NAVIGATION

Masco Corporation Reports Second Quarter 2019 Results

July 25, 2019

Key Results

  • Sales decreased 1 percent to $2.3 billion; in local currency, sales matched prior year
  • Operating profit for the quarter increased 9 percent to $392 million; adjusted operating profit increased 5 percent to $399 million
  • Earnings per share increased 21 percent to $0.82 per share; adjusted earnings per share increased 16 percent to $0.88 per share
  • Updating 2019 anticipated earnings per share to be in the range of $2.51 - $2.61 per share, and on an adjusted basis, to be in the range of $2.62 - $2.72 per share, compared to a previous range of $2.60 - $2.80
  • Board announces intent to increase annual dividend by $.06 per share to $.54 per share, beginning in the fourth quarter

 

LIVONIA, Mich.--(BUSINESS WIRE)-- Masco Corporation (NYSE: MAS), one of the world’s leading manufacturers of branded home improvement and building products, reported its second quarter results.

“We delivered operating profit growth and margin expansion across all segments in the quarter,” said Masco President and CEO, Keith Allman. “This performance was achieved through disciplined pricing actions and cost control, which more than offset lower volumes. We continued our focus on creating shareholder value and returned $202 million to shareholders through share repurchases and dividends during the quarter.”

2019 Second Quarter Commentary

  • On a reported basis, compared to second quarter 2018:
    • Net sales decreased 1 percent to $2.3 billion; in local currency, net sales matched prior year
    • In local currency, North American sales increased 1 percent and international sales decreased 4 percent
    • Gross margins increased 170 basis points to 34.4 percent from 32.7 percent
    • Operating profit increased 9 percent to $392 million
    • Operating margins increased 160 basis points to 17.2 percent from 15.6 percent
    • Net income increased to $0.82 per share, compared to $0.68 per share
  • Compared to second quarter 2018, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 25 percent, were as follows:
    • Gross margins increased 90 basis points to 34.5 percent compared to 33.6 percent
    • Operating profit increased 5 percent to $399 million from $380 million
    • Operating margins increased 100 basis points to 17.5 percent compared to 16.5 percent
    • Net income increased to $0.88 per share, compared to $0.76 per share
  • Liquidity at the end of the second quarter was $325 million
  • Repurchased 4.3 million shares in the quarter

2019 Second Quarter Operating Segment Results

  • Plumbing Products’ net sales decreased 2 percent (flat excluding the impact of foreign currency) due to lower volume and currency, partially offset by pricing
  • Decorative Architectural Products’ net sales increased 3 percent due to growth in paints and other coating products
  • Cabinetry Products’ net sales decreased 6 percent due to lower volume, partially offset by pricing
  • Windows and Other Specialty Products’ net sales decreased 3 percent due to lower volume, partially offset by favorable mix in North America and pricing

“We are pleased with how we have navigated through a dynamic first half of 2019, and believe we are well positioned to execute on our plans in the second half of the year,” said Allman. “We anticipate adjusted earnings per share to be in the range of $2.62 - $2.72. Additionally, our Board demonstrated confidence in our future by announcing its intention to raise our annual dividend 13% to $0.54 per share beginning in the fourth quarter.”

About Masco

Headquartered in Livonia, Michigan, Masco Corporation is a global leader in the design, manufacture and distribution of branded home improvement and building products. Our portfolio of industry-leading brands includes Behr® paint; Delta® and Hansgrohe® faucets, bath and shower fixtures; KraftMaid® and Merillat® cabinets; Milgard® windows and doors; Kichler® decorative and outdoor lighting; and HotSpring® spas. We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders. For more information about Masco Corporation, visit www.masco.com.

The 2019 second quarter supplemental material, including a presentation in PDF format, is available on Masco’s website at www.masco.com.

Conference Call Details

A conference call regarding items contained in this release is scheduled for Thursday, July 25, 2019 at 8:00 a.m. ET. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (855) 226-2726 (855-22MASCO) and from outside the U.S. at (706) 679-3614. Please use the conference identification number 6594856. The conference call will be webcast simultaneously and in its entirety through Masco’s website. Shareholders, media representatives and others interested in Masco may participate in the webcast by registering through the Investor Relations section on Masco’s website.

