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RPM Q4 Result Tops Consensus; Warns On Supply Chain Challenges, Margin Pressure

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RPM Q4 Result Tops Consensus; Warns On Supply Chain Challenges, Margin Pressure
  • RPM International Inc. (NYSE: RPM) reported fourth-quarter FY21 net sales growth of 19.6% year-over-year to $1.74 billion, beating the consensus of $1.68 billion.
  • Adjusted EPS improved by 13.3% Y/Y to $1.28, beating the consensus of $1.27.
  • The sales increase was driven by organic growth of 28.4% and foreign currency translation tailwinds of 4.8%.
  • Sales by segments: CPG Segment $629.39 million (+33.2% Y/Y), PCG Segment $283.31 million (+20.5% Y/Y), Consumer Segment $628.86 million (+2.1% Y/Y) and SPG Segment $202.75 million (+49.9% Y/Y).
  • The gross profit increased by 25.2% Y/Y to $693.39 million, and the margin improved by 180 bps to 39.7%.
  • Cash provided by operating activities for the year totaled $766.16 million, compared to $549.92 million a year ago.
  • Cash and cash equivalents were at $246.7 million at the end of May 31, 2021.
  • RPM's consolidated EBIT increased 26.6% Y/Y to $215 million from $169.8 million a year ago.
  • Outlook: The company expects supply chain challenges and margin pressure to persist during the fiscal 2022 first half.
  • It expects Q1 consolidated sales to increase in the low- to mid-single digits, consolidated adjusted EBIT to decrease 25% to 30%, affected by Consumer Group.
  • It expects good performance in Q2, with the exception of the Consumer Group.
  • Price action: RPM shares are trading lower by 2.04% at $86.37 on the last check Monday.
 

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