Third-quarter sales of $1.48 billion, a decrease of 3.0% compared to the prior year
Third-quarter net income of $52.0 million, diluted EPS of $0.40, and EBIT of $62.7 million
Third-quarter adjusted diluted EPS of $0.35 and adjusted EBIT of $78.2 million
Third-quarter cash provided by operating activities of $91.5 million, second highest third-quarter amount in company history
Fiscal 2025 fourth-quarter outlook calls for flat sales and adjusted EBIT to be up in the low-single-digit percentage range

RPM International Inc. (NYSE:RPM), a world leader in specialty coatings, sealants and building materials, today reported financial results for its fiscal 2025 third quarter ended February 28, 2025.

Frank C. Sullivan, RPM chairman and CEO commented, "The unfavorable weather conditions we discussed in early January continued and became more widespread as the third quarter progressed. Unseasonably cold weather in the southern U.S. and wildfires in the west reduced demand in geographies that typically have more construction and outdoor project activity in winter months. In addition to weather, we faced difficult comparisons to the third quarter of fiscal 2024, when adjusted EBIT was up 31%."

He continued, "By prioritizing cash flow over profitability, we generated another quarter of strong cash flow as inventories declined $36 million versus last year. However, this disciplined inventory management, which is a key component of MAP 2025, also lowered production levels, which had a negative impact on fixed cost absorption in our seasonally smallest quarter. This, along with foreign currency headwinds and transitional costs from eight plant consolidations, pressured margins and more than offset MAP 2025 operational improvements."

Third-Quarter 2025 Consolidated Results


Consolidated
	Three Months Ended
$ in 000s except per share data	February 28,		February 29,
		2025		2024	$ Change			% Change
Net Sales	$	1,476,562	$	1,522,982	$	(46,420	)	(3.0	%)
Net Income Attributable to RPM Stockholders		52,034		61,199		(9,165	)	(15.0	%)
Diluted Earnings Per Share (EPS)		0.40		0.47		(0.07	)	(14.9	%)
Income Before Income Taxes (IBT)		40,951		83,581		(42,630	)	(51.0	%)
Earnings Before Interest and Taxes (EBIT)		62,678		93,443		(30,765	)	(32.9	%)
Adjusted EBIT(1)		78,236		110,140		(31,904	)	(29.0	%)
Adjusted Diluted EPS(1)		0.35		0.52		(0.17	)	(32.7	%)

(1) Excludes certain items that are not indicative of RPM's ongoing operations. See tables below titled Supplemental Segment Information and Reconciliation of Reported to Adjusted Amounts for details.

The third-quarter sales decline was primarily driven by unfavorable weather conditions, which reduced construction activity, and sluggish demand from specialty OEM manufacturing end markets. Foreign currency translation was also a headwind to sales.

Geographically, sales declines in North America were driven by adverse weather. In Europe, foreign currency translation offset growth generated by sales and marketing initiatives. Africa / Middle East declined slightly as it faced challenging comparisons to the prior year when sales increased 22.9%. The decline in Latin America and Asia / Pacific was driven by foreign currency translation headwinds and challenging comparisons to the prior year when sales increased 13.5% and 5.0% respectively.

Sales included a 1.8% organic decline, 0.5% growth from acquisitions net of divestitures, and a 1.7% decline from foreign currency translation.

The adjusted EBIT decline was driven by negative fixed-cost absorption from lower production levels, including disciplined inventory management to improve cash flow; foreign currency headwinds; and transitory costs related to MAP 2025 plant consolidations and start-ups. Corporate / other expenses also increased during the quarter, driven by higher M&A and compensation expenses. Additionally, comparisons to the prior year were challenging as adjusted EBIT increased 31.3% in the third quarter of fiscal 2024. MAP 2025 improvements and SG&A streamlining actions helped to offset the adjusted EBIT decline.

The adjusted diluted EPS decline was driven by the reduction in adjusted EBIT.

Third-Quarter 2025 Segment Sales and Earnings


Construction Products Group
	Three Months Ended
$ in 000s	February 28,		February 29,
		2025		2024	$ Change			% Change
Net Sales	$	473,408	$	495,753	$	(22,345	)	(4.5	%)
Income Before Income Taxes		9,923		15,060		(5,137	)	(34.1	%)
EBIT		10,465		15,728		(5,263	)	(33.5	%)
Adjusted EBIT(1)		12,730		20,487		(7,757	)	(37.9	%)

(1) Excludes certain items that are not indicative of RPM's ongoing operations. See table below titled Supplemental Segment Information for details.