A replay of the call will be available on Masco’s website or by phone by dialing (855) 859-2056 and from outside the U.S. at (404) 537-3406. Please use the conference identification number 6594856. The telephone replay will be available approximately two hours after the end of the call and continue through August 25, 2019.

Safe Harbor Statement

This press release contains statements that reflect our views about our future performance and constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,” “anticipate,” “appear,” “may,” “will,” “should,” “intend,” “plan,” “estimate,” “expect,” “assume,” “seek,” “forecast,” and similar references to future periods. Our views about future performance involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. We caution you against relying on any of these forward-looking statements.

Our future performance may be affected by the levels of residential repair and remodel activity and new home construction, our ability to maintain our strong brands and reputation and to develop new products, our ability to maintain our competitive position in our industries, our reliance on key customers, the cost and availability of raw materials and increasing tariffs, our dependence on third-party suppliers, risks associated with international operations and global strategies, our ability to achieve the anticipated benefits of our strategic initiatives, including the potential divestitures of our Cabinetry and Windows businesses, our ability to successfully execute our acquisition strategy and integrate businesses that we have and may acquire, our ability to attract, develop and retain talented personnel, risks associated with our reliance on information systems and technology, and our ability to achieve the anticipated benefits from our investments in new technology. These and other factors are discussed in detail in Item 1A, “Risk Factors” in our most recent Annual Report on Form 10-K, as well as in our Quarterly Reports on Form 10-Q and in other filings we make with the Securities and Exchange Commission. Any forward-looking statement made by us speaks only as of the date on which it was made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events or otherwise.

MASCO CORPORATION
Condensed Consolidated Statements of Operations - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(in millions, except per common share data)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2019

 

2018

 

2019

 

2018

Net sales

$

2,275

 

 

$

2,297

 

 

$

4,183

 

 

$

4,217

 

Cost of sales

1,493

 

 

1,547

 

 

2,802

 

 

2,848

 

Gross profit

782

 

 

750

 

 

1,381

 

 

1,369

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

390

 

 

392

 

 

762

 

 

767

 

Impairment charges for goodwill and other intangible assets

 

 

 

 

16

 

 

 

Operating profit

392

 

 

358

 

 

603

 

 

602

 

 

 

 

 

 

 

 

 

Other income (expense), net:

 

 

 

 

 

 

 

Interest expense

(41

)

 

(38

)

 

(80

)

 

(79

)

Other, net

(4

)

 

(8

)

 

(8

)

 

(11

)

 

(45

)

 

(46

)

 

(88

)

 

(90

)

Income before income taxes

347

 

 

312

 

 

515

 

 

512

 

 

 

 

 

 

 

 

 

Income tax expense

95

 

 

88

 

 

136

 

 

127

 

Net income

252

 

 

224

 

 

379

 

 

385

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

12

 

 

13

 

 

23

 

 

25

 

Net income attributable to Masco Corporation

$

240

 

 

$

211

 

 

$

356

 

 

$

360

 

 

 

 

 

 

 

 

 

Income per common share attributable to Masco Corporation (diluted):

 

 

 

 

 

 

 

Net income

$

0.82

 

 

$

0.68

 

 

$

1.21

 

 

$

1.15

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

290

 

 

309

 

 

292

 

 

311

 

 

 

 

 

 

 

 

 

Historical information is available on our website.

MASCO CORPORATION
Exhibit A: Reconciliations - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2019

 

2018

 

2019

 

2018

Gross Profit, Selling, General and Administrative Expenses, and Operating Profit Reconciliations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

2,275

 

 

$

2,297

 

 

$

4,183

 

 

$

4,217

 

 

 

 

 

 

 

 

 

Gross profit, as reported

$

782

 

 

$

750

 

 

$

1,381

 

 

$

1,369

 

Rationalization charges

2

 

 

2

 

 

2

 

 

3

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

25

 

Gross profit, as adjusted

$

784

 

 

$

772

 

 

$

1,383

 

 

$

1,397

 

 

 

 

 

 

 

 

 

Gross margin, as reported

34.4

%

 

32.7

%

 

33.0

%

 

32.5

%

Gross margin, as adjusted

34.5

%

 

33.6

%

 

33.1

%

 

33.1

%

 

