Share-Based Compensation

9 Months Ended

Jun. 30, 2025

Share-Based Payment Arrangement [Abstract]

SHARE-BASED COMPENSATION

Our outstanding share-based compensation program includes deferred stock units. During the nine months ended 30 June 2025, we granted both market-based and time-based deferred stock units. The terms of the awards were fixed at the grant date. All previously outstanding stock options were fully exercised during the first quarter of fiscal year 2025.

We issue shares from treasury stock upon the payout of deferred stock units and the exercise of stock options. As of 30 June 2025, 0.8 million shares remained available for future grant under our Long-Term Incentive Plan ("LTIP"), which is shareholder approved.

Share-based compensation cost recognized on the consolidated income statements is summarized below:


	Three Months Ended		Nine Months Ended
	30 June		30 June
	2025	2024	2025	2024
Before-tax share-based compensation cost(A)	$11.0	$17.6	$65.8	$46.0
Income tax benefit	(2.8)	(4.2)	(15.8)	(11.1)
After-tax share-based compensation cost	$8.2	$13.4	$50.0	$34.9

(A)Fiscal year 2025 includes noncash executive separation costs of $22.4 to accelerate vesting of share-based awards. Refer to the "Shareholder Activism-Related Costs" disclosure in Note 19, Supplemental Information, for additional information.

Before-tax share-based compensation cost is primarily included in "Selling and administrative expense" on our consolidated income statements. The amount of share-based compensation cost capitalized in the first nine months of fiscal years 2025 and 2024 was not material.

Deferred Stock Units

During the nine months ended 30 June 2025, we granted 95,490 market-based deferred stock units. The market-based deferred stock units are earned over the performance period beginning 1 October 2024 and ending 30 September 2027, conditioned on the level of our total shareholder return in relation to the S&P 500 Index over the three-year performance period.

The market-based deferred stock units had an estimated grant-date fair value of $470.13 per unit, which was estimated using a Monte Carlo simulation model. The model utilizes multiple input variables that determine the probability of satisfying the market condition stipulated in the grant and calculates the fair value of the awards. We generally expense the grant-date fair value of these awards on a straight-line basis over the applicable vesting period. The calculation of the fair value of market-based deferred stock units used the following assumptions:


Expected volatility	30.3	%
Risk-free interest rate	4.1	%
Expected dividend yield	2.1	%

In addition, during the nine months ended 30 June 2025, we granted 137,024 time-based deferred stock units at a weighted average grant-date fair value of $330.06.