The Sherwin-Williams Company (SHW) Q2 2024 earnings summary

Executive summary

• Consolidated net sales rose 0.5% year-over-year to $6.27 billion in Q2 2024, with Paint Stores Group leading growth and Performance Coatings Group contributing, offsetting declines in Consumer Brands Group.

• Diluted EPS increased 14% to $3.50; adjusted EPS up 12.5% to $3.70; EBITDA grew 12.1% to $1.44 billion, or 22.9% of sales.

• Gross margin expanded to 48.8% from 46.0% year-over-year, driven by moderating raw material costs.

• Strong cash flow enabled $1.34 billion returned to shareholders via dividends and share repurchases in the first half.

• The company remains confident in its growth strategy and disciplined capital allocation despite macroeconomic uncertainty.

Financial highlights

• Gross profit up 6.7% year-over-year to $3.06 billion; net income for Q2 was $889.9 million, up from $793.7 million a year ago.

• EBITDA margin improved to 22.9% of net sales in Q2 2024.

• Operating cash flow for the first six months reached $1.14 billion.

• Adjusted diluted EPS for Q2 was $3.70, up from $3.29 in Q2 2023.

• Returned $613 million to shareholders in Q2 via dividends and buybacks; $1.34 billion in H1 2024.

Outlook and guidance

• Full-year 2024 adjusted diluted EPS guidance raised to $11.10–$11.40, up 8.7% at midpoint from 2023.

• Full-year 2024 consolidated sales expected to be up low single digits; Q3 sales also projected up low single digits.

• Paint Stores and Performance Coatings Group sales guidance unchanged; Consumer Brands Group guidance reduced due to weak DIY demand.

• Raw material costs expected down low single digits for the year, flattish in the back half.

• Capital expenditures for 2024 estimated at $675 million, including major projects.