ASHLAND INC.

NOTE A – SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation and basis of presentation

The accompanying Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP") and U.S. Securities and Exchange Commission ("SEC") regulations. The Consolidated Financial Statements include the accounts of Ashland Inc. ("Ashland") and its majority owned subsidiaries and, when applicable, entities for which Ashland has a controlling financial interest or is the primary beneficiary. Investments in joint ventures and 20% to 50% owned affiliates where Ashland has the ability to exert significant influence are accounted for under the equity method. Ashland had no significant equity method investments for any of the periods presented. All intercompany transactions and balances have been eliminated.

Ashland is comprised of the following reportable segments: Life Sciences, Personal Care, Specialty Additives and Intermediates. Unallocated and Other includes corporate governance activities and certain legacy matters. See Note Q for more information.

Use of estimates, risks and uncertainties

The preparation of Ashland’s Consolidated Financial Statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, and the disclosures of contingent assets and liabilities. Significant items that are subject to such estimates and assumptions include, but are not limited to, environmental remediation, asbestos litigation, the accounting for goodwill and other indefinite-lived intangible assets and income taxes. Although management bases its estimates on historical experience and various other assumptions that are believed to be reasonable under the circumstances, actual results could differ significantly from the estimates under different assumptions or conditions.

Ashland’s results are affected by domestic and international economic, political, legislative, regulatory and legal actions. Economic conditions, such as recessionary trends, inflation, interest and monetary exchange rates, government fiscal policies and changes in the prices of certain key raw materials, can have a significant effect on operations. While Ashland maintains reserves for anticipated liabilities and carries various levels of insurance, Ashland could be affected by civil, criminal, regulatory or administrative actions, claims or proceedings relating to asbestos, environmental remediation, income taxes or other matters.

Cash and cash equivalents

Cash and cash equivalents include cash on hand and highly liquid investments maturing within three months after purchase.

Allowance for credit losses on accounts receivable

Ashland records an allowance for credit losses using the expected credit loss model. Ashland estimates expected credit losses based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. When measuring expected credit losses, Ashland pools assets with similar country risk and credit risk characteristics. Each period, the allowance for credit losses is adjusted through earnings to reflect expected credit losses over the remaining lives of the assets. No significant credit losses were incurred in 2025, 2024 and 2023.

A progression of activity in the allowance for credit losses is presented in the following table for the years ended September 30:

(a)

Adjustments to allowances for credit loses were less than $1 million for fiscal 2024.

Inventories

Inventories are carried at the lower of cost or net realizable value. Inventories are stated at cost using the weighted-average cost method. This method values inventories using average costs for raw materials and most recent production costs for labor and overhead.

The following summarizes Ashland’s inventories as of September 30:

A progression of activity in the inventory reserves for obsolete and slow moving inventories, which reduce the amounts of finished products and raw materials, supplies and work in process reported, is presented in the following table, for the years ended September 30:

Property, plant and equipment

The cost of property, plant and equipment is depreciated by the straight-line method over the estimated useful lives of the assets. Buildings are depreciated principally over 12 to 35 years and machinery and equipment principally over 2 to 25 years. Such costs are periodically reviewed for recoverability when impairment indicators are present. Such indicators include, among other factors, operating losses, unused capacity, market value declines and technological obsolescence. Recorded values of asset groups of property, plant and equipment that are not expected to be recovered through undiscounted future net cash flows are written down to current fair value, which generally is determined from estimated discounted future net cash flows (assets held for use) or net realizable value (assets held for sale). See Note F for additional information related to property, plant and equipment.

Leasing arrangements

Ashland determines if an arrangement contains a lease at inception based on whether or not it has the right to control the asset during the contract period and other facts and circumstances.

Operating lease right-of-use assets represent Ashland’s right to use an underlying asset for the lease term and lease liabilities represent Ashland’s obligation to make lease payments arising from the lease, both of which are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Leases with a lease term of 12 months or less at inception are not recorded within the Consolidated Balance Sheets and are expensed on a straight-line basis over the lease term within the Statements of Consolidated Comprehensive Income (Loss). The lease term is determined by assuming the exercise of renewal options that are reasonably certain. As most leases do not provide an implicit interest rate, Ashland used its incremental borrowing rate based on the information available at commencement date in determining the present value of future lease payments. When contracts contain lease and non-lease components, Ashland generally accounts for both components as a single lease component. For additional information on leasing arrangements, see Note J.

Goodwill and other indefinite-lived intangible assets

Ashland tests goodwill and other indefinite-lived intangible assets for impairment annually as of July 1 and when events and circumstances indicate an impairment may have occurred. Ashland reviews goodwill for impairment based on its identified reporting units. Ashland determined that its reporting units are Life Sciences, Personal Care, Specialty Additives and Intermediates. Ashland tests goodwill for impairment by comparing the carrying value to the estimated fair value of its reporting units. If the fair value of the reporting unit is lower than its carrying amount, goodwill is written down for the amount by which the carrying amount exceeds the fair value. However, the loss recognized cannot exceed the carrying amount of goodwill.

Using the quantitative approach, Ashland makes various estimates and assumptions in determining the estimated fair value of each reporting unit using a combination of discounted cash flow models and valuations based on earnings multiples for guideline public companies in each reporting unit’s industry peer group. Discounted cash flow models are reliant on various assumptions, including projected business results, long-term growth factors and weighted-average cost of capital. Management judgment is involved in estimating these variables, and they include uncertainties since they are forecasting future events. Ashland performs sensitivity analyses by using a range of inputs to confirm the reasonableness of the long-term growth rate and weighted average cost of capital. Additionally, Ashland compares the indicated equity value to Ashland’s market capitalization and evaluates the resulting implied control premium/discount to determine if the estimated enterprise value is reasonable.

Ashland tests at least annually its indefinite-lived intangible assets, principally trademarks and trade names. If the carrying value of an individual indefinite-lived intangible asset exceeds its fair value, such individual indefinite-lived intangible asset is written down by an amount equal to such excess. Ashland performs a quantitative impairment test for the trademarks and trade names during which, trademarks and trade names are valued using a “relief-from-royalty” valuation method compared to the carrying value. Assumptions inherent in the valuation methodologies include, but are not limited to, such estimates as future projected business results, growth rates, the weighted-average cost of capital for a market participant, and royalty rates. For further information on goodwill and other indefinite-lived intangible assets, see Note G.

Finite-lived intangible assets

Finite-lived intangible assets principally consist of certain trademarks and trade names, intellectual property, and customer lists. These intangible assets are amortized on a straight-line basis over their estimated useful lives. The cost of trademarks and trade names is amortized principally over 3 to 20 years, intellectual property over 3 to 20 years and customer and supplier relationships over 10 to 24 years. Ashland reviews finite-lived intangible assets for impairment whenever events or changes in circumstances indicate the carrying amount of an asset may not be recoverable. Ashland monitors these changes and events on at least a quarterly basis. The intangibles amortization expense caption within the Statements of Consolidated Comprehensive Income (Loss) includes amortization expense related to trademarks and trade names, intellectual property and customer and supplier relationships. Intangible assets classified as finite are amortized on a straight-line basis over their estimated useful lives. For further information on finite-lived intangible assets, see Note G.

Derivative instruments

Ashland regularly uses derivative instruments to manage its exposure to fluctuations in foreign currencies and certain commodities. All derivative instruments are recognized as either assets or liabilities on the Consolidated Balance Sheets and are measured at fair value. Changes in the fair value of all derivatives are recognized immediately in the Statements of Consolidated Comprehensive Income (Loss) unless the derivative qualifies as a hedge of future cash flows or a hedge of a net investment in a foreign operation. Gains and losses related to an instrument that qualifies for hedge accounting are either recognized in the Statements of Consolidated Comprehensive Income (Loss) immediately to offset the gain or loss on the hedged item, or deferred and recorded in the stockholders’ equity section of the Consolidated Balance Sheets as a component of accumulated other comprehensive loss and subsequently recognized in the Statements of Consolidated Comprehensive Income (Loss) when the hedged item affects net income (loss). For additional information on derivative instruments, see Note E.

Restricted investments

During 2015, Ashland placed $335 million of insurance proceeds into a renewable annual trust for asbestos (Asbestos trust) that Ashland determined is restricted for the purpose of paying ongoing and future litigation defense and claim settlement costs incurred in conjunction with asbestos claims. As of September 30, 2025 and 2024, the funds within the Asbestos trust had a balance of $231 million and $248 million, respectively, and were primarily invested in publicly traded mutual funds with diversified asset allocations with a portion maintained in demand deposits. These funds are presented primarily as noncurrent assets within the restricted investments caption of the Consolidated Balance Sheets, with $30 million and $36 million classified within other current assets in the Consolidated Balance Sheets as of September 30, 2025 and 2024, respectively.

During 2021, Ashland established a renewable annual trust for environmental remediation (Environmental trust) that Ashland determined is restricted for ongoing and future environmental remediation and related litigation costs. As of September 30, 2025 and 2024, the funds within the Environmental trust had a balance of $116 million and $120 million, respectively, and were primarily invested in publicly traded mutual funds with diversified asset allocations with a portion maintained in demand deposits. These funds are presented primarily as noncurrent assets within the restricted investments caption of the Consolidated Balance Sheets, with $20 million and $37 million classified within other current assets in the Consolidated Balance Sheets as of September 30, 2025 and 2024, respectively.

The funds within these trusts are classified as investment securities reported at fair value. Interest income and gains and losses (realized and unrealized) on the investment securities are reported in the net interest and other expense (income) caption in the Statements of Consolidated Comprehensive Income (Loss). See Note E for additional information regarding the fair value of these investments within the trusts.

Revenue recognition

Ashland’s sales are measured as the amount of consideration it expects to receive in exchange for transferring goods and are recognized when performance obligations are satisfied under the terms of contracts or purchase orders with customers. Ashland generally utilizes standardized language for the terms of contracts or purchase orders.

A performance obligation is deemed to be satisfied by Ashland when control of the product or service is transferred to the customer. The transaction price of a contract or purchase order, or the amount Ashland expects to receive upon satisfaction of all performance obligations, is determined by reference to the applicable terms. Ashland generally collects the cash from its customers within 60 days of the product delivery date. Sales and other similar taxes collected from customers on behalf of third parties are excluded from the contract price.

All of Ashland’s sales are derived from contracts or purchase orders with customers, and nearly all contracts or purchase orders with customers contain a single performance obligation for the transfer of goods where such performance obligation is satisfied at a point in time. Control of a product is deemed to be transferred to the customer generally upon shipment or delivery. Costs for shipping and handling activities, whether performed before or after the customer obtains control of the goods, are accounted for as fulfillment costs when not reimbursed.

Costs incurred to obtain contracts with customers are not significant and are expensed immediately as the period of performance is generally one year or less. Ashland records credit losses in specific situations when it is determined that the customer is unable to meet its financial obligation.

Expense recognition

Cost of sales include material and production costs, as well as the costs of inbound freight, purchasing and receiving, inspection, warehousing, internal transfers and all other distribution network costs. Selling, general and administrative expense includes sales and marketing costs, advertising, customer support, environmental remediation, corporate and divisional administrative and other costs. Advertising costs ($1 million in 2025, $1 million in 2024 and $2 million in 2023) and research and development costs ($54 million in 2025,$55 million in 2024 and$51 million in 2023) are expensed as incurred.

Income taxes

Ashland is subject to income taxes in the United States and numerous foreign jurisdictions. The provision for income taxes includes income taxes paid, currently payable or receivable, and deferred taxes. Ashland recognizes the income tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. Ashland evaluates and adjusts these accruals based on changing facts and circumstances. Deferred tax assets and liabilities are determined based on differences between financial reporting and tax basis of assets and liabilities, and are measured using enacted tax rates and laws that are expected to be in effect when the differences reverse. Deferred tax assets are also recognized for the estimated future effects of tax loss and credit carryforwards. The effect on deferred taxes of changes in tax rates is recognized in the period in which the enactment date occurs. Taxes due on Global Intangible Low-Taxed Income ("GILTI") inclusions in U.S. are recognized as a current period expense when incurred. Valuation allowances are established when necessary on a jurisdictional basis to reduce deferred tax assets to the amounts expected to be realized. In the event that the actual outcome of tax consequences differs from Ashland’s estimates and assumptions due to changes or future events such as tax legislation, geographic mix of earnings, completion of tax audits or earnings repatriation plans, the resulting change to the provision for income taxes could have a material effect on the Statements of Consolidated Comprehensive Income (Loss) and Consolidated Balance Sheets. For additional information on income taxes, see Note K.