CPG sales declined as unfavorable weather conditions limited construction and restoration activity, particularly in the southern and western U.S. Foreign currency translation was also a headwind to sales.

Sales included a 1.7% organic decline, 0.2% growth from acquisitions, and a 3.0% decline from foreign currency translation.

Compared to the third quarter of fiscal 2024 when adjusted EBIT increased 69.8%, adjusted EBIT declined as lower volumes reduced fixed-cost absorption and, as part of MAP 2025, two different plant consolidations resulted in temporary inefficiencies as production was being transferred. These headwinds were partially offset by SG&A streamlining actions.


Performance Coatings Group
	Three Months Ended
$ in 000s	February 28,		February 29,
		2025		2024	$ Change			% Change
Net Sales	$	340,625	$	343,536	$	(2,911	)	(0.8	%)
Income Before Income Taxes		42,818		47,039		(4,221	)	(9.0	%)
EBIT		42,072		45,835		(3,763	)	(8.2	%)
Adjusted EBIT(1)		43,789		47,092		(3,303	)	(7.0	%)

(1) Excludes certain items that are not indicative of RPM's ongoing operations. See table below titled Supplemental Segment Information for details.

PCG organic sales declined slightly compared to strong growth in the prior year when organic sales increased 9.2%. Fiberglass reinforced plastic structures grew double digits, driven by demand from data centers, while other businesses declined modestly as they faced challenging prior-year comparisons.

Sales included a 0.3% organic decline, a 1.1% increase from acquisitions net of divestitures, and a 1.6% decline from foreign currency translation.

Compared to the third quarter of fiscal 2024 when adjusted EBIT increased 45.1%, adjusted EBIT declined as lower fixed-cost utilization from reduced volumes, plant start-up costs, and negative foreign currency translation more than offset MAP 2025 improvements.


Specialty Products Group
	Three Months Ended
$ in 000s	February 28,		February 29,
		2025		2024	$ Change			% Change
Net Sales	$	158,737	$	176,494	$	(17,757	)	(10.1	%)
Income Before Income Taxes		5,257		9,803		(4,546	)	(46.4	%)
EBIT		5,364		9,713		(4,349	)	(44.8	%)
Adjusted EBIT(1)		6,716		12,101		(5,385	)	(44.5	%)

(1) Excludes certain items that are not indicative of RPM's ongoing operations. See table below titled Supplemental Segment Information for details.

SPG's sales decline was primarily due to lower demand in specialty OEM end markets and the disaster restoration business, which was impacted by reduced remediation activity. This was partially offset by growth in the food coatings and additives business, which benefited from a prior acquisition.

Sales included a 10.9% organic decline, 1.4% growth from an acquisition, and a 0.6% decline from foreign currency translation.

The adjusted EBIT decline was driven by lower fixed-cost utilization from reduced volumes, as well as additional expenses at the new resin and innovation centers of excellence that SPG manages on behalf of all RPM segments. MAP 2025 benefits and SG&A streamlining actions partially offset these earnings headwinds.


Consumer Group
	Three Months Ended
$ in 000s	February 28,		February 29,
		2025		2024	$ Change			% Change
Net Sales	$	503,792	$	507,199	$	(3,407	)	(0.7	%)
Income Before Income Taxes		47,998		65,159		(17,161	)	(26.3	%)
EBIT		48,074		64,159		(16,085	)	(25.1	%)
Adjusted EBIT(1)		54,184		64,994		(10,810	)	(16.6	%)

(1) Excludes certain items that are not indicative of RPM's ongoing operations. See table below titled Supplemental Segment Information for details.

The Consumer Group's organic sales grew modestly, driven by new product introductions and market share gains. This organic growth was offset by foreign currency translation headwinds.

Sales included 0.3% organic growth and a 1.0% decline from foreign currency translation.

Adjusted EBIT declined as MAP 2025 working capital efficiency initiatives resulted in lower production and fixed-cost utilization. The segment also experienced raw material inflation and challenging comparisons to the prior year, when adjusted EBIT grew 34.6%.

Cash Flow and Financial Position

During the first nine months of fiscal 2025:

Cash provided by operating activities was $619.0 million, driven by working capital efficiency enabled by MAP 2025 initiatives. This compares to $941.1 million in the prior-year period when there was a larger working capital release as supply chains normalized.
Operating working capital as a percentage of sales improved by 70 basis points to 20.7% compared to 21.4% in the prior-year period, driven by MAP 2025 working capital efficiency initiatives.
Capital expenditures were $158.9 million compared to $138.1 million during the prior-year period with the increase driven by investments in shared RPM centers of excellence, including a newly opened production facility and distribution center, both in Belgium, as well as a new production facility in India and MAP 2025-enabled plant consolidations.
The company returned $242.6 million to stockholders through cash dividends and share repurchases.

