McCormick & Company, Incorporated reported financial results for the third quarter of fiscal year 2026, which ended August 31, 2026. The company reported total net sales of $2,024 million for the quarter, representing a 17.4% increase compared to the same period in the prior year. Organic sales growth was reported at 1.9%, while acquisition growth, largely driven by the McCormick de Mexico business, contributed 14.6% to the total sales increase. Currency had a favorable impact of 0.9% on reported sales.
On the profitability side, gross profit for the quarter increased to $795 million, a 23.2% rise year-over-year. Gross profit margin expanded by 190 basis points to 39.3%. Adjusted gross profit margin expanded by 180 basis points to 39.3%. This expansion was attributed to the contribution from the McCormick de Mexico acquisition, higher sales, and cost savings from the Comprehensive Continuous Improvement (CCI) program, partially offset by higher commodity and freight costs.
Operating income for the third quarter was $217 million, a decrease of 24.8% from the prior year. However, adjusted operating income increased 22% year-over-year to $359 million. Adjusted earnings per share (EPS) were reported at $0.86, a slight increase of 1.2% compared to the prior year's $0.85. Reported EPS was $0.36, which included a negative impact of $0.50 per share from special charges, including a non-cash impairment charge related to a pepper sourcing project in Malaysia and exit costs.
McCormick reaffirmed its fiscal 2026 outlook. The company expects net sales growth between 13% and 17% on a reported basis, with organic sales growth projected between 1% and 3%. Adjusted operating income is expected to grow between 16% and 20%, and adjusted EPS is expected to be between $3.05 and $3.13. The company anticipates foreign currency rates will favorably impact net sales by 1%, adjusted operating income by 1%, and adjusted EPS by 1%.
In other news, the company remains on track with integration planning for its proposed combination with Unilever’s Foods business. The transaction, announced in March 2026, is expected to be accretive to McCormick’s adjusted EPS with mid- to high-single-digit accretion anticipated within the first twelve months post-close. The combined company is expected to realize approximately $600 million in annual run-rate cost synergies, with detailed integration planning already underway.