The Organization for Economic Co-operation and Development (“OECD”) introduced Global Anti-Base Erosion and Profit Shifting (“BEPS”) Pillar 2 rules under which multi-national entities would pay a minimum level of tax on the income arising in each of the jurisdictions in which they operate. Numerous countries, including EU member states, have enacted or are expected to enact legislation to effectuate the new rules. In addition, several non-EU countries have proposed and/or adopted legislation consistent with the global minimum tax framework. Important details of these minimum tax developments are still to be determined and, in some cases, enactment and timing remain uncertain. Based on current legislation and available guidance, Ashland implemented these rules during the year ended September 30, 2025. Ashland treated the Pillar Two global minimum tax as a period cost. These Pillar Two minimum tax rules did not have a material impact on Ashland’s financial condition, results of operations, or cash flows during the fiscal year ended September 30, 2025.

On July 4, 2025, “An Act to provide for reconciliation pursuant to title II of H. Con. Res. 14” – commonly referred to as the One Big Beautiful Bill Act ("OBBBA") – was signed into law. OBBBA includes several changes to the U.S. federal income tax system, including modifications to the deduction for domestic research and development costs, expensing of certain business property, and changes to the limitation on business interest. Ashland recorded the impact of the applicable provisions of OBBBA, which were not material to the Consolidated Financial Statements, during the year ended September 30, 2025.

A progression of activity in the tax valuation allowances is presented in the following table for the years ended September 30:

Asbestos-related litigation

Ashland is subject to liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims result from indemnification obligations undertaken in 1990 in connection with the sale of Riley Stoker Corporation ("Riley") and the acquisition of Hercules (formerly Hercules Incorporated) in November 2008. Although Riley, a former subsidiary, was neither a producer nor a manufacturer of asbestos, its industrial boilers contained some asbestos-containing components provided by other companies. Hercules, an indirect wholly-owned subsidiary of Ashland, has liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims typically arise from alleged exposure to asbestos fibers from resin encapsulated pipe and tank products sold by one of Hercules’ former subsidiaries to a limited industrial market.

Ashland retained Gnarus Advisors LLC ("Gnarus") to assist in developing and annually updating independent reserve estimates for future asbestos claims and related costs given various assumptions. The methodology used to project future asbestos costs is based largely on Ashland’s recent experience, including claim-filing and settlement rates, disease mix, open claims, and litigation defense. Ashland’s claim experience is compared to the results of previously conducted epidemiological studies estimating the number of people likely to develop asbestos-related diseases. Those studies were undertaken in connection with national analyses of the population expected to have been exposed to asbestos. Using that information, Gnarus estimates a range of the number of future claims that may be filed, as well as the related costs that may be incurred in resolving those claims. Ashland records the amount it believes to be the best estimate of future payments for litigation defense and claim settlement costs using the results of a non-inflated, non-discounted approximate 40-year model. For additional information on asbestos-related litigation, see Note M.

Accruals for environmental remediation are recognized when it is probable a liability has been incurred and the amount of that liability can be reasonably estimated. Such costs are charged to expense if they relate to the remediation of conditions caused by past operations or are not expected to mitigate or prevent contamination from future operations. Accruals for environmental remediation reflect Ashland's estimates of the most likely costs that will be incurred over an extended period of time to remediate identified conditions for which costs are reasonably estimable and probable of being incurred, without regard to any third-party recoveries, and are regularly adjusted as environmental assessments and remediation efforts continue. For additional information on environmental remediation, see Note M.

Pension and other postretirement benefits

The funded status of Ashland’s pension and other postretirement benefit plans is recognized in the Consolidated Balance Sheets. The funded status is measured as the difference between the fair value of plan assets and the benefit obligation at September 30, the measurement date. For defined benefit pension plans, the benefit obligation is the projected benefit obligation ("PBO") and for the other postretirement benefit plans, the benefit obligation is the accumulated postretirement benefit obligation ("APBO"). The PBO represents the actuarial present value of benefits expected to be paid upon retirement based on estimated future compensation levels. The APBO represents the actuarial present value of postretirement benefits attributed to employee services already rendered. The measurement of the benefit obligation is based on Ashland’s estimates and actuarial valuations. These valuations reflect the terms of the plans and use participant-specific information such as compensation, age and years of service, as well as certain assumptions that require judgment, including, but not limited to, estimates of discount rates, rate of compensation increases, interest rates and mortality rates. The fair value of plan assets represents the current market value of assets held by an irrevocable trust fund for the sole benefit of participants. For additional information regarding plan assumptions and the current financial position of the pension and other postretirement plans, see Note L.

Ashland recognizes the change in the fair value of plan assets and net actuarial gains and losses annually in the fourth quarter of each fiscal year and whenever a plan is determined to qualify for a remeasurement. The remaining components of pension and other postretirement benefits expense are recorded ratably on a quarterly basis. Pension and other postretirement benefits adjustments charged directly to cost of sales that are applicable to inactive participants are excluded from inventoriable costs. The service cost component of pension and other postretirement benefits costs is allocated to each reportable segment; while the remaining components of pension and other postretirement benefits costs are recorded within the other net periodic benefit loss caption on the Statements of Consolidated Comprehensive Income (Loss).

Foreign currency translation

Subsidiaries outside the United States primarily use the local currency as the functional currency. Upon consolidation, the results of operations of the subsidiaries and affiliates whose functional currency is other than the U.S. dollar are translated into U.S. dollars at the average exchange rates for the year while assets and liabilities are translated at year-end exchange rates. Adjustments to translate assets and liabilities into U.S. dollars are recorded in the stockholders’ equity section of the Consolidated Balance Sheets as a component of accumulated other comprehensive loss and are included in net income (loss) only upon sale or substantial liquidation of the underlying foreign subsidiary or affiliated company.

During 2024, following the enactment by the Argentina government of a 50% peso devaluation against the U.S. dollar, Ashland recorded a $5 million currency devaluation charge within the selling, general and administrative expense caption of the Statements of Consolidated Comprehensive Income (Loss).

Stock incentive plans

Ashland recognizes compensation expense for stock incentive plans awarded to key employees and directors over the requisite service period based upon the grant-date fair value. Stock incentive awards are primarily in the form of restricted stock and restricted stock units, performance shares and other non-vested stock awards. Ashland utilizes several industry accepted valuation models to determine grant-date fair value. For further information concerning stock incentive plans, see Note O.

Earnings (loss) per share

The following is the computation of basic and diluted earnings (loss) per share ("EPS") from continuing operations attributable to Ashland for the years ended September 30. EPS is reported under the treasury stock method. Stock Appreciation Rights ("SARs") and warrants for each reported year whose grant price was greater than the market price of Ashland Common Stock at the end of each fiscal year were not included in the computation of EPS from continuing operations per diluted share because the effect of these instruments would be antidilutive. The total number of these shares outstanding was 1.6 million for 2025 and 1.2 million for both 2024 and 2023. The majority of these shares are for warrants with a strike price of $128.66.

(a)

As a result of the loss from continuing operations attributable to Ashland during fiscal 2025, the effect of the share-based awards convertible to common stock would be antidilutive and have been excluded from the diluted EPS calculation.

Other accounting pronouncements

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") ASU No. 2024-03 “Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures” which was subsequently updated by ASU No. 2025-01 "Income Statement – Reporting Comprehensive Income – Expense Disaggregation Disclosures" clarifying the effective date. The ASU was issued to enhance disclosure of income statement expenses. For each relevant expense caption presented on the face of the income statement, the following expense components must be presented in a tabular format within the Notes to Consolidated Financial Statements: purchases of inventory, employee compensation, depreciation, intangible asset amortization and depletion expense. Certain amounts already required to be disclosed under current GAAP requirements must also be presented in the same disclosure as the new disaggregation requirements. The new guidance also requires disclosure of a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. Additionally, the total amount of selling expenses must be disclosed at each interim and annual reporting periods. Finally, the Company’s description of selling expenses must be defined in annual reporting periods. The amendments in this ASU are effective for fiscal years beginning after December 15, 2027, and for interim periods beginning after December 15, 2027. The Company is currently evaluating the impact of adopting this guidance on our Consolidated Financial Statements.

In December 2023, the FASB issued ASU No. 2023-09 "Income Taxes (Topic 740): Improvements to Income Tax Disclosures". The ASU was issued to improve transparency and disclosure requirements for the rate reconciliation, income taxes paid and other tax disclosures. The amendments in ASU 2023-09 are effective for fiscal years beginning after December 15, 2024, with early adoption permitted, and may be applied either prospectively or retrospectively. The Company is currently evaluating the impact of adopting this guidance.

In November 2023, the FASB issued ASU No. 2023-07 "Segment Reporting (Topic 280): Improvements to Reporting Segment Disclosures." The ASU was issued to improve reportable segment disclosure requirements, primarily through enhanced disclosures of significant segment expenses that are regularly provided to the chief operating decision maker and included within segment profit and loss. This guidance was effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted, and applied retrospectively to all prior periods presented in the financial statements. The Company adopted the annual guidance during the year ended September 30, 2025. See Note Q for disclosures.

In October 2023, the FASB issued ASU No. 2023-06 "Disclosure Improvements: Codification Amendments in Response to the SEC's Disclosure Update and Simplification Initiative". The amendments in this ASU represent changes to clarify or improve disclosures and presentation requirements of a variety of topics by aligning them with the SEC's regulations. The amendments to the various topics should be applied prospectively, and the effective date will be determined for each individual disclosure based on the effective date of the SEC's removal of the related disclosure. If the SEC has not removed the applicable requirements from Regulation S-X or Regulation S-K by June 30, 2027, then this ASU will not become effective. Early adoption is prohibited. The Company does not expect the amendments in this ASU to have a material impact on the Consolidated Financial Statements.

NOTE B – DIVESTITURES

Avoca business sale

On March 31, 2025, Ashland completed the sale of its Avoca business to Mane SA. Proceeds from the sale were $16 million, net of transaction costs. Ashland recorded an impairment charge of $183 million ($1 million allocated to goodwill, $134 million to other intangible assets, $33 million to property, plant and equipment, $14 million to operating lease assets, net and $1 million to other current assets) within the income (loss) on acquisitions and divestitures, net caption of the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2025. The impairment charge includes the impact of the related inside tax basis differences associated with the impaired assets. The tax benefit associated with the sale is included within the income tax expense (benefit) caption of the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2025. See Note K for tax details associated with the transaction. Ashland also recorded a pre-tax gain on sale of $8 million following the completion of this divestiture, mainly related to working capital movements, within the income (loss) on acquisitions and divestitures, net caption of Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2025.

The Avoca business was included within Ashland's Personal Care reportable segment.

Ashland determined this transaction did not qualify for discontinued operations treatment since it neither represented a strategic shift nor did it have a major effect on Ashland's operations and financial results.

Nutraceuticals business sale

On August 30, 2024, Ashland completed the sale of its Nutraceuticals business to Turnspire Capital Partners LLC ("Turnspire"). Proceeds from the sale were $26 million, net of transaction costs. Ashland recorded a $99 million impairment charge primarily related to allocated goodwill of $17 million, other intangible assets of $69 million and property, plant and equipment of $13 million within the income (loss) on acquisitions and divestitures, net caption of the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2024. The impairment charge includes the impact of the related inside tax basis differences associated with the impaired assets. The tax benefit associated with the expected disposition is included within the income tax expense (benefit) caption of the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2025. See Note K for tax details associated with the transaction. Ashland also recorded a pre-tax loss on sale of $8 million following the completion of this divestiture, mainly related to working capital movements, within the income (loss) on acquisitions and divestitures, net caption of Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2024. The income (loss) on acquisitions and divestitures, net caption also includes a reserve of $7 million for foreign VAT taxes associated with the entities transferred within the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2024.

The Nutraceuticals business was included within Ashland's Life Sciences reportable segment and served the broader nutrition market.

Ashland determined this transaction did not qualify for discontinued operations treatment since it neither represented a strategic shift nor did it have a major effect on Ashland's operations and financial results.

Other manufacturing facility sales

During 2023, Ashland entered into and completed a definitive sale agreement to sell a Specialty Additives manufacturing facility for less than $1 million. The net asset value related to this site was $4 million at September 30, 2022. Ashland recorded a $4 million impairment charge withinthe selling, general and administrative expense caption of the Statement of Consolidated Comprehensive Income (Loss) during the year ended September 30, 2023, related to this site.

