RPM International HomeThe Value of 168RPM In ActionRPM In ActionRPM In Action
Click HERE for Advanced Search
IR Home
News Releases
Analysts
Corporate Governance
Direct Stock Purchase
Dividends & Splits
Dividend Reinvestment Plan
E-mail Alerts
Estimates
Financial Reports
Frequently Asked Questions
Fundamentals
Information Request
Investor Contacts
Proxy Vote
RPM Videos
SEC Filings
Stock Price/History
Stock Transfer Agent
Upcoming Events
Webcasts & Presentations
 
News Release
Printer Friendly Version View printer-friendly version
Download PDF Download PDF
<< Back
RPM Reports Fiscal 2013 Third-Quarter Results
- Third-quarter net sales increase 9% over prior year
- Net income increases 31% and diluted EPS increases 40%, on an as-adjusted basis
- Adjustments include accrual for prospective GSA settlement in roofing division

MEDINA, Ohio, April 4, 2013 /PRNewswire/ -- RPM International Inc. (NYSE: RPM) today reported financial results for its fiscal 2013 third quarter ended February 28, 2013, which reflected strong operating performance, offset by two non-operating adjustments and certain other charges recorded during the quarter in the company's industrial segment.

"RPM achieved solid operating results in the quarter," stated Frank C. Sullivan, chairman and chief executive officer. "Net sales, net income and diluted earnings per share (EPS) all increased significantly, on an as-adjusted basis, driven by strong performance in all of our consumer segment businesses and in many industrial segment businesses. Together with accretive acquisitions, this performance helped offset weaknesses in our European operations and North American roofing business. The improvement was all the more noteworthy given the difficult comparisons to last year's strong third quarter during which RPM's sales and earnings grew to record levels as a result of the exceptionally mild weather throughout most of North America."

Third-Quarter Results

On an as-reported basis, net sales grew 9.1% to $843.7 million from $773.6 million. Consolidated earnings before interest and taxes (EBIT) were a negative $48.6 million, compared to EBIT of $27.1 million a year ago, due primarily to an adjustment for a $68.8 million accrual associated with an investigation of the company's Building Solutions Group roofing contracts with the U.S. General Services Administration (GSA). The substantial majority of the accrual relates to the sale of products and services from 2002 to 2008. The as-reported net loss for the quarter was $42.4 million, compared to net income of $6.6 million in the year-ago period. The diluted loss per share was $0.33, compared to diluted earnings per share of $0.05 in the fiscal 2012 third quarter. 

RPM's Building Solutions Group is in ongoing settlement discussions with the U.S. Department of Justice (DOJ) and the GSA aimed at resolving the investigation. The company is cooperating with the investigation, which involves compliance with certain pricing terms and conditions of GSA contracts under which RPM's Building Solutions Group roofing division sold products and services to the federal government. The actual amount of the company's loss, which remains subject to approval by the DOJ, may vary from the amount of the accrual.

The second non-operating adjustment for the quarter is associated with the company's decision to close an existing flooring business in Brazil in light of the Viapol acquisition there earlier this fiscal year. The impact of this decision resulted in a $6.1 million cumulative translation adjustment (CTA) write-off, which also triggered a $7.7 million tax benefit that impacted the current quarter as well. The net impact of this strategic repositioning of RPM's existing flooring business in Brazil was an increase to net income of $1.6 million or $0.01 per share.

"We are extremely excited about the establishment of a significant platform for RPM in Brazil with the Viapol acquisition, where we can leverage its substantial sales force, manufacturing facilities, broad distribution network and entrepreneurial management team to expand RPM's epoxy and polyurethane flooring presence," stated Sullivan.

On an as-adjusted basis, EBIT declined 3.1%, to $26.3 million from $27.1 million a year ago. The decrease in EBIT was primarily due to a $6.4 million unfavorable swing in foreign exchange losses on working capital balances at quarter end, principally related to the devaluation of the British Pound versus the Euro, and $4.1 million in non-operating expense changes, principally related to severance in Europe. Net income increased 30.8% to $8.7 million, compared to $6.6 million in the year-ago period. Diluted earnings per share were $0.07, up 40.0% from $0.05 in the fiscal 2012 third quarter.