 

 

 

 

 

 

 

Selling, general and administrative expenses, as reported

$

390

 

 

$

392

 

 

$

762

 

 

$

767

 

Professional fees related to potential divestitures

5

 

 

 

 

8

 

 

 

Selling, general and administrative expenses, as adjusted

$

385

 

 

$

392

 

 

$

754

 

 

$

767

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses as percent of net sales, as reported

17.1

%

 

17.1

%

 

18.2

%

 

18.2

%

Selling, general and administrative expenses as percent of net sales, as adjusted

16.9

%

 

17.1

%

 

18.0

%

 

18.2

%

 

 

 

 

 

 

 

 

Operating profit, as reported

$

392

 

 

$

358

 

 

$

603

 

 

$

602

 

Rationalization charges

2

 

 

2

 

 

2

 

 

3

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

25

 

Impairment charges for goodwill and other intangible assets

 

 

 

 

16

 

 

 

Professional fees related to potential divestitures

5

 

 

 

 

8

 

 

 

Operating profit, as adjusted

$

399

 

 

$

380

 

 

$

629

 

 

$

630

 

 

 

 

 

 

 

 

 

Operating margin, as reported

17.2

%

 

15.6

%

 

14.4

%

 

14.3

%

Operating margin, as adjusted

17.5

%

 

16.5

%

 

15.0

%

 

14.9

%

 

Historical information is available on our website.

MASCO CORPORATION
Exhibit A: Reconciliations - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(in millions, except per common share data)

 

 

Three Months Ended June 30,

 

Six Months Ended June 30,

 

2019

 

2018

 

2019

 

2018

Income Per Common Share Reconciliations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes, as reported

$

347

 

 

$

312

 

 

$

515

 

 

$

512

 

Rationalization charges

2

 

 

2

 

 

2

 

 

3

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

25

 

Impairment charges for goodwill and other intangible assets

 

 

 

 

16

 

 

 

Professional fees related to potential divestitures

5

 

 

 

 

8

 

 

 

(Earnings) from equity investments, net

 

 

(2

)

 

 

 

(2

)

Income before income taxes, as adjusted

354

 

 

332

 

 

541

 

 

538

 

Tax at 25% rate

(88

)

 

(83

)

 

(135

)

 

(135

)

Less: Net income attributable to noncontrolling interest

12

 

 

13

 

 

23

 

 

25

 

Net income, as adjusted

$

254

 

 

$

236

 

 

$

383

 

 

$

378

 

 

 

 

 

 

 

 

 

Net income per common share, as adjusted

$

0.88

 

 

$

0.76

 

 

$

1.31

 

 

$

1.22

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

290

 

 

309

 

 

292

 

 

311

 

Outlook for the Twelve Months Ended December 31, 2019

 

Twelve Months Ended December 31, 2019

 

Low End

 

High End

Income Per Common Share Outlook

 

 

 

 

 

 

 

Net income per common share

$

2.51

 

 

$

2.61

 

Rationalization charges

0.02

 

 

0.02

 

Impairment charges for goodwill and other intangible assets

0.04

 

 

0.04

 

Professional fees related to potential divestitures

0.03

 

 

0.03

 

Allocation to participating securities per share (1)

0.02

 

 

0.02

 

Net income per common share, as adjusted

$

2.62

 

 

$

2.72

 

 

(1) Represents the impact of distributed dividends and undistributed earnings to unvested restricted stock awards in accordance with the two-class method of calculating earnings per share.

Historical information is available on our website.

MASCO CORPORATION
Condensed Consolidated Balance Sheets and Other Financial Data - Unaudited
June 30, 2019 and December 31, 2018

(dollars in millions)

 

 

June 30, 2019

 

December 31, 2018

Balance Sheet

 

 

 

Assets

 

 

 

Current Assets:

 

 

 

Cash and cash investments

$

325

 

 

$

559

 

Receivables

1,423

 

 

1,153

 

Inventories

975

 

 

946

 

Prepaid expenses and other

120

 

 

108

 

Total Current Assets

2,843

 

 

2,766

 

 

 

 

 

Property and equipment, net

1,212

 

 

1,223

 

Operating lease right-of-use assets

228

 

 

 

Goodwill

891

 

 