As of February 28, 2025:

Total debt was $2.10 billion compared to $2.19 billion a year ago, with the $0.09 billion reduction driven by improved cash flow being used to repay higher-cost debt.
Total liquidity, including cash and committed revolving credit facilities, was $1.21 billion, compared to $1.29 billion a year ago.

Definitive Agreement to Acquire The Pink Stuff

As previously announced, the company entered into a definitive agreement to acquire the Star Brands Group, the parent company of The Pink Stuff, a globally recognized leader in household cleaning products. Upon closing, The Pink Stuff will become part of the Consumer Group's Rust-Oleum cleaners business and expand Rust-Oleum's product offerings as well as its distribution channels including e-commerce, grocery and drug stores.

In calendar year 2024, The Pink Stuff generated approximately £150 million in sales, and the transaction is expected to close late in the fourth quarter of fiscal 2025 or early in the first quarter of fiscal 2026, subject to customary closing conditions.

Business Outlook

Sullivan added, "As we look toward the fourth quarter, macroeconomic conditions are challenging, but we are seeing pockets of positive momentum and are leveraging our focus on repair and maintenance in both construction and consumer end markets. As demonstrated in prior economic cycles, the ability of our products and services to extend asset life becomes even more attractive to end users when budgets are tight. Additionally, RPM associates continue to implement initiatives to outgrow our markets, including new product introductions, and achieve efficiency improvements. We anticipate that this will result in modest earnings growth in the fourth quarter with the financial benefits of MAP 2025 becoming even more evident when sustained volume growth returns."

"While the tariff situation is dynamic, most of our businesses have limited cross-border trade for raw material procurement and finished good sales. This helps mitigate the effects of tariffs; however, we are not immune, and we assume that raw material inflation will increase from low-single-digits to mid-single digits as a result of currently known tariffs. Our guidance does not assume any impact from the acquisition of The Pink Stuff since it is expected to close late in the fourth fiscal quarter of 2025 or early in the first quarter of fiscal 2026," Sullivan concluded.

The company expects the following in the fiscal 2025 fourth quarter:

Consolidated sales to be flat compared to prior-year results.
CPG sales to be flat compared to prior-year record results.
PCG sales to increase in the mid-single-digit percentage range compared to prior-year results.
SPG sales to decline in the low-single-digit percentage range compared to prior-year results.
Consumer Group sales to decline in the low-single-digit percentage range compared to prior-year results.
Consolidated adjusted EBIT to be up in the low-single-digit percentage range compared to prior-year record results.

Earnings Webcast and Conference Call Information

Management will host a conference call to discuss these results beginning at 10:00 a.m. ET today. The call can be accessed via webcast at www.RPMinc.com/Investors/Presentations-Webcasts or by dialing 1-844-481-2915 or 1-412-317-0708 for international callers and asking to join the RPM International call. 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 April 8, 2025, until April 15, 2025. The replay can be accessed by dialing 1-877-344-7529 or 1-412-317-0088 for international callers. The access code is 4767461. The call also will be available for replay and as a written transcript via the RPM website at www.RPMinc.com.

About RPM

RPM International Inc. owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services. The company operates across four reportable segments: consumer, construction products, performance coatings and specialty products. RPM has a diverse portfolio of market-leading brands, including Rust-Oleum, DAP, Zinsser, Varathane, DayGlo, Legend Brands, Stonhard, Carboline, Tremco and Dryvit. From homes and workplaces to infrastructure and precious landmarks, RPM's brands are trusted by consumers and professionals alike to help build a better world. The company is ranked on the Fortune 500^®and employs approximately 17,200 individuals worldwide. Visit www.RPMinc.com to learn more.

For more information, contact Matt Schlarb, Vice President – Investor Relations & Sustainability, at 330-220-6064 or mschlarb@rpminc.com.

From Fortune ©2024 Fortune Media IP Limited. All rights reserved. Used under license. Fortune and Fortune 500 are registered trademarks of Fortune Media IP Limited and are used under license. Fortune and Fortune Media IP Limited are not affiliated with, and do not endorse the products or services of RPM International Inc.

