTE~~fiscal 162025. ~~FAIR~~The ~~VALUE~~loss ~~MEASUREMENTS”~~included ~~for~~a ~~more~~write-off ~~information~~of ~~regarding~~accumulated ~~convertible~~foreign ~~debt~~currency ~~investments~~translation adjustments of $9.5.

During fiscal ~~2024~~2025, the Company ~~recorded~~incurred aemployee ~~gain~~and executive severance charges of $1225.3. The Company incurred charges of $6.1 in its U.S. Consumer segment and $1.2 in its Hawthorne segment in the “~~Impairment~~Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations ~~associated~~during ~~with~~fiscal a2025. The ~~payment~~Company ~~received~~incurred charges of $2.3 in ~~resolution~~its ofU.S. aConsumer ~~dispute~~segment, ~~with~~$3.0 ~~the~~in ~~former~~its ~~ownership~~Hawthorne ~~group~~segment, of$1.1 ain ~~business~~its ~~that~~Other ~~was~~segment ~~acquired~~and $11.6 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal ~~2022~~2025.

During fiscal ~~2022~~2025, the Company ~~began~~incurred ~~implementing~~ a ~~series~~charge 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. The Company also accelerated the reduction of certain Hawthorne inventory, primarily lighting, growing environments and hardware products, to reduce on hand inventory to align with the reduced network capacity. During fiscal 2024, the Company incurred costs of $897.4 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets, intangible assets, property, plant and equipment and software. The Company incurred costs of $11.3 in its U.S. Consumer segment and $71.8 in its Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. The Company incurred costs of $1.5 in ~~its U.S. Consumer segment, $1.0 in its Hawthorne segment, $1.1 in its Other segment and $2.4 at Corporate in~~ the “Impairment, restructuring and other” line in the Consolidated Statements of Operations ~~during fiscal 2024. During fiscal 2023, the Company incurred costs of $229.0~~ associated with ~~this~~a ~~restructuring~~settlement ~~initiative~~agreement ~~primarily related~~ to ~~inventory~~resolve ~~write-down~~litigation ~~charges,~~with ~~employee~~the ~~termination~~former ~~benefits,~~shareholders ~~facility closure costs and impairment~~ of ~~right-of-use~~a ~~assets~~business ~~and~~that ~~property,~~was ~~plant~~acquired ~~and equipment. The Company incurred costs of $16.3~~ in ~~its U.S. Consumer segment and $168.5 in its Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during~~ fiscal ~~2023~~2021. ~~The Company incurred costs of $7.7 in its U.S. Consumer segment, $20.7 in its Hawthorne segment, $0.8 in its Other segment and $14.9 at Corporate in the “Impairment, restructuring and other”~~

77During fiscal 2025, the Company incurred a non-cash loss of $7.0 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations related to the exchange of its convertible debt investment in RIV Capital for non-voting exchangeable shares of FLUENT. Refer to “NOTE 7. INVESTMENT IN UNCONSOLIDATED AFFILIATES” for further details.

During fiscal 2025, the Company incurred impairment charges of $3.6 associated with Hawthorne finite-lived intangible assets in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations.


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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. The Company also accelerated the reduction of certain Hawthorne inventory, primarily lighting, growing environments and hardware products, to reduce on hand inventory to align with the reduced network capacity. During fiscal 2025, the Company incurred costs of $13.0 associated with this restructuring initiative primarily related to facility closure costs and impairment of right-of-use assets and property, plant and equipment. The Company incurred costs of $4.0 in its U.S. Consumer segment and $9.0 in its Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal ~~2023~~2025. During fiscal ~~2022~~2024, the Company incurred costs of $6589.24 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets, intangible assets, property, plant and equipment and software. The Company incurred costs of $911.73 in its U.S. Consumer segment and $2771.18 in its Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal ~~2022~~2024. The Company incurred costs of $111.95 in its U.S. Consumer segment, $8.1.0 in its Hawthorne segment, $01.71 in its Other segment and $2.4 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2024. During fiscal 2023, the Company incurred costs of $229.0 associated with this restructuring initiative primarily related to inventory write-down charges, employee termination benefits, facility closure costs and impairment of right-of-use assets and property, plant and equipment. The Company incurred costs of $16.3 in its U.S. Consumer segment and $168.5 in its Hawthorne segment in the “Cost of sales—impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal 2023. The Company incurred costs of $7.7 in its U.S. Consumer segment, $20.7 in its Hawthorne segment, $0.8 in its Other segment and $14.9 at Corporate in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations during fiscal ~~2022~~2023. Costs incurred since the inception of this restructuring initiative through September 30, ~~2024~~2025 were $5862.34 for the U.S. Consumer segment, $~~297~~306.2 for the Hawthorne segment, $2.9 for the Other segment and $25.1 at Corporate.

