RPM International Expects Third Quarter Results at the Higher End of Previous Guidance
March 20 2020 - 6:00AM
Business Wire
RPM International Inc. (NYSE:RPM) today announced that it
expects its financial results for its fiscal third quarter, ended
February 29, 2020, to be at the higher end of its guidance provided
on January 8, 2020. At that time, the company said that it expected
revenue for the fiscal third quarter to be up 2.5% to 4%, adjusted
EBIT growth in the 25% to 30% range, and adjusted diluted EPS in
the high-teens to low-20-cent range. The company noted today that
the positive momentum of the 2020 MAP to Growth operating
improvement plan contributed to good earnings leverage in the third
quarter.
“As the impact of the COVID-19 outbreak continues to evolve,
RPM’s top priorities include protecting the health and well-being
of our associates and their family members, supporting our local
communities to control the spread of the virus, and maintaining the
continuity and success of our business operations,” said Frank C.
Sullivan, RPM chairman and chief executive officer. “While the
COVID-19 outbreak continues globally, our supply chain and business
operations remain strong, our March operating results are solid,
and we continue to meet the changing needs of our customers in a
timely manner during this unprecedented period,” stated Sullivan.
“I want to thank all of our associates for their hard work and
dedication as they provide superior service to our customers as we
navigate through these challenging times together.”
The company will report its fiscal third-quarter results on
April 8, 2020, prior to the market open. Management will host a
conference call to discuss the results beginning at 10:00 a.m. EDT
the same day. The call can be accessed by dialing 800-708-4540 or
847-619-6397 for international callers. The call also will be
available both live and for replay, and as a written transcript,
via the RPM website at www.RPMinc.com.
About RPM
RPM International Inc. owns subsidiaries that are world leaders
in specialty coatings, sealants, building materials and related
services. The company operates across four reportable segments:
consumer, construction products, performance coatings and specialty
products. RPM has a diverse portfolio with hundreds of
market-leading brands, including Rust-Oleum, DAP, Zinsser,
Varathane, Day-Glo, Legend Brands, Stonhard, Carboline, Tremco and
Dryvit. From homes and workplaces, to infrastructure and precious
landmarks, RPM’s brands are trusted by consumers and professionals
alike to help build a better world. The company employs
approximately 15,000 individuals worldwide. Visit www.RPMinc.com to
learn more.
For more information, contact Russell L. Gordon, vice president
and chief financial officer, at 330-273-5090 or
rgordon@rpminc.com.
Use of Non-GAAP Financial Information
To supplement the financial information presented in accordance
with Generally Accepted Accounting Principles in the United States
(“GAAP”) in this news release, we use EBIT, adjusted EBIT and
adjusted earnings per share, which are all non-GAAP financial
measures. EBIT is defined as earnings (loss) before interest and
taxes, with adjusted EBIT and adjusted earnings per share provided
for the purpose of adjusting for one-off items impacting revenues
and/or expenses that are not considered by management to be
indicative of ongoing operations. We evaluate the profit
performance of our segments based on income before income taxes,
but also look to EBIT as a performance evaluation measure because
interest expense is essentially related to acquisitions, as opposed
to segment operations. For that reason, we believe EBIT is also
useful to investors as a metric in their investment decisions. EBIT
should not be considered an alternative to, or more meaningful
than, income before income taxes as determined in accordance with
GAAP, since EBIT omits the impact of interest and investment income
or expense in determining operating performance, which represent
items necessary to our continued operations, given our level of
indebtedness. Nonetheless, EBIT is a key measure expected by and
useful to our fixed income investors, rating agencies and the
banking community all of whom believe, and we concur, that this
measure is critical to the capital markets' analysis of our
segments' core operating performance. We also evaluate EBIT because
it is clear that movements in EBIT impact our ability to attract
financing. Our underwriters and bankers consistently require
inclusion of this measure in offering memoranda in conjunction with
any debt underwriting or bank financing. EBIT may not be indicative
of our historical operating results, nor is it meant to be
predictive of potential future results. See the financial statement
section of this earnings release for a reconciliation of EBIT and
adjusted EBIT to income before income taxes, and adjusted earnings
per share to earnings per share. We have not provided a
reconciliation of our fiscal 2020 adjusted EBIT and adjusted
earnings per share guidance, because material terms that impact
such measures are not in our control and/or cannot be reasonably
predicted, and therefore a reconciliation of such measures is not
available without unreasonable effort.
Forward-Looking Statements
This press release contains “forward-looking statements”
relating to our business. These forward-looking statements, or
other statements made by us, are made based on our expectations and
beliefs concerning future events impacting us and are subject to
uncertainties and factors (including those specified below) which
are difficult to predict and, in many instances, are beyond our
control. As a result, our actual results could differ materially
from those expressed in or implied by any such forward-looking
statements. These uncertainties and factors include (a) global
markets and general economic conditions, including uncertainties
surrounding the volatility in financial markets, the availability
of capital and the effect of changes in interest rates, and the
viability of banks and other financial institutions; (b) the
prices, supply and capacity of raw materials, including assorted
pigments, resins, solvents and other natural gas- and oil-based
materials; packaging, including plastic containers; and
transportation services, including fuel surcharges; (c) continued
growth in demand for our products; (d) legal, environmental and
litigation risks inherent in our construction and chemicals
businesses and risks related to the adequacy of our insurance
coverage for such matters; (e) the effect of changes in interest
rates; (f) the effect of fluctuations in currency exchange rates
upon our foreign operations; (g) the effect of non-currency risks
of investing in and conducting operations in foreign countries,
including those relating to domestic and international political,
social, economic and regulatory factors; (h) risks and
uncertainties associated with our ongoing acquisition and
divestiture activities; (i) the timing of and the realization of
anticipated cost savings from restructuring initiatives and the
ability to identify additional cost savings opportunities; (j)
risks related to the adequacy of our contingent liability reserves;
and (k) other risks detailed in our filings with the Securities and
Exchange Commission, including the risk factors set forth in our
Annual Report on Form 10-K for the year ended May 31, 2019, as the
same may be updated from time to time. We do not undertake any
obligation to publicly update or revise any forward-looking
statements to reflect future events, information or circumstances
that arise after the date of this release.
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version on businesswire.com: https://www.businesswire.com/news/home/20200320005099/en/
Russell L. Gordon, vice president and chief financial officer
330-273-5090 rgordon@rpminc.com
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