Third-Quarter Segment Sales and Earnings

On an as-reported basis, industrial segment sales grew 6.1% to $532.3 million from $501.9 million in the fiscal 2012 third quarter. Organic sales improved 1.6%, including foreign exchange translation gains of 1.2%, while acquisitions added 4.5%. Industrial segment EBIT fell to a negative $66.3 million, including the impact of both adjustments referred to above. 

On an as-adjusted basis, industrial segment EBIT was $8.7 million, a decrease of $12.6 million from the prior year. This was principally due to the previously mentioned unfavorable swing in foreign exchange losses, which impacted this segment by $7.5 million, combined with $4.1 million in non-operating expense changes in Europe, as those businesses take appropriate actions to adjust to the difficult economic conditions continuing throughout the Eurozone.

"With the exception of our roofing division, most of our North American industrial businesses benefited from the gradual economic recovery in the U.S., especially our businesses serving commercial construction markets," Sullivan stated. 

RPM's consumer segment had a 14.6% increase in net sales to $311.4 million from
$271.7 million in the fiscal 2012 third quarter. Organic sales improved 2.5%, including foreign exchange translation gains of 0.3%, while acquisitions added 12.1%. Consumer segment EBIT increased 61.6% to $34.7 million from $21.5 million a year ago.

"Our consumer segment continued to benefit from the introduction of new products, market share gains and increased consumer spending as the housing market continues its gradual recovery. We are particularly encouraged by the traction being gained by new products that are well beyond our traditional consumer price points and by increases in market share across virtually all consumer product lines. The recent acquisitions of HiChem in southern hemisphere Australia and Kirker, specializing in nail polish enamels, added to the strong consumer segment results as their business dynamics provide a counter to the historic seasonal low of most of RPM's core consumer businesses," stated Sullivan. 

Cash Flow and Financial Position

For the first nine months of fiscal 2013, cash from operations was $170.9 million, compared to $153.5 million in the first nine months of fiscal 2012. Capital expenditures during the current nine-month period of $45.7 million compare to depreciation of $41.9 million over the same time. Total debt at the end of the first nine months was $1.4 billion, up from $1.1 billion a year ago and at the end of fiscal 2012, due mainly to increased acquisitions. RPM's net (of cash) debt-to-total capitalization ratio was 49.8%, compared to 40.3% at May 31, 2012, primarily due to additional borrowings to fund acquisitions.

"At February 28, 2013, our total liquidity, including cash and long-term committed available credit, stood at $912 million," Sullivan stated. "As a result, we have plenty of resources to continue our robust acquisition program, which has added companies with annual sales totaling more than $225 million during the current fiscal year," stated Sullivan.

Nine-Month Results

On an as-reported basis, nine-month net sales grew 8.7% to $2.91 billion from $2.68 billion. Consolidated EBIT was $124.4 million, compared to EBIT of $256.7 million a year ago. As-reported net income for the nine-month period was $33.2 million, compared to net income of $133.4 million in the year-ago period. Diluted earnings per share were $0.25, compared to diluted earnings per share of $1.02 in the fiscal 2012 nine-month period. 

Adjustments affected nine-month results in both years. In fiscal 2013, the company incurred charges of $79.8 million in its Building Solutions Group roofing division, of which $68.8 million related to the current quarter GSA accrual and $11.0 million related to a first-quarter charge for the strategic decision to exit certain unprofitable contracts outside of North America. A $6.1 million pre-tax loss was also recorded during the current quarter when the company completed a repositioning of its flooring business in Brazil, which was more than offset by a tax benefit reflected in income tax expense.  In addition, the company recognized, during the first half of this fiscal year, a $56.1 million write-down of its equity investment in Kemrock Industries and Exports Ltd., due to continued deteriorating economic conditions in India, where Kemrock is based, and the resulting adverse impact on Kemrock's operating performance and stock price.

