The Sherwin-Williams Company (SHW) 27 Apr 212021 Q1 Earnings call transcript

Good morning. Thank you for joining the Sherwin-Williams Company's Review of First Quarter 2021 Results and our Outlook for the Second Quarter and Full Year of 2021. With us on today's call are John Morikis, Chairman, President and CEO; Al Mistysyn, CFO; Jane Cronin, Senior Vice President, Corporate Controller; and Jim Jaye, Senior Vice President, Investor Relations and Communications. This conference call is being webcast simultaneously in listen-only mode by Issuer Direct via the Internet at www.sherwin.com. An archived replay of this webcast will be available at www.sherwin.com beginning approximately two hours after this conference call concludes. include securities statements sales, laws other will the defined earnings call matters. federal US with conference certain as forward-looking under and This respect to such of statement or no undertakes otherwise. future a update forward-looking date only result forward-looking any to made, as revise whether Any on the speaks obligation which events statement statement or company of is and information, the as new provided in this full the earnings A statements declaration earlier forward-looking release morning. is regarding transmitted company's we will remarks, the session After prepared the open to questions. company's turn will Jaye. I over the now call to Jim

both finished in you. first we in robust repaint extremely everyone. Thank We continued markets, and segments of We exceeded to expectations the morning, two the Sherwin-Williams stronger. and residential in Good double-digit fourth we demand we generated as industrial growth quarter the that the DIY. sales residential The delivered in which beginning We terrific with of capitalized provided the results as again first quarter. at strong well entered our the guidance on momentum in the quarter new quarter. quarter. architectural across with leading exited once and

generated region. industrial in our We growth business improvement with double-digit also in every

numbers, I'll make the our stock getting stock some to a All call our of the declared conference a dividend today's to you split X-for-X on share been release in of stock Trading and stock-split-adjusted amounts X, have of began Before per-share press investors. of of commentary in that more the shares split. in base broader stock adjusted and on basis into a April to February Directors X-for-X XXXX. reflect remind specific Board a and approved the employees form accessible and

the commentary this in otherwise comparisons first specified. our to all Additionally, XXXX of unless quarter are morning prepared

top-line. with starting the So

decreased XX.X% XX.X% $XXX a due consolidated XXX gross XXXX $X.XX sales increased expense percent cost greater-than-anticipated quarter points as XX.X% million. raw tax to sales to increased profit XX.X%. to margin to inflation. or Consolidated XX SG&A million of decreased billion. before basis basis Consolidated points material to First $XXX.X

included The $XXX.X the million of depreciation acquisition-related Wattyl and business. onetime XXXX to first of divestiture quarter $XX.X amortization of Australia costs and expense the of related million

of of expense. amortization XXXX included first and $XX.X million quarter acquisition-related depreciation The

Excluding before to XX.X%. share per $X.XX flow-through share Diluted tax these share profit $X.XX items, million to in per consolidated with XX.X% income quarter $XXX.X ago. increased a net increased of year the per from

first share. quarter Wattyl related expense The onetime XXXX, per costs of the of share amortization to and per $X.XX of acquisition-related and included depreciation $X.XX divestiture

depreciation $X.XX quarter XXXX, and acquisition-related of The amortization per first expense included of share.

by sales by Flow-through XX.X%. costs. partially growth, Performance our three first to items, million primarily in expansion The driven Group Excluding Consumer single-digit from growth. high grew flow-through margin segment share on operating per grew the $XXX.X on the leverage basis growth. XX.X%. points of and these XX.X% $X.XX of quarter. quarter operating a resulting million in the share. delivered of sales, improved improved EBITDA per quarter $XXX.X excellent $X.XX offset margin sales Flow-through adjusted on adjusted diluted operating leverage share All from in the in strong increased in top-line XX.X% of Group was operating in points margin primarily to was or improved Adjusted higher operating earnings sales. Americas top-line growth, top-line basis And Coatings resulting material was Net segment which raw XX.X% to leverage to Flow-through points XX.X% basis double-digit segments double-digit of Group XX.X% cash per to XX sales margin quarter. XX.X%. from to XXX Brands the Segment was Adjusted XXX

guidance our on commentary over now XXXX. the along turn quarter for full the and to the second John Morikis additional me for first call John? with Let year quarter

the Thank There you, chain. aggressively supply is economies the XX,XXX particularly high trends no team We're Credit all managing through in of better sales tremendous a transitory businesses goes and Jim both new in capturing who in our disruptions team architectural very across was as above the XXXX. to our pursuing and and and everyone. Demand industry. to reopen. forecast. to continue a in off seeing quarter, customers March where members in level, industrial at positive well start robust business We're were are morning, good serving our

As quarter percentage including In residential repaint, comparison. In points our Canada double-digit of sales segment US about up not increased strongest our period against a sales impact every deliver driver currency Group material. the was of strong ago, over to delivered by in the improved price. year the and comparison. a growth unfavorable we've often profitability growth the translation Americas in were a is quarter. the X.X% The against said, in X.X strong in The volume Same-store results we of segment, quarter high the leveraged first X.X% and single-digit double-digit we largest same

double-digits grown this consecutive business by years. for We five have

percentage momentum quarter. were and the where both are fifth were and DIY Demand strong. We continue. for interior Contractors expect very exterior sales remained our unprecedented business this to reporting consecutive backlogs up by in solid double-digit

high double-digit of an a residential for in single-digit New quarter area remained against us growth strength low comparison. with the also

Growth housing very are have sales the down in solid where meaningful down in was turnover low starts than were Protective was against a and ago. month mid the building maintenance by positive the we and quarter offset as of was the multifamily smaller and improved over properties Marine of at the commercial but a our year March. Property month resume gradually percentage the year. since see up in in quarter, in trending quarter reporting in a well to The is gas and though softness customer segment. slightly solid progresses. single-digits improvement of Projects segments oil are year last improving. remainder was bridge comparisons and continue expect summer highway flooring, the and & as Momentum in the paces sequentially in rates. varying more by delivered business to single-digit been pharmaceutical New March quarter, and such is growth favorable permits order customers and strong

to quarter. perspective, aggressively in is interior the the pursue end interior part exterior up expect mix We all delayed these percentages were maintenance continue larger double-digit in opportunities paint as From be with markets being by of our first normal product and and both cannot projects for a as improvement continued indefinitely. sales

quarter equipment solid in increased type Contractors demand. in of anticipation this third sales invest Additionally, consecutive by the quarter. the of this spray equivalent is double-digits typically in

the better Our announced expect Canadian began the We effective first February increase quarter customers price X, to X% previously in X% to in to chain and disruption or prior supply and the quarter. following would realized later experiencing X.X% quarters. X% in industry the approximately from US the became price

new growth. We and US sales make the Canada. will in e-commerce evaluate products, additional these and Along to continue stores, management the opened pricing new we with to stores new innovative actions drive productivity-enhancing additional in investments services in trainees, We to needed. reps, quarter XX as continue

business related the quarter, positive to DIY remained Brands as our Sales impact to demand in XX% including X.X America led Asia currency Australia increased and at Consumer the on the Australia the growth of guidance, points robust. percentage regions and translation, quarter. Sales were North above by Moving in exited Europe, Group. our of all by followed the respectively. We segment in close segment mid-teens

disruptions team this this I for their quarter. know managed in is want by to caused performance Uri our global thank supply industry-wide Storm within you chain As during segment. supply navigating Winter the chain material organization incredible the raw

percentage. largest single-digit both the all were and generated of in strong percentage. a From percentage and Group single-digit continued are by the percentage continues equipment, first construction job. had grew were Sales divisional every quarter Coatings quarter. positive Group. the Latin let of across quarter a Regionally, in the by percentages. the paint The the all first containers Performance trends the the customers quarter, in group comment high the new robust we in residential and percentage. which up to accelerated our in positive in North were in by Currency sales furniture regions grew were quarters up building sales strong largest applications. continues last region products to cabinetry, in in on growth. I'll products, of up and third our translation general double-digit with within of Strength We our low working keep our fastest and was kitchen by in businesses Performance a divisions heavy demand in up sales double-digit quarter, for collaboratively gain was the every in group, drive followed on America, in and Asia finishing. me a and increased momentum and saw tailwind and the highest fourth sales America the start by strong Europe, group. positive Last, In by to by General high-teens Coatings Price year momentum, Industrial, division double-digit perspective, where flooring X% which region. Sales were division region. were growth Wood Industrial in were

