RPM Tops Q3 Views

RPM International Inc. RPM reported stronger-than-expected results for the third quarter on Wednesday. The Medina, Ohio-based company posted a quarterly loss of $57.3 million, or $0.44 per share, versus a year-ago profit of $16.2 million, or $0.12 per share. The latest quarter results included a net charge of $83.5 million for the tax accrual. Excluding items, the company earned $0.20 per share. Its net sales gained 9.6% to $946.4 million versus $863.4 million. However, analysts were expecting earnings of $0.14 per share on revenue of $936.7 million. Industrial segment sales climbed 10.6% to $620.0 million versus $560.5 million, while organic sales surged 5.5% y/y in the latest quarter. Sales in its consumer segment rose 7.8% to $326.4 million from $302.9 million, while organic sales jumped 9.1% y/y. Consolidated earnings before interest and taxes declined 7.9% to $34.2 million, versus $37.2 million. During the quarter, RPM repurchased 550,000 shares of its stock in the open market with a cost of around $26 million. "For the fourth quarter of our fiscal year, we expect our consumer segment to benefit from continued innovation and consistent growth in consumer DIY spending. In our industrial segment, we do not see a near-term turnaround in the European economies and expect a very strong U.S. dollar to continue negatively impacting results," stated Frank C. Sullivan, RPM chairman and chief executive officer. "Our businesses serving the energy sector are beginning to see the effects of a slowdown in production due to the decline in oil prices. However, we do expect continued positive momentum in our businesses serving the U.S. commercial construction markets." For fiscal 2015, RPM projects earnings to be at the upper end of its earlier outlook of $2.25 to $2.30 per share. The average estimate among 7 Estimize users was for earnings of $0.13 per share and revenue of $931.48 million for the third quarter. RPM shares gained 1.15% to close at $48.25 yesterday.