The fiscal 2012 year-to-date adjustment was for income recognized in RPM's industrial segment, which occurred when RPM's ownership position in Kemrock exceeded 20%, thereby triggering a reportable equity ownership position and resulted in a benefit of $5.2 million, including a $4.6 million cumulative income catch-up. 

On an as-adjusted basis, nine-month consolidated EBIT increased to $266.5 million from $251.5 million a year ago. Net income increased 13.9% to $146.0 million from net income of $128.2 million in the year-ago period. Diluted earnings per share were $1.10, compared to diluted earnings per share of $0.98 in the fiscal 2012 nine-month period. 

Nine-Month Segment Sales and Earnings

On an as-reported basis, sales for RPM's industrial segment increased 6.4%, to $1.93 billion from $1.81 billion in the fiscal 2012 first nine months. Organic sales were flat, including foreign exchange translation losses of 1.7%, while acquisitions added 6.5%. Industrial segment EBIT fell to $88.8 million from $192.0 million in the first nine months of fiscal 2012. On an as-adjusted basis, nine-month industrial segment EBIT declined 1.3% to $184.4 million from $186.8 million in the prior year.

In the consumer segment, nine-month sales increased 13.4% to $981.1 million from $865.2 million reported in the first nine months of fiscal 2012. Organic sales improved 4.9%, including foreign exchange translation losses of 0.5%, while acquisitions added 8.5%. Consumer segment EBIT improved 32.4%, to $132.1 million from $99.7 million in the first nine months a year ago. The consumer segment was unaffected by one-time adjustments.

Business Outlook

"For the full year, we now expect consumer segment sales to exceed the higher end of our targeted 8% to 10% range, while industrial segment sales will most likely fall short of the lower end of our previous 6% to 10% range.  Our guidance calls for consolidated net sales growth of 8% to 10% and net income growth of 9% to 12%, resulting in diluted earnings per share in a range of $1.80 to $1.85, on an as-adjusted basis.  Although we exceeded last year's third quarter results, we fell short of our internal plan by $0.03 per share as a result of the European expenses for foreign exchange and severance.  While we are hopeful of hitting our full year goals, this third quarter shortfall and continuing weakness in Europe and roofing will make this challenging," Sullivan stated.

Webcast and Conference Call Information

Management will host a conference call to further discuss these results beginning at 10:00 a.m. EDT today. The call can be accessed by dialing 866-700-6067 or 617-213-8834 for international callers. Participants are asked to call the assigned number approximately 10 minutes before the conference call begins. The call, which will last approximately one hour, will be open to the public, but only financial analysts will be permitted to ask questions. The media and all other participants will be in a listen-only mode.

For those unable to listen to the live call, a replay will be available from approximately noon EDT on April 4, 2013 until 11:59 p.m. EDT on April 11, 2013. The replay can be accessed by dialing 888-286-8010 or 617-801-6888 for international callers. The access code is 90961771. The call also will be available both live and for replay, and as a written transcript, via the RPM web site at www.rpminc.com.  

About RPM

RPM International Inc., a holding company, owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services serving both industrial and consumer markets. RPM's industrial products include roofing systems, sealants, corrosion control coatings, flooring coatings and specialty chemicals. Industrial brands include Stonhard, Tremco, illbruck, Carboline, Flowcrete, Universal Sealants and Euco. RPM's consumer products are used by professionals and do-it-yourselfers for home maintenance and improvement and by hobbyists. Consumer brands include Zinsser, Rust-Oleum, DAP, Varathane and Testors. Additional details can be found at www.RPMinc.com and by following RPM on Twitter at www.twitter.com/RPMintl.

For more information, contact Barry M. Slifstein, vice president – investor relations and planning, at 330-273-5090 or bslifstein@rpminc.com.

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) risks related to the adequacy of our contingent liability reserves; (j) risks and uncertainties associated with the SPHC bankruptcy proceedings; 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, 2012, 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.