PMI customers end-market reports. we an inventory and the larger our demand likely growing of numbers, element is there's these production recent believe given by While restocking in driver industrial

against and to our remarkably to part were a since gain results. robust food acquisition in acquired continue the and every and Sales double-digit beverage continues continue Our Packaging deliver remains cans in XXXX. single-digits nearly terrific traction. been our also and consistent quarter a region. of has team quarter delivered non-BPA growth coatings team positive business. in This ago to invest high were this every solid up Valspar the Demand has for year We great business Sherwin-Williams customers in as and

in Coatings quarter up single-digit at continues a a strong. of pleased mid future of percentage a year miles selected single-digit We're of all Sales very remains North high quarter. collision volume a levels, business. This construction business in commercial ago. that team been in We're in very momentum This consistent in particularly do of America. also the has our is sales an our resumption is which installations Our new winning comparison and job the new percentage excellent also grew gradual regions. Refinish This shop level America projects. Automotive Coil double-digit with and indicator below remarkably good to systems performer. growth by in encouraging also products North seeing by driven accounts Last, given were against were the pre-pandemic

$XXX.XX. Before me the shares invested We We distributed buybacks. allocation the $XXX to quarter. of $XXX to our an XX.X%. We in form increase million X.X quarter moving in our and to the speak million million shareholders capital returned share an of million $XXX.X dividends, to in in approximately outlook, dividends on let average of at price purchase

also in X.X We $XX.X ratio through ended business the times. a invested million our of expenditures. quarter with debt-to-EBITDA We capital

Turning outlook. to our

new remainder robust and North partners we though in property over in see who of to residential are to maintenance. paint residential America demand retail sales continue We repaint work the pros opportunities year, in commercial DIY in continued and with excited will challenging our be and Comparisons the recovery the to grow by segment.

improve as We'll will strengths and the we the We to that market. leverage distribution, services expect continue differentiated outpaces our rate to grow expect to innovation, continue demand at in a progresses. industrial value-added year as

a coupled still disruptions. pressured in the still from network an equation, industrial complete. low surging causing further significant range, recent disaster to it's to At be time, supply already significant in disruptions, and single-digit commodity we improving, be Recovery some anticipate the inflation of range the the costs In due communicated January. will the of is have in prices back rapidly been moderation with challenged and the COVID-XX, architectural the they raw elevated side February Texas we significant supply half production impacted upward. These petrochemical expect year-over-year. mid high year in this though cost in now demand has for the weeks but chain driven of far and year to material natural from increase complex single-digit low the to On double-digit we

impact is described, a results. about the we lag see there a our we to in previously time see inflation from in As quarter the of commodities time the we

highest which Given this which and in supply we remains comes capacity more online the see quarter, raw inflation back at of be significant second expect The to year. the material robust uncertain. becomes pace our will timing,

in proactive disruptions our minimize highly We to have impact been supply chain on managing customers. the the

quarter. months our We expect first in in similar mode be material the build during to availability raw a lower-than-anticipated throughout inventory as summer resulted reduced

supply global both our the announced We've challenges any give in in elevated offset Group, are in relationships close of strength may if chain likely Group. raw in occur. the issued also through inflation Americas Our highly we Brands price price will customers costs raw actions to Coatings We working Consumer material proactive We've pricing actions with these material managing been take our in increases us to and increase and need to addition great confidence Performance the The seeing. further levels. the previously remain at that pricing

compared are committed we fully combating that second backdrop, will consolidated of percentage a increase some to the material XXXX anticipate this second also While XXXX. costs, mid- raw quarter to to price Against sales by result quarter near-term realization timing we rising recognize likely the margin will teens we pressure. in high net

to teens by a up We percentage. The expect be Group Americas mid to high

by including down to percentage. we negative divestiture. impact double-digit to a approximately four the to Coatings We a related high-XXs Wattyl be expect by expect to And of be mid-teens up percentage percentage Consumer low a Performance Brands points

Tuesday year Xth. the you provide financial scheduled full presentation we sales our guidance plan for event June community For with XXXX, our update virtual to at and EPS an to

strong to have seeing. that time raw the material at cost availability greater demand and We as confirmation further currently well expect trends are inflation as trends of we clarity of

EPS Our remains time. at and adjusted guidance current sales this unchanged

sales increase a high expect to single-digit consolidated percentage. net mid We to by

negative up single-digit mid-single-digit points five single-digit Group to to and to a be or We expect of be by related Brands Wattyl percentage; Coatings down a approximately by a Group The a low Consumer to divestiture; impact to including percentage up up Americas the mid by Group percentage Performance be high percentage.

diluted $X.XX year $X.XX acquisition-related expect of per to includes XXXX guidance $X.XX per of income an divestiture per increase to expense the $X.XX share. earnings XXXX. in $X.XX share $X.XX an at compared Full net share XXXX share Wattyl XXXX. the share earnings X% We of for share the be per to and the a in earned per to per basis, range XXXX loss $X.XX amortization per of delivered expect of year share in on we On adjusted full over midpoint $X.XX, we

additional purposes. for points close modeling be that me Let some with may your helpful data

gross to increase margin expect lag and We some contraction see rapid raw price year the in greater-than-expected costs. given the and in full realization between material

margin over inflation the and abates, to as we we gross it expand just and cycles. As then expect capture in price previous see recover time has

year expect pre-tax adjusted as sales see margin to controlling leverage SG&A. We of strong full while we expansion growth

to We will continue differentiated making our investments across the enterprise that will solutions enhance our customers. provide ability to

our store to reps, return cadence on and with focused systems to productivity improvements, Canada XX capacity the and expect product around in XXXX. be We'll also We in normal openings new and sales innovation. US

our investments in We our center investments platform in the digital also plan These guidance. and channel. incremental home are embedded full additional year

foreign material full expect sales We not exchange a year. currency for the have will impact on

effective rate range. in XXXX our XX% be expect We tax the to low

to The unchanged. CapEx approximately interest we guidance million depreciation remains provided be expense We last approximately $XXX to year and amortization and quarter $XXX expect full be million.

in million due We long-term $XX of XXXX. have debt

We to by for dividend XX.X% year. the expect full increase the

evaluate that great our We to We'll continue strategy. opportunistic share expect in also to making off XXXX start with excellent repurchases. a acquisitions our to fit first We're performance. quarter continue

us over strong is demand strength. as operating team by differentiated equipped in customer morning we another take gains confident front our better the That year to than you manage that results. remarks. inflation our We see to this We're through the of many is be of for we'll provide and recovery the remaining year momentum energized joining expect With like issues transitory cost us nobody deliver prepared happy and to concludes Our the in solutions your availability to thank and I'd questions. and of raw and Sherwin-Williams. opportunities ability material excellent to with remainder

with with of you. question. Baird. will we Ghansham a Instructions] At time, Thank line And from your Panjabi question be session. proceed you. first the Thank comes [Operator our Please this question-and-answer conducting

Hey, morning. guys. Good

Morning. Good

your XQ of but to outliers just at was on XQ on that. your us positive curious various to your any coming there what pretty want just segments? for operating guidance. because three well, XXXX the were verticals relative realize volume a it across initial various guided about and Street is the into this thoughts verticals? your Are and full on your above your initial John think sales just I'm negative standpoint guidance as above still side asking as is view versus or point, part thoughts the to Wattyl -- is year. relates is I The perhaps from much intact year that the But sales I

Yes.

of take a in really forecast little jump Al Let our producing. business good to and me a Wood we're we GI it segments say at the you I'd feel is a pleasing it's if about standpoint, getting each I'll the here, bit have that the us. because Ghansham. that -- are coming return say I'd business performance the is and pace the from Industrial at will run momentum the a into of

to those to at position positioned robust it's about very expected and a pretty growth. impacted to We've coming long the as and that markets how we by capture defensive in occur, well we've tried are that. believe both we COVID, We business In pace. spoken

are growing. to point So Industrial your GI and Wood

are you commercial the well res new the quite property expecting I'd our traction our look continued If DIY. doing at as well we in businesses. management TAG really segments as in repaint, business, residential, say,

architecture jump cylinder. well. in ask the is me element let and element Al business, been well. of every forecast every the will sit every to as Protective And improving regarding really which quite sequential has of outside say, But I'd Marine growth So business frankly of the on the showing industrial

call, a last I have did our January as first And half. on earnings second Al. is a stronger weaker this said we and year Ghansham, Hey, half

