Oct 6, 2026, 6:53 AM ETBasic Materials

RPM International — Fiscal 2027 First Quarter Earnings Summary

RPMRPM INTERNATIONAL INC

Financial Performance

Net sales reached a record $2.216 billion, a 4.8% increase year-over-year (YoY), driven by 3.1% organic growth, 1.6% acquisition growth, and a 0.1% foreign currency tailwind.
Net income attributable to stockholders was $256.4 million, up 12.6% YoY.
Diluted earnings per share (EPS) were $2.01, a 13.6% increase from $1.77 in the prior year period.
Adjusted diluted EPS was $1.98, up 5.3% YoY.
Adjusted EBITDA reached a record $405.5 million, increasing 4.5% YoY.
Income before income taxes was $337.1 million, up 13.1% YoY.
Operating cash flow was $263.9 million, compared to $237.5 million in the prior year, driven by improved working capital efficiency.
Capital expenditures were $58.5 million, down from $62.5 million in the prior year.
Total debt decreased to $2.41 billion from $2.67 billion a year ago.
Total liquidity was $1.21 billion, up from $933.4 million a year ago.
The company returned $90.5 million to stockholders via dividends and share repurchases, a 10.2% increase YoY.

Fiscal 2027 Q2 consolidated sales are projected to increase in the low- to mid-single-digit range.
Fiscal 2027 Q2 consolidated adjusted EBITDA is projected to increase in the low- to mid-single-digit range.
Fiscal 2027 full-year consolidated sales are projected to increase in the mid-single-digit range (previously 3% to 7%).
Fiscal 2027 full-year consolidated adjusted EBITDA is projected to increase in the mid-single-digit range (previously 5% to 10%).
Segment-specific Q2 guidance: Construction Products Group (CPG) sales in the low-single-digit range; Performance Coatings Group (PCG) sales in the mid- to high-single-digit range; Consumer Group sales in the low- to mid-single-digit range.
Management anticipates CPG will return to positive organic growth by the end of the year.
Future benefits are expected from MAP operational improvements and pricing increases to offset persistent inflation.

Construction Products Group (CPG): Net sales were $859.2 million (up 0.8% YoY). Income before taxes was $149.1 million (down 6.3% YoY). Adjusted EBITDA was $166.2 million (down 9.7% YoY). Sales included a 1.7% organic decline offset by 2.5% acquisition growth. Headwinds included a slowdown in healthcare and education markets and raw material availability issues.
Performance Coatings Group (PCG): Net sales were $630.0 million (up 10.2% YoY). Income before taxes was $107.3 million (up 23.6% YoY). Adjusted EBITDA was $121.1 million (up 18.2% YoY). Sales included 7.9% organic growth and 1.8% acquisition growth. Growth was driven by engineered solutions for high-performance buildings, energy, infrastructure, and food coatings.
Consumer Group: Net sales were $726.7 million (up 5.3% YoY). Income before taxes was $132.3 million (up 21.5% YoY). Adjusted EBITDA was $146.6 million (up 5.5% YoY). Sales included 5.2% organic growth. Growth was aided by shelf space wins, new product introductions, and pricing.
Organizational Update: Effective June 1, 2026, Latin America businesses generating approximately $143 million in annual revenue were moved from CPG and Consumer Group to PCG.
Acquisitions: The Volteco acquisition (Italy-based waterproofing solutions) was completed for the Construction Products Group; Volteco had 2025 sales of €28 million.

Emerging market regions generated revenue increases above 20%, fueled by demand for engineered solutions in high-performance buildings and infrastructure.
North American growth was driven by PCG and Consumer Group improvements.
European growth was driven by acquisitions.
The company leverages a "Platform model" to accelerate growth and improve efficiency in emerging markets.
Raw material inflation and supply shortages remain challenges, with pricing actions implemented to offset costs.

CPG faced a temporary slowdown in healthcare and education markets.
Raw material inflation and supply shortages impacted margins.
A small European business is under review for closure, resulting in a $6.3 million warranty charge.
A customer bankruptcy resulted in a $4.4 million increase in bad debt expense.
Forward-looking statements note risks including global economic conditions, raw material prices, legal/environmental risks, currency fluctuations, trade policies, and geopolitical conflicts.

CEO Frank C. Sullivan described the quarter as a display of "resilience" with record sales and adjusted EBITDA.
Management credited solid organic growth in PCG and Consumer, along with manufacturing, procurement, and SG&A efficiencies, for overcoming challenges.
Sullivan noted that segment trends in Q2 are expected to be similar to Q1, with PCG leading growth and CPG demand remaining soft.
Management highlighted that MAP benefits and selling price increases will help offset gross margin pressure from inflation and start-up costs at new facilities.

The company will host an Investor Day webcast on November 9, 2026, at its Stonhard facility in New Jersey.
A $10.8 million gain on the sale of a facility closed as part of the MAP 2025 program was included in Consumer Group income before taxes but excluded from adjusted EBITDA.
The company reported a $10.8 million gain on the sale of closed facilities, net, which contributed to the reduction in MAP initiatives expenses.
Deferred compensation adjustments of $1.1 million were made in Corporate/Other.
The company has consolidated over 75 ERP systems as part of its MAP strategy.