Ashland determined this transaction did not qualify for discontinued operations treatment since it neither represented a strategic shift nor did it have a major effect on Ashland’s operations and financial results.

Other corporate assets

During 2025, Ashland completed the sale oftwo excess land properties with a net book value ofzero. Ashland received net proceeds and recorded a pre-tax gain of $15 million within the income (loss) on acquisitions and divestitures, net caption of the Statement of Consolidated Comprehensive Income (Loss) during the year ended September 30, 2025.

During 2023, Ashland completed the sale oftwo excess land properties with a net book value of $2 million. Ashland received net proceeds of $9 million and recorded a pre-tax gain of $7 million within the income (loss) on acquisitions and divestitures, net caption of the Statement of Consolidated Comprehensive Income (Loss) for during the year ended September 30, 2023.

NOTE C – DISCONTINUED OPERATIONS

Ashland has divested certain businesses that have qualified as discontinued operations. The operating results from these divested businesses and subsequent adjustments related to ongoing assessments and activities of certain retained liabilities and tax items have been recorded within the discontinued operations caption in the Statements of Consolidated Comprehensive Income (Loss) for all periods presented and are discussed further within this note.

Due to the ongoing assessment of certain matters associated with previous divestitures, subsequent adjustments to these divestitures may continue in future periods in the discontinued operations caption in the Statements of Consolidated Comprehensive Income (Loss).

The following divested businesses represent disposal groups that qualified as discontinued operations in previous periods and impacted discontinued operations:

•

The Performance Adhesives business divested in 2022;

•

The Composites business and Marl facility (Composites/Marl facility) divested in 2019;

•

The separation of Valvoline Inc. (Valvoline) business divested in 2017;

•

The sale of Ashland Water Technologies (Water Technologies) business divested in 2014; and

•

The sale of the Ashland Distribution (Distribution) business divested in 2011.

Additionally, Ashland is subject to liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims result primarily from indemnification obligations undertaken in 1990 in connection with the sale of Riley, which qualified as a discontinued operation and from the acquisition during 2009 of Hercules. Adjustments to the recorded asbestos litigation reserves and related insurance receivables are recorded within the discontinued operations caption. See Note M for more information related to the adjustments on asbestos litigation reserves and receivables.

Components of amounts reflected in the Statements of Consolidated Comprehensive Income (Loss) related to discontinued operations are presented in the following table for the years ended September 30:

NOTE D – RESTRUCTURING ACTIVITIES

Restructuring activities

Ashland periodically implements company-wide and targeted restructuring programs related to acquisitions, divestitures and other cost reduction programs in order to enhance profitability through streamlined operations and an improved overall cost structure.

Fiscal 2025, 2024 and 2023 restructuring costs

During fiscal 2025, Ashland initiated a restructuring plan to offset the impact from the Nutraceuticals business sale completed in fiscal 2024 and other portfolio optimization actions ("2025 Restructuring Program"). As a part of this program, Ashland is also advancing a multi-year manufacturing optimization restructuring plan to improve operational cost and strengthen its competitive position.

During fiscal 2023, Ashland implemented targeted organizational restructuring actions to reduce costs ("2023 Restructuring Program"). This program continued into fiscal 2024.

Ashland recorded severance expense of $13 million, $25 million and $5 million during the years ended September 30, 2025, 2024 and 2023, respectively, within the selling, general and administrative expense caption of the Statements of Consolidated Comprehensive Income (Loss).

The following table details at September 30, 2025, the amount of restructuring severance liabilities related to these programs.

(a)

The restructuring severance liability associated with these programs is recorded within accrued expenses and other liabilities in the Consolidated Balance Sheets at September 30, 2025 and 2024.

Plant optimization actions

Ashland's portfolio optimization actions have included projects associated with carboxymethylcellulose ("CMC"), industrial methylcellulose ("MC"), vinyl pyrrolidone and derivatives ("VP&D") and hydroxyethylcellulose ("HEC") as well as manufacturing productivity initiatives.

During 2025, Ashland incurred $21 million, $1 million and $19 million of accelerated depreciation for product line optimization activities associated with manufacturing facilities within the Life Sciences, Personal Care and Specialty Additives reportable segments, respectively, which was recorded within the cost of sales caption of the Statements of Consolidated Comprehensive Income (Loss).

During 2024, Ashland incurred $55 million of accelerated depreciation for product line optimization activities associated with two Specialty Additives manufacturing facilities, which was recorded within the cost of sales caption of the Statements of Consolidated Comprehensive Income (Loss).

During 2024, Ashland incurred $2 million of accelerated depreciation for product line optimization activities associated with a Personal Care manufacturing facility in Summerville, South Carolina, which was recorded within the cost of sales caption of the Statements of Consolidated Comprehensive Income (Loss).

NOTE E – FAIR VALUE MEASUREMENTS

As required by U.S. GAAP, Ashland uses applicable guidance for defining fair value, the initial recording and periodic remeasurement of certain assets and liabilities measured at fair value and related disclosures for instruments measured at fair value. Fair value accounting guidance establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value into three broad levels. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). An instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the instrument’s fair value measurement. The three levels within the fair value hierarchy are described as follows.

Level 1 – Observable inputs such as unadjusted quoted prices in active markets for identical assets or liabilities.

Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly. These include quoted prices for similar assets or liabilities in active markets and quoted prices for identical or similar assets or liabilities in markets that are not active.

Level 3 – Unobservable inputs for the asset or liability for which there is little, if any, market activity at the measurement date. Unobservable inputs reflect Ashland’s own assumptions about what market participants would use to price the asset or liability. The inputs are developed based on the best information available in the circumstances, which might include Ashland’s own financial data such as internally developed pricing models, discounted cash flow methodologies, as well as instruments for which the fair value determination requires significant management judgment.

For assets that are measured using quoted prices in active markets (Level 1), the total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using significant other observable inputs (Level 2) are primarily valued by reference to quoted prices of similar assets or liabilities in active markets, adjusted for any terms specific to that asset or liability. For all other assets and liabilities for which unobservable inputs are used (Level 3), fair value is derived through the use of fair value models, such as a discounted cash flow model or other standard pricing models that Ashland deems reasonable.

The following table summarizes financial instruments subject to recurring fair value measurements as of September 30, 2025. For additional information on fair value hierarchy measurements of pension plan assets, see Note L.

(a)

Includes $297 million within restricted investments and $50 million within other current assets in the Consolidated Balance Sheets.

(b)

Includes $231 million related to the Asbestos trust and $116 million related to the Environmental trust. See Note A for additional details.

(c)

Included in other noncurrent assets in the Consolidated Balance Sheets.

(d)

Included in accounts receivable, net in the Consolidated Balance Sheets.

(e)

Included in accrued expenses and other liabilities in the Consolidated Balance Sheets.

The following table summarizes financial instruments subject to recurring fair value measurements as of September 30, 2024:

(a)

Includes $295 million within restricted investments and $73 million within other current assets in the Consolidated Balance Sheets.

(a)

Includes $248 million related to the Asbestos trust and $120 million related to the Environmental trust. See Note A for additional details.

(b)

Included in other noncurrent assets in the Consolidated Balance Sheets.

(c)

Included in accounts receivable, net in the Consolidated Balance Sheets.

(d)

Included in accrued expenses and other liabilities in the Consolidated Balance Sheets.

Restricted investments

As discussed in Note A, Ashland maintains certain investments in a company restricted renewable annual trusts for the purpose of paying future asbestos indemnity and defense costs and future environmental remediation and related litigation costs. The financial instruments are designated as investment securities, classified as Level 1 measurements within the fair value hierarchy. These investment securities were classified primarily as noncurrent restricted investment assets, with $50 million and $73 million classified within other current assets, in the Consolidated Balance Sheets at September 30, 2025 and 2024, respectively.

The following table presents gross unrealized gains and losses for the restricted investments as of:

The following table presents the investment income, net gains and losses realized, funds restricted for specific transactions, and disbursements related to restricted investments for the years ended September 30:

(a)

Included in the net interest and other expense (income) caption within the Statements of Consolidated Comprehensive Income (Loss).

Foreign currency derivatives

Ashland conducts business in a variety of foreign currencies. Accordingly, Ashland regularly uses foreign currency derivative instruments to manage exposure on certain transactions denominated in foreign currencies to curtail potential earnings volatility effects of certain assets and liabilities, including short-term intercompany loans denominated in currencies other than Ashland’s functional currency of an entity. These derivative contracts generally require exchange of one foreign currency for another at a fixed rate at a future date and generally have maturities of less than twelve months. All contracts are valued at fair value with net changes in fair value recorded within the selling, general and administrative expense caption of the Statements of Comprehensive Income (Loss). The impacts of these contracts were largely offset by gains and losses resulting from the impact of changes in exchange rates on transactions denominated in non-functional currencies.

The following table summarizes the gains and losses recognized within the Statements of Consolidated Comprehensive Income (Loss) for the years ended September 30:

The following table summarizes the fair values of the outstanding foreign currency derivatives included in accounts receivable, net and accrued expenses and other liabilities of the Consolidated Balance Sheets at September 30:

Commodity derivatives

To manage its exposure to the market price volatility of natural gas consumed by its U.S. plants during the manufacturing process, Ashland regularly enters into forward contracts that are designated as cash flow hedges. See Note A for more information.

The following table summarizes the gains and losses recognized within the cost of sales caption of the Statements of Consolidated Comprehensive Income (Loss) for the years ended September 30:

The following table summarizes the fair values of the outstanding commodity derivatives included in accounts receivable, net and accrued expenses and other liabilities of the Consolidated Balance Sheets at September 30:

Other financial instruments

At September 30, 2025 and 2024, Ashland’s long-term debt (including the current portion and excluding debt issuance cost discounts) had carrying values of $1,394 million and $1,361 million, respectively, compared to a fair value of $1,366 million and $1,327 million, respectively. The fair values of long-term debt are based on quoted market prices (level 1 of the fair value hierarchy).

NOTE F – PROPERTY, PLANT AND EQUIPMENT

The following table describes the various components of property, plant and equipment within the Consolidated Balance Sheets as of September 30:

(a)

Includes $10 million offinance lease asset as of September 30, 2025 and 2024.

The following table summarizes various property, plant and equipment activity within the Statements of Consolidated Comprehensive Income (Loss) during the years ended September 30:

(a)

Includes $41 million and $57 million of accelerated depreciation during 2025 and 2024, respectively, related to plant optimization actions. See Note D for additional details.

NOTE G – GOODWILL AND OTHER INTANGIBLES

Goodwill

During the third quarter of fiscal 2025, Ashland experienced a continued decline in the market price of its common stock. Ashland also experienced slowing growth due to a weakening macroeconomic environment that is dampening consumer sentiment and demand globally which resulted in lower growth and lower margins for the Life Sciences and Specialty Additives reporting units than what was previously forecasted. These factors led Ashland to determine that triggering events occurred, and a quantitative goodwill impairment assessment was performed during the third quarter of fiscal 2025.

Following the aforementioned quantitative analysis, the carrying value of the Life Sciences and the Specialty Additives reporting units exceeded their fair value, resulting in non-cash goodwill impairment charges of $375 million and $331 million, respectively, for a total goodwill impairment charge of $706 million, which was recorded within the goodwill impairment caption of the Statement of Consolidated Comprehensive Income (Loss) for the year ended September 30, 2025. The pre-impairment goodwill balance for the Life Sciences and Specialty Additives reporting units were $841 million and $443 million, respectively. The goodwill impairment charges are nondeductible for tax purposes.

On July 1, 2025, the date of our annual goodwill impairment assessment, Ashland evaluated each reporting unit using a qualitative approach focusing on any additional changes in market conditions, performances versus forecast and strategic initiatives. Particular attention was given to forward looking macroeconomic trends and forecasts, recent financial results, earnings multiples for guideline public companies in each reporting unit's industry peer group and sensitivity analysis for each reporting unit's discounted cash flow model. There was no additional impairment identified as part of the July 1, 2025 annual goodwill impairment assessment. No subsequent indicators of impairment had been identified during the fourth quarter of fiscal 2025.

