CLEVELAND, July 16, 2015
/PRNewswire/ -- The Sherwin-Williams Company (NYSE: SHW)
announced its financial results for the second quarter and six
months ended June 30, 2015. Compared to the same periods in
2014, consolidated net sales increased $89.1
million, or 2.9%, to $3.13
billion in the quarter and increased $172.9 million, or 3.2%, to $5.58 billion in six months due primarily to
higher paint sales volume in our Paint Stores and Consumer Groups.
Unfavorable currency translation rate changes decreased
consolidated net sales 3.0% in the quarter and six months.
Diluted net income per common share in the quarter increased to
$3.70 per share from $2.94 per share in 2014 and increased in six
months to $5.08 per share from
$4.06 per share last year. The
increases in second quarter and six month diluted net income per
common share were due primarily to improved operating results of
the Paint Stores and Consumer Groups. Currency translation rate
changes decreased diluted net income per common share by
$.07 per share in the quarter and
$.11 in six months.
Net sales in the Paint Stores Group increased 5.4% to
$1.98 billion in the quarter and
increased 6.3% to $3.45 billion in
six months due primarily to higher architectural paint sales volume
across all end market segments. Net sales from stores open for more
than twelve calendar months increased 3.9% in the quarter and
increased 5.0% in six months over last year's comparable periods.
Paint Stores Group segment profit increased $57.5 million to $433.4
million in the quarter from $375.9
million last year and increased $87.8
million to $610.0 million in
six months from $522.1 million last
year due primarily to higher paint sales volume. Segment profit as
a percent to net sales increased in the quarter to 21.8% from 20.0%
last year and increased in six months to 17.7% from 16.1% in
2014.
Net sales of the Consumer Group increased 13.1% to $490.0 million in the quarter and increased 11.0%
to $841.7 million in six months due
primarily to shipments of HGTV HOME® by Sherwin-Williams
paint to Lowe's stores. Segment profit increased to $114.2 million in the quarter from $92.5 million last year and increased to
$169.7 million in six months from
$143.6 million last year due
primarily to improved operating efficiencies. As a percent to net
external sales, segment profit increased in the quarter to 23.3%
from 21.3% last year and increased in six months to 20.2% from
18.9% last year.
The Global Finishes Group's net sales stated in U.S. dollars
decreased 7.1% to $505.8 million in
the quarter and decreased 6.4% to $975.3
million in six months. Unfavorable currency translation rate
changes decreased net sales by 7.7% in the quarter and 7.3% in six
months. Stated in U.S. dollars, segment profit increased in the
quarter to $57.3 million from
$54.9 million last year due primarily
to higher paint sales volume and charges in the second quarter 2014
related to the exit of our business in Venezuela partially offset by unfavorable
currency translation rate changes. Six month segment profit
decreased to $96.2 million from
$101.3 million last year due
primarily to unfavorable currency translation rate changes. Second
quarter and six months 2014 segment profit included a $4.5 million charge related to the exit of our
business in Venezuela. Unfavorable
currency translation rate changes reduced segment profit
$8.3 million in the quarter and
$12.7 million in six months. As a
percent to net external sales, segment profit was 11.3% in the
quarter versus 10.1% last year and 9.9% in six months compared to
9.7% in 2014.
The Latin America Coatings Group's net sales stated in U.S.
dollars decreased 17.2% to $150.1
million in the quarter and decreased 13.0% to $316.3 million in six months due primarily to
unfavorable currency translation rate changes partially offset by
selling price increases. Unfavorable currency translation rate
changes decreased net sales by 17.4% in the quarter and 15.6% in
six months. Stated in U.S. dollars, segment profit decreased in the
quarter to $4.0 million from
$5.7 million last year and decreased
in six months to $13.5 million from
$15.6 million last year due primarily
to increasing raw material costs and unfavorable currency
translation rate changes partially offset by selling price
increases. Unfavorable currency translation rate changes decreased
segment profit $2.3 million in the
quarter and $5.7 million in six
months. As a percent to net external sales, segment profit
decreased in the quarter to 2.7% from 3.1% last year and remained
flat at 4.3% in six months.
