RPM International Q1 Results Top View; Lifts Full-year Outlook

(RTTNews) - Specialty chemical products company RPM International Inc. (RPM) on Wednesday reported a profit for the first quarter that more than tripled from the prior year, reflecting strong performance in the company's consumer segment and modest gains in its industrial segment. Both revenue and adjusted earnings beat analysts' expectations. Looking ahead, the company raised its earnings outlook for fiscal 2014.

Consumer segment sales for the first quarter rose 26 percent from the prior-year period to $433.45 million. Organic growth was 9.1 percent, principally driven by volume, with negative foreign exchange of 0.3 percent and acquisition growth of 17.4 percent.

Industrial segment net sales increased 4 percent to $731.23 million, with 3.5 percent in organic growth. This was offset by 0.2 percent in foreign exchange losses, while acquisitions added 0.7 percent.

RPM International's net income for the first quarter was $103.10 million or $0.77 per share, up from $33.91 million or $0.26 per share in the year-ago period.

During the prior-year period, the company incurred a one-time, non-cash charge of $45.3 million for the partial write-down of its investments in Kemrock Industries and Exports Limited in India and a charge of $11.0 million in its roofing business.

Excluding this, adjusted net income latest quarter was $103.10 million or $0.77 per share, compared to $84.8 million or $0.64 per share in the same period last year. On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.71 per share for the quarter. Analysts estimates typically exclude special items.

Net sales for the quarter grew 11 percent to $1.17 billion from $1.05 billion in the previous-year quarter. Analysts had a consensus revenue estimate of $1.13 billion.

Looking ahead to fiscal 2014, RPM International now forecasts earnings in a range of $2.00 to $2.07 per share. Previously, the company had forecast net income for the year to increase 9 to 13 percent, resulting in earnings per share in a range of $1.98 to $2.05. Analysts expect the company to report earnings of $2.05 per share for the year.

Frank Sullivan, Chairman and Chief Executive Officer of RPM International said, "We are cautious with regards to the uncertainties surrounding the political gridlock in Washington, as well as U.S. Federal Reserve policy and its impact on global foreign exchange markets. However, we are very encouraged by the earlier than expected improved performance in RPM's European and roofing businesses and the continued momentum in all aspects of our consumer segment."

RPM closed Tuesday's regular trading session at $35.72, down $1.00 on a volume of 719,500 shares.