898

 

Other intangible assets, net

387

 

 

406

 

Other assets

92

 

 

100

 

Total Assets

$

5,653

 

 

$

5,393

 

 

 

 

 

Liabilities

 

 

 

Current Liabilities:

 

 

 

Accounts payable

$

1,023

 

 

$

926

 

Notes payable

231

 

 

8

 

Accrued liabilities

699

 

 

750

 

Total Current Liabilities

1,953

 

 

1,684

 

 

 

 

 

Long-term debt

2,771

 

 

2,971

 

Other liabilities

858

 

 

669

 

Total Liabilities

5,582

 

 

5,324

 

 

 

 

 

Equity

71

 

 

69

 

Total Liabilities and Equity

$

5,653

 

 

$

5,393

 

 

As of June 30,

 

2019

 

2018

Other Financial Data

 

 

 

Working Capital Days

 

 

 

Receivable days

54

 

 

56

 

Inventory days

67

 

 

70

 

Payable days

72

 

 

72

 

Working capital

$

1,375

 

 

$

1,368

 

Working capital as a % of sales (LTM)

16.5

%

 

17.1

%

 

Historical information is available on our website.

MASCO CORPORATION
Condensed Consolidated Statements of Cash Flows and Other Financial Data - Unaudited
For the Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

Six Months Ended June 30,

 

2019

 

2018

Cash Flows From (For) Operating Activities:

 

 

 

Cash provided by operating activities

$

510

 

 

$

499

 

Working capital changes

(297

)

 

(206

)

Net cash from operating activities

213

 

 

293

 

 

 

 

 

Cash Flows From (For) Financing Activities:

 

 

 

Retirement of notes

 

 

(114

)

Purchase of Company common stock

(289

)

 

(265

)

Cash dividends paid

(70

)

 

(65

)

Dividends paid to noncontrolling interest

(42

)

 

(89

)

Proceeds from the exercise of stock options

13

 

 

 

Employee withholding taxes paid on stock-based compensation

(16

)

 

(33

)

Increase (decrease) in debt, net

20

 

 

(1

)

Credit Agreement and other financing costs

(2

)

 

 

Net cash for financing activities

(386

)

 

(567

)

 

 

 

 

Cash Flows From (For) Investing Activities:

 

 

 

Capital expenditures

(71

)

 

(103

)

Acquisition of business, net of cash acquired

 

 

(548

)

Other, net

8

 

 

107

 

Net cash for investing activities

(63

)

 

(544

)

 

 

 

 

Effect of exchange rate changes on cash and cash investments

2

 

 

8

 

 

 

 

 

Cash and Cash Investments:

 

 

 

Decrease for the period

(234

)

 

(810

)

At January 1

559

 

 

1,194

 

At June 30

$

325

 

 

$

384

 

 

As of June 30,

 

2019

 

2018

Liquidity

 

 

 

Cash and cash investments

$

325

 

 

$

384

 

 

Historical information is available on our website.

MASCO CORPORATION
Segment Data - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

Three Months Ended June 30,

 

 

 

Six Months Ended June 30,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Plumbing Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,012

 

 

$

1,032

 

 

(2

)%

 

$

1,952

 

 

$

2,003

 

 

(3

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

198

 

 

$

194

 

 

 

 

$

351

 

 

$

357

 

 

 

Operating margin, as reported

19.6

%

 

18.8

%

 

 

 

18.0

%

 

17.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

2

 

 

1

 

 

 

 

2

 

 

2

 

 

 

Accelerated depreciation related to rationalization activity

 

 

1

 

 

 

 

 

 

1

 

 

 

Operating profit, as adjusted

200

 

 

196

 

 

 

 

353

 

 

360

 

 

 

Operating margin, as adjusted

19.8

%

 

19.0

%

 

 

 

18.1

%

 

18.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

20

 

 

18

 

 

 

 

39

 

 

36

 

 

 

EBITDA, as adjusted

$

220

 

 

$

214

 

 

 

 

$

392

 

 

$

396

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Decorative Architectural Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

827

 

 

$

806

 

 

3

%

 

$

1,400

 

 

$

1,351

 

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

173

 

 

$

145

 

 

 

 

$

246

 

 

$

234

 

 

 