The valuation used to test goodwill for impairment is dependent upon a number of significant estimates and assumptions, including macroeconomic conditions, growth rates, competitive activities, cost containment, margin expansion, and Ashland's business plans. Ashland believes these estimates and assumptions are reasonable. However, future changes in the judgments, assumptions, and estimates that are used in the impairment testing for goodwill, including discount rates or future cash flow projections, could result in significantly different estimates of the fair values. As a result of these factors and other factors discussed above and the limited or no cushion (or headroom as commonly referred) for the Life Sciences and Specialty Additives reporting units, goodwill is more susceptible to impairment risk.

Ashland is required to provide additional disclosures about fair value measurements as part of the Consolidated Financial Statements for each major category of assets and liabilities measured at fair value on a non-recurring basis (including impairment assessments). Goodwill was valued using Level 3 inputs, which are unobservable by nature, and included internal estimates of future cash flows (income approach). Significant increases (decreases) in any of those unobservable inputs in isolation would result in a significantly higher (lower) fair value measurement. The most significant assumptions used in the determination of the estimated fair value of reporting units are sales and EBITDA growth rates (including terminal growth rates) and the discount rate. The terminal growth rate represents the rate at which the reporting unit is expected to grow beyond the shorter-term business planning period. The terminal growth rate utilized in Ashland’s fair value estimate is consistent with the reporting unit operating plans and approximates expected long-term category market growth rates and inflation. The discount rate, which is consistent with a weighted-average cost of capital that is likely to be expected by a market participant, is based upon industry required rates of return, including consideration of both debt and equity components of the capital structure. The discount rates may be impacted by adverse changes in the macroeconomic environment, volatility in the equity and debt markets, or other factors. While Ashland can implement and has implemented certain strategies to address the events that triggered the interim impairment assessment, future changes in operating plans or other adverse changes could result in a further decline in fair value that would trigger a future material impairment charge of the reporting unit’s goodwill balance.

The following is a progression of goodwill by reportable segment for the years ended September 30, 2025 and 2024.

(a)

Ashland allocated $17 million to the Nutraceuticals business during 2024. See Note B for additional details.

(b)

As of September 30, 2024, there were accumulated impairments ofzero, $356 million, $174 million and $90 million related to the Life Sciences, Personal Care, Specialty Additives and Intermediates reportable segments, respectively.

(c)

Ashland allocated $1 million to the Avoca business during 2025. See Note B for additional details.

(d)

As of September 30, 2025, there were accumulated impairments of $375 million, $356 million, $505 million and $90 million related to the Life Sciences, Personal Care, Specialty Additives and Intermediates reportable segments, respectively.

Other intangible assets

In conjunction with the triggering events described above for goodwill, Ashland tested its indefinite-lived intangible assets for impairment during the third quarter of fiscal 2025. Ashland's quantitative assessment did not indicate any impairment, as each indefinite-lived intangible asset's fair value exceeded its carrying values. Trademarks and trade names are valued using a “relief-from-royalty” valuation method compared to the carrying value. On July 1, 2025, the date of our annual impairment assessment, Ashland evaluated its indefinite-lived intangible assets for impairment using a qualitative approach focusing on key assumptions used as part of the third quarter quantitative approach. There wasno impairment identified as part of the July 1, 2025 annual other indefinite-lived intangible asset impairment assessment. No subsequent indicators of impairment had been identified during the fourth quarter of fiscal 2025. However, similar to the factors discussed with respect to goodwill above and limited cushion, certain indefinite-lived intangible assets are more susceptible to impairment risk. See Note B for further information with respect to other intangible assets related to the Avoca business.

Other intangible assets were comprised of the following as of:

(a)

Ashland allocated $7 million to the Avoca business during 2025 and $7 million to the Nutraceuticals business during 2024. See Note B for additional details.

(b)

Ashland allocated $29 million to the Avoca business during 2025 and $17 million to the Nutraceuticals business during 2024. See Note B for additional details.

(c)

Ashland allocated $98 million to the Avoca business during 2025 and $45 million to the Nutraceuticals business during 2024. See Note B for additional details.

Amortization expense recognized on other intangible assets was $63 million for 2025, $76 million for 2024 and $93 million for 2023, and is included in the intangibles amortization expense caption of the Statements of Consolidated Comprehensive Income (Loss). As of September 30, 2025, all of Ashland’s intangible assets that had a carrying value were being amortized except for certain trademarks and trade names that have been determined to have indefinite lives. Estimated amortization expense for future periods is $58 million in 2026, $37 million in 2027, $34 million in 2028, $27 million in 2029 and $19 million in 2030. The amortization expense for future periods is an estimate. Actual amounts may change from such estimated amounts due to fluctuations in foreign currency exchange rates, additional intangible asset acquisitions and divestitures, potential impairment, accelerated amortization, or other events.

Goodwill and other intangible assets

Ashland’s assessment of an impairment on any of these assets classified currently as having indefinite lives, including goodwill, could change in future periods if significant events happen and/or circumstances change that effect the previously mentioned assumptions such as: a significant change in projected business results, a divestiture decision, increase in Ashland’s weighted-average cost of capital rates, decrease in growth rates or assumptions, economic deterioration that is more severe or of a longer duration than anticipated, or another significant economic event.

NOTE H – DEBT

The following table summarizes Ashland’s current and long-term debt at September 30:

(a)

Other includes $10 million and $12 million of debt issuance costs as of September 30, 2025 and 2024, respectively. The current portion of the long-term debt waszero for both September 30, 2025 and 2024.

At September 30, 2025, Ashland’s total debt had an outstanding principal balance of $1,419 million, discounts of $25 million and debt issuance costs of $10 million. As of September 30, 2025, Ashland hadno long-term debt (excluding debt issuance costs) maturing in 2026, $4 million due in fiscal 2027, $586 million in 2028, $97 million in 2029, andzero in 2030.

Credit Agreements and Refinancing

2022 Credit Agreement

During July 2022, Ashland, through two of its subsidiaries, enacted an amendment to the 2020 credit agreement. The amended credit agreement (the 2022 Credit Agreement) provides for a $600 million five-year revolving credit facility (the 2022 Revolving Credit Facility). The 2022 Credit Agreement and the obligations of Ashland Services B.V. under the 2022 Revolving Credit Facility are guaranteed by Ashland. The borrowing capacity remaining under the 2022 Credit Agreement was $596 million, which reflects the full $600 million 2022 Revolving Credit Facility less a reduction of $4 million for letters of credit outstanding at September 30, 2025.

At Ashland’s option, loans issued under the 2022 Credit Agreement bears interest at (a) in the case of loans denominated in U.S. dollars, either Term SOFR or an alternate base rate and (b) in the case of loans denominated in Euros, EURIBOR, in each case plus the applicable interest rate margin. Loans will initially bear interest at Term SOFR or EURIBOR plus 1.250% per annum, in the case of Term SOFR borrowings or EURIBOR borrowings, respectively, or at the alternate base rate plus 0.250% per annum, in the case of alternate base rate borrowings, through and including the date of delivery of a quarterly compliance certificate and thereafter the interest rate will fluctuate between Term SOFR or EURIBOR plus 1.250% per annum and Term SOFR or EURIBOR plus 1.750% per annum (or between the alternate base rate plus 0.250% per annum and the alternate base rate plus 0.750% per annum), based upon the Consolidated Net Leverage Ratio (as defined in the 2022 Credit Agreement) at such time. Term SOFR borrowings are subject to a credit spread adjustment of 0.10% per annum. In addition, the Company is required to pay fees of 0.125% per annum on the daily unused amount of the 2022 Revolving Credit Facility through and including the date of delivery of a quarterly compliance certificate, and thereafter the fee rate fluctuates between 0.125% and 0.275% per annum, based upon the Consolidated Net Leverage Ratio. Borrowings under the 2022 Credit Agreement may be prepaid at any time without premiums.

The 2022 Credit Agreement contains financial covenants for leverage and interest coverage ratios. The 2022 Credit Agreement contains usual and customary representations, warranties and affirmative and negative covenants, including financial covenants for leverage and interest coverage ratios, limitations on liens, additional indebtedness, further negative pledges, investments, mergers, sale of assets and restricted payments, and other customary limitations.

Debt repayments and repurchases

Cash repatriation

During 2025 and 2024, Ashland repatriated$403 million and $305 million, respectively, in cash.

Accounts receivable facilities and off-balance sheet arrangements

U.S. Accounts Receivable Sales Program

On March 17, 2021, a wholly-owned, bankruptcy-remote special purpose entity and consolidated Ashland subsidiary ("SPE") entered into an agreement with a group of entities (buyers) to sell certain trade receivables, without recourse beyond the pledged receivables, of two other U.S. based Ashland subsidiaries. Under the agreement, Ashland can transfer whole accounts receivable up to a limit established by the buyer, which was set at $125 million between February and October of each year and up to $100 million all other times (a level 1 fair value measurement). Ashland’s continuing involvement is limited to servicing the accounts receivable, including billing, collections and remittance of payments to the buyers as well as a limited guarantee on over-collateralization. The arrangement was set to terminate on May 31, 2023.

On April 14, 2023, Ashland entered into a Second and Third Amendments associated with this current program. As part of this amendment the buyer's limit was reduced to $115 million between April and October of each year, and up to $100 million at all other times. Additionally, the scheduled termination date was extended from May 31, 2023 to April 14, 2025.

On September 13, 2024, Ashland entered into a Fourth Amendment associated with this current program. As part of this amendment the buyer's limits were reduced to $80 million between September 13, 2024 to (and including) December 31, 2024 and up to $70 million from January 1, 2025 through the termination date of the agreement. Additionally, the scheduled termination date was extended from April 14, 2025 to September 11, 2026.

Ashland determined that any accounts receivable transferred under this agreement are put presumptively beyond the reach of Ashland and its creditors, even in bankruptcy or other receivership. Ashland received a true sale at law and non-consolidation opinions to support the legal isolation of these accounts receivable. Ashland accounts for the accounts receivable transferred to buyers as sales. Ashland recognizes any gains or losses based on the excess of proceeds received net of buyer’s discounts and fees compared to the carrying value of the assets. Proceeds received, net of buyer’s discounts and fees, are recorded within the operating activities of the Statements of Consolidated Cash Flows. Losses on sale of assets, including related transaction expenses are recorded within the net interest and other expense (income) caption of the Statements of Consolidated Comprehensive Income (Loss). Ashland regularly assesses its servicing obligations and records them as assets or liabilities when appropriate. Ashland also monitors its obligation with regards to the limited guarantee and records the resulting guarantee liability when warranted. When applicable, Ashland discloses the amount of the accounts receivable that serves as over-collateralization as a restricted asset.

Ashland recognized a loss of $3 million within the Statements of Consolidated Comprehensive Income (Loss) for 2025, 2024 and 2023 within the net interest and other expense (income) caption associated with sales under the program. Ashland has recorded $59 million of sales against the buyer’s limit, which was $59 million at September 30, 2025, compared to $71 million of sales against the buyer's limit, which was $71 million at September 30, 2024. Ashland transferred $75 million and $85 million in accounts receivable to the SPE as of September 30, 2025 and 2024, respectively. Ashland recorded liabilities related to its service obligations and limited guarantee as of September 30, 2025 and 2024 of less than $1 million.

For the years ended September 30, 2025, 2024, and 2023, the gross cash proceeds received for accounts receivable transferred and derecognized were $388 million, $323 million, and $217 million, respectively, of which $400 million, $322 million, $241 million, were collected by Ashland in our capacity as a servicer of the accounts receivable and remitted to the buyer. The difference between accounts receivable transferred and derecognized versus collected of $12 million, $1 million and $24 million for the years ended September 30, 2025, 2024, and 2023, respectively, represents the impact of a net reduction in account receivable sales volume during 2025, a net increase in 2024, and a net decrease during 2023.

Foreign Accounts Receivable Sales Program

On October 19, 2023, Ashland entered, through an Ireland based, wholly-owned, bankruptcy-remote consolidated special purpose entity (the "SPE"), into athree-year agreement with a group of entities (buyers) to sell certain accounts receivable, without recourse beyond the pledged receivables, of certain wholly-owned Ashland subsidiaries (Foreign Accounts Receivable Sales Program) primarily in Europe. Under the agreement, Ashland can transfer whole accounts receivable up to a limit established by the buyer, which is currently set at €125 million (a level 1 fair value measurement). Ashland’s continuing involvement is limited to servicing the accounts receivable, including billing, collections and remittance of payments to the buyers as well as a limited guarantee on over-collateralization.

