Masco Corporation Reports First Quarter 2018 Results
April 24, 2018
LIVONIA, Mich. (April 24, 2018) - Masco Corporation (NYSE: MAS), one of the world’s leading manufacturers of branded home improvement and building products, reported strong net sales and earnings per share growth in the first quarter of 2018.
“We delivered a solid start to 2018 as we continued to grow our top line, invest for future growth, and deploy capital to create value for our shareholders,” said Masco President and CEO, Keith Allman. “Growth was led by our Plumbing and Decorative Architectural Products segments, and our North American windows business. Additionally, we completed the acquisition of Kichler Lighting for approximately $550 million and returned approximately $183 million to shareholders through dividends and share repurchases.”
2018 First Quarter Commentary
- Net sales increased 8 percent to $1.9 billion; in local currency, net sales increased 5 percent
- In local currency, North American sales increased 7 percent and international sales decreased 2 percent
- Gross margins decreased 180 basis points to 32.2 percent from 34.0 percent
- Operating margins decreased 180 basis points to 12.7 percent from 14.5 percent
- Net income increased to $0.47 per share compared to $0.43 per share
- Gross margins decreased 150 basis points to 32.6 percent compared to 34.1 percent
- Operating margins decreased 160 basis points to 13.0 percent compared to 14.6 percent
- Net income increased to $0.45 per share, compared to $0.40 per share
2018 First Quarter Operating Segment Highlights
- Plumbing Products’ net sales increased 11 percent (6 percent excluding the impact of foreign currency translation), driven by North American growth
- Decorative Architectural Products’ net sales increased 10 percent due to the acquisition of Kichler as well as growth from Behr’s pro initiative and Liberty’s builders’ hardware business
- Cabinetry Products’ net sales decreased 6 percent due to the divestiture of Moores as well as decreased sales to U.S. builders, partially offset by mid-single digit growth in the repair and remodel business
- Windows and Other Specialty Products’ net sales increased 4 percent (2 percent excluding the impact of foreign currency translation) due to strong growth in our North American windows business
“We believe our end markets remain strong and very supportive of long-term growth,” said Allman. “While we did have a high level of investment spending in the first quarter, our expectations for the year have not changed. With our strong brands, industry leading positions, and strong execution, we continue to anticipate achieving adjusted earnings per share for 2018 in the range of $2.48 to $2.63.”
Headquartered in Livonia, Mich., 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 2018 first 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 Tuesday, April 24, 2018 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 3485119. 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 3485119. The telephone replay will be available approximately two hours after the end of the call and continue through May 24, 2018.
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, 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, 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, our ability to achieve the anticipated benefits from our investments in new technology, risks associated with our reliance on information systems and technology, and our ability to sustain the improved results of our U.S. window business. 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.
Vice President, Treasurer and Investor Relations