Use of Non-GAAP Financial Information

To supplement the financial information presented in accordance with Generally Accepted Accounting Principles in the United States ("GAAP") in this earnings release, we use EBIT, adjusted EBIT and adjusted earnings per share, which are all non-GAAP financial measures. EBIT is defined as earnings (loss) before interest and taxes, with adjusted EBIT and adjusted earnings per share provided for the purpose of adjusting for one-off items impacting revenues and/or expenses that are not considered by management to be indicative of ongoing operations. 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 income (expense), net is essentially related to corporate functions, 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, income before income taxes as determined in accordance with GAAP, since EBIT omits the impact of interest and investment income or expense in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness. 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. See the financial statement section of this earnings release for a reconciliation of EBIT and adjusted EBIT to income before income taxes, and adjusted earnings per share to earnings per share. We have not provided a reconciliation of our fourth-quarter fiscal 2025 or full-year fiscal 2025 adjusted EBIT guidance because material terms that impact such measure are not in our control and/or cannot be reasonably predicted, and therefore a reconciliation of such measure is not available without unreasonable effort.

Use of Key Performance Indicator Metric

To supplement the financial information presented in accordance with Generally Accepted Accounting Principles in the United States ("GAAP") in this earnings release, we use the key performance indicator ("KPI") metric of operating working capital as a percentage of sales, which is defined as the net amount of net trade accounts receivable plus inventories less accounts payable, all divided by trailing twelve-month net sales. We evaluate the working capital investment needs of our business to support current operations as well as future changes in business activity. For that reason, we believe operating working capital as a percentage of sales is also useful to investors as a metric in their investment decisions.

Forward-Looking Statements

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 and regional markets and general economic conditions, including uncertainties surrounding the volatility in financial markets, the availability of capital and the viability of banks and other financial institutions; (b) the prices, supply and availability of raw materials, including assorted pigments, resins, solvents, and other natural gas- and oil-based materials; packaging, including plastic and metal containers; and transportation services, including fuel surcharges; (c) continued growth in demand for our products; (d) legal, environmental and litigation risks inherent in our 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) changes in global trade policies, including the adoption or expansion of tariffs and trade barriers; (h) 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; (i) risks and uncertainties associated with our ongoing acquisition and divestiture activities; (j) the timing of and the realization of anticipated cost savings from restructuring initiatives, the ability to identify additional cost savings opportunities, and the risks of failing to meet any other objectives of our improvement plans; (k) risks related to the adequacy of our contingent liability reserves; (l) risks relating to a public health crisis similar to the Covid pandemic; (m) risks related to acts of war similar to the Russian invasion of Ukraine; (n) risks related to the transition or physical impacts of climate change and other natural disasters or meeting sustainability-related voluntary goals or regulatory requirements; (o) risks related to our or our third parties' use of technology including artificial intelligence, data breaches and data privacy violations; (p) the shift to remote work and online purchasing and the impact that has on residential and commercial real estate construction; and (q) other risks detailed in our filings with the Securities and Exchange Commission, including the risk factors set forth in our Form 10-K for the year ended May 31, 2024, 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 filing date of this press release.


CONSOLIDATED STATEMENTS OF INCOME
IN THOUSANDS, EXCEPT PER SHARE DATA
(Unaudited)

	Three Months Ended						Nine Months Ended
	February 28,			February 29,			February 28,			February 29,
		2025			2024			2025			2024

Net Sales	$	1,476,562		$	1,522,982		$	5,290,669		$	5,327,114
Cost of Sales		909,072			915,818			3,121,962			3,143,105
Gross Profit		567,490			607,164			2,168,707			2,184,009
Selling, General & Administrative Expenses		501,710			504,760			1,557,692			1,559,081
Restructuring Expense		3,456			6,359			18,215			14,096
Interest Expense		22,993			28,527			70,604			90,693
Investment (Income), Net		(1,266	)		(18,665	)		(20,818	)		(36,393	)
Other (Income) Expense, Net		(354	)		2,602			(1,370	)		7,973
Income Before Income Taxes		40,951			83,581			544,384			548,559
(Benefit) Provision for Income Taxes		(11,363	)		22,103			80,066			139,953
Net Income		52,314			61,478			464,318			408,606
Less: Net Income Attributable to Noncontrolling Interests		280			279			1,388			820
Net Income Attributable to RPM International Inc. Stockholders	$	52,034		$	61,199		$	462,930		$	407,786

Earnings per share of common stock attributable to
RPM International Inc. Stockholders:
Basic	$	0.41		$	0.48		$	3.61		$	3.18
Diluted	$	0.40		$	0.47		$	3.59		$	3.16

Average shares of common stock outstanding - basic		127,536			127,781			127,628			127,803
Average shares of common stock outstanding - diluted		128,154			128,334			128,315			128,315

