Follow us on Twitter Follow us on LinkedIn Like us on Facebook Follow us on Instagram Visit the TPC Store
Search the site




Coatings Industry News

Main News Page

Gloss is Off in Valspar’s 1st Quarter

Wednesday, February 13, 2013

More items for Coating Materials

Comment | More

International markets flattened coatings and dinged paint sales in Valspar's first quarter of 2013, prompting the Minneapolis manufacturer to reduce its full-year guidance.

Net sales and net income per share both declined, while gross profit was essentially flat for the quarter ended Jan. 25, Valspar reported Tuesday (Feb. 12)

"Although we made substantial progress this quarter on a number of key initiatives, international markets were weaker than anticipated," Gary E. Hendrickson, chairman and chief executive officer of the world's sixth-largest paint and coatings company, said in a statement.

The report followed a flat fourth quarter, but profitable year, for Valspar.

Sales, Net Income Dip

Overall first-quarter sales totaled $875.2 million, compared to $885.6 million in the first quarter of 2012, according to Valspar's first-quarter balance sheet. First-quarter net income per share was $0.60 in 2013, dipping from adjusted net income per share of $0.62 in 2012, which excluded a $0.04 per share restructuring charge.

Valspar high-performance coatings
Photos: Valspar

There was no joy in Minneapolis, as Valspar adjusted its full-year guidance for 2013. The company's portfolio includes high-performance architectural coatings.

Net income for the first quarter of 2013 was $55.0 million, declining from $55.8 million from the prior-year period. Reported earnings per share for Q1 of 2012 were $0.58.

Hendrickson cited "weak demand in certain international markets" for the quarter's thready pulse—a situation that is "expected to continue," he added.

"[T]hus, we are adjusting our full-year guidance to $3.60 to $3.80 to reflect these market conditions," he said.

Sales Segment Data

Valspar's portfolio includes:

  • Industrial OEM coatings;
  • Coatings and inks for rigid packaging;
  • Paints, varnishes and stains, primarily for the do-it-yourself market;
  • Coatings for refinishing vehicles;
  • High-performance floor coatings;
  • Resins and colorants for internal use and for other paint and coatings.

The paint business was hit hardest in the first quarter, with sales declining from $339.5 million in the same period of 2012 to $329.0 million in 2013, according to key data released by Valspar.

Valspar protective coatings

Coatings sales and earnings held their own, but Valspar's paint sales declined in the first quarter.

Coatings sales improved slightly, from $494.6 million in Q1 of 2012 to $497.6 million in the same period of 2013.

Sales in the "Other" category declined to $48.5 million in the first quarter of 2013 from $51.4 million in the year-ago period.

Both reported and adjusted gross profit as a percentage of net sales were 33.6 percent. In the first quarter of 2012, the reported percentage was 33.1, while the adjusted figure was 33.5 percent.

Earnings Pinched

Adjusted Earnings Before Taxes and Interest (EBIT) followed the sales trends, with the coatings segment inching from $74.2 million in Q1 of 2012 to $74.3 million in 2013.

On the paint side, adjusted EBIT declined from $27.3 million in the first quarter of 2012 to $22.5 million this year.

Valspar's stock declined 7.14 percent Tuesday morning, following the release of the report.


Tagged categories: Architectural coatings; Earnings reports; OEM (Original Equipment Manufacturers); Paint and Coating Sales; Valspar; Wood coatings

Comment Join the Conversation:

Sign in to our community to add your comments.

Carboline Company
New product: Carbozinc® 608 HB
Introducing a new high build zinc-rich primer that can save you time and money by eliminating the epoxy intermediate coat!

Mitsubishi Gas Chemical America
Performance Amine 1,3-BAC
A highly reactive cycloaliphatic diamine offering superior performance. Reasonable cost and curing efficacy makes it suitable for all types of epoxy resin applications.

SABRE Autonomous Solutions
The ALPHA1 provides reliable results consistently allowing you to cost your next job with confidence.

New resins from BASF will have metals loving water!
Excellent corrosion resistance, low VOC, high gloss, thin films 800-231-7868

Jotun Paints Inc.
Jotun Jotachar 1709
Mesh-free passive fire protection epoxy designed to protect against hydrocarbon pool fire scenarios for up to four hours as defined in the ANSI/UL1709 standard.

NLB Corporation
NLB Sure Shroud: Greater Protection and Flexibility
NLB’s Sure Shroud’s lighter weight and flexibility reduces operator fatigue and offers unmatched protection against high pressure hose ruptures. 10k to 40k psi rated.

DeFelsko Corporation
PosiTector SST Soluble Salt Tester
Measures the concentration of soluble salts on metal surfaces. Use with all Bresle patch types including the reusable, adhesive-free PosiPatch.

Novatek Corporation
Dustless Coatings Removal
Novatek Corporation, Dustless Coatings Removal Strip, clean and profile all dust free! Comply with new lead standards. Contact today: (866) 563-7800

Tarps manufacturing, Inc.
QUALITY MADE IN AMERICA —Available near you!
CLICK to get a behind-the-scenes look at how Tarps Manufacturing makes the highest-quality tarps right here in the USA — available nationwide.

HoldTight Solutions Inc.
Our HoldTight®102 salt remover & flash rust
preventer prevents flash
rust by removing surface contaminants. Contact us
for your nearest distributor.
(800) 319.8802


Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL

The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About   |   Privacy policy   |   Terms & conditions   |   Site Map   |   Search   |   Contact Us