Skip to content
AnalystLens

SHERWIN WILLIAMS CO 8-K Report, Financial Results (Oct 22, 2024)

Reports
Earnings & Results·Exhibits & Filings
Filing Date
Filed October 22, 2024
Period End
October 22, 2024
Security
SHW
In the record · 2016–202610-K1110-Q328-K145

SHW filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 145 current reports (8-K) between 2016 and 2026.

  1. Leadership change8-K · Jan ’18Jan ’18
  2. Leadership change8-K · Nov ’20Nov ’20
  3. Material agreement8-K · Oct ’22Oct ’22
  4. Material agreement8-K · Sep ’26Sep ’26

01—Abstract

Summary

Summary of the 8-K filed October 22, 2024. Cited figures are marked; the original filing is the authoritative source.

The Sherwin-Williams Company (SHW) reported third-quarter 2024 results on October 22, 2024, with net sales rising 0.7% to $6.16 billiona and diluted EPS up 7.8% to $3.18 (adjusted diluted EPS up 5.3% to $3.37).

EBITDA grew 1.2% to $1.28 billionb, or 20.8% of net sales. Gross margin expanded to 49.1% from 47.7%, but SG&A rose 8.8% to 30.7% of sales as management invested ahead of demand in stores, sales and technical reps, services and digital capabilities. Quarterly income before taxes rose only 1.4%, aided by lower environmental provisions in the Administrative function (which swung to a $2.8 million provision from $39.4 million a year earlier).

Segment performance was mixed. Paint Stores Group (PSG) sales grew 3.2% to $3.65 billionc, with same-store sales up 2.2%, led by protective & marine and residential repaint, though segment profit fell 2.4% on investment and cost increases. Consumer Brands Group (CBG) sales fell 7.5% amid weak North American DIY demand, yet segment profit rose 62.9% on fixed-cost absorption and cost control.

Performance Coatings Group (PCG) was essentially flat at $1.72 billiond, with segment profit down 7.2% due to weaker North American sales and currency headwinds, though Packaging grew strongly. Management reaffirmed full-year 2024 diluted EPS guidance of $10.30 to $10.60 (adjusted $11.10 to $11.40) and guided Q4 and full-year sales to flat to up low-single digits. The company also announced a 5% price increase in PSG effective January 6, 2025.

Cash generation remained solid, with $2.22 billion of operating cash flow in the first nine months and $1.97 billion returned to shareholders through dividends and buybacks. However, capital expenditures rose sharply to $770 million year-to-date from $569 million, and short-term borrowings increased to $915.5 million from $338.6 million a year earlier. Investors should weigh the top-line stagnation and the reliance on margin gains and cost control against the company's continued investment in growth.

02—Key points

Key Highlights

  1. Q3 2024 net sales rose 0.7% to $6.16 billion; PSG same-store sales grew 2.2% despite a down residential market.
  2. Diluted EPS increased 7.8% to $3.18; adjusted diluted EPS rose 5.3% to $3.37, supported by gross margin expansion to 49.1% from 47.7%.
  3. SG&A rose to 30.7% of net sales from 28.7% as the company invested in stores, technical reps, services and digital capabilities; management expects sequential moderation.
  4. Consumer Brands Group sales fell 7.5% on soft North American DIY demand, but segment profit rose 62.9% on cost control and fixed-cost absorption.
  5. Performance Coatings Group sales were flat and segment profit fell 7.2%, with weakness in North America offset by strong Packaging growth.
  6. Full-year 2024 diluted EPS guidance of $10.30 to $10.60 was reaffirmed, with the range described as wider than typical entering Q4.
  7. A 5% price increase is planned for the Paint Stores Group effective January 6, 2025; capital expenditures rose to $770 million year-to-date from $569 million.

03—Questions

Frequently Asked Questions

  1. Did Sherwin-Williams meet expectations in Q3 2024?

    Results were modestly positive. Sales rose 0.7% and both diluted and adjusted EPS grew, with gross margin expansion a key bright spot. However, top-line growth was limited, and the reported earnings benefit was partly helped by lower environmental provisions in the Administrative function.

  2. Did management change full-year 2024 guidance?

    No. Management reaffirmed diluted EPS guidance of $10.30 to $10.60 and adjusted EPS guidance of $11.10 to $11.40. It also expects full-year 2024 sales to be flat to up low-single digits, and noted the range is wider than usual due to hurricane-related demand and possible extended industrial holiday shutdowns.

  3. Why did Consumer Brands and Performance Coatings sales decline while profit diverged?

    Consumer Brands sales fell 7.5% on weak North American DIY demand and currency translation, yet its profit rose 62.9% through fixed-cost absorption and cost control. Performance Coatings sales were flat, but profit fell 7.2% on lower North American sales and unfavorable currency effects.

  4. What are the main risks to the investment case highlighted in the release?

    Key risks include soft DIY and industrial demand, choppy end markets, rising SG&A and capital spending, higher short-term borrowings, and currency headwinds. The release also cites raw material and supply chain disruptions, competitive pressures, and litigation and environmental liabilities among its forward-looking risk factors.

04—Continue

← View all 8-K filings