Ashland determined that any accounts receivable transferred under this agreement are put presumptively beyond the reach of Ashland and its creditors, even in bankruptcy or other receivership. Ashland received true sale at law and non-consolidation opinions from independent qualified legal advisors in the jurisdiction of each originating subsidiary to support the legal isolation of these accounts receivable. Consequently, Ashland accounts for accounts receivable transferred to buyers as part of this agreement as sales.

Ashland recognized a loss of $5 million and $3 million within the Statements of Consolidated Comprehensive Income (Loss) for 2025 and 2024, respectively, within the net interest and other expense (income) caption associated with sales under the program. Ashland has recorded $103 million of sales against the buyer’s limit, which was $103 million at September 30, 2025, compared to $104 million of sales against the buyer's limit, which was $104 million at September 30, 2024. Ashland transferred $142 million and $155 million in accounts receivable to the SPE as of September 30, 2025 and 2024, respectively. Ashland recorded liabilities related to its service obligations and limited guarantee as of September 30, 2025 and 2024 of less than $1 million.

For the years ended September 30, 2025 and 2024, the gross cash proceeds received for accounts receivable transferred and derecognized were $528 million and $104 million, respectively, of which $534 million andzero were collected by Ashland in our capacity as a servicer of the accounts receivable and remitted to the buyer. The difference between accounts receivable transferred and derecognized versus collected of $6 million and $104 million for the periods ended September 30, 2025 and 2024, respectively, represents the impact of a net reduction and a net increase in accounts receivable sales volume during each period, respectively.

Supply Chain Finance Program

During April 2024, Ashland authorized a financing program offered through JP Morgan and Taulia Alliance. Under this program, JP Morgan and its affiliates may purchase certain confirmed receivables directly from suppliers pursuant to the terms of a separate arrangement entered into between JPMorgan and Taulia Alliance and such suppliers. There were no changes to Ashland's standard payment terms with its suppliers in connection with this program. Ashland provides no guarantees to JP Morgan and Taulia Alliance under this program. The program was implemented during June 2025 and has been actively offered to suppliers. As of September 30, 2025, participation in the program was not significant. There were less than $1 million of confirmed invoices under this program for the year ended September 30, 2025.

Other debt

At September 30, 2025 and 2024, Ashland held other debt totaling $76 million and $71 million, respectively, comprised primarily of the 6.50% notes due 2029 and other notes.

Covenants related to current Ashland debt agreements

Ashland’s debt contains usual and customary representations, warranties and affirmative and negative covenants, including financial covenants for leverage and interest coverage ratios, limitations on liens, additional subsidiary indebtedness, restrictions on subsidiary distributions, investments, mergers, sale of assets and restricted payments and other customary limitations. As of September 30, 2025, Ashland was in compliance with all debt agreement covenant restrictions.

The maximum consolidated net leverage ratio permitted under Ashland’s most recent credit agreement (the 2022 Credit Agreement) is 4.0. The 2022 Credit Agreement defines the consolidated net leverage ratio as the ratio of consolidated indebtedness minus unrestricted cash and cash equivalents to consolidated EBITDA (Covenant Adjusted EBITDA) for any measurement period. In general, the 2022 Credit Agreement defines Covenant Adjusted EBITDA as net income (loss) plus consolidated interest charges, taxes, depreciation and amortization expense, fees and expenses related to capital market transactions and proposed or actual acquisitions and divestitures, restructuring and integration charges, certain environmental charges, non-cash stock and equity compensation expense, and any other nonrecurring expenses or losses that do not represent a cash item in such period or any future period; less any non-cash gains or other items increasing net income (loss). In general, consolidated indebtedness includes debt plus all purchase money indebtedness, banker’s acceptances and bank guaranties, deferred purchase priceof property or services, attributable indebtedness and guarantees. At September 30, 2025, Ashland’s calculation of the consolidated net leverage ratio was 2.8.

The minimum required consolidated interest coverage ratio under the 2022 Credit Agreement is 3.0. The 2022 Credit Agreement defines the consolidated interest coverage ratio as the ratio of Covenant Adjusted EBITDA toconsolidated interest charges for any measurement period. At September 30, 2025, Ashland’s calculation of the consolidated interest coverage ratio was 6.5.

Net interest and other expense (income)

(a)

Represents investment income related to the restricted investments discussed in Note E.

The following table details the debt issuance cost and original issue discount amortization included in interest expense during the years ended September 30:

NOTE I – OTHER NONCURRENT ASSETS AND LIABILITIES

The following table summarizes the components of other noncurrent assets as of September 30:

Deferred compensation investments

Deferred compensation investments consist of insurance policies valued at cash surrender value. Gains and losses related to deferred compensation investments are immediately recognized within the selling, general and administrative expense caption on the Statements of Consolidated Comprehensive Income (Loss). These investments had gains of $5 million, $8 million, and $5 million during 2025, 2024 and 2023, respectively. These cash inflows exclude company-owned life insurance death benefits of $12 million, $1 million and $6 million for 2025, 2024 and 2023, respectively.

The following table provides the components of other noncurrent liabilities as of September 30:

NOTE J – LEASING ARRANGEMENTS

Ashland leases certain office buildings, transportation equipment, warehouses and storage facilities, and equipment. Substantially all of Ashland’s leases are operating leases or short-term leases. Real estate leases represented over 85% of the total lease liability at both September 30, 2025 and 2024. See Note A for additional information related to Ashland’s leasing arrangements.

The components of lease cost recognized within the Statements of Consolidated Comprehensive Income (Loss) for the years ended September 30, were as follows:

The following table summarizes Ashland’s lease assets and liabilities at September 30:

(a)

Included in property, plant and equipment. See Note F.

The weighted average remaining lease term for operating leases as of September 30, 2025 and 2024 was approximately 10 years and 19 years, respectively. The sale of the Avoca business in fiscal 2025 was the driver for the reduction of the average.

The weighted average discount rate used to measure operating lease liabilities as of both September 30, 2025 and 2024 was 3.8%. There are no leases that have not yet commenced but that create significant rights and obligations for Ashland.

Right-of-use assets exchanged for new operating lease obligations was $7 million and $6 million for the years ended September 30, 2025 and 2024, respectively. During the second quarter of fiscal 2024, Ashland acquired a favorable lease asset for $10 million, which was recorded in the property, plant and equipment caption of the Consolidated Balance Sheet at September 30, 2024.

The following table provides cash paid for amounts included in the measurement of operating lease liabilities for the years ended September 30:

The following table summarizes Ashland's maturities of lease liabilities as of September 30, 2025:

NOTE K – INCOME TAXES

Income Tax Provision

A summary of the provision for income taxes related to continuing operations for the years ended September 30 is as follows:

Temporary differences that give rise to significant deferred tax assets and liabilities as of September 30 are presented in the following table.

(a)

Gross net operating loss carryforwards of $99 million will expire in future years beyond 2026 or have no expiration, and primarily relate to European and Asian subsidiaries.

(b)

Apportioned net operating loss carryforwards generated of $443 million will expire in future years as follows: $44 million in 2026, and the remaining balance in other future years.

(c)

Credit carryforwards consist primarily of foreign tax credits of $23 million expiring in future years, and state tax credits of $3 million that will expire in 2026 and other future years.

(d)

Valuation allowances primarily relate to certain state and foreign net operating loss carryforwards and certain federal credit carryforwards.

(e)

The total gross amount of goodwill as of September 30, 2025 and 2024 expected to be deductible for tax purposes was $33 million and $36 million, respectively.

The U.S. and foreign components of income (loss) from continuing operations before income taxes and a reconciliation of the statutory federal income tax with the provision for income taxes for the years ended September 30 is as follows. The foreign components of income (loss) from continuing operations disclosed in the following table exclude any allocations of certain corporate expenses incurred in the U.S.

(a)

2025 includes $12 million related to GILTI permanent adju stments and $15 million related to Subpart F. 2024 includes $17 million related to GILTI permanent adjustments and $11 million related to Subpart F. 2023 includes $19 million related to GILTI permanent adjustment and $12 million related to Subpart F.

(b)

2025 includes net $10 million related to state NOL's, deferred taxes and foreign tax credits. 2024 includes net $10 million related to state NOL's, deferred taxes and foreign tax credits. 2023 includes net $2 million related to deferred taxes and foreign tax credits.

Unrecognized tax benefits

U.S. GAAP prescribes a recognition threshold and measurement attribute for the accounting and financial statement disclosure of tax positions taken or expected to be taken in a tax return. The evaluation of a tax position is a two-step process. The first step requires Ashland to determine whether it is more likely than not that a tax position will be sustained upon examination based on the technical merits of the position. The second step requires Ashland to recognize in the financial statements each tax position that meets the more likely than not criteria, measured at the amount of benefit that has a greater than 50% likelihood of being realized. Ashland had$65 million of unrecognized tax benefits at both September 30, 2025 and 2024, recorded within other noncurrent liabilities. As of September 30, 2025, the total amount of unrecognized tax benefits that, if recognized, would affect the tax rate for continuing and discontinued operations was $60 million. The remaining unrecognized tax benefits relate to tax positions for which ultimate deductibility is highly certain but for which there is uncertainty as to the timing of such deductibility. Recognition of these tax benefits would not have an impact on the effective tax rate.

Ashland recognizes interest and penalties related to uncertain tax positions as a component of income tax expense (benefit) in the Statements of Consolidated Comprehensive Income (Loss). Such interest and penalties totaled $4 million expense in 2025, $3 million expense in 2024 and $1 million benefit in 2023. Ashland had $19 million and $14 million in interest and penalties related to unrecognized tax benefits accrued as of September 30, 2025 and 2024, respectively.

Changes in unrecognized tax benefits were as follows:

From a combination of statute expirations and audit settlements in the next twelve months, Ashland expects a decrease in the amount of accrual for uncertain tax positions of between zero and $1 million for continuing operations. For the remaining balance as of September 30, 2025, it is reasonably possible that there could be material changes to the amount of uncertain tax positions due to activities of the taxing authorities, settlement of audit issues, reassessment of existing uncertain tax positions or the expiration of applicable statute of limitations; however, Ashland is not able to estimate the impact of these items at this time.

Ashland or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various state and foreign jurisdictions. Foreign taxing jurisdictions significant to Ashland include Belgium, Brazil, China, Germany, India, Italy, Mexico, Netherlands, Spain, Switzerland and the United Kingdom. Ashland is subject to U.S. federal income tax examinations by tax authorities for periods after September 30, 2021 and U.S. state income tax examinations by tax authorities for periods after September 30, 2018. With respect to countries outside of the United States, with certain exceptions, Ashland’s foreign subsidiaries are subject to income tax audits for years after 2019. In October 2025, Ashland received a $103 million tax refund related to the capital loss carryback from the Nutraceuticals business divestiture which was included within other current assets in the Consolidated Balance Sheet at September 30, 2025.

NOTE L – EMPLOYEE BENEFIT PLANS

Pension plans

Ashland and its subsidiaries have several contributory and noncontributory qualified defined benefit pension plans that generally cover international employees and a small portion of certain U.S. manufacturing union employees. Pension obligations for applicable employees of non-U.S. consolidated subsidiaries are provided for in accordance with local practices and regulations of the respective countries. The majority of these foreign pension plans are closed to new participants while those that remain open relate to areas where jurisdictions require plans to operate within the applicable country.

Benefits for those eligible for Ashland’s U.S. pension plans generally are based on employees’ years of service and compensation during the years immediately preceding their retirement. The remaining U.S. pension plans are still open for enrollment for qualifying union employees within certain manufacturing sites.

Other postretirement benefit plans

Ashland and its subsidiaries maintain limited health care for certain eligible employees in the U.S. who are retired or disabled. Ashland shares the costs of providing health care coverage with certain eligible retired employees through premiums, deductibles and coinsurance provisions. Ashland funds its share of the costs of the postretirement benefit plans as the benefits are paid.

Postretirement health care plans include a limit on Ashland’s share of costs for recent and future retirees. The assumed pre-65 health care cost increase trend rate as of September 30, 2025 was 7.1% and continues to be reduced to 4.0% in 2049 and thereafter. The assumptions used to project the liability anticipate future cost-sharing changes to the written plans that are consistent with the increase in health care costs.

Net periodic benefit loss allocation

Consistent with Ashland’s historical accounting policies, service cost for continuing operations is allocated to each reportable segment, excluding the Unallocated and other, while all other costs for continuing operations are recorded within Unallocated and other.