SUPPLEMENTAL SEGMENT INFORMATION
IN THOUSANDS
(Unaudited)

		Three Months Ended						Nine Months Ended
		February 28,			February 29,			February 28,			February 29,
			2025			2024			2025			2024
Net Sales:
	CPG Segment	$	473,408		$	495,753		$	1,957,515		$	1,940,292
	PCG Segment		340,625			343,536			1,092,487			1,096,905
	SPG Segment		158,737			176,494			518,154			534,427
	Consumer Segment		503,792			507,199			1,722,513			1,755,490
	Total	$	1,476,562		$	1,522,982		$	5,290,669		$	5,327,114

Income Before Income Taxes:
	CPG Segment
	Income Before Income Taxes (a)	$	9,923		$	15,060		$	272,573		$	253,910
	Interest (Expense), Net (b)		(542	)		(668	)		(1,906	)		(4,619	)
	EBIT (c)		10,465			15,728			274,479			258,529
	MAP initiatives (d)		2,006			4,759			6,456			6,168
	Acquisition-related costs (e)		259			-			259			-
	Adjusted EBIT	$	12,730		$	20,487		$	281,194		$	264,697
	PCG Segment
	Income Before Income Taxes (a)	$	42,818		$	47,039		$	170,883		$	153,362
	Interest Income, Net (b)		746			1,204			1,755			3,753
	EBIT (c)		42,072			45,835			169,128			149,609
	MAP initiatives (d)		1,220			1,257			3,712			17,404
	Acquisition-related costs (e)		497			-			497			-
	Adjusted EBIT	$	43,789		$	47,092		$	173,337		$	167,013
	SPG Segment
	Income Before Income Taxes (a)	$	5,257		$	9,803		$	37,154		$	36,345
	Interest (Expense) Income, Net (b)		(107	)		90			(313	)		293
	EBIT (c)		5,364			9,713			37,467			36,052
	MAP initiatives (d)		1,070			2,471			6,941			8,116
	(Gain) on sale of a business (f)		-			(83	)		(237	)		(1,206	)
	Legal contingency adjustment on a divested business (h)		282			-			282			3,953
	Adjusted EBIT	$	6,716		$	12,101		$	44,453		$	46,915
	Consumer Segment
	Income Before Income Taxes (a)	$	47,998		$	65,159		$	244,459		$	295,054
	Interest (Expense) Income, Net (b)		(76	)		1,000			(456	)		2,619
	EBIT (c)		48,074			64,159			244,915			292,435
	MAP initiatives (d)		6,110			835			22,125			1,249
	Business interruption insurance recovery (g)		-			-			-			(11,128	)
	Adjusted EBIT	$	54,184		$	64,994		$	267,040		$	282,556
	Corporate/Other
	(Loss) Before Income Taxes (a)	$	(65,045	)	$	(53,480	)	$	(180,685	)	$	(190,112	)
	Interest (Expense), Net (b)		(21,748	)		(11,488	)		(48,866	)		(56,346	)
	EBIT (c)		(43,297	)		(41,992	)		(131,819	)		(133,766	)
	MAP initiatives (d)		4,114			7,458			27,449			28,632
	Adjusted EBIT	$	(39,183	)	$	(34,534	)	$	(104,370	)	$	(105,134	)
	TOTAL CONSOLIDATED
	Income Before Income Taxes (a)	$	40,951		$	83,581		$	544,384		$	548,559
	Interest (Expense)		(22,993	)		(28,527	)		(70,604	)		(90,693	)
	Investment Income, Net		1,266			18,665			20,818			36,393
	EBIT (c)		62,678			93,443			594,170			602,859
	MAP initiatives (d)		14,520			16,780			66,683			61,569
	Acquisition-related costs (e)		756			-			756			-
	(Gain) on sale of a business (f)		-			(83	)		(237	)		(1,206	)
	Business interruption insurance recovery (g)		-			-			-			(11,128	)
	Legal contingency adjustment on a divested business (h)		282			-			282			3,953
	Adjusted EBIT	$	78,236		$	110,140		$	661,654		$	656,047

(a)	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 and Adjusted EBIT.
(b)	Interest Income (Expense), Net includes the combination of Interest Income (Expense) and Investment Income (Expense), Net.
(c)	EBIT is defined as earnings (loss) before interest and taxes, with Adjusted EBIT provided for the purpose of adjusting for items impacting earnings that are not considered by management to be indicative of ongoing operations. We evaluate the profit performance of our segments based on income before income taxes, but also look to EBIT, or adjusted EBIT, as a performance evaluation measure because Interest Income (Expense), Net is essentially related to corporate functions, 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, income before income taxes as determined in accordance with GAAP, since EBIT omits the impact of interest and investment income or expense in determining operating performance, which represent items necessary to our continued operations, given our level of indebtedness. 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.