So it off was start to first in strong a important that half. got we the

the and we where based trends, strong, to be trends, quarter of it expected we're we ahead the of our quarter sales we those was strong guidance in into fourth first Honestly, TAG quarter and mentioned, PCG. you continued coming the quarter second first to especially off strong closer our on start As did out the guidance. saw

do, And quarter carried for weaker year. But update those said, we're being in a an the mentioned as small would the quarter be and before and we last wait as generally going typically give that year. which get against a remarks, through us. second So we second the John on first momentums is quarter July. And his quarter in we opening full

as opening remarks, financial the on So X update an his community give EPS full John in and at prepared year sales presentation. guidance we're June mentioned to our

too future, a but not to points So, you far data of in outlook good view us the and more gives a year. give the better

mentioned, Al little than a It's coming would do the as we Yes. quarter. second earlier normally that we update out -- of

us earlier little it So but the opportunity at the in time. a bit challenges market given to June, that are update right that some an you give in will of now an give

question, Xx three Okay. raw I February on second your than through X. year. Obviously, is effective the And mean, what increase a it for basically then ago more was for you material just the guidance price got months pricing side TAG. But

one was unfolds? So in time the TAG much. given to when given in you us year? any And TAG Thanks remind I multiple in what of see price guess the last increases would year -- sort as saw adjust to so need also pricing

in. you put I'd and I -- that demonstrated take have We I'll say, believe conviction pricing determination this to Ghansham back.

is good point a one. Your

and out in willingness mix in it. that quality a we'd pricing see the As accept own to the through not we piece unique. additional think prefer contractors we some this offset out in with quite we of prefer We've the say painting it's We'd the rate that with in those we've Positive in We've that it's that own we this there about, the of us talked way that focus we would our that this seeing little we which If to table. through mentioned, think situation put natural in I compression right the with pricing. would to. comes relationship midst pricing off taking remains I'd our it's an be our at prices situations. material aggressive up projects margin pricing pricing, with When approach. in to if build we're as do pretty right And year, we've find Well, and to at Al just pricing, which demonstrated they painting we're hoping with efficiencies we a frankly to the those on we're are out projects -- unable know past some in other February. it for loyalty When those But we customers the on What work that. continue we're came margin built shift, of facilities, customers to offset we'll while with in we now raw additional real. we out season. quoting compression. ourselves the a not I out in these often say we entered in part level need not need disaster prices. and see? pricing handle elevated helped then -- go them now But got that moving

let just Ghansham Yes. add to that. me

segments. the my dollar. also selling offset been we that price half, dollar will of As focus our you're And that material that operating raw opening is increases our John have our that that And to second going on we'll his planned. about is year talked full brought first that And but and half. expectation is I've driver across number increases just our remarks, in in And momentum not in TAG, seeing the see margin one volume expectation but all into that expansion. for is

gross that expect typical. We leverage SG&A. to get And than on margin that's more contraction. will offset That

XXXX and inflationary of discipline gross that short-term your in environment. we saw As almost not in To with only from you our but price were get an coming gross recover, through shown And expand XXXX pricing contraction back to you out XXXX. increases to out XXXX is typical margin We've go margin gross months. XXXX, you question, XXX increases. XX and margin know six basis our points from --

expecting, it's we're talked that at So materials And to still providing these the year. persists materials. customers And same our And raw increases our another this with high it's offset believe about that we're raw there. sold. those in as And environment. John level are and And to of solutions really customers said as go then they that need offset John high will provide our increase the XX% we material price at we solutions of later we if discipline cost to this is we that why value. goods inflation to there important raw need is those services out levels, and

to effect our grow As as of processes able majority we're we raw those see recover increases. continuous margins hold see then on take materials our improvement to and moderate, we'll long-term, a and to start price

XX% we're a cost materials pricing of relatively represent very total might Al of cavalier it, that of to Yes. point what does while COGS. small one I Ghansham, means their not represent that to about It additional our that raw percentage is our and customers. we're that it and sensitive add mentioned goods. to

labor, project. remainder of at costs are Majority look about on sorry the their represents painting XX% I'm paint cost. you -- same a their percent contractor, the cost the it If of of

total small cost of goods. their a percentage relatively of it's So

there But for it. we're and our need it. to solutions So disciplined money, our their if in disciplined sensitive to our out we're helping doing make it. when in Al's we more also to point, providing We're approach the customers, job understanding know to we're with them

Very clear. so much. Thanks

Thank you.

you. Thank

Next Goldman question proceed of with is line your Bob Koort with coming from question. the Sachs. Please

if gave was you Good I think in implications wanted could second But there. half, ago. second the very sort the morning. of growth DIY and think a I in – maybe much. you you ask about you me I rate explained in on TAG why wondering, of some the moderation component help to Thank

you half? of that what Thanks. maybe your different second you it And as the would would than you think comparison any group? the consumer sales in see on I that's do XX% XX% What report through into stores. or what the get be

more say, DIY orders back a And – rate I'd Bob. normal as low orders DIY I'm very as eventually Thanks, revert we've we as begin previously expect indicated, returning stay-at-home begin and mentioned stay-at-home ease sorry, you was back. to to single-digit yeah, strong. do to people

So comparisons second be beginning in more the this challenging year. will of quarter

is on be able that the way a market position been to working to strategically hard Our belief we've to company, company really whichever capitalize as the tilts.

the So, the fact to segments, turns. if market, able pro be be hard capitalize We've if way going in our very you to our company the the we're to the as winner it relates position on we other. shifts it that DIY to reverts or to as position business, back will industrial worked whichever think it one way

the our business, might but on CBG It's largely with pro DIY pros paints hard On then side. will working back, driven the Brands be there we well as that as our we or the many an customers in of Consumer DIY Group are initiative stores revert a see while side some through who on for company. of the higher the side

the us frankly, have that commitment You've investments that about there, we have there, we we have and heard that quite the determination there. speak the

segment comes frankly, from. tilts so We're top quite which we the – to those Bill discriminate to of whichever to it just it. way going the determined be on Bob, one of And each segments. we And very we're don't be believe table in leading

the DIY you talked to digits businesses our you single if if combined about John high moderating still expect would half I And at looked those mid- Bob. two Yeah, businesses those so expect, up be segments, architectural as in to other stronger we combined, second will. and in

the look And at if Al the maybe comparison I can talk XXXX. you about you versus – think XXXX

I a growing think previous the to we're if to the you most if comparison you look Bob, back recent not at rate. pretty year, look just still the impressive year, at

Yeah.

increase double-digit low well. over period a to close half looking be that you'd think as I second

We're keep So it. we're with fighting not it along customers to giving our back.

prepared mentioned to Can follow-up, growth paint of interior a willingness impressive characterization in growth And – segments. the your some slides the give us quick you pretty have you back contractors in homes? in do-it-for-me

the double-digit moves hit leader They're what Heidi as and see we're their well, by in interior a Remodel than of would back And tell previously brings greater period it's percentage see Petz, you actually the a aggressive home a to data prepared Actually, March. in strong, And us. is had. second pace as is good remarks, macro with five the and In comfort excited when got this observation look sales focused a double-digit we've really mid-single-digit for Even up make growth at projecting team I terrific think on XX we that. interior greater growth, exterior. be you Yeah. on XX% large leader. returning But you capitalize is mentioned she very it's for interior that's lot these to LIRA bullish. when beast in because terrific a new The did business a Index, contractors to the existing efforts that such just res this straight this both record executing a a We've I in greater a it The quarter I year-over-year the there strong XX. able to repaint, are record growth, of NAHB the consecutive customers. it's of really this because XX% over work growth. years into

are bullish. contractors confident and clearly So

this record us another that expect residential floor the is way this pedal pushing momentum, repaint. the We to to to in should good for and expect going you There's us segment. be all year be in

you. Thank

from the with America. comes Byrne line question. your Please of question Bank next of with Our Steve proceed

you. Thank Yes.