 

CONSOLIDATED STATEMENTS OF INCOME

IN THOUSANDS, EXCEPT PER SHARE DATA
















(Unaudited)





























































































AS REPORTED



ADJUSTED (a)







Three Months Ended


Nine Months Ended



Three Months Ended


Nine Months Ended







February 28,


February 29,


February 28,


February 29,



February 28,


February 29,


February 28,


February 29,







2013


2012


2013


2012



2013


2012


2013


2012







































Net Sales





$     843,736


$    773,643


$     2,907,876


$   2,675,646



$        843,736


$     773,643


$    2,910,754


$  2,675,646

Cost of sales





500,172


470,443


1,705,431


1,593,799



500,172


470,443


1,702,890


1,593,799

Gross profit





343,564


303,200


1,202,445


1,081,847



343,564


303,200


1,207,864


1,081,847

Selling, general & administrative expenses





318,638


277,456


955,339


833,553



318,638


277,456


944,751


833,553

Estimated loss contingency





68,846


-


68,846


-



-


-


-


-

Interest expense





20,506


17,897


58,804


53,612



20,506


17,897


58,804


53,612

Investment (income), net





(6,317)


(2,190)


(14,655)


(3,259)



(6,317)


(2,190)


(14,655)


(3,259)

Other expense (income), net





4,714


(1,399)


53,830


(8,369)



(1,373)


(1,399)


(3,349)


(3,159)

Income (loss) before income taxes





(62,823)


11,436


80,281


206,310



12,110


11,436


222,313


201,100

Provision (benefit) for income taxes





(20,631)


3,512


38,519


61,127



3,278


3,512


66,196


61,127

Net income (loss)





(42,192)


7,924


41,762


145,183



8,832


7,924


156,117


139,973

Less:  Net income attributable to noncontrolling interests




164


1,299


8,537


11,816



164


1,299


10,143


11,816

Net income (loss) attributable to RPM International Inc. Stockholders

$     (42,356)


$        6,625


$          33,225


$      133,367



$            8,668


$         6,625


$       145,974


$     128,157























Earnings (loss) per share of common stock attributable to



















RPM International Inc. Stockholders:





















Basic





$         (0.33)


$          0.05


$              0.25


$            1.02



$              0.07


$           0.05


$             1.11


$           0.98























Diluted





$         (0.33)


$          0.05


$              0.25


$            1.02



$              0.07


$           0.05


$             1.10


$           0.98























Average shares of common stock outstanding - basic 




129,013


128,121


128,900


128,072



129,013


128,121


128,900


128,072























Average shares of common stock outstanding - diluted




129,013


130,377


129,722


128,627



129,896


130,377


129,722


128,627























(a)  

Refer to the attached page for a reconciliation of as reported figures to adjusted figures presented above.














































































SUPPLEMENTAL SEGMENT INFORMATION





















IN THOUSANDS





















(Unaudited)



























AS REPORTED



ADJUSTED (a)







Three Months Ended


Nine Months Ended



Three Months Ended


Nine Months Ended







February 28,


February 29,


February 28,


February 29,



February 28,


February 29,


February 28,


February 29,







2013


2012


2013


2012



2013


2012


2013


2012

















Net Sales:






















Industrial Segment





$     532,336


$    501,925


$     1,926,747


$   1,810,479



$        532,336


$     501,925


$    1,929,625


$  1,810,479


Consumer Segment





311,400


271,718


981,129


865,167



311,400


271,718


981,129


865,167


     Total





$     843,736


$    773,643


$     2,907,876


$   2,675,646



$        843,736


$     773,643


$    2,910,754


$  2,675,646























Income Before Income Taxes (b):






















Industrial Segment






















     Income (Loss) Before Income Taxes (b)





$     (68,643)


$      20,422


$          81,156


$      189,192



$            6,290


$       20,422


$       176,831


$     183,982


     Interest (Expense), Net (c)





(2,360)


(874)


(7,594)


(2,856)



(2,360)


(874)


(7,594)


(2,856)


     EBIT (d)





$     (66,283)


$      21,296


$          88,750


$      192,048



$            8,650


$       21,296


$       184,425


$     186,838


Consumer Segment






















     Income Before Income Taxes (b)