During fiscal 2024 and fiscal 2023, the Company recorded non-cash, pre-tax ~~goodwill~~other-than-temporary ~~and~~impairment ~~intangible~~charges ~~asset~~related ~~impairment~~to ~~charges~~its convertible debt investments of $~~127~~64.96 and $101.3, respectively, in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations~~, comprised of $117~~.7 Refer ofto ~~finite-lived~~“NOTE ~~intangible asset impairment charges associated with the Hawthorne segment and $10~~15.3 FAIR ofVALUE ~~goodwill~~MEASUREMENTS” ~~impairment~~for ~~charges~~further ~~associated with the Other segment~~details.

During fiscal ~~2022~~2024, the Company recorded ~~non-cash,~~a ~~pre-tax~~gain ~~goodwill and intangible asset impairment charges~~ of $~~632~~12.41 ~~as a result of interim impairment testing of its Hawthorne segment~~ in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations, ~~comprised~~associated ofwith ~~$522.4~~a payment received in resolution of ~~goodwill~~a ~~impairment~~dispute ~~charges~~with ~~and~~the ~~$110.0~~former ownership group of ~~finite-lived~~a ~~intangible~~business ~~asset~~that ~~impairment~~was ~~charges~~acquired in fiscal 2022. This payment was classified as an operating activity in the Consolidated Statements of Cash Flows.

During fiscal ~~2022~~2023, the Company ~~incurred~~recorded ~~inventory~~non-cash, ~~write~~pre-~~down~~tax goodwill and intangible asset impairment charges of $~~120~~127.9 in the “~~Cost of sales—impairment~~Impairment, restructuring and other” line in the Consolidated Statements of Operations, ~~and~~comprised of $117.7 of finite-lived intangible asset impairment charges ofassociated ~~$35.3~~with in the ~~“Impairment,~~Hawthorne ~~restructuring~~segment and ~~other”~~$10.3 ~~line~~of ingoodwill ~~the~~impairment ~~Consolidated~~charges ~~Statements of Operations~~ associated with ~~its~~the ~~decision~~Other segment. Refer to ~~discontinue~~“NOTE 4. GOODWILL ~~and~~AND ~~exit~~INTANGIBLE ~~the~~ASSETS, ~~market~~NET” for ~~certain~~further ~~Hawthorne lighting products and brands~~details.

During fiscal 2022, the Company recorded gains of $16.2 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations associated with the sale of property, plant and equipment.

NOTE 4. GOODWILL AND INTANGIBLE ASSETS, NET

The following table displays a rollforward of the carrying amount of goodwill by reportable segment:

	U.S. Consumer		Hawthorne		Other		Total
	U.S.Consumer		Hawthorne		ReportableSegment Total
Goodwill	$	245.7	$	617.0	$	10862.17	$	~~872.8~~
Accumulated impairment losses	(1.8)		(617.0)		—(618.8)		~~(618.8)~~
Balance at September 30, 2022	243.9		—		10.1		254.0
Balance at September 30, 2023	243.9		—		243.9
Foreign currency translation	—		—		0.2		0.2
Goodwill	245.7		617.0		862.7
Impairment	—		—		(10.3)		(10.3)
Accumulated impairment losses	(1.8)		(617.0)		(618.8)
Goodwill	245.7		617.0		10.3		873.0
Balance at September 30, 2024	243.9		—		243.9
Accumulated impairment losses	(1.8)		(617.0)		(10.3)		(629.1)
Goodwill	245.7		617.0		862.7
Balance at September 30, 2023	243.9		—		—		243.9
Accumulated impairment losses	(1.8)		(617.0)		(618.8)
Goodwill	245.7		617.0		10.3		873.0
Balance at September 30, 2025	$	243.9	$	—	$	243.9
Accumulated impairment losses	(1.8)		(617.0)		(10.3)		(629.1)
Balance at September 30, 2024	$	243.9	$	—	$	—	$	243.9

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The following table presents intangible assets, net of accumulated amortization and impairment charges:

	September 30, 2024						September 30, 2023
	September 30, 2025						September 30, 2024
	GrossCarryingAmount		AccumulatedAmortization/ImpairmentCharges		NetCarryingAmount		GrossCarryingAmount		AccumulatedAmortization/ImpairmentCharges		NetCarryingAmount
Finite-lived intangible assets:
Trade names	$	~~325~~320.85	$	(~~272~~275.87)	$	5344.08	$	~~322~~325.48	$	(~~260~~272.78)	$	6153.70
Customer relationships	~~253~~246.13		(223.98)		2922.25		~~251~~253.51		(~~216~~223.19)		3529.42
Technology	50.21		(4546.54)		43.7		50.12		(4445.5)		54.67
Other	3534.05		(27.06)		86.09		3435.90		(2427.80)		108.10
Total finite-lived intangible assets, net					9477.9						~~112~~94.89
Indefinite-lived intangible assets:
Indefinite-lived trade names					168.2						168.2
Roundup® marketing agreement amendment					155.7						155.7
Total indefinite-lived intangible assets					323.9						323.9
Total intangible assets, net					$	~~418~~401.8					$	~~436~~418.78