Operating margin, as reported

20.9

%

 

18.0

%

 

 

 

17.6

%

 

17.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

 

 

25

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Operating profit, as adjusted

173

 

 

165

 

 

 

 

255

 

 

259

 

 

 

Operating margin, as adjusted

20.9

%

 

20.5

%

 

 

 

18.2

%

 

19.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

10

 

 

10

 

 

 

 

20

 

 

15

 

 

 

EBITDA, as adjusted

$

183

 

 

$

175

 

 

 

 

$

275

 

 

$

274

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cabinetry Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

251

 

 

$

268

 

 

(6

)%

 

$

488

 

 

$

485

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

33

 

 

$

33

 

 

 

 

$

53

 

 

$

39

 

 

 

Operating margin, as reported

13.1

%

 

12.3

%

 

 

 

10.9

%

 

8.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Professional fees related to potential divestitures

1

 

 

 

 

 

 

3

 

 

 

 

 

Operating profit, as adjusted

34

 

 

33

 

 

 

 

56

 

 

39

 

 

 

Operating margin, as adjusted

13.5

%

 

12.3

%

 

 

 

11.5

%

 

8.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

4

 

 

4

 

 

 

 

7

 

 

7

 

 

 

EBITDA, as adjusted

$

38

 

 

$

37

 

 

 

 

$

63

 

 

$

46

 

 

 

 

Historical information is available on our website.

MASCO CORPORATION
Segment Data - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

Three Months Ended June 30,

 

 

 

Six Months Ended June 30,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Windows and Other Specialty Products

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

185

 

 

$

191

 

 

(3

)%

 

$

343

 

 

$

378

 

 

(9

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit (loss), as reported

$

7

 

 

$

8

 

 

 

 

$

(4

)

 

$

12

 

 

 

Operating margin, as reported

3.8

%

 

4.2

%

 

 

 

(1.2

)%

 

3.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impairment charge for goodwill

 

 

 

 

 

 

7

 

 

 

 

 

Professional fees related to potential divestitures

4

 

 

 

 

 

 

5

 

 

 

 

 

Operating profit, as adjusted

11

 

 

8

 

 

 

 

8

 

 

12

 

 

 

Operating margin, as adjusted

5.9

%

 

4.2

%

 

 

 

2.3

%

 

3.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

5

 

 

5

 

 

 

 

11

 

 

11

 

 

 

EBITDA, as adjusted

$

16

 

 

$

13

 

 

 

 

$

19

 

 

$

23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

2,275

 

 

$

2,297

 

 

(1

)%

 

$

4,183

 

 

$

4,217

 

 

(1

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

$

411

 

 

$

380

 

 

 

 

$

646

 

 

$

642

 

 

 

General corporate expense, net

(19

)

 

(22

)

 

 

 

(43

)

 

(40

)

 

 

Operating profit, as reported

392

 

 

358

 

 

 

 

603

 

 

602

 

 

 

Operating margin, as reported

17.2

%

 

15.6

%

 

 

 

14.4

%

 

14.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

2

 

 

1

 

 

 

 

2

 

 

2

 

 

 

Accelerated depreciation related to rationalization activity - segment

 

 

1

 

 

 

 

 

 

1

 

 

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

 

 

25

 

 

 

Impairment charges for goodwill and other intangible assets

 

 

 

 

 

 

16

 

 

 

 

 

Professional fees related to potential divestitures

5

 

 

 

 

 

 

8

 

 

 

 

 

Operating profit, as adjusted

399

 

 

380

 

 

 

 

629

 

 

630

 

 

 

Operating margin, as adjusted

17.5

%

 

16.5

%

 

 

 

15.0

%

 

14.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

39

 

 

37

 

 

 

 

77

 

 

69

 

 

 

Depreciation and amortization - non-operating

3

 

 

2

 

 

 

 

5

 

 

4

 

 

 

EBITDA, as adjusted

$

441

 

 

$

419

 

 

 

 

$

711

 

 

$

703

 

 

 

 

Historical information is available on our website.