$       34,720


$      21,531


$        132,069


$        99,796



$          34,720


$       21,531


$       132,069


$       99,796


     Interest (Expense), Net (c)





(15)


36


(34)


51



(15)


36


(34)


51


     EBIT (d)





$       34,735


$      21,495


$        132,103


$        99,745



$          34,735


$       21,495


$       132,103


$       99,745


Corporate/Other






















     (Expense) Before Income Taxes (b)





$     (28,900)


$     (30,517)


$      (132,944)


$      (82,678)



$        (28,900)


$     (30,517)


$        (86,587)


$      (82,678)


     Interest (Expense), Net (c)





(11,814)


(14,869)


(36,521)


(47,548)



(11,814)


(14,869)


(36,521)


(47,548)


     EBIT (d)





$     (17,086)


$     (15,648)


$        (96,423)


$      (35,130)



$        (17,086)


$     (15,648)


$        (50,066)


$      (35,130)


     Consolidated






















          Income (Loss) Before Income Taxes (b)





$     (62,823)


$      11,436


$          80,281


$      206,310



$          12,110


$       11,436


$       222,313


$     201,100


          Interest (Expense), Net (c)





(14,189)


(15,707)


(44,149)


(50,353)



(14,189)


(15,707)


(44,149)


(50,353)


          EBIT (d)





$     (48,634)


$      27,143


$        124,430


$      256,663



$          26,299


$       27,143


$       266,462


$     251,453























(a)

Refer to the attached page for a reconciliation of as reported figures to adjusted figures presented above.

(b)  

The presentation includes a reconciliation of Income (Loss) Before Income Taxes, a measure defined by Generally Accepted Accounting Principles in the United States (GAAP), to EBIT.





(c)  

Interest (expense), net includes the combination of interest (expense) and investment income/(expense), net.













(d)  

EBIT is defined as earnings (loss) before interest and taxes.  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 corporate 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, operating income as determined in accordance with GAAP, since EBIT omits the impact of interest and taxes in determining


operating performance, which represent items necessary to our continued operations, given our level of indebtedness and ongoing tax obligations.  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.

CONSOLIDATED STATEMENTS OF INCOME








RECONCILIATION OF "AS REPORTED" TO "ADJUSTED"








IN THOUSANDS, EXCEPT PER SHARE DATA








(Unaudited)





























































Three Months Ended February 28, 2013


























AS REPORTED


Adjustments


ADJUSTED






















Net Sales



$        843,736


$              -


$     843,736







Cost of sales


500,172




500,172







Gross profit



343,564


-


343,564







Selling, general & administrative expenses


318,638




318,638







Estimated loss contingency


68,846


(68,846)

(1)

-







Interest expense


20,506




20,506







Investment (income), net


(6,317)




(6,317)







Other expense (income), net


4,714


(6,087)

(2)

(1,373)







Income (loss) before income taxes


(62,823)


74,933


12,110







Provision (benefit) for income taxes


(20,631)


23,909


3,278







Net income (loss)


(42,192)


51,024


8,832







Less: Net income attributable to noncontrolling interests


164




164







Net income (loss) attributable to RPM International Inc. Stockholders

$         (42,356)


$      51,024


$         8,668






















Earnings (loss) per share attributable to RPM International Inc. Stockholders:

























Basic



$             (0.33)


$          0.40


$           0.07







Diluted



$             (0.33)


$          0.40


$           0.07






















(1)

Adjustment removes the accrual associated with an investigation of the company's Building Solutions Group roofing contracts with the U.S. General Services Administration.  The substantial majority of the accrual relates to the sale of products and services from 2002 to 2008.


(2)

Adjustment removes the impact of strategic repositioning of certain industrial segment subsidiaries located in Brazil. Included in the loss was the impact of an adjustment for accumulated foreign currency translation losses that were previously recorded as an unrealized foreign exchange loss in the currency translation account as a component of other comprehensive income.





















