Company: LW
Filing Date: 2025-09-30
Form Type: 10-Q
Source: 0001679273-25-000070
Chunk: 13

Company: Lamb Weston Holdings, Inc.
Filing Date: 2025-09-30
Form: 10-Q
Item: Part I, Item 1
Chunk 13
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88 ___________________________________________(a)Potential dilutive shares of common stock under employee incentive plans are determined by applying the treasury stock method to the assumed exercise of outstanding stock options and the assumed vesting of outstanding restricted stock units and performance awards. As of August 24, 2025 and August 25, 2024, 1.7 million and 0.8 million, respectively, shares of stock-based awards were excluded from the computation of diluted earnings per share because they would be antidilutive.

3. INCOME TAXES

Income tax expense for the periods presented were as follows:Thirteen Weeks Ended(in millions)August 24,2025August 25,2024Income before income taxes and equity method earnings$112.8 $166.9 Equity method investment earnings (loss)(0.6)11.3 Income tax expense47.9 50.8 Effective tax rate (a)42.7%28.5%___________________________________________(a)The effective income tax rate is calculated as the ratio of income tax expense to pre-tax income, inclusive of equity method investment earnings. The effective tax rate varies from the U.S. statutory tax rate of 21% principally due to the impact of U.S. state taxes, foreign taxes and currency, permanent differences, and discrete items.Compared to the thirteen weeks ended August 25, 2024, the effective tax rate is higher primarily due to having a larger proportion of losses in certain jurisdictions with no expected tax benefits. In addition, the thirteen weeks ended August 24, 2025 included $10.2 million of discrete tax expense, primarily related to the establishment of a full valuation allowance against certain international deferred tax assets. Income Taxes Paid

Income taxes paid, net of refunds, were $9.7 million and $6.0 million during the thirteen weeks ended August 24, 2025 and August 25, 2024, respectively. 

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4. RESTRUCTURING

Restructuring expense includes charges from the Cost Savings Program, and the Company’s restructuring plan announced on October 1, 2024 (the “Restructuring Plan”, collectively referred to as the “Plans”).We expect to recognize total pre-tax cash charges of $70 million to $100 million, most of which will be paid in fiscal 2026, related to the Cost Savings Program. The charges in the first fiscal quarter of 2026 largely relate to professional service fees and employee severance