(d)	Reflects restructuring and other charges, which have been incurred in relation to our Margin Acceleration Plan ("MAP to Growth") and our Margin Achievement Plan ("MAP 2025"), together MAP initiatives, as follows: - Restructuring and other related expense, net: Includes charges incurred related to headcount reductions, facility closures and asset impairments recorded in "Restructuring Expense" on the Consolidated Statements of Income. Restructuring Expense totaled $3.5 million and $6.4 million for the quarters ended February 28, 2025 and February 29, 2024 respectively, and $18.2 million and $14.1 million for the nine months ended February 28, 2025 and February 29, 2024 respectively. Other related expenses include inventory write-offs in connection with restructuring activities recorded in "Cost of Sales", accelerated depreciation and amortization recorded within "Cost of Sales" or "Selling, General, & Administrative Expenses ("SG&A")" depending on the nature of the expense as well as the prior year loss on sale and increase in our allowance for doubtful accounts resulting from of the divestiture of the non-core Universal Sealant's Bridgecare service business within our PCG segment. - Exited product lines: Sale of inventory that had previously been reserved for as a result of prior product line rationalization initiatives at PCG partially offset by inventory write-offs related to the discontinuation of certain product lines within our SPG segment. These amounts resulted from ongoing product line rationalization efforts in connection with our MAP initiatives and were recorded in "Cost of Sales". - ERP consolidation plan: Includes expenses incurred as a result of our stated goals to consolidate over 75 ERP systems across the organization to four ERP platforms, one per segment, as part of our overall MAP strategy as well as costs incurred for other decision support tools to facilitate our commercial initiatives related to MAP 2025 which have been incurred in all segments, including Corporate/Other, and have been recorded within "SG&A". - Professional fees: Includes expenses incurred to consolidate accounting locations, costs incurred to implement technologies and processes to drive improved sales mix and salesforce effectiveness and cost incurred to implement new global manufacturing methodologies with the goal of improving operating efficiency incurred within all of our segments and recorded within "SG&A". All of this spend is in support of stated MAP goals with the most significant expense incurred within Corporate/Other. Included below is a reconciliation of the TOTAL CONSOLIDATED MAP initiatives.
		Three Months Ended						Nine Months Ended
		February 28,			February 29,			February 28,			February 29,
			2025			2024			2025			2024
	Restructuring and other related expense, net	$	7,473		$	7,940		$	29,526		$	26,599
	Exited product line		-			-			-			(248	)
	ERP consolidation plan		2,570			2,169			11,519			8,731
	Professional fees		4,477			6,671			25,638			26,487
	MAP initiatives	$	14,520		$	16,780		$	66,683		$	61,569

(e)	Acquisition costs reflect amounts included in "Cost of Sales" for inventory step-ups.
(f)	Reflects gains associated with post-closing adjustments for the sale of the non-core furniture warranty business in the SPG segment in fiscal 2023 which have been recorded in "SG&A".
(g)	Business interruption insurance recovery at our Consumer segment related to lost sales and incremental costs incurred during fiscal 2021 and 2022 as a result of an explosion at the plant of a significant alkyd resin supplier, which has been recorded in "SG&A".
(h)	Represents incremental expense related to an adverse legal ruling from a case associated with a business that was divested in FY23.

SUPPLEMENTAL SEGMENT INFORMATION
RECONCILIATION OF "REPORTED" TO "ADJUSTED" AMOUNTS
(Unaudited)

		Three Months Ended						Nine Months Ended
		February 28,			February 29,			February 28,			February 29,
			2025			2024			2025			2024

	Reconciliation of Reported Earnings per Diluted Share to Adjusted Earnings per Diluted Share (All amounts presented after-tax):
	Reported Earnings per Diluted Share	$	0.40		$	0.47		$	3.59		$	3.16
	MAP initiatives (d)		0.10			0.10			0.39			0.37
	(Gain) on sales of a business (f)		-			-			-			(0.01	)
	Business interruption insurance recovery (g)		-			-			-			(0.07	)
	Legal contingency adjustment on a divested business (h)		-			-			-			0.02
	Investment returns (i)		0.02			(0.07	)		(0.02	)		(0.11	)
	Income tax adjustments (j)		(0.17	)		0.02			(0.38	)		0.02
	Adjusted Earnings per Diluted Share (k)	$	0.35		$	0.52		$	3.58		$	3.38