Steve. Hey,

leave thus actions seem approach conservative for It push you morning – best. fair your just room that growth price to good in kind that could growth. at yes, would sales TAG that wouldn't it at and your stale? We're looking it at just and that's If more – thank my that assume I pricing stale? Is Is questions. this of just would and you kind for implies volume second any you fairly year half taking if being your look mid-single-digit guide, of full

to I at we're What the said conference. June sales FCP look Yeah, Xth, and to our at guidance year full updating EPS Ghansham, Steve. going

and segment not the look one make to whole – sales didn't the a sense So me and to company. take at try adjust it to

the to going an meeting. for you that segments and we're So at all the update give full year

Let about our me architectural performance going strong here. be very very very though, We're we performance a strong forward feeling good expect and very direct Steve.

just whether these given surprised small remain contractors, your then Okay. a cost the is your your push really at made maintaining me comments understand understand to enough I'm these pro you Help better. It a about fraction. relatively price push concern and about kind thinking a inflationary little that you not I'm taking clearly, price the now actions. the of loyalty to is paint of me price? absorb advantage help that, wouldn't It on that – this seems raws and see more not bit of And levels. situation better you're waiting take this,

want clear been out right? is with really to this, right now. pricing. on say we build Steve, as communicate have as accept intentions want of context. we temporarily talking compression picture past minor loyalty and When I some our that customers to that We're When put about in effectiveness that to to you I that Yeah. our pricing you about want us that We've our to pricing. important absorb, plans. We're and the talk as absorb, through and working you we will work well. through I be that in The

mentioned, in Al view this say the press our successfully. – little out term, and long it's come cadence term, been And I'm expect worked accept in know little the price. the have I and a our going the past that with when to and recover expect the this as a year. would that's I this so it's is of to And I it short give we've give trying customers that quarter over that trying run or My learned compression very decades a the any idea very dollars relationship with customers. in as model and that loyal And anyone out would on from adjust. simple. customer up we versus our take the a for it. it. We'll exception handle We a out will. of more the result get customers appreciate priority our way not And built customer with shouldn't a immediately the go we challenge to I this with And work us. to way know to We'll by of come we we'll to years to perfect

which a to the increase maybe XX a really out days the delayed XX, where we add increase just pricing the days, in industrial side And Steve we can the with raw planned. could XX we last just rapid had saw than materials over Yes. go so on we that higher I'd

a of groups all some are tell businesses about price certainly in selling we we expecting from to. to across And we and month-to-month of The and the to divisions. quarter see would businesses do in we talked as quarter. we then out normally our where customers so X. second X.X% little we in a our out X% communicate Street. our And first kind And we'll April saw And around action all need or then first realization over evaluate and But our growth take

Okay, that. very good. you Thank for

Steve. you, Thank

JPMorgan. with Our Please the question Jeff is of question. Zekauskas line next with your from proceed

quarter? What's Thanks the very very sequentially, at don't know I unusual much. million. something $XXX Is growth. keeping pattern. down unusual costs there the had When first that costs SG&A they're And very, sales in nice low? you maybe seems look so historical your I And SG&A given your

travel reps the investments and Brands that and Coatings Jeff stores on. programs really back our to in a was have Consumer say new turned X.X%. and e-commerce in -- continued costs these -- I in decrease there. our We in as year-over-year. continued the initiative reps and related haven't actually and decrease Performance But all Group would investment continued -- then a up we do SG&A That are additional the hasn't fully about customer services And consolidated investments. non-value I where of we'll the And invest And focus and/or our environment see increase offset to in. say of the to expect on should we're in our you see But some in -- those in would continue savings we economies to that. going in reopening to start can to offset we're some to increase back-office put do forward. we'll modest in SG&A environment. activities help investments going this functions continuing there going we're

think Was there comp to XXXX much? related if And it -- management should compensation you unusual last change about XXXX in relative management to year?

be our targets we comp on targets. of year full the Jeff achievement think I dependent and those year of Yes, the beginning the will at set

our look you last to have -- and If year quarter first year. sequentially comp in to first more fourth from quarter quarter last quarter the fourth quarter we the fourth would year, this

As our year. we stock towards strong the the our have including we do fourth accrual the with quarter did we we had typically expense more comp. true-up And quarter of fourth end comp in

Thank Okay. you much. very

just element I I mentioned of because just understand our the kind an asked important going we believe asking is strategy. Al investments it pricing, back think But decline make because your Steve about I an question. we'll first that to important important might in think add question that earlier that's the to it's the continue SG&A. of part management were the you I of or

them And us areas provided we on and fact expenses that a what more money to. and allows when ask So, stand many that's we're to the customers areas. money while we're in us for strategy having front solution to execute need managing also which in our in critical in investing to more many allows make allows of

So, investing I as be that we're great one. while your question also want I is But well. expense clear we're think to areas managing critical a in the

so Thank much. you

Jeff. Thanks

the Our next with question. question Citi. line P.J. from Juvekar with of proceed comes your Please

Brands. a which in were a year had XX% And number. large morning. Good ago quarter, I up sales Sales clarification were the a X%. just Consumer hi. was Yes, question down on the

So, inventories had was on and Ace last took boxes the number as this going going the like takes there building something something maybe approach or now, pandemic year in what it there XX% they're that you into are on in growth So, XQ Consumer and big else puts business? inventories with is down exited Brands?

nice Ace the was impact flow-through with I had if -- go that's a really strong first retail international COVID quarter on first businesses. say When some digits talking the part first to We saw XXXX a there. big moderation the We our had was we still the of because of we of certainly -- strong you was up. our outside side businesses impacted And strong we're in difficult that both with Asia-Pacific other XX%-plus. quarter partners our really double and and sell-through it. was the P.J. Really here even our US. international down DIY saw and the quarter back of a

to continues, acquisitions Thank get that you in Especially Sherwin with be net M&A? aggressive would clarification. your now list? for debt-to-EBITDA X.X And recovery times your top to should shopping of of expect as close more the what kind we the at

a expect piece. of And our robust. activity, in very say to mainly looks I'd us the you P.J., lot should pipeline industrial see Well,

we're understand working we of got our we've to say again I'd number that important it's that a projects So, to this strategy. hope have completed year.

and believe that is that that focused about a rate. valued we're they our greater simple. achieve can help their solutions pretty more when We success customers -- on have customers differentiated And reminder a a view and solutions unique partner. our thinking success very greater As the us the the at as

to So, color to be as buy as we're expedite might on lower, improved our on and infrastructure can elements trying whatever everywhere. everything commodities. that value a loss, distribution. that of we through can line well costs, production is differentiation focusing it an not broaden focused example, We're technologies not everyone, high unique focused we on those areas be We're help energy

had determined just not as the as are require we're as unique and in growing well believe, are that growth. we've Valspar the acquisition to this But this. well sense So, for very we that do we're also we given positions to well positioned acquisitions

prioritizing right growth our is on now focus opportunities. Our

group our us -- that's Justin where so, Group Group leaders, at Binns, many do It's an Coatings and you're don't really exciting team, time Performance leadership at President new Binn, here our our focusing to in and know to what teams where do Sherwin-Williams, for we our PCG where Justin go, go. And just, are there there not grow. new on. it's And our looking because there's we so opportunities where we invest,

an we're So, important M&A lever. excited about as

and like here, very forward at book a but strategy. looking where going We're good to business. buy and on what's of pursuing It's approach, what we're modeling it and disciplined in not trying say, making strategic We're activity just go. only going more not, necessarily our expect it a going the to happen. driving I not available financial see we We but values,

Great. Thank you.

bet. You

Thanks, P.J.

with is of BMO Capital the proceed from Please line with John Our question. McNulty question your Markets. next

for Yeah. question. my taking Thanks

would that in also disruptions? next flow one you markets, the necessary Can of but seeing how couple as looking maybe that inventory? just where Brands to speak in any strength you've of the some And Group. been the through the chain you quarters? see be we're the industry rest Consumer may terms just there first the on The given the catch-up is And of through say the supply of

challenges, are that say some mentioned. I'd Well, as you there

that, And such Sherwin-Williams this as I is also disaster. this you DNA in that demonstrate this I to respond think customers. that demonstrate we was year there's XXXth is I'd still to of challenges a to a your disaster in good a the But, is natural say our level relationship your valuable. business, these with pretty it also why And way for believe part. most just a which channel natural disaster utilize in doing the inventory

And facilities, tractor closer that assets. in these think able And asset We them that. and we're in do to say to It got trying to ever. utilize we to the -- fleet respond. into in we're people And that I in be our teams We unique experience. we've so And and we're are unique John, disruptions. unique a to think of assets, our we quite the are our the We because be to we're of minimize our fire base. position we'll our trailers of adversity, really could working think -- the to that utilizing believe, our trying this frankly, to our I success, very vehicles. customers love with collaborate than our robust responding, exit of we aspect for customers our running every face center ability delivery

come so, front, company are people the not same transportation when to responsive even begging We a our someone assets. our Those or pick to becomes we're for are to up but centers, to the home customers. ours. waiting qualified ours. you our on close well-trained with store's product those inventory home come stores. be our know about communities with to stands center Those leaders And both home highly located can own available in products We've same asked I serve those. the We got they front. XXXX stores, the reps the true our primarily in the with those dictate own front and stores with on center

is responsive we And so can. we're as to do as trying what be

rest getting on you you choppiness, other to dealing get Sherwin-Williams day. like goal We be see will, clearly and an the on And it. if issue as some is with. We while customers this there the have working this. be that from a of we're transitory inventory our better it's of and believe every we're those, top through so, want say, we we'll just point to to is side, And standpoint

guess then side. makes Got it. And as a I that cost just maybe the sense. No, follow-up on

the the of a inflation. it. baskets, guess does it's the on of there's pet general whether seem there's front, other obviously you to on can I or of of and I focus think TiOX a pigment just lot lot chem cost some tinplate? speak like It side

throughout that not just as Can some of the maybe chems, spike you're and up there that more we're consistent but or down you the other us seeing be in about think may the it inflation pet that buckets. So, help quantify to in progressing back year?