Nine Months Ended February 28, 2013


Nine Months Ended February 29, 2012




















AS REPORTED


Adjustments


ADJUSTED


AS REPORTED


Adjustments


ADJUSTED
















Net Sales



$     2,907,876


$        2,878


$  2,910,754


$    2,675,646


$             -


$  2,675,646

Cost of sales


1,705,431


(2,541)


1,702,890


1,593,799




1,593,799

Gross profit



1,202,445


5,419

(3)

1,207,864


1,081,847




1,081,847

Selling, general & administrative expenses


955,339


(10,588)

(4)

944,751


833,553




833,553

Estimated loss contingency


68,846


(68,846)

(1)

-







Interest expense


58,804




58,804


53,612




53,612

Investment (income), net


(14,655)




(14,655)


(3,259)




(3,259)

Other expense (income), net


53,830


(57,179)

(5)

(3,349)


(8,369)


5,210

(6)

(3,159)

Income before income taxes


80,281


142,032


222,313


206,310


(5,210)


201,100

Provision for income taxes


38,519


27,677


66,196


61,127




61,127

Net income



41,762


114,355


156,117


145,183


(5,210)


139,973

Less: Net income attributable to noncontrolling interests


8,537


1,606


10,143


11,816




11,816

Net income attributable to RPM International Inc. Stockholders

$          33,225


$    112,749


$     145,974


$       133,367


$      (5,210)


$     128,157
















Earnings per share attributable to RPM International Inc. Stockholders:


























Basic



$              0.25


$          0.86


$           1.11


$             1.02


$        (0.04)


$           0.98

Diluted



$              0.25


$          0.85


$           1.10


$             1.02


$        (0.04)


$           0.98
















(3)

Represents an adjustment for revised cost estimates in the Roofing Division of RPM's Building Solutions Group (industrial segment) in conjunction with unprofitable contracts outside of North America of $5,419 during the first quarter of fiscal 2013.


(4)

Adjustment includes $5,588 in Roofing exit costs and $5,000 of charges relating to Kemrock investment write-downs at RPM's Performance Coatings Group (industrial segment) during the first quarter of fiscal 2013. 


(5)

Adjustments include the write-downs of Kemrock investments, including $35,538 at Corporate and $4,735 at RPM's Performance Coatings Group (industrial segment) during the first quarter of fiscal 2013 and an additional $10,819 write-down at Corporate in the second quarter of fiscal 2013. Adjustments also reflect the $6,087 impact of the loss on repositioning of certain industrial segment subsidiaries in Brazil, as described in (2) above.


(6)

Adjustment removes the income recognized by the industrial segment related to RPM's equity method investment in Kemrock recognized during the second quarter of fiscal 2012 of $5,210, which included a $4,631 cumulative catch-up. Adjustment excludes approximately $0.4 million of net earnings recognized by the industrial segment for its share of Kemrock's earnings during the third quarter of fiscal 2012.


CONSOLIDATED BALANCE SHEETS







IN THOUSANDS


















February 28, 2013


February 29, 2012


May 31, 2012




(Unaudited)


(Unaudited)



Assets







Current Assets








Cash and cash equivalents


$             247,104


$             272,178


$             315,968


Trade accounts receivable


674,357


640,780


772,048


Allowance for doubtful accounts


(31,703)


(27,381)


(26,507)


Net trade accounts receivable


642,654


613,399


745,541


Inventories


585,804


517,172


489,978


Deferred income taxes


22,352


16,438


19,868


Prepaid expenses and other current assets


253,545


265,245


239,982


Total current assets


1,751,459


1,684,432


1,811,337









Property, Plant and Equipment, at Cost


1,147,105


1,044,980


1,050,965


Allowance for depreciation and amortization


(672,657)


(642,199)


(632,133)