(d)	Reflects restructuring and other charges, which have been incurred in relation to our Margin Acceleration Plan ("MAP to Growth") and our Margin Achievement Plan ("MAP 2025"), together MAP initiatives, as follows: - Restructuring and other related expense, net: Includes charges incurred related to headcount reductions, facility closures and asset impairments recorded in "Restructuring Expense" on the Consolidated Statements of Income. Restructuring Expense totaled $3.5 million and $6.4 million for the quarters ended February 28, 2025 and February 29, 2024 respectively, and $18.2 million and $14.1 million for the nine months ended February 28, 2025 and February 29, 2024 respectively. Other related expenses include inventory write-offs in connection with restructuring activities recorded in "Cost of Sales", accelerated depreciation and amortization recorded within "Cost of Sales" or "Selling, General, & Administrative Expenses ("SG&A")" depending on the nature of the expense as well as the prior year loss on sale and increase in our allowance for doubtful accounts resulting from of the divestiture of the non-core Universal Sealant's Bridgecare service business within our PCG segment. - Exited product lines: Sale of inventory that had previously been reserved for as a result of prior product line rationalization initiatives at PCG partially offset by inventory write-offs related to the discontinuation of certain product lines within our SPG segment. These amounts resulted from ongoing product line rationalization efforts in connection with our MAP initiatives. - ERP consolidation plan: Includes expenses incurred as a result of our stated goals to consolidate over 75 ERP systems across the organization to four ERP platforms, one per segment, as part of our overall MAP strategy as well as costs incurred for other decision support tools to facilitate our commercial initiatives related to MAP 2025 which have been incurred in all segments, including Corporate/Other, and have been recorded within "SG&A". - Professional fees: Includes expenses incurred to consolidate accounting locations, costs incurred to implement technologies and processes to drive improved sales mix and salesforce effectiveness and cost incurred to implement new global manufacturing methodologies with the goal of improving operating efficiency incurred within all of our segments and recorded within "SG&A". All of this spend is in support of stated MAP goals with the most significant expense incurred within our Corporate/Other.
(f)	Reflects gains associated with post-closing adjustments for the sale of the non-core furniture warranty business in the SPG segment in fiscal 2023 which have been recorded in "SG&A".
(g)	Business interruption insurance recovery at our Consumer segment related to lost sales and incremental costs incurred during fiscal 2021 and 2022 as a result of an explosion at the plant of a significant alkyd resin supplier, which has been recorded in "SG&A".
(h)	Represents incremental expense related to an adverse legal ruling from a case associated with a business that was divested in FY23.
(i)	Investment returns include realized net gains and losses on sales of investments and unrealized net gains and losses on equity securities, which are adjusted due to their inherent volatility. Management does not consider these gains and losses, which cannot be predicted with any level of certainty, to be reflective of the Company's core business operations.
(j)	The current year adjustment relates to U.S. foreign tax credits recognized as a result of global cash redeployment and debt optimization projects, as well as other adjustments to our net deferred tax asset related to U.S. foreign tax credit carryforwards resulting from our reassessment of income tax positions following recent developments in U.S. income tax case law. For fiscal year 2024, the adjustment relates to income taxes associated with the FY23 sale of the furniture warranty business.
(k)	Adjusted Diluted EPS is provided for the purpose of adjusting diluted earnings per share for items impacting earnings that are not considered by management to be indicative of ongoing operations.

CONSOLIDATED BALANCE SHEETS
IN THOUSANDS
(Unaudited)