Yes. that one. happy to John, take I'm

for us. John transitory manage this as have inflation many this just We've ability through us. for It's demonstrated area well. through by me Let and times in not and reiterating material is get a what we'll new been This saying. raw whole Al bit issue to a an of begin little the past

raws pet up would greater chem petrochem into the packaging were our You're second bit biggest a hit In to first absolutely our The resins, on And was exposure quarter. here quarter as is Performance monomers year-over-year. That imagine mid-single-digits with driver that little the you side: side. there harder solvents, their trend continuing our Group materials. right. by Coatings

of levels. epoxy, are If you at we've look at HDPE, propylene, commodities, in ethylene, the many some they're seen and those all record years highest

Winter challenging It extended to operating at still look those production what's disrupted that XXX utilization the of production demand fuels. rates a XX-plus We environment Storm that to depressed a below-average period. seen already been we've and Refineries of number related offline chemical across were There's industry, due an Uri. John mentioned things. take driving COVID-XX. had a You facilities was facilities at for offline. transportation for have

You've the demand, both on and got the we've as architectural screaming about industrial side. talked

asked Steel coronavirus the tightness shutdowns, to outages high So, you supply some I mean is about similar that's seeing increases, as the petrochem mill others. demand. -- side. I due of there know We're we're seeing unplanned well. dynamics

impacting So, that's costs and our on drums. steel pails

say high would TiOX driven I bit as getting by little the well, demand. the there On side, a tighter market's

packages, recovery You've stimulus got of industrial construction demand, demand. the

got You've logistical inventories and low constraints.

moving think well. TiOX I is as So,

for That should XQ took online. it we the peak. low-double-digit we now. right why up to be our the is will reasons up those capacity the guide high-single back how come all moving percentage full year for For see That's there that year.

you as of costs a X, Some to think moderate. will FCP mentioned, event. these better view that we Al of we'll start our June But, at give

for it. much the detail. Appreciate very and the color Thanks

bet, You John.

Bank. line David your question. from is Please of the question with proceed Begleiter next Our with Deutsche

be John, that in in you. pretty how Al, Why levels, meaningfully. you'll – like Thank Performance is QX, it by? driven looks XXXX Coatings, being above

And Yes. be things low jump opening that. John high versus I should about let remarks I'll talked the in double-digits him up on by David, you're single-digits, in think right. all it's that absolutely division. We XXXX. his

really Love delivered in our quarter. to, industrial growth all Yes. because the All entire about regions we're optimistic I think in business. first divisions year-over-year

leadership that in stability vaccines the But and balance will comparisons the look We believe favorable positive. customer is the us forward region, aggressively a should of be market drive PMI this leaning for If terrific is do bode positive moving at forward. should you is team manufacturing, that's XXXX. and every well

but at through run remarks, here. our businesses terrific got these good you I briefly if wood, double-digit some look and of with momentum them I'd been start the in I talked that my really and industrial about have the strong As gains we've prepared really performers in

correlate residential. If you of flooring, these many look at new kitchen furniture, to cabinets,

really customers, year team expect goes, second bit our this of that as a say only in growing really We momentum like but a not wallet that half. become planting And seeds first through is to continue the through more good while that's new a And also note half, team with customers, of customers. really it share lot challenging existing the to good a may leadership here. we it's the

continuing here. and really another for for And partners, time. They've between is terrific That since a I've to packaging up region accomplished. and – helped positive Every cans business anticipate partnership We growth. continues demand we've Resumption PMI the in robust. business not We're traction. spoken gain business. I've strong our really terrific got are driving in the very show be. us every our have except it is here way. our both high projects about team really see to have non-BPA teens been forward strong packaging to business only growth very with coating. in as high North us expectations. diversify we double-digits is business and wins regions. Valspar. digits has and the about This Both in share improve. gains about good up, this coming we what Good was and again, going business some North positive acquired in very have customers mid-single to where We've well we've coil And coil, And quite Packaging here repeatedly and capacity. number and is been new and in Again, Talk delivered talked in coil. expect a one additional remains to we and good but quarter picking food we GI place seen proud our and all appliances. in of commercial a investing is for America this America, up the I'm long really was growth demand we momentum. here demand second asked our diversifying packaging in nice beverage about

we're strength ever believe here and in accounts again through prepared really So this been focus remarks. I mentioned going another than then in And significant lesser products still refinishes has this leadership a I installs another for in had. But more Europe. experienced for team. in but in is share the significant And I here and installations terrific our installations, growth number I've very terrific gain the Asia talking And positively continuing to is of our automotive North here systems on been our something quarter to in we We've more team. this new we've is got about America, think my Like a that market, degree believe innovation. and quarters. others we Americas.

and forward. And this in ever well I levels. think pre-COVID bodes highest of face clearly driven for business. had shop us that the miles going still off collision it's we've for that's volume the rate And that's

industrial will margins. obviously We some area is the of have that this be. with momentum everything to that do we still work proving be had operating Pleased hoped to in the business So the lot and team I and leadership got, upside a the still that margins there's as that. We has. think a well deliver upside. still as team But of there's as mentioned in cash operating

to it. So forward looking we're

full impressive very – that the guidance – you you'll raising as June sounds that But be one also up that why could really your X. be John And year meaningfully Performance current of be the guess guidance Coatings sales guidance? should segment itself that's versus in and imply I conservative doesn't reasons

you we'll sensing of voices, end said, up update little We're would that update into going quarter. all you an say I probably that's the our of of we in or and normally if like I'd move the June Well, bit bullishness confidence you're second give appropriate. early give an a at But to then.

you Thank much. very

Thank you, David.

next line with question from Fargo. the proceed your Mike of Our with Sison is question. Please Wells

Nice Hey, guys. quarter.

Mike. Hey,

Group. Brands Consumer on one quick one Just

outlook really be flattish were fourth need year, you up hit If up the and quarter you'd to part sort third able of comps. of to to for the full on tough

that there there is so team So create some if maybe and or doing your DIY trends that have is in – to space are occur, were that gain some really growth on some driven and by so just things sustaining, to forth? shelf

committed an Yes. feel had the is terrific a to I'd numbers say to – year and and some growing to expect. businesses post business. and in I I mentioned terrific got here We terrific committed that we partners PROs they're paint really growing who initiative together. we one important CBG earlier, We've good. and Mike our in investing our continue we're

you really do doing continue. are close to them job, can our Already wonderful on And in count could parts in that. our getting that we're shifts plays to way We're But this the we committed to they're that on other and what team Brian I in Rea at here or customers leadership. on one to committed accountable as work see to expect mentioned delivering to But willing a for out Todd them. of be think it we're And in market, execute we're perspective got holding we're going and seen. and a that's the it. be it to leadership leadership Al customers. exactly wonderful kind from better and of them And that that, world. Patton you the yet the it business And a is team, deliver way timing to doing. and that invest some different of help

Great. Thank you.

You bet.

Thanks, Mike.

from Vincent Andrews is with next of your Stanley. question. Morgan Please the line with question proceed coming Our

Thank you afternoon, and everyone. good

wanted Just level. to you ask maybe on inventory the Al

You that or up. $XXX $XXX million so million year-over-year, it's mentioned obviously down prepared being in sales up your and raws remarks are despite

curtail I'll this It And your of it quarter of the if seeing then later like for competitors or you're sort So -- secondly, like providing as particularly there have maybe bad for maybe of at of that? something or they're curious in is -- just any some the that more whether as just that might volume maybe on constraints second well some in rest curious far potentially moat is you? Group, another two any is I'm you side risk risk things; And season the upside? if segments can opportunities smaller all Americas but sounds supply year one, about we your in The the ask are volume-constrained as tell? hurricane

paint industries. has the diversified we something impact It disaster. but that an Vincent to this Because are And as tried base I to geographically, us. industry supply the I not Jim many that Yes. in as I on the happens industries. is going impacted that? impact like as raw when It issue in something petrochem don't And it's facilities supply why many touch on going I material and had say It's that, take just XXX natural industry, before. mentioned offline. a think would significant

but very right to we're out And to suppliers. working greatest our ones disaster are amongst there a be this we our stand supply, challenging. be going with like be want with is natural so, now. customers the To And that challenges hard clear the

that of have We mentioned we I As get repeatedly, it's and this. think on transitory. mentioned top we'll believe we