MASCO CORPORATION
North American and International Data - Unaudited

For the Three and Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

Three Months Ended June 30,

 

 

 

Six Months Ended June 30,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

North American

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

1,891

 

 

$

1,872

 

 

1

%

 

$

3,426

 

 

$

3,388

 

 

1

%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

364

 

 

$

323

 

 

 

 

$

566

 

 

$

541

 

 

 

Operating margin, as reported

19.2

%

 

17.3

%

 

 

 

16.5

%

 

16.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

2

 

 

1

 

 

 

 

2

 

 

2

 

 

 

Accelerated depreciation related to rationalization activity

 

 

1

 

 

 

 

 

 

1

 

 

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

 

 

25

 

 

 

Impairment charge for other intangible assets

 

 

 

 

 

 

9

 

 

 

 

 

Professional fees related to potential divestitures

3

 

 

 

 

 

 

6

 

 

 

 

 

Operating profit, as adjusted

369

 

 

345

 

 

 

 

583

 

 

569

 

 

 

Operating margin, as adjusted

19.5

%

 

18.4

%

 

 

 

17.0

%

 

16.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

29

 

 

27

 

 

 

 

56

 

 

48

 

 

 

EBITDA, as adjusted

$

398

 

 

$

372

 

 

 

 

$

639

 

 

$

617

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

384

 

 

$

425

 

 

(10

)%

 

$

757

 

 

$

829

 

 

(9

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

$

47

 

 

$

57

 

 

 

 

$

80

 

 

$

101

 

 

 

Operating margin, as reported

12.2

%

 

13.4

%

 

 

 

10.6

%

 

12.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Impairment charge for goodwill

 

 

 

 

 

 

7

 

 

 

 

 

Professional fees related to potential divestitures

2

 

 

 

 

 

 

2

 

 

 

 

 

Operating profit, as adjusted

49

 

 

57

 

 

 

 

89

 

 

101

 

 

 

Operating margin, as adjusted

12.8

%

 

13.4

%

 

 

 

11.8

%

 

12.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

10

 

 

10

 

 

 

 

21

 

 

21

 

 

 

EBITDA, as adjusted

$

59

 

 

$

67

 

 

 

 

$

110

 

 

$

122

 

 

 

 

Historical information is available on our website.

 

 

 

 

 

 

 

 

 

 

 

MASCO CORPORATION
North American and International Data - Unaudited
For the Three and Six Months Ended June 30, 2019 and 2018

(dollars in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended June 30,

 

 

 

Six Months Ended June 30,

 

 

 

2019

 

2018

 

Change

 

2019

 

2018

 

Change

Total

 

 

 

 

 

 

 

 

 

 

 

Net sales

$

2,275

 

 

$

2,297

 

 

(1

)%

 

$

4,183

 

 

$

4,217

 

 

(1

)%

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

$

411

 

 

$

380

 

 

 

 

$

646

 

 

$

642

 

 

 

General corporate expense, net

(19

)

 

(22

)

 

 

 

(43

)

 

(40

)

 

 

Operating profit, as reported

392

 

 

358

 

 

 

 

603

 

 

602

 

 

 

Operating margin, as reported

17.2

%

 

15.6

%

 

 

 

14.4

%

 

14.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

2

 

 

1

 

 

 

 

2

 

 

2

 

 

 

Accelerated depreciation related to rationalization activity

 

 

1

 

 

 

 

 

 

1

 

 

 

Kichler inventory step up adjustment

 

 

20

 

 

 

 

 

 

25

 

 

 

Impairment charges for goodwill and other intangible assets

 

 

 

 

 

 

16

 

 

 

 

 

Professional fees related to potential divestitures

5

 

 

 

 

 

 

8

 

 

 

 

 

Operating profit, as adjusted

399

 

 

380

 

 

 

 

629

 

 

630

 

 

 

Operating margin, as adjusted

17.5

%

 

16.5

%

 

 

 

15.0

%

 

14.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

39

 

 

37

 

 

 

 

77

 

 

69

 

 

 

Depreciation and amortization - non-operating

3

 

 

2

 

 

 

 

5

 

 

4

 

 

 

EBITDA, as adjusted

$

441

 

 

$

419

 

 

 

 

$

711

 

 

$

703

 

 

 

 

Historical information is available on our website.

 

Investor Contact
David Chaika
Vice President, Treasurer and Investor Relations
313.792.5500
david_chaika@mascohq.com

Source: Masco Corporation