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News Release

RPM Continues Income & EPS Growth in Third Quarter

MEDINA, Ohio, Apr 4, 2002 /PRNewswire-FirstCall via COMTEX/ -- RPM, Inc. (NYSE: RPM) today reported continued net income and earnings per share growth for both the third quarter and nine months of fiscal 2002.

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Third Quarter Results

For the quarter ended February 28, 2002, the specialty coatings manufacturer reported net sales of $407.5 million, up slightly from last year's third quarter net sales of $405.4 million. During the quarter, the Consumer business enjoyed a 6 percent sale increase with increasing customer demand across its various product lines. This strong demand more than offset the 4 percent dip in sales that the Industrial business faced during the quarter as flooring and other industrial maintenance projects were postponed or cancelled.

Net income was $3.2 million, up significantly from last year's third quarter net loss of $7.0 million. Third quarter net earnings on a diluted basis were $0.03 per share compared with a net loss of $0.07 per share in the fiscal 2001 third quarter. Excluding a non-cash, third quarter charge of approximately $0.01 per diluted share relating to the devaluation of the Argentinean peso, net earnings for the third quarter of 2002 would have been $0.04 per diluted share. Had FAS 142 been effective, 2001's third quarter results on a diluted basis would have been $0.01 per share net loss.

In addition, the company repaid $29 million of debt through continued strong cash flow from operations, which totaled $37 million in the third quarter. This brings its 12-month debt reduction total to nearly $108 million.

Nine Month Results

For the nine months ended February 28, 2002, RPM reported net sales of approximately $1.429 billion, down 2.2 percent from last year's nine month net sales of $1.460 billion.

Net income during the first nine months of fiscal 2002 increased 66 percent to $64.3 million compared with $38.7 million in the comparable period last year. Earnings per share on a diluted basis for the first nine months of 2002 were $0.63 per share versus $0.38 per share in the prior year. Excluding the previously mentioned non-cash third quarter charge, net earnings for the nine month period of 2002 would have been $0.64 per diluted share. Had FAS 142 been effective, 2001's nine month earnings on a diluted basis would have been $0.54 per share.

Equity Offering Raises Approximately $157 Million

Subsequent to the end of the third quarter, the company announced the sale of 10 million shares of its common stock, the proceeds of which were used to further reduce debt. Including the underwriters' exercise of their 15 percent over allotment to meet strong investor demand, shares issued totaled 11.5 million and resulted in net proceeds of approximately $157 million. This offering is expected to have a $0.01 per share dilutive impact in fiscal year 2002 and a $0.07 per share dilutive impact in fiscal year 2003.

"This stock offering is in line with our ongoing effort to improve the company's financial flexibility," said Thomas C. Sullivan, chairman and chief executive officer. "By further reducing our debt, we will be able to use more of our strong cash flow to fund our growth initiatives, including acquisitions."

Dividend Payment

On April 1, RPM's board of directors voted to maintain the company's current quarterly dividend of $0.125 per share, payable April 30, 2002, to shareholders of record as of April 12, 2002.

About RPM

RPM, Inc. is a world leader in specialty coatings serving both industrial and consumer markets. RPM's industrial products including roofing systems, sealants, corrosion control coatings, flooring coatings and specialty chemicals. Its consumer products are used by professionals and do-it- yourselfers for home, automotive and boat maintenance and by hobbyists. Leading industrial brands include Stonhard, Tremco, Carboline, Day-Glo, Euco and Dryvit. Consumer brands include Zinsser, Rust-Oleum, DAP, Flecto, Bondo and Testor.

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This press release contains "forward-looking" statements based on management's expectations and beliefs concerning future events. Forward- looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of the company that could cause actual results to differ materially from such statements. These uncertainties and other factors include risks related to the company's ability to realize the benefits from its restructuring and consolidation efforts; changes in the results of operations due to economic conditions or unforeseen factors; overall economic conditions within and among the company's domestic and international coatings market; unusual weather conditions that might adversely affect sales; legal, environmental and litigation risks inherent in the company's construction and chemicals businesses; and such other risks and uncertainties described from time to time in the company's reports filed with the Securities and Exchange Commission, including the risk factors contained in the company's recently filed registration statement on Form S-3. The foregoing list is not exhaustive, and the company disclaims any obligation to subsequently revise any forward-looking statements to reflect events or circumstances after the date of such statements.

                       In thousands, except per share data

                                     Nine Months Ended     Three Months Ended
                                        February 28,          February 28,
                                      2002        2001       2002      2001

    Net Sales                      $1,428,693  $1,460,227  $407,538  $405,400
    Cost of Sales                     777,415     804,513   228,902   234,162
    Gross Profit                     $651,278    $655,714  $178,636  $171,238
    Selling, General &
     Expenses                         521,720     542,138   166,025   165,104
    Interest Expense, Net              32,083      51,156     7,660    17,453
    Income Before Income Taxes        $97,475     $62,420    $4,951  ($11,319)
    Provision for Income Taxes         33,142      23,720     1,677    (4,301)
    Net Income                        $64,333     $38,700    $3,274   ($7,018)

    Basic Earnings per Share            $0.63       $0.38     $0.03    ($0.07)

    Diluted Earnings per Share          $0.63       $0.38     $0.03    ($0.07)

    Average Shares Outstanding -
     Basic                            102,346     102,199   102,508   102,209

    Average Shares Outstanding -
     Diluted                          102,857     102,208   103,720   102,216

                       In thousands, except per share data

                                                         February 28,
                                                     2002              2001
           Current Assets                         $736,735          $766,455
           Property, Plant & Equipment
            (net)                                  345,326           374,057
           Other Assets                            886,134           927,226
              Total Assets                      $1,968,195        $2,067,738

    Liabilities and Shareholders' Equity
           Current Liabilities                    $385,952          $358,924
           Long-Term Debt                          814,606           969,846
           Other Liabilities                       103,009           107,149
              Total Liabilities                 $1,303,567        $1,435,919
           Shareholders' Equity                    664,628           631,819
           Total Liabilities &
             Shareholders' Equity               $1,968,195        $2,067,738

                       In thousands, except per share data

                                                Nine Months Ended February 28,
                                                     2002              2001
    Cash Flows From Operating Activities
            Net Income                             $64,333           $38,700
            Depreciation and Amortization           41,785            58,938
            Items not affecting cash and
             other                                  (8,716)          (14,510)
            Changes in operating working
             capital                                34,037           (33,256)
                                                   131,439            49,872

    Cash Flows From Investing Activities
            Additions to property and
             equipment                             (16,241)          (43,513)
            Acquisition of new
             businesses, net of cash                                  (3,341)
                                                   (16,241)          (46,854)

    Cash Flows From Financing Activities
            Proceeds from stock option
             exercises                               4,932               598
            Repurchase of common shares                              (11,101)
            Increase (decrease) in debt            (63,033)           43,217
            Dividends                              (38,167)          (37,890)
                                                   (96,268)           (5,176)

            Net Increase (Decrease) in
             Cash                                  $18,930           $(2,158)

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CONTACT:          Glenn R. Hasman, Vice President of Finance and Communications
                  of RPM, Inc., +1-330-273-8820
                  AP Archive:
                  PRN Photo Desk, 888-776-6555 or 212-782-2840

Copyright (C) 2002 PR Newswire.  All rights reserved.

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