leadership of get and procurement now. do we chain, as global have we'll that properly. to right we ship our our me great supply can gives lot the willingness and think that to the And we a make is. to we whatever as doing it the Where tenure I product customers in our them asset serve fact in, team fastest it to it quite can it the the base confidence in responsiveness well we're get the that from have frankly wherever

the dealt we our there competitors, so, of Heidi that there in mentioned be Patton Brian of It's And we them we same quickly our customers. I'd our be as how every challenges about, fast that one how I've competitors' I really can these it Boy how we've as better, we're Petz, sitting And talking of are and mentioned customers, leaders all I'm that talking yes, is about in one issue. a not talk, getting say, of competitors front challenges. front our Justin as of but when can it's of are with. proud are grow, one feeling pressures. Binns, there's them The can fast What are real we far

those And And a We're have from similar trying to very take the advantage trying in Sherwin-Williams. some like to raw so while might of turn to situation that. respond into few customers. yes, a be material, ability we're

front that expect about and how customers help customers services now we're should we make our you can products talking those aggressively right in So of money. our our

maybe And just follow-up. as a Okay. quick

I think property talked management TAG down. in you about being

So maybe year? bit give little year-over-year and you sequentially on there moving of more are rest could and color both for if the expect how just what trends the a us you the

quarter. was best I Yes the I'd It's describe down would would the that. recovery that sequentially, but be by say way in would be choppy digit improved mid-single

the As better. through results the we went quarter, got

are comparisons in Now aligns this little the that were But whose meaningful that easier. a bit underfoot some I'd rebound to to from mid digit with that, Dodge in starts single forecasted came a that non-building high of business. say range. there's recovery we believe

are our gain leadership starting over lot are that a of Southeast and them now. diversifying we've be right customers, of for But some to bit just comps the utilization determination are divisions Southwestern again here. this the a year. fewer, easier get talked And the pick say the for begin or say, investing when But important facilities more got they that look say, start get this attacking favorable you that maintenance to of it's management side. We're to -- those a is I grow. as in as there to rates we're commercial business We business. And a position continue I'd little as Midwest way between seeing fall in on to I'll by compared Eastern comps a tourist again, rest better property little good We're if more industry, and attack. waiting we our the governors we're areas. to here continue governors might where great call not look that I'd of many expecting to to more and And and COVID you property well. -- momentum activity to I'd to bit expect in we're some But at up. We've at say think of these I'd earlier demonstrate. also

We're got relationships believe positioned we've here great I So leadership good -- well. a really determination. we're strong and lot a position of

so Look June. in event forward to Thanks the much.

Thanks Vincent.

from Vertical proceed of Kevin your Research. McCarthy with is the question. question line The Please with next

Yes, good afternoon.

point your strategy the thoughts hit view speak to screen that or of trends your issue to for be and business whether from to Within and there then you that US Uri? the to term, in was capital And radar trends? over I'd architectural to Is medium the an relates impact that's would your regional a the store the example? looking seem out Florida on US hear not quarter saw curious demographic More you be or people base from in allocation it as moving Texas. topline of your maybe

move doing they're to times of people Yes. a color mind and We their on love like they change regardless the them couple and we while paint of where moving that.

us. The plenty resuming that. We're So XX-plus terrific but into of excited stores The are stores the for is we're there, positioned Southwestern talked count high range. our our well. new Southeast very opportunity. divisions there's store of and markets up density about about We still

still I we that might taking the good of there's be but opportunities temporary. divisions movement, we think shift permanent place that benefactors have some coverage it that if are the in love the be and of or

few about area. division. hard investments. We've had the been by the at executing making working up look growth years. The we largest the you or Canadian talked there team -- really in last was at over that If has you performance demographic our been lot of a This

have Todd quite the leader for of in in time came frankly that his has divisions are Southeastern and leaders job delivering. our are doing the Wipf this all I a division say division, them in team. is quite executing. as there expectations area high mentioned So that but terrific terrific and down order and a I'd Eastern terrific and for Southwestern Midwestern leading down say, is in, another been they're some I'd area

on think move. shift wherever capitalize reality be are trying with largely we was is our well that the I the about to we're demographics that And as it is, there, of Kevin relationships contractors receiving But goes it be the So the to there's cute really end. positioned. going on in we'll because

just dilution side, associated would divestiture of Understood. with how you your And on Wattyl? then the earnings the characterize level of housekeeping

is Kevin, the got decide it's with to those would not we portfolio better we to on Yeah, regular but they we if quarters, And programs X%. cash on targets. And have believe And the flow. three that customer’s impact profit brands, and we then midterm complete somebody businesses we basis be to at margin, can or the about and looking could -- a be just sales RONA, operating consumer Hence look be close don't you the businesses targets growth our immaterial. else. at at these targets, remaining meet reviews served look set scale

much. Okay. Thank you very

question. line the with coming question next Fischer Our proceed is from Please of Duffy Barclays. with your

fellows. Yeah. Good morning

Duffy. Hey

Duffy. Hey

Hi guys.

want I me. a comments. couple question one Al's triangulate for to just Just of

your But you was volume EBIT But look at the expansion. about margin XX% being grew incremental than margins, talked of driver use the you XX%. So came a did. TAG just number consumer biggest and TAG more if at consumer year-over-year, in lot

have though able So about the have it takes margins just puts didn't and consumer of growth? volume higher to meaningfully TAG the why talk was can incremental you even than

X.X% Yeah. the strong I was favorable. in was high mix reasons. of would Strong repaint volume strong. the Duffy couple year. -- sales a TAG, was a And DIY increased Residential same-store say versus product X.X% strong. the TAG within last

saw New double-digit strong. in growth res exterior. was We

at leading quarter, with has our happy the in And investing of really home in flow-through was to happy all price been who first strong Pro in channels, that our XX%. increase the that Consumer team the and -- about driving high flow-through. and talked investments. XX%. flow-through say -- it we've strong this So paints center effectiveness just I'll those

Asia we're grows We operating bit dilute as it does though and little the also margins shift U.S. nice there, Europe Even faster margins. than in our the improvement of had consolidated Pacific a a mix seeing

walking would that more factors -- high-level the increase of last consumer’s price kind the would the benefit did business first the of being the on that. lag impact the the end business. in second the bit bit then get Ace to little also a first quarter -- they the little Ace I is a come And And our of are from towards away us quarter quarter. say those -- So of thing a in

Perfect.

Okay, thank you guys.

Thanks Duffy.

line the is question John of proceed your next Our question. from with Roberts Please UBS. with

make I you more Did shift to of death acrylic all want instead make urethane mix you. issue instead or limited vinyl your we this Did due there. maybe have raws? that's epoxy? production sure to any beat raw material at inventory of you availability more Thank of to to to and have

lot we're we bit usual a seen But arrivals be to obvious situation. more materials Yeah. time here that of that manufacturing, I'd little raw plants of an manufactured on going given like something of have, of about the that the a business we of John. mentioned or the that's say, – I'd might that capacity basis. the say doing do. power the that we timing purchasing company all The is though have that's the There's opportunities the everyday I than shifting the that And quite have, a strength we frankly of we earlier when have. benefit ours, Sherwin-Williams assets with

now as our we're ability able Here the to products best -- utilize situation this become our best with ability. available, to assets

the sales spray are equipment a projected? that strong some stores the consistent you've outlooks then still And leading with indicator in seeing as of you growth

Yes we are.

All right. Thank you.

Thanks John.

question. The next your Edlain question comes from of proceed Rodriguez with with the line Jefferies. Please

afternoon guys. Thank you. Good

afternoon. Good

are little in seeing of the Protective do start fundamental pre-COVID businesses Marine, and One quick a that are under seeing terms one. like of you Like and improvement in And those in commercial some expect auto to businesses? of maybe some real still businesses? any pressure paint, those refinish, levels like bit when you

to we'd of absolutely to obviously would that improvement to but intent. teams in this to than to expect I should we're those like continue. is able them working A pre-COVID our that We're hard seeing and little The levels. on that format, sequential give that that division see timing our projection all later. you say in expect be levels, with by reach we that sooner hard

Okay. you. Thank

Thank you.

question. of Markets. line question is Arun next Our proceed Viswanathan with with from Please the your RBC Capital

you've taking a for Thanks right. here at the All that I seen guys. future circle lot expectations and guess, maybe in periods. I of back strength my your just question wanted to

So, new for periods. continue. you've seen many obviously, seems double-digit in like going growth it's But also recovery the repaint you've actually That a resi seen on to side.

that If two just you stores two dynamics, market a were the those think year next about you feel paint do at X.X to to times continue to grow will clip? say

Yes.

we similarly, easy. industrial some nice I refinish. was And on now. going the guess That then saw on in recovery But strength nice a have you Okay. maybe side

normal periods packaging that still length. that You've well? of are you in recovery expect What business below areas to as discussed at future see potentially may

asking? the business you're In industrial

Yes.

