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Sherwin-Williams Reports Record Q1 Sales

Monday, April 24, 2017

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Sales were up in the first quarter of 2017 for The Sherwin-Williams Company (Cleveland), including increased net sales and volumes in its Global Finishes Group, which includes the company's protective and marine business.

The paints and coatings giant reported a 7.3 percent increase in sales to a record $2.76 billion, according to its first quarter earnings report, released Thursday (April 20).

Paint Stores Up

Compared to the same period in 2016, the company says net sales increased by $187.4 million, due primarily to higher paint sales volume in the Paint Stores Group, which includes Sherwin-Williams branded stores in the U.S., Canada and the Caribbean. Diluted net income per common share increased 44.6 percent, to $2.53 per share in the quarter.

Images: Sherwin-Williams

Sherwin-Williams' Global Finishes Group, which includes its protective and marine coatings, saw a 3.6 percent increase in net sales, thanks in part to higher sales volumes.

“We are pleased to report record sales and earnings per share from the continued positive sales volume and strong operating results of our Paint Stores Group and operating margin improvement in our Global Finishes Group,” said John G. Morikis, Chairman, President and CEO.

Higher architectural paint sales were the push behind the Paint Stores Group growth, which increased 12.1 percent to $1.81 billion. The Paint Stores Group segment profit increased $50.5 million to $304.1 million in the quarter from $253.5 million last year, due primarily to higher paint sales volume and selling price increases partially offset by increased raw material costs, according to the company.

Sherwin-Williams opened ten net new store locations in the first quarter, the company says.

Other Groups

The Latin America Coatings Group's net sales increased 12.9 percent to $141.4 million in the quarter due to selling price increases and foreign currency translation rate changes. That group covers sales of all kinds of paints and coatings in the Latin America region.

The Global Finishes Group's net sales increased 3.6 percent to $470.3 million in the quarter thanks to higher paint sales volume and selling price increases.Global Finishes includes protective and marine coatings, OEM coatings and automotive finishes.

Compared to the same period in 2016, net sales increased by $187.4 million due primarily to higher paint sales volume in the Paint Stores Group.

The net sales of the Consumer Group saw a dip, however, with a 10.7 percent decrease to $337.5 million due to lower volume sales to most of the Group's retail and commercial customers, the company says. Sherwin-Williams' consumer brands include Dutch Boy, Krylon, Minwax, and Thompson's Water Seal.

Preparation for Valspar Buy

It’s noted that the company has not made any market purchases of its common stock in the three months that ended March 31, at which point the company recorded $1.02 billion cash on hand that’s to be utilized to fund the Valspar acquisition, which is still anticipated.

Earlier this month, Sherwin-Williams and Valspar announced that they were selling Valspar’s North American Wood Coatings unit to Philadelphia-based coatings company Axalta for $420 million. This was in connection with reviews of the merger by the Federal Trade Commission.

The company went on to note estimation for the second quarter, which include a consolidated net sales increase of a “mid to high single digit percentage.”


Tagged categories: Architectural coatings; Asia Pacific; Coating Materials; Coatings; Earnings reports; EMEA (Europe, Middle East and Africa); Finance; Latin America; North America; Paint; Sherwin-Williams; Valspar

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