The Sherwin-Williams Company (SHW) Q4 2024 earnings summary

Executive summary

• Consolidated net sales reached a record $23.1 billion in 2024, with Paint Stores Group driving growth despite a choppy demand environment.

• Gross profit, EBITDA, and adjusted EPS all expanded year-over-year; adjusted EPS rose 9.5% to $11.33.

• Q4 2024 sales were $5.3 billion, up 0.9% year-over-year, with Paint Stores Group leading growth.

• Returned $2.5 billion to shareholders via buybacks and dividends; net operating cash generated was $3.2 billion (13.7% of sales).

• Adjusted EBITDA for the year grew to $4.5 billion, or 19.4% of net sales.

Financial highlights

• Full-year gross margin expanded 180 basis points to 48.5%; Q4 gross margin at 48.6%.

• Adjusted EPS for Q4 increased 15.5% to $2.09; EBITDA margin expanded to 16.5%.

• Net income for 2024 was $2.68 billion, up from $2.39 billion in 2023.

• CapEx for 2024 was $1.1 billion, including $532 million for new HQ and R&D center.

• Ended 2024 with net debt-to-Adjusted EBITDA ratio of 2.2x.

Outlook and guidance

• 2025 consolidated sales expected to rise low single digits; adjusted diluted EPS guidance is $11.65–$12.05, GAAP EPS $10.70–$11.10.

• Paint Stores Group expected to be at or above high end of sales guidance; FX to be a ~1% headwind.

• SG&A expected to grow low single digits in 2025, including $80–$100 million in new building operating expenses.

• Interest expense to rise due to refinancing and new building financing; projected at ~$475 million.

• Plan to open 80–100 new stores in 2025; recommend 10.5% dividend increase to $3.16/share.