Key TakeawaysRPM International said difficult economic conditions and bad weather will hurt current-quarter results.The maker of Rust-Oleum and other coatings and sealants anticipates third-quarter fiscal 2025 sales to be flat, and adjusted EBIT to be up or down by a low-single-digit percentage.The company explained that high mortgage rates and worse-than-expected winter weather are impacting demand. Rust-Oleum and DayGlo parent RPM International (RPM) on Tuesday issued soft guidance as it said difficult ec ...

Group 1: Earnings Performance - RPM International reported quarterly earnings of $1.39 per share, exceeding the Zacks Consensus Estimate of $1.35 per share, and up from $1.22 per share a year ago, representing an earnings surprise of 2.96% [1] - The company posted revenues of $1.85 billion for the quarter ended November 2024, surpassing the Zacks Consensus Estimate by 3.70%, compared to year-ago revenues of $1.79 billion [2] - Over the last four quarters, RPM International has surpassed consensus EPS estimates three times [2] Group 2: Stock Performance and Outlook - RPM International shares have declined approximately 2.1% since the beginning of the year, while the S&P 500 has gained 1.6% [3] - The company's earnings outlook is mixed, with a current Zacks Rank of 3 (Hold), indicating expected performance in line with the market in the near future [6] - The current consensus EPS estimate for the coming quarter is $0.62 on revenues of $1.55 billion, and for the current fiscal year, it is $5.56 on revenues of $7.37 billion [7] Group 3: Industry Context - The Paints and Related Products industry, to which RPM International belongs, is currently in the top 35% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Record second-quarter sales of $1.85 billion, an increase of 3.0% over the prior year[4] - Record second-quarter net income of $183.2 million, with diluted EPS of $1.42, representing a 25.7% increase[4] - Adjusted diluted EPS of $1.39 increased 13.9% over the prior year, with adjusted EBIT rising 7.7% to $255.1 million[4] - Strong cash provided by operating activities of $279.4 million during the second quarter[4] - Total net sales for the second quarter of fiscal 2025 reached $1,845,318, an increase of 2.9% compared to $1,792,275 in the same period last year[38] - Reported earnings per diluted share for Q2 FY2025 were $1.42, up from $1.13 in Q2 FY2024, representing a 25.7% increase[45] - Adjusted earnings per diluted share for the six months ended November 30, 2024, were $3.23, compared to $2.86 for the same period in 2023, reflecting a 12.9% growth[45] - The company reported a net income of $412,004 for the six months ended November 30, 2024, compared to $347,128 in the prior year, a 18.7% increase[47] Sales and Segment Performance - Sales growth driven by 3.7% organic growth, with a 0.1% decline from divestitures and a 0.6% decline from foreign currency translation[8] - Construction Products Group achieved net sales of $690.1 million, a 4.3% increase, and adjusted EBIT of $108.6 million, up 9.0%[11] - Performance Coatings Group reported net sales of $380.1 million, a 1.4% increase, with adjusted EBIT rising 6.7% to $64.9 million[14] - Consumer Group's sales increased by 2.0% to $590.2 million, with adjusted EBIT remaining flat at $96.6 million[21] - The CPG segment reported net sales of $690,116, up 4.3% from $661,750 in the prior year[38] - The Consumer segment's income before income taxes decreased to $88,311, down 10.5% from $98,066 in the same quarter last year[38] - The SPG segment's income before income taxes increased to $16,694, a 64.5% rise from $10,145 in the same quarter last year[38] - Corporate/Other segment reported a loss before income taxes of $61,448, an improvement from a loss of $72,287 in the same quarter last year[38] - The PCG segment's adjusted EBIT increased to $64,956, up from $60,870 in the same quarter last year, showing operational efficiency[38] Debt and Cash Flow - Total debt reduced to $2.03 billion from $2.25 billion a year ago, reflecting improved cash flow used for debt repayment[25] - Interest expense decreased to $23,177 for the three months ended November 30, 2024, from $30,348 for the same period in 2023[37] - Interest expense for the total consolidated operations decreased to $23,177 from $30,348 in the same quarter last year, indicating improved financial management[38] - Long-term debt, less current maturities, decreased to $2,019,846 as of November 30, 2024, from $2,246,834 a year earlier, a reduction of 10.1%[46] - Cash provided by operating activities for the six months ended November 30, 2024, was $527,508, down from $767,781 in the prior year, a decrease of 31.2%[47] - Cash and cash equivalents at the end of the period were $268,683, up from $262,746 at the end of the same period last year, a 2.0% increase[47] Future Outlook - Fiscal 2025 third-quarter outlook calls for flat sales, with adjusted EBIT expected to grow or decline by low-single-digits[4] - Consumer Group sales are expected to decrease in the low-single-digit percentage range compared to prior-year results[31] - Consolidated adjusted EBIT is projected to increase between 6% and 10% compared to prior-year record results, a narrower range than the previous outlook[31] - Consolidated sales are anticipated to grow in the low-single-digit percentage range compared to prior-year record results, unchanged from the prior outlook[31] Operational Efficiency and Restructuring - The company highlighted the importance of EBIT as a key measure for investors, particularly in assessing core operating performance[33] - MAP initiatives contributed $27,443 in the second quarter, compared to $12,893 in the same period last year, reflecting a significant increase in restructuring efforts[42] - The company plans to consolidate over 75 ERP systems into four platforms as part of its MAP strategy, aiming to enhance operational efficiency[44]

Analysts expect RPM International Inc. RPM to report second-quarter earnings at $1.34 per share before the opening bell, on Tuesday, Jan. 7, 2025. That’s up from $1.22 per share in the year-ago period. The Medina, Ohio-based company projects quarterly revenue of $1.79 billion, compared to $1.79 billion a year earlier, according to data from Benzinga Pro. On Oct. 2, RPM International reported first-quarter results. Sales declined 2.1% Y/Y to $1.97 billion, missing the consensus of $2.015 billion.With the rec ...

RPM International Inc. RPM will release its second-quarter financial results, before the opening bell, on Tuesday, Jan. 7, 2025.Analysts expect the Medina, Ohio-based company to report quarterly earnings at $1.34 per share, up from $1.22 per share in the year-ago period. RPM International projects quarterly revenue of $1.79 billion, compared to $1.79 billion a year earlier, according to data from Benzinga Pro.On Oct. 2, RPM International reported first-quarter results. Sales declined 2.1% Y/Y to $1.97 billi ...

RPM International Inc.’s (RPM) stock has gained 22.7% in the past three months, strongly outperforming the Zacks Construction sector’s 10.3% growth and S&P 500 index’s 7.1% rally.RPM well captured the attention of investors recently after President-elect Donald Trump pledged to impose new tariffs on imports from Canada, Mexico and China. The stock touched a new 52-week high of $141.79 in Monday’s trading session.Image Source: Zacks Investment ResearchOther stocks like Quanta Services, Inc. (PWR) , Owens Cor ...

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