Restructuring and plan remeasurement

During the first quarter of fiscal 2025, as part of its fiscal 2024 restructuring activities, Ashland terminated approximately 40 employees in its Doel, Belgium facility. The post-retirement benefits for these employees, all of whom participated in a non-contributory defined benefit plan in Belgium, were frozen. This resulted in a decrease in total expected future years of service within the plan and required Ashland to remeasure the plan as of December 31, 2024. As a result, Ashland recorded a $1 million curtailment loss within the other net periodic benefit loss caption of the Statement of Consolidated Comprehensive Income (Loss) during the year ended September 30, 2025.

The following table summarizes the components of pension and other postretirement benefit costs for continuing operations and the assumptions used to determine net periodic benefit loss for the plans for the years ended September 30:

(a)

Service cost is classified within the selling, general and administrative expense and cost of sales captions on the Statements of Consolidated Comprehensive Income (Loss).

(b)

These components are classified within theother net periodic benefit loss caption on the Statements of Consolidated Comprehensive Income (Loss). Actuarial (gain) loss includes net actuarial gains and losses as well as the change in the fair value of plan assets recognized in the fourth quarter. The change in the fair value of plan assets recognized in the fourth quarter was a loss of $15 million, gain of $12 million and a loss of $9 million for the years ended September 30, 2025, 2024 and 2023, respectively.

(c)

The plan assumptions discussed are a blended weighted-average rate for Ashland’s U.S. and non-U.S. plans.

The changes in prior service credit recognized in accumulated other comprehensive loss during the years ended September 30, 2025 and 2024 were less than $1 million each. At September 30, 2025, Ashland expects to recognize less than $1 million of the prior service credit in accumulated other comprehensive loss as net periodic benefit loss during the next fiscal year.

The amounts included in accumulated other comprehensive loss at September 30, are shown in the following table.

Obligations and funded status

Actuarial valuations are performed for the pension and other postretirement benefit plans to determine Ashland’s obligation for each plan. In accordance with U.S. GAAP, Ashland recognizes the status of the plans in the Consolidated Balance Sheets. Ashland maintains a defined benefits plan in the U.K. that is overfunded by $12 million, all of which is recorded in the other noncurrent assets caption of the Consolidated Balance Sheets.

Summaries of the change in benefit obligations, plan assets, funded status of the plans, amounts recognized in the Consolidated Balance Sheets, and assumptions used to determine the benefit obligations at September 30, are as follows:

The accumulated benefit obligation for all pension plans was $271 million and $284 million at September 30, 2025 and 2024, respectively. All Ashland pension plans are either qualified U.S. or non-US plans. Information for pension plans with an accumulated benefit obligation in excess of plan assets follows at September 30:

Plan assets

The expected long-term rate of return on pension plan assets was 4.78% and 4.99% for the years ended September 30, 2025 and 2024, respectively. The basis for determining the expected long-term rate of return is a combination of future return assumptions for various asset classes in Ashland’s investment portfolio, historical analysis of previous returns, market indices and a projection of inflation.

The following table summarizes the various investment categories that the pension plan assets are invested in and the applicable fair value hierarchy that the pension plan assets are classified in as of September 30, 2025. For additional information and a detailed description of each level within the fair value hierarchy, see Note E.

The following table summarizes the various investment categories that the pension plan assets are invested in and the applicable fair value hierarchy that the pension plan assets are classified in as of September 30, 2024.

Ashland’s defined benefit pension plans hold a variety of investments that are designed to diversity risk. Ashland’s pension plan assets are generally classified within Level 1 or Level 2 of the fair value hierarchy because they are valued using quoted market prices in active markets, broker or dealer quotations, or alternative pricing sources, primarily matrix pricing, with reasonable levels of price transparency, however, certain pension plan assets are classified within Level 3 of the fair value hierarchy if they have significant unobservable inputs. The types of financial instruments based on quoted market prices in active markets include cash and cash equivalents (money market securities). Such instruments are classified within Level 1 of the fair value hierarchy. Ashland does not adjust the quoted market price for such financial instruments. The types of financial instruments valued based on quoted market prices in markets that are not active, broker or dealer quotations, or alternative pricing sources with reasonable levels of price transparency include common collective trust funds (“CCTs”) and insurance contracts at or near inception. Such financial instruments are generally classified within Level 2 for the fair value hierarchy. Insurance contracts after inception based on values from third-party insurers with limited level of transparency, are generally classified within Level 3 of the fair value hierarchy.

The CCTs are valued at net asset value ("NAV") provided by the respective fund administrators as there is not an active market for CCTs. The Company has determined that the NAV is an appropriate estimate of the fair value of the CCTs at September 30, 2025 and 2024, because the CCTs are audited and accounted for at fair value by the administrators of the respective CCTs. The underlying assets in the CCTs consist primarily of marketable debt and equity securities based on the respective fund administrator’s investment strategy. Given there are no significant liquidity restrictions on any of the CCTs as of September 30, 2025 or 2024, the Company has determined that the CCTs are classified within Level 2 of the fair value hierarchy.

Insurance contracts represent qualified insurance contracts (“buy in”) with a third-party insurer that were executed by Ashland for certain non-US defined benefit pension plans. The buy in insurance contracts replaced certain assets historically held by the defined benefit pension plans and as a result the longevity and investments risks for certain of these non-US defined benefit pension plans have been transferred to the respective insurers. The projected benefit obligations related to these non-US defined benefit pension plans remain on the Consolidated Balance Sheets but are insured through these buy in insurance contracts.

The fair value of the insurance contracts is initially based on the purchase price (premium) of the insurance contact which is based on a competitive quoted price in a market that is not active (i.e. among multiple insurance companies) and not less than the Company’s actuarially determined projected benefit obligation, which is consistent with a Level 2 measurement of the fair value hierarchy (and was the case at September 30, 2024). Subsequent fair value measurements, including at September 30, 2025, of the insurance contracts are based on the insurance contracts exit value (the amount at which the insurance contracts could be sold to another third-party insurer). The exit price, or fair value, is determined by the third-party insurers using assumptions similar to that of the related projected benefit obligations and include significant unobservable inputs such as the defined benefit pension plans demographic data, internal insurance company determined margin requirements and proprietary discount rates. As a result, and after the period in which the buy in insurance contracts are entered into, the Company has determined that the insurance contracts are classified with Level 3 of the fair value hierarchy. The fair value of the insurance contracts at September 30, 2024 was $157 million. During the year ended September 30, 2025, cash payments made under the insurance contracts were $9 million, additional employer contributions were $6 million and the change in fair value based on the insurers internally developed valuation models was $9 million, which represented a decrease in the actual return on plan assets, resulting in fair value of the insurance contracts of $145 million at September 30, 2025.

Investments and Strategy

In developing an investment strategy for its defined benefit pension plans, Ashland has considered the following factors: the nature of the plans’ liabilities, the allocation of liabilities between active, deferred and retired members, the funded status of the plans, the applicable investment horizon, the respective size of the plans and historical and expected capital market returns. Ashland’s U.S. pension plan assets are managed by outside investment managers, which are monitored against investment return benchmarks and Ashland’s established investment strategy. Investment managers are selected based on an analysis of, among other things, their investment process, historical investment results, frequency of management turnover, cost structure and assets under management. Assets are periodically reallocated between investment managers to maintain an appropriate asset mix and diversification of investments and to optimize returns.

The current asset allocation for the U.S. plans is 51% fixed income,36% equity and 13% other. Fixed income primarily includes long duration corporate debt obligations and U.S. government debt obligations. Equity primarily includes public equity investments. Investment managers may employ a limited use of derivatives to gain efficient exposure to markets.

Ashland’s investment strategy and management practices relative to pension plan assets of non-U.S. plans generally are consistent with those for U.S. plans, except in those countries where investment of pension plan assets is dictated by applicable regulations. Although the investment allocation may vary based on funding percentages and whether plans are still accruing additional liabilities, the weighted-average asset allocations for Ashland’s U.S. and non-U.S. plans at September 30 by asset category follow.

Cash flows

During the years ended September 30, 2025 and 2024, Ashland contributed $6 million and $7 million to its U.S. pension plans, respectively, and $6 million and $8 million to its non-U.S. pension plans, respectively. Ashland expects to contribute approximately $5 million to its U.S. pension plans and expects to contribute approximately $6 million to its non-U.S. pension plans during 2026.

The following benefit payments, which reflect future service expectations, are projected to be paid from plan assets in each of the next five years and in aggregate for five years thereafter.

Other plans

Ashland sponsors savings plans to assist eligible employees in providing for retirement or other future needs. Under such plans, Company contributions amounted to $21 million in both 2025 and 2024, and $23 million 2023, respectively. These contributions are expensed according to the consolidated financial statement line based on the employee's role within Ashland, which is either cost of sales, selling, general and administrative expense, or research and development expense within the Statements of Consolidated Comprehensive Income (Loss). Ashland also sponsors various other employee benefit plans, some of which are required by different countries. The total noncurrent liabilities associated with these plans was $4 million for both September 30, 2025 and 2024.

NOTE M – LITIGATION, CLAIMS AND CONTINGENCIES

Asbestos litigation

Ashland and Hercules have liabilities from claims alleging personal injury caused by exposure to asbestos. To assist in developing and annually updating independent reserve estimates for future asbestos claims and related costs, Ashland has retained third party actuarial experts Gnarus. The methodology used by Gnarus to project future asbestos costs is based largely on recent experience, including claim-filing and settlement rates, disease mix, open claims and litigation defense. The claim experience of Ashland and Hercules are separately compared to the results of previously conducted third party epidemiological studies estimating the number of people likely to develop asbestos-related diseases. Those studies were undertaken in connection with national analyses of the population expected to have been exposed to asbestos. Using that information, Gnarus estimates a range of the number of future claims that may be filed, as well as the related costs that may be incurred in resolving those claims. Changes in asbestos litigation reserves and receivables are recorded on an after-tax basis within the discontinued operations caption in the Statements of Consolidated Comprehensive Income (Loss).

Ashland asbestos-related litigation

The claims alleging personal injury caused by exposure to asbestos asserted against Ashland result primarily from indemnification obligations undertaken in 1990 in connection with the sale of Riley, a former subsidiary. The amount and timing of settlements and number of open claims can fluctuate from period to period. A summary of Ashland asbestos claims activity, excluding Hercules claims, is as follows for the years ended September 30:

Ashland asbestos-related liability

From the range of estimates, Ashland records the amount it believes to be the best estimate of future payments for litigation defense and claim settlement costs. Ashland reviews this estimate and related assumptions quarterly and annually updates the results of a non-inflated, non-discounted approximate 40-year model developed with the assistance of Gnarus.

During the most recent update completed during 2025, it was determined that the liability for Ashland asbestos-related claims should be increased by $16 million. Total reserves for asbestos claims were$258 million at September 30, 2025 compared to$274 million at September 30, 2024.

A progression of activity in the asbestos litigation reserves for the years ended September 30, is as follows:

(a)

Includes $29 million and $28 million classified in accrued expenses and other liabilities on the Consolidated Balance Sheets as of September 30, 2025 and 2024, respectively.

Ashland asbestos-related receivables

Ashland has insurance coverage for certain litigation defense and claim settlement costs incurred in connection with its asbestos claims, and coverage-in-place agreements exist with the insurance companies that provide substantially all of the coverage that will be accessed.

For the Ashland asbestos-related obligations, Ashland has estimated the value of probable insurance recoveries associated with its asbestos litigation reserves based on management’s interpretations and estimates surrounding the available or applicable insurance coverage, including an assumption that all solvent insurance carriers remain solvent. Substantially all of the estimated receivables from insurance companies are expected to be due from domestic insurers, all of which are solvent.

At September 30, 2025, Ashland’s receivable for recoveries of litigation defense and claim settlement costs from insurers amounted to$95 million (excluding the Hercules receivable for asbestos claims discussed below). Receivables from insurers amounted to $97 million at September 30, 2024. During 2025, the annual update of the model used for purposes of valuing the asbestos litigation reserves and its impact on valuation of future recoveries from insurers was completed. This model update resulted in a $5 million increase in the receivable for probable insurance recoveries.

A progression of activity in the Ashland insurance receivable for the years ended September 30, is as follows:

(a)

The total allowance for credit losses was $1 million at both September 30, 2025 and 2024.

