The Sherwin-Williams Company 2023 year-end and Q4 financial results show record year

• Consolidated net sales increased 4.1% in the year to a record US$23.05bn;
• Net sales from stores in the Paint Stores Group open more than 12 calendar months increased 6.8% in the year;
• Diluted net income per share increased 19.8% to US$9.25 per share in the year compared to US$7.72 per share in the full year 2022;
• Adjusted diluted net income per share increased to US$10.35 per share in the year compared to US$8.73 per share in the full year 2022;
• Diluted net income per share decreased 6.1% to US$1.39 per share and adjusted diluted net income per share decreased 4.2% to $1.81 per share, in the fourth quarter of 2023;
• Generated net operating cash of US$3.52bn, or 15.3% of net sales, in the year;
• Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization (Adjusted EBITDA) increased 17.5% in the year to $4.24 billion or 18.4% of net sales;
• Full year 2024 diluted net income per share guidance in the range of US$10.05 to US$10.55 per share, including acquisition-related amortisation expense of $0.80 per share;
• Full year 2024 adjusted diluted net income per share guidance in the range of US$10.85 to US$11.35 per share.

CEO remarks: 

“Sherwin-Williams delivered solid fourth quarter results, with positive sales growth and significant year-over-year gross margin improvement,” said President and Chief Executive Officer, Heidi G. Petz.

“We continued our accelerated growth investments in the quarter, which we are confident will continue to drive profitable above-market growth in future periods. Sales in all three reportable segments were within or better than our guidance.

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“In our architectural businesses, commercial and residential repaint were the strongest performers, while DIY remained challenging. In our industrial businesses, growth varied by division and region, reflecting ongoing choppiness in the market. Paint Stores Group and Performance Coatings Group segment margins expanded year over year.

“For the full year, sales grew to a record US$23.05bn, gross margin expanded to 46.7% (which is well within our current targeted range) and adjusted diluted net income per share increased 18.6% to a record US$10.35 per share. We generated strong net operating cash in the year, which enabled us to continue to invest in customer-focused innovation, while returning US$2.06bn to shareholders through dividends and share repurchases.

“From a segment perspective, Paint Stores Group overcame a difficult demand environment characterised by challenging conditions in new residential and existing home sales markets to deliver high-single digit percentage growth against a low-teens comparison, while also expanding its segment margin.

“Consumer Brands Group faced weak DIY demand, but grew in its targeted Pros Who Paint market and completed the divestiture of non-core aerosol product lines and its China architectural business.

“Performance Coatings Group generated sales growth in a market that was highly variable by region and business, further integrated recent acquisitions and delivered strong adjusted segment margin.”

The full report can be read here.