		February 28, 2025			February 29, 2024			May 31, 2024
Assets
Current Assets
	Cash and cash equivalents	$	241,895		$	248,905		$	237,379
	Trade accounts receivable		1,153,993			1,130,409			1,468,208
	Allowance for doubtful accounts		(48,908	)		(58,377	)		(48,763	)
	Net trade accounts receivable		1,105,085			1,072,032			1,419,445
	Inventories		1,044,776			1,080,698			956,465
	Prepaid expenses and other current assets		367,197			344,948			282,059
	Total current assets		2,758,953			2,746,583			2,895,348
Property, Plant and Equipment, at Cost			2,629,810			2,459,045			2,515,847
	Allowance for depreciation		(1,236,755	)		(1,172,164	)		(1,184,784	)
	Property, plant and equipment, net		1,393,055			1,286,881			1,331,063
Other Assets
	Goodwill		1,358,632			1,309,744			1,308,911
	Other intangible assets, net of amortization		510,385			523,677			512,972
	Operating lease right-of-use assets		346,221			326,998			331,555
	Deferred income taxes		34,368			17,517			33,522
	Other		217,961			171,004			173,172
	Total other assets		2,467,567			2,348,940			2,360,132
Total Assets		$	6,619,575		$	6,382,404		$	6,586,543
Liabilities and Stockholders' Equity
Current Liabilities
	Accounts payable	$	640,446		$	577,861		$	649,650
	Current portion of long-term debt		7,057			6,225			136,213
	Accrued compensation and benefits		215,643			237,951			297,249
	Accrued losses		33,568			30,897			32,518
	Other accrued liabilities		346,747			349,015			350,434
	Total current liabilities		1,243,461			1,201,949			1,466,064
Long-Term Liabilities
	Long-term debt, less current maturities		2,090,182			2,187,140			1,990,935
	Operating lease liabilities		296,861			278,009			281,281
	Other long-term liabilities		224,270			268,940			214,816
	Deferred income taxes		89,019			98,153			121,222
	Total long-term liabilities		2,700,332			2,832,242			2,608,254
	Total liabilities		3,943,793			4,034,191			4,074,318
Stockholders' Equity
	Preferred stock; none issued		-			-			-
	Common stock (outstanding 128,423; 128,763; 128,629)		1,284			1,288			1,286
	Paid-in capital		1,172,247			1,144,282			1,150,751
	Treasury stock, at cost		(934,470	)		(844,345	)		(864,502	)
	Accumulated other comprehensive (loss)		(598,290	)		(593,729	)		(537,290	)
	Retained earnings		3,033,505			2,639,310			2,760,639
	Total RPM International Inc. stockholders' equity		2,674,276			2,346,806			2,510,884
	Noncontrolling interest		1,506			1,407			1,341
	Total equity		2,675,782			2,348,213			2,512,225
Total Liabilities and Stockholders' Equity		$	6,619,575		$	6,382,404		$	6,586,543

CONSOLIDATED STATEMENTS OF CASH FLOWS
IN THOUSANDS
(Unaudited)
	Nine Months Ended
	February 28,			February 29,
		2025			2024

Cash Flows From Operating Activities:
Net income	$	464,318		$	408,606
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization		140,092			126,656
Deferred income taxes		(47,012	)		2,190
Stock-based compensation expense		21,494			19,457
Net (gain) on marketable securities		(5,125	)		(16,496	)
Net loss on sales of assets and businesses		-			2,576
Other		(635	)		1,244
Changes in assets and liabilities, net of effect
from purchases and sales of businesses:
Decrease in receivables		302,429			430,512
(Increase) decrease in inventory		(96,539	)		55,118
(Increase) decrease in prepaid expenses and other		(35,973	)		30,349
current and long-term assets
Increase (decrease) in accounts payable		5,174			(83,960	)
(Decrease) in accrued compensation and benefits		(82,118	)		(20,049	)
Increase in accrued losses		1,383			4,366
(Decrease) in other accrued liabilities		(48,476	)		(19,424	)
Cash Provided By Operating Activities		619,012			941,145
Cash Flows From Investing Activities:
Capital expenditures		(158,924	)		(138,093	)
Acquisition of businesses, net of cash acquired		(127,325	)		(15,549	)
Purchase of marketable securities		(77,640	)		(30,591	)
Proceeds from sales of marketable securities		59,460			22,130
Proceeds from sales of assets and businesses, net		-			5,749
Other		(1,236	)		2,485
Cash (Used For) Investing Activities		(305,665	)		(153,869	)
Cash Flows From Financing Activities:
Additions to long-term and short-term debt		104,047			-
Reductions of long-term and short-term debt		(136,379	)		(516,086	)
Cash dividends		(190,064	)		(172,601	)
Repurchases of common stock		(52,499	)		(37,488	)
Shares of common stock returned for taxes		(17,140	)		(21,949	)
Payment of acquisition-related contingent consideration		(1,122	)		(1,082	)
Other		(1,014	)		(1,586	)
Cash (Used For) Financing Activities		(294,171	)		(750,792	)

Effect of Exchange Rate Changes on Cash and
Cash Equivalents		(14,660	)		(3,366	)

Net Change in Cash and Cash Equivalents		4,516			33,118

Cash and Cash Equivalents at Beginning of Period		237,379			215,787

Cash and Cash Equivalents at End of Period	$	241,895		$	248,905

View source version on businesswire.com: https://www.businesswire.com/news/home/20250408828634/en/

For more information, contact Matt Schlarb, Vice President – Investor Relations & Sustainability, at 330-220-6064 or mschlarb@rpminc.com

RPM Reports Fiscal 2025 Third-Quarter Results