Sherwin-Williams(US:SHW)2025-04-29 18:34Financial Performance - Consolidated net sales decreased by 1.1% to $5.306 billion in Q1 2025, with a 2.3% increase in the Paint Stores Group offsetting declines in the Consumer Brands and Performance Coatings Groups [124][127]. - Diluted net income per share increased by 1.5% to $2.00 in Q1 2025, compared to $1.97 in Q1 2024, despite a $0.03 decrease due to foreign currency translation [138]. - Adjusted EBITDA rose by 4.6% to $937.0 million, representing 17.7% of net sales in Q1 2025 [124]. - The Company reported a net income of $503.9 million, slightly down from $505.2 million in the same period of 2024 [176]. - EBITDA for the three months ended March 31, 2025, was $917.7 million, an increase from $896.2 million in the prior year [176]. - Adjusted EBITDA for the same period was $937.0 million, compared to $896.2 million in 2024, reflecting a significant improvement [176]. Liquidity and Capital Structure - The Company maintained a strong liquidity position with $199.8 million in cash and $2.148 billion of unused capacity under credit facilities as of March 31, 2025 [123][141]. - Total debt outstanding increased to $10.776 billion as of March 31, 2025, from $9.888 billion at December 31, 2024 [155]. - Shareholders' equity rose by $78.9 million to $4.130 billion in Q1 2025, primarily due to net income of $503.9 million [162]. - The company generated net operating cash of $3.151 billion over the twelve months ending March 31, 2025 [170]. - Net operating cash usage was $61.1 million in Q1 2025, compared to $58.9 million in the same period of 2024 [167]. Operational Highlights - The Paint Stores Group's gross profit increased by $79.8 million in Q1 2025, driven by higher net sales from increased selling prices [133]. - The Consumer Brands Group experienced a 6.0% decline in net sales, primarily due to soft DIY demand in North America and unfavorable currency translation impacts [129]. - The Performance Coatings Group's net sales decreased by 4.8%, with a 2.6% impact from unfavorable currency translation [129]. - The company repurchased 1.0 million shares of common stock during the first three months of 2025, with remaining authorization to purchase 33.4 million shares [164]. - The Company incurred $19.3 million in severance and other restructuring expenses during the three months ended March 31, 2025 [176]. Tax and Accounting - The effective tax rate increased to 22.8% in Q1 2025, up from 21.1% in Q1 2024, primarily due to less favorable tax benefits related to employee share-based payments [137]. - There have been no significant changes in critical accounting policies or management estimates since December 31, 2024 [178]. Risks and Forward-Looking Statements - The Company continues to face market risks associated with interest rates, foreign currency, and commodity fluctuations, but does not expect these to materially affect its financial condition [182]. - The Company is exposed to various risks including economic conditions, competition, and supply chain disruptions, which could impact future performance [180]. - Forward-looking statements are based on management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially [179]. - The Company does not expect foreign currency translation or interest rate movements to have a material adverse effect on its cash flows [182].