The Company acquired 2.25 million shares of its common stock
through open market purchases in the six months ended June 30,
2015. The Company had remaining authorization at June 30, 2015
to purchase 2.98 million shares.
Commenting on the financial results, Christopher M. Connor, Chairman and Chief
Executive Officer, said, "Our Paint Stores Group posted another
quarter of positive operating results and architectural volume
growth across all end market segments. Consumer Group improved its
operating results through improved operating efficiencies. The HGTV
HOME® by Sherwin-Williams paint program rollout was
completed in all Lowe's stores by May
1 and continued to ramp up to expected volumes throughout
the quarter. Our Global Finishes and Latin America Coatings Groups
are managing through the negative effects of currency devaluation
and weak end market demand in some geographies. In total, it is
gratifying to report another quarter of record sales and earnings
per share.
"We continued to invest in our business by opening twenty-two
net new locations in the Paint Stores Group in the first six
months. During the quarter, we continued to buy shares of our
stock, and we increased the dividend rate to $.67 from $.55 last
year. Our balance sheet remains flexible and is positioned well for
future acquisitions and other investments in our business.
"For the third quarter, we anticipate our consolidated net sales
will increase three to five percent compared to last year's third
quarter. At that anticipated sales level, we estimate diluted net
income per common share in the third quarter of 2015 to be in the
range of $3.75 to $3.90 per share
compared to $3.35 per share earned in
the third quarter of 2014. For the full year 2015, we expect
consolidated net sales to increase three to five percent compared
to full year 2014. With annual sales at that level, we are updating
our guidance that diluted net income per common share for 2015 to
be in the range of $10.60 to $11.00
per share compared to $8.78 per share
earned in 2014."
The Company will conduct a conference call to discuss its
financial results for the second quarter, and its outlook for the
third quarter and full year 2015, at 11:00
a.m. EDT on Thursday, July 16, 2015. The conference
call will be webcast simultaneously in the listen only mode by
Vcall. To listen to the webcast on the Sherwin-Williams website,
www.sherwin.com, click on About Us, choose Investor Relations, then
select Press Releases and click on the webcast icon following the
reference to the July 16th release. The webcast will also be
available at Vcall's Investor Calendar website,
www.investorcalendar.com. An archived replay of the live webcast
will be available at www.sherwin.com beginning approximately two
hours after the call ends and will be available until August 6, 2015 at 5:00
p.m. EDT.
Founded in 1866, The Sherwin-Williams Company is a global leader
in the manufacture, development, distribution, and sale of coatings
and related products to professional, industrial, commercial, and
retail customers. The company manufactures products under
well-known brands such as Sherwin-Williams®, HGTV
HOME® by Sherwin-Williams, Dutch Boy®,
Krylon®, Minwax®, Thompson's® Water Seal®,
and many more. With global headquarters in Cleveland, Ohio, Sherwin-Williams®
branded products are sold exclusively through a chain of more than
4,100 company-operated stores and facilities, while the company's
other brands are sold through leading mass merchandisers, home
centers, independent paint dealers, hardware stores, automotive
retailers, and industrial distributors. The Sherwin-Williams Global
Finishes Group distributes a wide range of products in more than
115 countries around the world. For more information, visit
www.sherwin.com.
This press release contains certain "forward-looking
statements", as defined under U.S. federal securities laws, with
respect to sales, earnings and other matters. These forward-looking
statements are based upon management's current expectations,
estimates, assumptions and beliefs concerning future events and
conditions. Readers are cautioned not to place undue reliance on
any forward-looking statements. Forward-looking statements are
necessarily subject to risks, uncertainties and other factors, many
of which are outside the control of the Company, that could cause
actual results to differ materially from such statements and from
the Company's historical results and experience. These risks,
uncertainties and other factors include such things as: general
business conditions, strengths of retail and manufacturing
economies and the growth in the coatings industry; changes in the
Company's relationships with customers and suppliers; changes in
raw material availability and pricing; unusual weather conditions;
and other risks, uncertainties and factors described from time to
time in the Company's reports filed with the Securities and
Exchange Commission. Since it is not possible to predict or
identify all of the risks, uncertainties and other factors that may
affect future results, the above list should not be considered a
complete list. Any forward-looking statement speaks only as of the
date on which such statement is made, and the Company undertakes no
obligation to update or revise any forward-looking statement,
whether as a result of new information, future events or
otherwise.