There's Yeah. I refinish. planted. the in lot we're a would automotive absolutely with that say seeds pleased being that of are our momentum

Our expectations for that high. business are very

continue. growth the to are that we with continue going even GI and wood, expect is think momentum experiencing in I coil industrial to that grow. say to I'd we

here. let me what, save just know time You some

There's expectations a of for those grow. to divisions one continue have of every We to upside. lot

businesses. one and we're able Our market in amount market be technology, to people believe importantly execute have we there's We every we most where can't of there's share product in here on here to -- position assets mean, sitting with an enormous of the the I those that. not the opportunities grow. the

of expectations so very businesses, And those on from sales one operating margin both our each are for high both the perspectives. and

Thanks, John.

bet. You

Thanks, Arun.

of from proceed question. Please is Shmois line Garik Loop Our next question Capital. your the with with

Thanks. Great.

for question one me. Just

for you recognizing just the quarter. looking upside -- clarification got in could later some first of this Just year. be But TAG on there pricing some and X.X% the

got? Is of to that expect following your or the but outlook the X% just quarters. top be X% that you last total, same the assuming, X.X% is it's wanted just sure. on You X% I'm or I as better

and Yes. bit little a That's we've maybe that price increases the effectiveness done. it's prior total better of even X% in than

Great. Thank you.

Thanks.

with Our the question is Please from question. Seaport line of your with next proceed Global. Harrison Mike

Hi, good afternoon.

Hey Mike.

you've And wanted a opportunity I you talked Lowe's. these toward gearing them. specific paint bit product little about it they've to the in And you at what in the you're aisle? to of benefit how stores. bringing on or maybe this kind Lowe's can sounds into PROs market at with lines PRO you're share the have people some Do dig metrics success who on serve what positioning about seen paint like better any talk in that

to asking and also business And you're even we have our would stores metrics I relationship and feel, I'll that mean, we and Mike, none discuss product use to on customers them that -- offering talk I be would say, that important about. do these those our that to the maybe for from metrics, it's that targeting a about share. customers' in we very share. can reflect

If also you sold but to our many residential customer, the the sold contractors. high-end are DIY products, to look those of repaint many at are

at So, I find point customers don't know not professional, that product in our are that stores price we that are nearly you that offer. would some buying every

are also customers work And breadth the we're PROs want that There on are the others or maybe type and that very so are the that different to be is of of the upscale doing that price have the frankly of higher-quality goods recognized high-end using that best. same of make but goods paint, might use targets they a product. very cost And money more homes largest cost paint. in -- quite there in points, their that labor

DIY designing or with customers. in application designing the idea products mind. not for PROs of applicator end products the the We're only we're for So,

build geared application. do that going But we on those a you're some are that home shopping largely So, line. throughout PRO product PROs maybe towards center, the commercial when find the into entire more side you typically products, go to

revisit also divestiture. to And wanted right. the All Wattyl

And architectural a on China why the expansion little we Wattyl there? fit. been about kind wondering international Just plans your side. on Maybe of architectural it's side. wasn't or says about a the good on since comment while comments talked Any this strategy what

Yes. to I because, one I'd discipline strategy. on and I'd question a say, great demonstrates like it's as touch think as well Mike, the it

So we shareholder my a message is would be, -- to are committed.

making in know we're are long-term in how investments in the interested committed interested not to opportunity those book reach just and believe paint. not that the have We to business. that through. to We're we make Al walked growth just We're areas targets a of We practice.

to a we're shareholders out return that's Our do. what investment expect their and on

our We're in the going world to there in programs. of be going which not doesn't customer out, customers those the But long-term expending looking where We're And understand, part paying looking both at and we to our part investments grind at invest. meaningful ones are areas get the -- we're can at treasure looking to We're geographies. be and win. to shareholders other our in viable that areas, what our needs we're to So of return and themselves programs time our going we're and shareholders. the see deserve. to that offer off, world, done some in to

Thank you.

is question from your Our of line Patterson with next the Research. with Truman question. Wolfe Please proceed

know I afternoon late. we're because be taking try everyone. my and for getting good Thanks questions. quick Hi, I'll

dynamics, Coatings pressures. TAG and inflationary potential material baskets Group. different on raw and pricing question Performance First different Clearly

either You near the take all term. margin segment segment, all gross next of pressures? compression little Is of longer mentioned bit just some greater to will recover And over kind quarter? then, a inflationary either compression the at risk it

about SG&A. dollar moving than of higher and operating on combination improvement say selling if have growth on for the we that PCG comes and But of I where short on of Truman, would But focused And strong driven price in increases in with Group for getting offset ways the you increases volumes more the others basket about later and discipline and year, leverage alone. we're and incremental in raw of increases, the talked on into or margin dollar showing selling about second resolve Coatings is the term, really Yes. as price are year material many to that volume gross starting I TAG, a compression as increases margin focused we petrochem we price by on coming And not side PCG. We're know Performance operating them as our expansion need volume. fall the margin the we would across getting in businesses. the size you just our has confidence see compression first. I of things. talked a can It's out because all quarter in the

Okay.

really That's Okay. helpful.

materials So in bit moving an least at PCG, forward. primarily to more dip a compression inability raw pricing due rather just than to

whatsoever? to think asking slowing been the anything. asked any that more but seeing that Wattyl soft, a not I'm a And the looks the Okay. make second I I guide in might has ways, a just of -- looks consumer, just the like missing this quarter aren't then I'm in little ask include And couple different want but all US bit DIY divestiture. directly April, it and through you reason sales is, sure,

So just wanting to understand that.

Truman, Wattyl. Yes. about in it X% it include for does

Okay. But you're in any April? DIY deceleration seeing in not

say me way. guidance. sales this Let are April it our within

Certainly.

good man, within a You’re Truman. our It's guidance.

luck Good quarter. the on guys. Thanks, right. All upcoming

Truman. Thanks,

is from Zelman Associates. with questions. Our with Please next line Justin question of proceed your the & Speer

Thanks, guys. it. Appreciate

to on, the retail us quarter if guidance partners, slowing? terms quarter, the managing you second paint, managing just One much through here. in demand to questions chain that the or may how of your your maybe understand, DIY your maybe versus maybe, disruptions stores. exit tied few DIY of could through just And to its perhaps supply for customers, retail through help maybe but even April? following be up inventories, trends underlying the How a Just that the not did quarter look point-of-sale

that say not I'd Is it your -- question. understand No. I -- -- sure I'm is quite it

it's Justin, not say, would slowing. I demand

guidance. a showing we're sales think I top strong line

pushes the inventory across or teens within PCG restocking by and it's that's down double low up TAG inventory. anything the driven But channel. segments or improvements mid So, the to anything particular, to strong the not That's high not on each of related level trends. a holder retail in basis consolidated CBG demand digits related mid-teens. to and underlying to

mid- going with still But guidance, be We to to the teens high to even have relative we're that of XXXX. quarter impact. second up Wattyl the

back it momentum giving we're not some we're all maintaining and So there.

to those With grow, I PROs an trying effort on on paint customers with as the well. earlier, retail -- mentioned through that the as

I Yes, tremendous and And customer what where looking of a your -- bit guiding whatever to versus that's demand is like that a maybe the guess single, tilt necessarily the second and But end maybe, some know sure. the negative going a through there? timing I quarter I that but that's to. reason, demand inventory maybe then softer there's not you're and you're that retail, recognize situation, but little phasing you're be have, I low question for demand maybe it's but to there's For that view growth. expecting end reflection a for at is of business year-over-year we sounds toggling actual some maybe end the just to towards back more it view

Well, then what go painting. to less we other positioned DIY in to not saying We areas if home business. people occurs going And as it are to is back think is be business. of that, there capture little a Sherwin-Williams work, that they're uniquely the is

it going there. going and to going homes they're be to up. work, online, plants to plants, work their up to on the and those coming painters of are are we're are if the production -- pick to are people more up in going work we're people to back that pick If going at back going their So while

know I you detail, Justin. in go of well and can number I So times. But discussion this a through know business had we've great very this

we've to residential, it's on there. years DIY, in that there. we're there is, hard, it tilts, we're in Our property is for moment. commercial, and Whichever If quite If we're frankly, maintenance, it's on it. res going capitalize the property to view in capitalize management, we're we're been And way business whatever repaint, we're it's new going working this if for there, and it.