As a result of the annual impairment testing for fiscal 2025 and 2024, the Company determined that no goodwill impairment charges were required. Refer to “NOTE 3. IMPAIRMENT, RESTRUCTURING AND OTHER” for further details of intangible asset impairment charges recorded during fiscal 2025 and 2024.

During fiscal 2023, the Company identified circumstances that indicated the carrying amounts of Hawthorne’s long-lived assets, including trade names and customer relationships, may not be recoverable. Accordingly, the Company performed a recoverability test for long-lived assets during the fourth quarter of fiscal 2023. The Company concluded that the carrying value of these long-lived assets exceeded their estimated fair value and recorded non-cash, pre-tax impairment charges of $72.0 related to trade names and $45.7 related to customer relationships during the fourth quarter of fiscal 2023 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations. The fair values of long-lived assets were determined using income-based approaches, including the relief-from-royalty method for trade names, that include market participant expectations of cash flows that the assets will generate over the remaining useful life discounted to present value using an appropriate discount rate. These fair value estimates utilize significant unobservable inputs and thus represent Level 3 fair value measurements.

~~The~~During ~~Company~~fiscal ~~performed~~2023, the annual goodwill impairment testing ~~as of the first day of its fourth quarter of fiscal 2023. This test~~ resulted in a non-cash, pre-tax goodwill impairment charge of $10.3 related to the Other segment, which was recorded during the fourth quarter of fiscal 2023 in the “Impairment, restructuring and other” line in the Consolidated Statements of Operations. The carrying value of goodwill of the Other segment reporting unit after recognizing the impairment is zero. The estimated fair value of the Other segment reporting unit was based upon an equal weighting of the income-based and market-based approaches, utilizing estimated cash flows and a terminal value, discounted at a rate of return that reflects the relative risk of the cash flows, as well as valuation multiples derived from comparable publicly traded companies that are applied to the operating performance of the reporting unit. The fair value estimate utilizes significant unobservable inputs and thus represents a Level 3 fair value measurement.

Total amortization expense was $1512.73, $2515.27 and $3725.12 for fiscal ~~2024~~2025, fiscal ~~2023~~2024 and fiscal ~~2022~~2023, respectively. Amortization expense is estimated to be as follows for the years ending September 30:

2025	$	12.6
2026	$	10.7
2026	11.5
2027	10.1
2027	10.7
2028	8.6
2028	9.1
2029	6.4
2029	6.9
2030	6.2

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NOTE 5. DETAIL OF CERTAIN FINANCIAL STATEMENT ACCOUNTS

The following presents detail regarding certain financial statement accounts:

	September 30,
	2024		2023
	2025		2024
INVENTORIES:
Raw materials	$	256.8	$	272.5
Finished goods	$	291.6	$	246.6
Finished goods	246.6		506.2
Raw materials	222.3		256.8
Work-in-progress	8478.19		~~101~~84.61
	$	~~587~~592.58	$	~~880~~587.35
PROPERTY, PLANT AND EQUIPMENT, NET:
Machinery and equipment	$	~~683~~697.63	$	~~651~~683.76
Buildings	~~305~~312.87		~~277~~305.18
Land and improvements	~~152~~158.90		~~149~~152.09
Software	~~107~~106.27		~~109~~107.92
Construction in progress	78101.70		~~104~~78.67
Furniture and fixtures	6275.65		62.36
Finance leases	2421.19		2124.1
	1,414.9		1,375.7
	1,473.1		1,414.9
Less: accumulated depreciation	(~~805~~841.45)		(~~765~~805.4)
	$	~~609~~631.56	$	~~610~~609.35
OTHER ASSETS:
Operating lease right-of-use assets	$	~~265~~256.43	$	~~262~~265.64
Net deferred tax assets	~~191~~121.31		~~189~~191.83
Accrued pension, postretirement and executive retirement assets	6256.73		6462.17
Convertible debt investments	4524.86		8545.8
Other	812.95		~~30.~~8.9
	$	~~574~~470.18	$	~~633~~574.1

	September 30,
	2024		2023
	2025		2024
OTHER CURRENT LIABILITIES:
Advertising and promotional accruals	$	~~131~~130.21	$	~~143~~131.

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