Masco (MAS) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales declined 2% year-over-year to $2.09 billion, mainly due to lower volumes and mix, but gross and operating margins improved, supported by cost savings, operational excellence, and the Sauna360 acquisition.

• Adjusted EPS grew 1% to $1.20, and operating profit reached $399 million with a 19.1% margin; net income was $258 million, with diluted EPS of $1.17.

• Returned $206 million to shareholders in Q2 via dividends and share repurchases, including 2 million shares repurchased for $143 million.

• Liquidity at quarter-end was $1.4 billion, including cash and revolver availability.

Financial highlights

• Gross profit increased by $16 million, with gross margin up 140 basis points to 37.6%.

• Operating profit was $399 million, and operating margin was 19.1% (adjusted).

• Adjusted EPS rose 1% to $1.20 per share; net income for Q2 was $258 million.

• Free cash flow remained strong, supporting $206 million in shareholder returns.

• Working capital as a percent of sales improved to 18.4%.

Outlook and guidance

• Full-year 2024 adjusted EPS guidance narrowed to $4.05–$4.20 per share.

• Full-year operating margin guidance raised to 17–17.5%, driven by plumbing segment performance.

• Sales for 2024 expected to be flat to low single-digit change, with second half sales anticipated to be roughly flat.

• Plumbing segment sales expected to be plus or minus low single digits, with margin guidance at ~19%.

• Decorative architectural segment sales expected to be down low single digits, with margin maintained at ~18%.