great It you margin have a cash to adapt flow have on free this to for yes, last makes And, portfolio question is The expectation dynamics. sense. I year. the the

last a margins the thinking phasing had front. very, year? that strong year this about very You cash flow of free on How are you

Yes.

even above with XX% future to Justin, we the have our our expecting XX.X%, are below little CapEx, we've CapEx a we also then operating that million but net be core our ourselves. targets set X%, building about. the talked cash bit $XXX we for And

because net for strong but look extra I below less operating $XXX talked if I net just a So at might XX.X%. be the that little million, we I cash, about year. above do that cash expect being the of operating we've CapEx, And bit think,

Excellent. Thank Really you, guys. it. appreciate

Thanks, Justin.

of proceed & question. The Company. next Morbelli with Please Gabelli question is Rosemarie your line from with the

everyone infrastructure and Thank of the potential quick from in your for my bill. what to question. you on would order How have you. a thanks much And have benefit just technologies one it? need I bigger taking impact? do Good afternoon, Coatings question Performance

It's it's excited. a us very great something that question. has Rosemarie,

terrific a is business business, Marine well. positioned & Protective Our very

-- a think, as look big as know might most tried to part variability what of I follow a there's all that infrastructure we be what think, well lot and recognize like, down this coming pipe think that the I have you of I might it here. in bill

position in a pieces terrific it's and wastewater. water just If we the parts. and have maybe -- So

we ours say, position it's but is on the terrific high-value in and a -- -- the bridge of highway, end work. have We bridge

I I at say If in -- infrastructure goes might investments, systems that our service that to very and have any goal them. very ceiling. we rapid well there. provide, there quickly, we'd our not unique be you assets back because we well And the positioned only to positioned about refer is do protection, to but technology. that have a coatings place to And offer put to unique that airport floor look have tremendous We very virtually you say, asked to be we return the technologies from ensure in very allow it's coatings

recoated in coated/recoated that coatings and and put floors down bridge polyaspartic back be quickly in or that be place, can back So closures so considerably place quickly. lane put can

that learned expect All have we customers our part get bring, offering are the we to product of frankly to very quite that and these hard of [Indiscernible]. work

in So positioned going it. on think to bill, depending be capitalize very that we out we're comes to well on what

pretend Can business much how benefit? for goes Let's through. the of could you thing your quantify that whole a second

on that'd I I will now. I positioned this, speculation be appreciate how Rosemarie until well know for to don't -- that can your modeling, quantify we're on to but right it. reality the very we our purely part see say of capitalize

M&A. it for technologies? sounds going Can as you though Okay. need looking the us, this you is be Obviously, in your are And additional terms what you gaps in to portfolio? share with technology do of

we publicly that now. do are would M&A looking We're some that areas opportunities. wouldn't targets there right flag not We but We of those, to recognize at do want that out those pursuing now. we're

And …

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And are the Valspar? not are about size of anything sorry. am the of talking still acquisitions? M&A, at that looking I on type a presume I We you bolt-on more

Yeah.

how openly we don't not long there. Valspar think a Valspar. us Valspar out -- opportunities for there's another There spoken that about, coveted I we've think business. I there are like but something

luck. and very much Thank Okay. you good

Thank you.

is your Kevin question proceed Research. with Northcoast Please the of Hocevar next Our line from with question.

kind if And forward. And TAG you, kind of do if -- of year. plus squeezing COGS; we'll of full will how of there. probably total actions you've assuming in based another the XX% me wanted inflation pricing seems That type the going you're than I of -- guys did like year. ramp pricing midpoint. what if raw imply on -- with you the pricing expected about the is throughout that see at doing year higher the segments? talk the Hey. Good to you up X% when offsetting the that's the for that in the But increase other the for to see mentioned year. something And for raw company addressed, already X% end pricing kind X% of price is just I afternoon you on everybody. up can TAG? pricing math And that or then, to material in. Thanks back And Al, back-of-the-envelope there? pricing when inflation the we'll expectation expecting follow taking And some you're half XX% this of

because raw about if way the we continue basket increase as it sales Yeah. to to expect the And -- persists the of raw do. yeah, to get normally think of what if you typically just Kevin, is, we'll the got COGS I material material works. then, at monitor you can the levels these offset dollars dynamic XX%

to because be industrial some others, and are than -- businesses just higher that within So of dynamics specific the within fair, going business.

is expectation be offset other internal we'd SG&A, we I it raw -- pull. still that dollar and to wood we'll So happening the would levers if dollars price. don't savings other that, dollar that my clear, And per that offset we with and say see Kevin, have to

levers So, boy, I not our we material don't to because operating increase. that want thinking offset focus leave going the look We'll That's have price they if I don't is not case. they're here, absolutely again available, give raw that, if all margin. the at don't growing get -- to

Yeah.

season the Okay. there year now if activity partners, promotions of retail And think there one last you're quick retail be, paint promotion the of around what this really aware in tends wasn't and we're -- will holidays. But year. the promotion. look the like much other with to that way the Curious, on of the some I -- one entering in

not But are. would something of respect we We customers. that discuss our out for it's

right. much. All Okay. you Thank very

Thank you.

Thanks Kevin.

you. Thank

Melich Greg Our your final of from Evercore with Please line question proceed the question. is ISI. from

Well, Surprised, have keep still it it. to thanks. one. I'll I

as that material double-digits, to raw industry sure an to low forecast? that make forecast the opposed single-digit, Just want a Sherwin And... high is

Yeah.

Yeah, sir.

those case, the given be the your the even customers, that bill is stock chasing where might just one to that's odd your this or of stay for if then, raw And industry material much up inventory Yeah? more? as in of years as

comments I would forecast, don't other, is I It's you an Greg if what that. have any Al industry on say. know

more rapid year, maybe than kind this frame mean, to last-in would Greg be it's might I you the we -- a way be first-out that. it say higher would That is the because because at Yeah. of way of I We of sales. the point, portion where North America our we're this I look, other if basis in your -- on would muted. largest increase in we years be

it? I that, less So -- well. uniqueness mean buy are it be But the we of given guys shouldn't just be year, to you you industry assume the obviously would than this would going

I more Okay. don't trying I are buying understand, -- make just wouldn't if a assumption year-over-year and up is like any that. on and in know increasing prices because what costs of our they're be where we're around explain our year at I to what going a stable, I this higher at. are peers we're that versus a rapidly it last... to hey

We little or spot we spot customers little -- more business. might bit in market keep that to a doing need be the our bit a things in those

so, a years. year there be And this volatility than other might little more

total thank got volume, I And you. make guess, want sure, Makes to right. on I sense, just it I

impact of there may out demand was volume of from like but been XXbps It any it have some think stock. there bps? You may material have volume don't not being been sounds hundreds of

Nothing material.

luck. Okay. Good Thank job. you. Great

Thanks, Greg.

I'll of session At you. Jim call reached this to for the time, end Jaye, our the Thank question-and-answer hand back closing for we've remarks. today.

there good I you that Yeah. a let just really confident just I to -- here how just to me in some Jim on want think couple of important questions. think back points. before -- I we jump One it's circle are. understand were

proven the important the line we're to and products innovation making well to customers and have more element, successful. I that here the of closest the building technical in think in we're think are day. market confidence record most us of we're peers. customers. our both, times And leadership think and had not think that of and positioned great strategy I reps with our uniquely team, to frames and ability started. We're And help that's I future. to confidence I think the that most stores got Sherwin-Williams started. outperform company believe, points and in accomplished. every of our great just and successful, relationship I towards those reemphasize leadership executing position. proud that And getting forward top markets are I be before, and customers we more reps bottom-line. help to the rep, highlights, we're complacent. think think couple believe We've mentality said We're managing of difficult the We the these best commitment to we our in the driving I We as services believe And this to our in more customers strategic that our but getting ability team. sales in that's a specification proven have members And I We terrific I through think our grow our not we investments the this and an in are think important solutions what importantly we've those periods and team just to all looking be those I've solutions only importantly, future. a

Jim, kick So talk to you I'll to the FCP. about it over

Tuesday, the Tuesday, Yeah, Registration will just very X on Investor on p.m. presentation. at to be items June for That's on virtual Again, housekeeping a that's financial of Eastern Relations available shortly. be June X. that community going our couple website X.

year. with you the ESG. we'll of things around members an management and heard other year As We'll give you multiple full team some this newer our times update also have today, technology

a event. So that be should great

need that, you I And Darr Natalie more thank want you with information, my joining can to out our to and call. If reach everybody team. just for

might other be answer myself, questions you available always, any Eric Swanson, have. to As we'll

have interest Sherwin. So, a great your thanks And in for day.

today's Thank This conference. will conclude you.

time. thank You may We lines for participation. this you your at disconnect your