(b)

Includes $10 million and $9 million classified in accounts receivable on the Consolidated Balance Sheets as of September 30, 2025 and 2024, respectively.

Hercules asbestos-related litigation

Hercules has liabilities from claims alleging personal injury caused by exposure to asbestos. Such claims typically arise from alleged exposure to asbestos fibers from resin encapsulated pipe and tank products which were sold by one of Hercules’ former subsidiaries to a limited industrial market. The amount and timing of settlements and number of open claims can fluctuate from period to period. A summary of Hercules’ asbestos claims activity for the years ended September 30, is as follows:

Hercules asbestos-related liability

From the range of estimates, Ashland records the amount it believes to be the best estimate of future payments for litigation defense and claim settlement costs. Ashland reviews this estimate and related assumptions quarterly and annually updates the results of a non-inflated, non-discounted approximate 40-year model developed with the assistance of Gnarus. As a result of the most recent annual update of this estimate completed during 2025, it was determined that the liability for Hercules asbestos-related claims should be increased by $10 million. Total reserves for asbestos claims were$177 million at September 30, 2025 compared to$185 million at September 30, 2024.

A progression of activity in the asbestos litigation reserves for the years ended September 30, is as follows:

(a)

Included $17 million classified in accrued expenses and other liabilities on the Consolidated Balance Sheets as of September 30, 2025 and 2024.

Hercules asbestos-related receivables

For the Hercules asbestos-related obligations, certain reimbursement obligations pursuant to coverage-in-place agreements with insurance carriers exist. As a result, any increases in the asbestos litigation reserves have been partially offset by probable insurance recoveries. Ashland has estimated the value of probable insurance recoveries associated with its asbestos litigation reserves based on management’s interpretations and estimates surrounding the available or applicable insurance coverage, including an assumption that all solvent insurance carriers remain solvent. The estimated receivable consists exclusively of solvent domestic insurers.

As of September 30, 2025 and 2024, the receivables from insurers amounted to$48 million and$50 million, respectively. During 2025, the annual update of the model used for purposes of valuing the asbestos litigation reserves and its impact on valuation of future recoveries from insurers was completed. This model update resulted in a $4 million increase in the receivable for probable insurance recoveries.

A progression of activity in the Hercules insurance receivable for the years ended September 30, is as follows:

(a)

The total allowance for credit losses was $1 million at both September 30, 2025 and 2024.

(b)

Includes $6 million classified in accounts receivable on the Consolidated Balance Sheets at both September 30, 2025 and 2024.

Asbestos litigation cost projection

Projecting future asbestos costs is subject to numerous variables that are difficult to predict. In addition to the uncertainties surrounding the number of claims that might be received, other variables include the type and severity of the disease alleged by each claimant and the related costs incurred in resolving those claims, mortality rates, dismissal rates, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case. Furthermore, any predictions with respect to these variables are subject to even greater uncertainty as the projection period lengthens. In light of these inherent uncertainties, Ashland believes that the asbestos litigation reserves for Ashland and Hercules represent the best estimate within a range of possible outcomes. As a part of the process to develop these estimates of future asbestos costs, a range of long-term cost models was developed. These models are based on national studies that predict the number of people likely to develop asbestos-related diseases and are heavily influenced by assumptions regarding long-term inflation rates for indemnity payments and legal defense costs, as well as other variables mentioned previously. Ashland has currently estimated in various models ranging from approximately 40 year periods that it is reasonably possible that total future litigation defense and claim settlement costs on an inflated and undiscounted basis could range as high as approximately $382 million for the Ashland asbestos-related litigation (current reserve of$258 million) and approximately $262 million for the Hercules asbestos-related litigation (current reserve of$177 million), depending on the combination of assumptions selected in the various models. While the timeframe used in Ashland's models for projecting asbestos liabilities generally decreases over time based on the expected lifetime of the liabilities, these models have been consistently applied within all periods presented. If actual experience is worse than projected, relative to the number of claims filed, the severity of alleged disease associated with those claims or costs incurred to resolve those claims, or actuarial refinement or improvements to the assumptions used within these models are initiated, Ashland may need to further increase the estimates of the costs associated with asbestos claims and these increases could be material over time.

Ashland is subject to various federal, state and local environmental laws and regulations that require environmental assessment or remediation efforts (collectively environmental remediation) at multiple locations. At September 30, 2025, such locations included 53 sites where Ashland has been identified as a potentially responsible party under Superfund or similar state laws,107 current and former operating facilities and about 1,225 service station properties, of which 14 are being actively remediated.

Ashland’s reserves forenvironmental remediation and related environmental litigation amounted to $226 million at September 30, 2025 compared to$221 million at September 30, 2024, of which $179 million at September 30, 2025 and $164 million at September 30, 2024, were classified in other noncurrent liabilities on the Consolidated Balance Sheets. The remaining reserves were classified in accrued expenses and other liabilities on the Consolidated Balance Sheets.

The following table provides a reconciliation of the changes in the environmental remediation reserves the years ended September 30:

Thetotal reserves for environmental remediation reflect Ashland’s estimates of the most likely costs that will be incurred over an extended period to remediate identified conditions for which the costs are reasonably estimable, without regard to any third-party recoveries. Engineering studies, historical experience and other factors are used to identify and evaluate remediation alternatives and their related costs in determining the estimated reserves for environmental remediation. Ashland regularly adjusts its reserves as environmental remediation continues. Ashland hasestimated the value of its probable insurance recoveries associated with its environmental remediation reserves based on management’s interpretations and estimates surrounding the available or applicable insurance coverage. At September 30, 2025 and 2024, Ashland’s recorded receivable for these probable insurance recoveries was $14 million and $13 million, respectively, of which $12 million and $11 million was classified in other noncurrent assets on the Consolidated Balance Sheets.

During 2025, 2024 and 2023, Ashland recognized $50 million, $54 million and $56 million of expense, respectively, for certain environmental liabilities related to normal ongoing remediation cost estimate updates for sites, which is consistent with Ashland’s historical environmental accounting policy.

Components of environmental remediation expense included within the selling, general and administrative expense caption of the Statements of Consolidated Comprehensive Income (Loss) are presented in the following table for the years ended September 30:

(a)

Net expense of $14 million, $11 million and $5 million for the years ended September 30, 2025, 2024 and 2023, respectively, related to divested businesses which qualified for treatment as discontinued operations and for which certain environmental liabilities were retained by Ashland. These amounts are classified within the income (loss) from discontinued operations caption of the Statements of Consolidated Comprehensive Income (Loss).

Environmental remediation reserves are subject to uncertainties that affect Ashland’s ability to estimate its share of the costs. Such uncertainties involve the nature and extent of contamination at each site and the extent of required cleanup efforts under existing environmental regulations. Although it is not possible to predict with certainty the ultimate costs of environmental remediation, Ashland currently estimates that the upper end of the reasonably possible range of future costs for identified sites could be as high as approximately $495 million. The largest reserve for any site is 21% of the total environmental remediation reserves as of September 30, 2025.

Brazil tax credits

In March 2017, the Federal Supreme Court of Brazil (Brazil Supreme Court) ruled in a leading case that a Brazilian value-added tax ("ICMS") should not be included in the base used to calculate a taxpayer’s federal contribution on total revenue known as PIS/COFINS ("2017 Decision"). As a result, two of Ashland’s Brazilian subsidiaries filed lawsuits challenging the inclusion of ICMS in Ashland’s calculation of PIS/COFINs, seeking recovery of excess taxes paid plus interest.

In response to the 2017 Decision, the Brazilian tax authority filed an appeal of the 2017 Decision seeking clarification of the amount of ICMS tax to exclude from the calculation of PIS/COFINS. In May 2021, the Brazil Supreme Court ruled that the ICMS tax be excluded from the calculation of PIS/COFINS. In May 2023, Law 14592/23 was passed in Brazil, converting the 2017 Decision provisional measure effective for PIS/COFINS legislation excluding ICMS from the calculation basis.

As of September 30, 2025, Ashland had received all favorable court rulings for previously filed suits, completed its analysis of certain prior year overpayments related to ICMS and received acknowledgment from the Brazilian tax authority that allows Ashland to begin the process to recover the taxes. As a result, Ashland recorded a pre-tax gain of $12 million during the year ended September 30, 2023 for certain excess PIS/COFINS paid from 2012 to February 2023 plus interest. The gain was recognized within the selling, general and administrative expense caption of the Statement of Consolidated Comprehensive Income (Loss). Ashland started utilizing these credits in December 2023. As of September 30, 2025, Ashland had remaining credits for a total of $7 million available for future use ($3 million within other current assets and $4 million within other noncurrent assets in the Consolidated Balance Sheets, respectively).

Other legal proceedings and claims

In addition to the matters described above, there are other various claims, lawsuits and administrative proceedings pending or threatened against Ashland and its current and former subsidiaries. Such actions are with respect to commercial matters, product liability, toxic tort liability, and other environmental matters, which seek remedies or damages, some of which are for substantial amounts. While Ashland cannot predict with certainty the outcome of such actions, it believes that adequate reserves have been recorded and losses already recognized with respect to such actions were immaterial as of September 30, 2025 and 2024. There is a reasonable possibility that a loss exceeding amounts already recognized may be incurred related to these actions; however, Ashland believes that such potential losses were immaterial as of September 30, 2025.

NOTE N – EQUITY ITEMS

Stock repurchase program

On June 28, 2023, Ashland's board of directors ("the Board") authorized a new evergreen $1 billion common share repurchase program ("2023 Stock Repurchase Program"). The new authorization terminated and replaced the 2022 Stock Repurchase Program, which had $200 million outstanding at the date of termination. As of September 30, 2025, $520 million remained available for repurchase under the 2023 Stock Repurchase Program.

The following table provides the stock repurchase activity for the years ended September 30:

(a)

Includes transactions costs.

Stockholder dividends

Ashland paid dividends per common share of $1.64, $1.58 and $1.44 during 2025, 2024 and 2023, respectively.

In May 2025, the Board announced a quarterly cash dividend of 41.5 cents per share to eligible stockholders at record, which represented an increase from the previous quarterly cash dividend of 40.5 cents per share. The dividend was paid in the third and fourth quarter of fiscal 2025.

In May 2024, the Board announced a quarterly cash dividend of 40.5 cents per share to eligible stockholders at record, which represented an increase from the previous quarterly cash dividend of 38.5 cents per share. The dividend was paid in the third and fourth quarter of fiscal 2024 and the first and second quarters of fiscal 2025.

In May 2023, the Board announced a quarterly cash dividend of 38.5 cents per share to eligible stockholders at record, which represented an increase from the previous quarterly cash dividend of 33.5 cents per share. The dividend was paid in the third and fourth quarter of fiscal 2023 and the first and second quarters of fiscal 2024.

In May 2022, the Board announced a quarterly cash dividend of 33.5 cents per share to eligible stockholders at record, which represented an increase from the previous quarterly cash dividend of 30.0 cents per share. This dividend was paid in the third and fourth quarters of fiscal 2022 and the first and second quarters of fiscal 2023.

Shares reserved for issuance

At September 30, 2025,16.4 million common shares were reserved for issuance under stock incentive and deferred compensation plans.

Other comprehensive income (loss)

Components of other comprehensive income (loss) recorded in the Statements of Consolidated Comprehensive Income (Loss) are presented in the following table, before tax and net of tax effects.

Summary of Stockholders’ Equity

A reconciliation of changes in stockholders’ equity for the years ended September 30, are as follows:

(a)

Common shares issued were 143,631,137,799 and 193,767 for 2025, 2024 and 2023, respectively.

(b)

Common shares repurchased were 1,541,320,4,285,194 and 3,082,928 for 2025, 2024 and 2023, respectively.

(c)

Includes $1 million in 2025 and $3 million in both 2024 and 2023 in excise tax on stock repurchases.

NOTE O – STOCK INCENTIVE PLANS

Ashland has stock incentive plans under which key employees or directors are granted performance share awards or nonvested stock awards. Each program is typically a long-term incentive plan designed to link employee compensation with increased shareholder value or reward superior performance and encourage continued employment with Ashland. Ashland recognizes compensation expense for the grant date fair value of stock-based awards over the requisite service period and accounts for forfeitures when they occur across all stock-based awards.

The components of Ashland's pretax compensation expense for stock-based awards (net of forfeitures) and associated income tax benefits for the years ended September 30, are as follows.