Property, plant and equipment, net


474,448


402,781


418,832

Other Assets








Goodwill


1,116,967


869,557


849,346


Other intangible assets, net of amortization


470,422


349,533


345,620


Other


109,625


107,782


134,885


Total other assets


1,697,014


1,326,872


1,329,851









Total Assets


$          3,922,921


$          3,414,085


$          3,560,020









Liabilities and Stockholders' Equity







Current Liabilities








Accounts payable


$             322,013


$             287,363


$             391,467


Current portion of long-term debt


3,557


3,238


2,584


Accrued compensation and benefits


121,593


123,807


157,298


Accrued loss reserves


34,007


26,621


28,880


Other accrued liabilities


249,786


147,080


144,911


Total current liabilities


730,956


588,109


725,140









Long-Term Liabilities








Long-term debt, less current maturities


1,392,381


1,099,460


1,112,952


Other long-term liabilities


435,553


253,939


381,619


Deferred income taxes


54,286


73,373


26,326


Total long-term liabilities


1,882,220


1,426,772


1,520,897


   Total liabilities


2,613,176


2,014,881


2,246,037









Stockholders' Equity








Preferred stock; none issued








Common stock (outstanding 132,506; 131,488; 131,555)

1,325


1,315


1,316


Paid-in capital


759,147


750,386


742,895


Treasury stock, at cost


(71,809)


(69,068)


(69,480)


Accumulated other comprehensive (loss)


(161,891)


(46,965)


(177,893)


Retained earnings


632,210


632,530


686,818


     Total RPM International Inc. stockholders' equity

1,158,982


1,268,198


1,183,656


Noncontrolling interest


150,763


131,006


130,327


     Total equity


1,309,745


1,399,204


1,313,983









Total Liabilities and Stockholders' Equity


$          3,922,921


$          3,414,085


$          3,560,020

CONSOLIDATED STATEMENTS OF CASH FLOWS




IN THOUSANDS






(Unaudited)










Nine Months Ended





February 28,


February 29,





2013


2012








Cash Flows From Operating Activities:





  Net income



$         41,762


$        145,183

  Adjustments to reconcile net income to net





          cash provided by operating activities:





               Depreciation



41,858


38,800

               Amortization



20,684


15,903

               Impairment loss on investment in Kemrock

51,092



               Estimated loss contingency, net of tax


52,635



               Deferred income taxes


4,461


(3,025)

               Stock-based compensation expense


12,354


9,873

               Other 



(1,166)


(6,127)

  Changes in assets and liabilities, net of effect





          from purchases and sales of businesses:





               Decrease in receivables


137,071


128,391

               (Increase) in inventory


(73,323)


(25,399)

               Decrease (increase) in prepaid expenses and other




                    current and long-term assets


12,931


(1,115)

               (Decrease) in accounts payable


(83,988)


(87,199)

               (Decrease) in accrued compensation and benefits

(39,696)


(28,222)

               Increase (decrease) in accrued loss reserves

6,305


(5,896)

               (Decrease) in other accrued liabilities


(10,905)


(40,013)

               Other



(1,213)


12,300

                    Cash From Operating Activities


170,862


153,454

Cash Flows From Investing Activities:





     Capital expenditures



(45,651)


(34,438)

     Acquisition of businesses, net of cash acquired


(396,951)


(151,180)

     Purchase of marketable securities


(82,054)


(58,853)

     Proceeds from sales of marketable securities


88,572


43,894

     Other




1,338


(1,751)

                    Cash (Used For) Investing Activities


(434,746)


(202,328)

Cash Flows From Financing Activities:





     Additions to long-term and short-term debt


318,994


22,148

     Reductions of long-term and short-term debt


(45,247)


(39,484)

     Cash dividends



(87,832)


(83,871)

     Repurchase of stock



(2,329)


(6,574)

     Other




3,750


6,151

                    Cash Provided By (Used For) Financing Activities

187,336


(101,630)








Effect of Exchange Rate Changes on Cash and 




     Cash Equivalents

7,684


(12,329)








Net Change in Cash and Cash Equivalents

(68,864)


(162,833)








Cash and Cash Equivalents at Beginning of Period

315,968


435,011








Cash and Cash Equivalents at End of Period

$        247,104


$        272,178

 

SOURCE RPM International Inc.



© 1997-2011 RPM International Inc.    |    E-Mail: Info@rpminc.com    |    Legal Notice
2628 Pearl Road - P.O. Box 777 - Medina, Ohio 44258
Phone: 330.273.5090 - Fax: 330.225.8743