Commenting on the second quarter, John G. Morikis, Chairman, President and Chief Executive Officer, said, “The Company posted record results in net sales, gross profit, and profit before taxes in the second quarter, aided by the Valspar
acquisition which continues to build momentum. Consolidated earnings per share expanded by 26.8% percent in the quarter, excluding acquisition-related costs and environmental expense provisions impacts in both years. Underlying demand remained solid across most of our end market
segments during the quarter. At the same time, raw material costs continued to inflate during the quarter at a rate slightly higher than anticipated. We continue to focus on offsetting these
escalating costs by controlling spending and implementing price increases.
"All three operating segments delivered year-over-year improvement in net sales and profit. The Americas Group posted
another strong quarter of volume growth and profit improvement. The Consumer Brands Group is executing well on its
expanded partnership with one of its largest customers. The Performance Coatings Group had sales and volume growth
across most of its businesses and improved their operating margin on good cost control and effective pricing actions. The
Valspar acquisition passed the one year anniversary on June 1, 2018, and both the Consumer Brands and Performance
Coatings Groups are ahead of schedule in integrating their respective businesses.
“For the third quarter, we anticipate our consolidated net sales will increase a mid-to-high single digit percentage
compared to last years third quarter. For the full year 2018, we expect our consolidated net sales will increase by a high teens to low twenty percentage, including incremental Valspar sales of $1.85 billion for the first five months of 2018, compared to the full year 2017. With annual sales at this level, we are updating our full year 2018 diluted net income per share to be in the range of $15.00 to $15.20 per share, including charges of $3.80 to $3.90 per share for acquisition-related costs and $.25 per share for environmental expense provisions. Diluted net income per share in 2017 was $18.67 per share, including a one-time benefit of $7.04 per share from deferred income tax reductions, a one-time charge of $.44 per share for discontinued operations and a charge of $3.00 per share for acquisition-related costs. We are raising our full year 2018 adjusted diluted net income per share to be in the range of $19.05 to $19.35 per share, excluding acquisition costs and environmental expense provisions, compared to $15.07 per share on a comparable basis in 2017. We now expect our 2018 effective tax rate to be in the low twenty percent range."
https://investors.sherwin-williams.com/doc/quartresults_q2_2018