(a)

The year ended September 30, 2025 included $1 million of expense and $1 million of income related to cash-settled nonvested restricted stock awards and cash-settled performance units, respectively.

(b)

The year ended September 30, 2024 included $2 million and less than $1 million of expense related to cash-settled nonvested restricted stock awards and cash-settled performance units, respectively.

(c)

The year ended September 30, 2023 included $1 million of expense and $1 million of income related to cash-settled nonvested restricted stock awards and cash-settled performance units, respectively.

Stock Appreciation Rights ("SARs")

SARs were granted to employees or directors at a price equal to the fair market value of the stock on the date of grant and typically become exercisable over periods ofone tothree years. Unexercised SARs lapseten years after the date of grant. Ashland estimated the fair value of SARs granted using the Black-Scholes option-pricing model. Ashland has not granted any SARs since August 2020.

A progression of activity and various other information relative to SARs and previously issued and vested stock options is presented in the following table for the years ended September 30:

(a)

Exercise prices per share for SARs outstanding at September 30, 2025 ranged from $57.96 to $67.16 for 588 thousand shares and from $76.76 to $82.34 for 158 thousand shares. The weighted-average remaining contractual life of outstanding and exercisable SARs and stock options was 2.0 years.

The total intrinsic value of SARs exercised was less than $1 million in 2025, $6 million in 2024 and $6 million in 2023. The actual tax benefit realized from the exercised SARs waszero in 2025, $1 million in 2024 and $1 million in 2023. The total grant date fair value of SARs that vested during 2025, 2024 and 2023 waszero, zero and $1 million, respectively. As of September 30, 2025, there waszero unrecognized compensation costs related to SARs. As of September 30, 2025, the aggregate intrinsic value of outstanding and exercisable SARs waszero.

Nonvested stock awards

Nonvested stock awards are granted to employees or directors at a price equal to the fair market value of the stock on the date of grant and generally vest over aone-to-three-year period. However, such shares or units are subject to forfeiture upon termination of service before the vesting period ends. Beginning in 2016, these awards were primarily granted as stock units that will convert to shares upon vesting, while the grants in prior years were generally made in nonvested shares. Only nonvested stock awards granted in the form of shares entitle employees or directors to vote the shares. Dividends on nonvested stock awards granted are in the form of additional units or shares of nonvested stock awards, which are subject to vesting and forfeiture provisions.

A progression of activity and various other information relative to nonvested stock awards is presented in the following table for the years ended September 30:

The total grant date fair value of nonvested stock awards that vested during 2025, 2024 and 2023 was $10 million, $9 million and $8 million, respectively. As of September 30, 2025, there was $5 million of total unrecognized compensation costs related to nonvested stock awards. That cost is expected to be recognized over a weighted-average period of 1.6 years.

Cash-settled nonvested stock awards

Certain nonvested stock awards are granted to employees and are settled in cash upon vesting. As of September 30, 2025,43 thousand cash-settled nonvested stock awards were outstanding. The value of these cash-settled nonvested stock awards changes in connection with changes in the fair market value of the Ashland Common Stock. These awards generally vest over a period ofthree years. The expense recognized related to cash-settled nonvested stock awards waszero, $2 million, andzero during 2025, 2024 and 2023, respectively.

Performance awards

Ashland sponsors a long-term incentive plan that awards performance shares/units to certain key employees that are tied to Ashland’s overall financial performance relative to the financial performance of selected industry peer groups and/or internal targets. Awards are granted annually, with each award covering athree-year measurement period and vesting over aone tothree year period. Nonvested performance shares/units do not entitle employees to vote the shares or to receive any dividends thereon.

Each awarded performance share is convertible toone share of Ashland Common Stock and recorded as a component of stockholders’ equity. For fiscal year 2025, performance measures used to determine the actual number of performance shares issuable upon vesting include 60:20:20 weighting of Ashland’s total shareholder return ("TSR") performance, return on net assets ("RONA"), and Ashland’s EPS as compared to internal targets. TSR relative to peers is considered a market condition while EPS and RONA are considered performance conditions in accordance with U.S. GAAP. Beginning in 2025, each award includes a dividend equivalent feature that accrue dividends and are reinvested from the date of grant until the applicable vesting date. If the award is forfeited the employee is not entitled to the accrued reinvested dividends on those awards.

For fiscal years 2024 and 2023, performance measures used to determine the actual number of performance shares issuable upon vesting includes 60:40 weighting of Ashland’s TSR performance and Ashland’s RONA performance as compared to internal targets. TSR relative to peers is considered a market condition while RONA is considered a performance condition in accordance with U.S. GAAP.

The following table shows the performance shares/units granted:

(a)

At the end of the performance period, the actual number of shares/units awarded can range from zero to 200% of the target shares/units granted, which is assumed to be 100%. Both the shares granted and weighted-average fair value per share/unit are as of the grant date.

For these awards, the fair value of the performance unit awards is equal to the fair market value of Ashland’s Common Stock as of the end of each reporting period. Compensation cost is recognized over the requisite service period if it is probable that the performance condition will be satisfied.

The fair values of the TSR portion of the performance share awards and TSR modifier of the performance unit awards are calculated using a Monte Carlo simulation valuation model using key assumptions for the years ended September 30, included in the following table. Compensation cost is recognized over the requisite service period regardless of whether the market condition is satisfied.

The following table shows changes in nonvested performance shares/units for the years ended September 30:

As of September 30, 2025, there was $5 million of total unrecognized compensation costs related to nonvested performance share/unit awards. That cost is expected to be recognized over a weighted-average period of approximately 1.9 years.

NOTE P – REVENUE

Trade receivables

Trade receivables are defined as receivables arising from contracts with customers and are recorded within the accounts receivable, net caption within the Consolidated Balance Sheets. Ashland’s trade receivables were $200 million and $206 million as of September 30,2025 and 2024, respectively. See Note H for additional information on Ashland's program to sell certain accounts receivable on a revolving basis to third party banks up to an aggregate purchase limit.

Disaggregation of revenue

Ashland disaggregates its revenue from contracts with customers by reportable segment and geographical region, as Ashland believes these categories best depict how management reviews the financial performance of its operations for the years ended September 30,2025, 2024 and 2023. Ashland includes only U.S. and Canada in its North America designation and includes Europe, the Middle East and Africa in its Europe designation. See the following tables for details (Intersegment sales eliminations have been excluded, see Note Q for additional information) for the years ended September 30:

Ashland has two product categories that represented 10% or greater of Ashland's total consolidated sales, which were cellulosics and polyvinylprrolidones (PVP). The following table summarizes the percentage of Ashland's total consolidated sales by product:

NOTE Q – REPORTABLE SEGMENT INFORMATION

Ashland determines its reportable segments based on how operations are managed internally for the products and services sold to customers, including how the results are reviewed by Guillermo Novo, Chair and Chief Executive Officer of the Company, which includes determining resource allocation methodologies used for reportable segments. Operating income (loss) and EBITDA are the primary measures of performance that are reviewed by the chief operating decision maker in assessing each reportable segment's financial performance. Ashland does not aggregate operating segments to arrive at these reportable segments.

Reportable segment business descriptions

Life Sciences is comprised of pharmaceuticals, nutrition, agricultural chemicals, diagnostic films (formerly known as advanced materials) and fine chemicals. Pharmaceutical solutions include controlled release polymers, disintegrants, tablet coatings, thickeners, solubilizers and tablet binders. Nutrition solutions include thickeners, stabilizers, emulsifiers and additives for enhancing mouthfeel, controlling moisture migration, reducing oil uptake and binding structured foods. Customers include pharmaceutical, food, beverage, hospitals and radiologists manufacturers. The nutraceuticals business was sold in August 2024. See Note B for additional details.

Personal Care is comprised of biofunctionals, microbial protectants (preservatives), skin care, sun care, oral care, hair care and household. These businesses have a broad range of natural, nature-derived, biodegradable, and high-performance ingredients for customer-driven solutions to help protect, renew, moisturize and revitalize skin and hair, and provide solutions for toothpastes, mouth washes and rinses, denture cleaning and care for teeth. Personal Care supplies nature-derived rheology ingredients, biodegradable surface wetting agents, performance encapsulates, and specialty polymers for household, industrial and institutional cleaning products. Customers include formulators at large multinational branded consumer products companies and smaller, independent boutique companies. The Avoca business was sold in March 2025. See Note B for additional details.

Specialty Additives is comprised of rheology and performance-enhancing additives serving the architectural coatings, construction, energy, automotive and various industrial markets. Solutions include coatings additives for architectural paints, finishes and lacquers, cement- and gypsum-based dry mortars, ready-mixed joint compounds, synthetic plasters for commercial and residential construction, and specialty materials for industrial applications. Products include rheology modifiers (cellulosic and associative thickeners), foam control agents, surfactants and wetting agents, pH neutralizers, advanced ceramics used in catalytic converters, and environmental filters, ingredients that aid the manufacturing process of ceramic capacitors, plasma display panels and solar cells, ingredients for textile printing, thermoplastic metals and alloys for welding. Products help improve desired functional outcomes through rheology modification and control, water retention, workability, adhesive strength, binding power, film formation, deposition and suspension and emulsification. Customers include, but are not limited to, global paint manufacturers, electronics and automotive manufacturers, textile mills, the construction industry and welders.

Intermediates is comprised of the production of 1,4 butanediol ("BDO") and related derivatives, including n-methylpyrrolidone. These products are used as chemical intermediates in the production of engineering polymers and polyurethanes, and as specialty process solvents in a wide array of applications including electronics, agriculture, pharmaceuticals, water filtration membranes and more. BDO is also supplied to Life Sciences, Personal Care, and Specialty Additives for use as a raw material.

Unallocated and Other generally includes items such as certain significant company-wide restructuring activities, corporate governance costs and legacy costs or activities that relate to divested businesses that are no longer operated by Ashland.

International data

Information about Ashland’s domestic and international operations for the years ended September 30, are as follows. Ashland has no operations in any individual international country or single customer that represented more than 10% of sales in 2025, 2024 and 2023.

Reportable segment results

Results of Ashland’s reportable segments are presented based on its management and internal accounting structure. The structure is specific to Ashland; therefore, the financial results of Ashland’s reportable segments are not necessarily comparable with similar information for other comparable companies. Ashland allocates all costs to its reportable segments except for certain significant company-wide restructuring activities, certain corporate governance costs and other costs or activities that relate to former businesses that Ashland no longer operates. The service cost component of pension and other postretirement benefits costs is allocated to each reportable segment on a ratable basis; while the remaining components of pension and other postretirement benefits costs are recorded within the other net periodic benefit loss caption of the Statements of Consolidated Comprehensive Income (loss). Ashland refines its expense allocation methodologies to the reportable segments from time to time as more refined information becomes available and the industry or market changes. Significant revisions to Ashland’s methodologies are adjusted for all reportable segments on a retrospective basis. There were no material changes in methodology for the years ended September 30, 2025, 2024 or 2023.

Ashland determined that disclosing sales by specific product was impracticable due to the highly customized and extensive portfolio of products offered to customers and since no one product or a small group of products could be aggregated together to represent a majority of revenue within a reportable segment.

The following table presents various financial information for each reportable segment for the years ended September 30:

(a)

Intersegment sales from Intermediates are accounted for at prices that approximate market value. All other intersegment sales are accounted for at cost.

(b)

Includes goodwill impairment of $375 million for Life Sciences in 2025.

(c)

Includes a capital project impairment charge of $11 million for Personal Care in 2024.

(d)

Includes goodwill impairment of $331 million in 2025 and a $4 million impairment charge related to a facility in 2023 for Specialty Additives.

(e)

Includes a$8 million gain on sale and a $183 million impairment charge related to the divestiture of the Avoca business in 2025, anda $8 million loss on sale and a$99 million impairment charge related to the divestiture of the Nutraceuticals business in 2024 within the income (loss) on acquisitions and divestitures, net.

(f)

Excludes income (loss) from discontinued operations, net of income taxes and other net periodic benefit loss. See the Statements of Consolidated Comprehensive Income (Loss) for applicable amounts excluded.

(g)

Depreciation includes accelerated depreciation of $21 million for Life Sciences in 2025.

(h)

Depreciation includes accelerated depreciation of $1 million and $2 million for Personal Care in 2025 and 2024, respectively.

(i)

Depreciation includes accelerated depreciation of $19 million and $55 million for Specialty Additives in 2025 and 2024, respectively.

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