Investor Relations
Contact:
Bob Wells
Senior Vice
President,
Corporate
Communications & Public Affairs
Sherwin-Williams
Direct:
216.566.2244
rjwells@sherwin.com
|
Media
Contact:
Mike
Conway
Director, Corporate
Communications
Sherwin-Williams
Direct:
216.515.4393
Pager:
216.422.3751
mike.conway@sherwin.com
|
The
Sherwin-Williams Company and Subsidiaries
|
|
Statements of
Consolidated Income (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Three Months Ended
June 30,
|
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Six Months Ended June
30,
|
|
Thousands of dollars,
except per share data
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net sales
|
|
$
|
3,132,139
|
|
$
|
3,042,995
|
|
$
|
5,582,423
|
|
$
|
5,409,551
|
|
Cost of goods
sold
|
|
|
1,602,153
|
|
|
1,633,342
|
|
|
2,919,988
|
|
|
2,933,997
|
|
Gross
profit
|
|
|
1,529,986
|
|
|
1,409,653
|
|
|
2,662,435
|
|
|
2,475,554
|
|
Percent to
net sales
|
|
|
48.8%
|
|
|
46.3%
|
|
|
47.7%
|
|
|
45.8%
|
|
Selling, general and
administrative expenses
|
|
|
999,224
|
|
|
969,183
|
|
|
1,928,421
|
|
|
1,853,271
|
|
Percent to
net sales
|
|
|
31.9%
|
|
|
31.8%
|
|
|
34.5%
|
|
|
34.3%
|
|
Other general expense
- net
|
|
|
9,971
|
|
|
770
|
|
|
8,298
|
|
|
198
|
|
Interest
expense
|
|
|
12,885
|
|
|
16,374
|
|
|
25,236
|
|
|
32,768
|
|
Interest and net
investment income
|
|
|
(553)
|
|
|
(757)
|
|
|
(975)
|
|
|
(1,346)
|
|
Other expense
(income) - net
|
|
|
677
|
|
|
(5,147)
|
|
|
432
|
|
|
(4,644)
|
|
Income before income
taxes
|
|
|
507,782
|
|
|
429,230
|
|
|
701,023
|
|
|
595,307
|
|
Income
taxes
|
|
|
157,845
|
|
|
137,783
|
|
|
219,682
|
|
|
188,403
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
349,937
|
|
$
|
291,447
|
|
$
|
481,341
|
|
$
|
406,904
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income per common
share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
3.78
|
|
$
|
3.00
|
|
$
|
5.18
|
|
$
|
4.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted
|
|
$
|
3.70
|
|
$
|
2.94
|
|
$
|
5.08
|
|
$
|
4.06
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shares
outstanding - basic
|
|
|
92,260,367
|
|
|
96,599,869
|
|
|
92,500,213
|
|
|
97,716,539
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average shares and
equivalents outstanding - diluted
|
|
94,124,695
|
|
|
98,541,909
|
|
|
94,427,191
|
|
|
99,688,557
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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Additional information regarding the Company's financial
condition, operating segment results and other information can be
found on the Sherwin-Williams website, www.sherwin.com, by clicking
on About Us, choosing Investor Relations, then selecting Press
Releases and clicking on the reference to the July 16th release.
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/the-sherwin-williams-company-reports-2015-second-quarter-and-first-six-months-financial-results-300114157.html
SOURCE The Sherwin-Williams Company