Sherwin-Williams Company (the) · NYSE:SHW
Sherwin-Williams Company (the) — The Sherwin-Williams Company — Investor Day (May 2015)
20 slides from Sherwin-Williams Company (the)'s investor day presentation, May 28, 2015
Slide 1: Financial Overview
Financial Overview Sean Hennessy Senior Vice President – Finance & Chief Financial Officer
Slide 2: Consolidated Sales
Consolidated Sales $ Millions 11,130 12,000 10,186 9,534 10,000 8,766 7,810 8,005 7,980 7,776 7,191 7,094 8,000 6,000 4,000 2,000 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 % Change vs. Prior Year: 17.6 8.6 2.5 (0.3) (11.1) 9.6 12.7 8.8 6.8 9.3 Financial Community Presentation – May 28, 201
Slide 3: Consolidated Gross Profit
Consolidated Gross Profit $ Millions $ Gross Profit % to Sales 6,000 5,164 4,617 5,000 4,222 3,745 4,000 3,598 3,499 3,481 3,413 3,263 3,080 3,000 46.0 45.3 46.4 44.9 44.8 44.3 42.8 43.7 43.8 42.7 2,000 1,000 0 2005 2006 2007 2008 2009 2010 2011 2012* 2013 2014 Financial Community Presentation – May
Slide 4: SG&A Expense
SG&A Expense $ Millions $ SG&A % to Sales 3,823 4,000 3,468 3,500 3,200 2,961 3,000 2,644 2,728 2,513 2,597 2,535 2,326 2,500 2,000 35.7 35.1 33.1 33.8 33.6 34.0 34.3 1,500 32.4 32.2 32.4 1,000 500 0 2005 2006 2007 2008 2009 2010 2011 2012* 2013 2014 Financial Community Presentation – May 28, 2015 *
Slide 5: Operating Income
Operating Income* $ Millions 1,342 1,400 $ Operating Income % to Sales 1,149 1,200 1,002 947 1,000 903 855 784 754 728 753 800 600 12.5 12.1 11.6 11.3 10.5 10.7 10.3 9.9 9.7 8.9 400 200 0 2005 2006 2007 2008 2009 2010 2011 2012** 2013 2014 * Consolidated Gross Profit Minus SG&A Expenses Financial Co
Slide 6: 2014 Reportable Segments
2014 Reportable Segments $ Millions Net External Segment Sales Profit ROS* Paint Stores Group 6,852 1,201 17.5% Latin America Coatings Group 771 40 5.2% Consumer Group 1,421 253 17.8% Global Finishes Group 2,081 201 9.7% Administrative 5 (437) - Financial Community Presentation – May 28, 2015 * Base
Slide 7: Profit Before & After Tax
Profit Before & After Tax $ Millions 1,400.0 Profit Before Tax 1,258.2 Profit After Tax 1,200.0 1,086.0 1,000.0 912.9 907.3 865.9 834.3 741.5 753.0 800.0 714.5 677.8 656.2 631.0 615.6 622.8 576.1 600.0 463.3 476.9 462.5 441.9 435.8 400.0 200.0 0.0 2005 2006 2007 2008 2009 2010 2011* 2012** 2013 2014
Slide 8: Working Capital Ratio
Working Capital Ratio (Accounts Receivable + Inventory – Payables)/Sales 15.0% 12.5% 12.7% 13.0% 11.7% 11.9% 11.2% 10.9% 10.7% 10.8% 10.5% 11.0% 10.1% 9.0% 7.0% 5.0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Financial Community Presentation – May 28, 2015
Slide 9: Working Capital & Days
Working Capital & Days $ Millions 2009 2010 2011 2012 2013 2014 Accounts Receivable $696.1 $916.7 $989.9 $1,032.5 $1,097.8 $1,130.6 Days 53 56 56 55 54 55 Inventories $738.5 $917.7 $926.8 $920.3 $970.8 $1,033.5 Days 96 94 96 91 86 86 Accounts Payable $674.7 $909.6 $965.1 $923.0 $998.5 $1,042.2 Days
Slide 10: Working Capital & Days
Working Capital & Days $ Millions 1Q 2014 1Q 2015 Accounts Receivable $1,174.1 $1,234.6 Days 50 53 Inventories $1,096.8 $1,161.3 Days 99 100 Accounts Payable $1,130.3 $1,174.8 Days 68 69 Net Working Capital $1,140.6 $1,221.0 % to Sales 11.0% 10.9% Financial Community Presentation – May 28, 2015
Slide 11: Net Operating Cash
Net Operating Cash $ Millions 1200 1,083.8 1,081.5 1000 Uses of Cash 876.2 887.9 859.2 • Acquisitions 800 706.6 735.8 712.1 • Capital Expenditures 665.7 • Buy Back Stock 605.3 546.4 569.8 • Manage Debt 600 • Pay Dividends 425.0 428.5 400 200 0 2008 2009 2010 2011 2012 2013 2014 Net Operating Cash Ne
Slide 12: 2015 First Quarter Cash Flow
2015 First Quarter Cash Flow $ Millions 2014 2015 Net Operating Cash (83.1) (55.1) Capital Expenditures (29.4) (42.9) Dividends (55.1) (62.6) Free Cash Flow (167.6) (160.6) Financial Community Presentation – May 28, 2015
Slide 13: Free Cash Flow
Free Cash Flow* Four Years by Quarter 650 550 450 350 250 150 50 -50 -150 -250 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr Total Year 2011 -219 180 272 196 429 2012 -228 280 294 224 570 2013 -174 301 388 197 712 2014 -167 323 427 83 666 2015 -160 Financial Community Presentation – May 28, 2015 * Net Operating C
Slide 14: Total Debt : EBITDA Ratio
Total Debt : EBITDA Ratio 98% 113% 103% 151% 129% 119% 2000 1,805 1,705 1,722 1800 1,521 1600 1,336 1400 1,129 1200 1,045 924 965 993 1000 834 818 800 600 400 200 0 2009 2010 2011 2012 2013 2014 EBITDA Total Debt Financial Community Presentation – May 28, 2015
Slide 15: Debt Maturity Schedule
Debt Maturity Schedule December 31, 2014 Due Date $ Millions 1.350% Senior Notes 2017 $700.0 7.375% Debentures 2027 $119.2 4.000% Senior Notes 2042 $300.0 Other $6.7* Total Long Term Debt $1,125.9 Financial Community Presentation – May 28, 2015 * Includes $3.5 million of 7.45% debentures - 2097
Slide 16: Interest Expense, Earnings Coverage and Debt to Capitalization
Interest Expense, Earnings Coverage and Debt to Capitalization Interest Exp. (Millions) Earnings Cov. (Times) 80.0 71.6 70.6 67.2 65.7 70.0 62.7 64.2 60.0 49.6 50.0 40.0 42.5 42.8 40.0 30.0 18.4 18.3 20.6 15.5 14.2 16.6 20.0 13.4 13.7 11.9 10.6 10.0 0.0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2
Slide 17: Rating Agencies
Rating Agencies Standard & Poor’s Rating Services April 2014 • Affirm Long-Term Rating at ‘A’ • Affirm Short-Term Rating at ‘A-1’ • Stable Outlook Moody’s Investors Services April 2014 • Affirm Long-Term Rating at ‘A-3’ • Affirm Short-Term Debt Rating at ‘P-2’ • Stable Outlook Fitch Ratings May 2015
Slide 18: Treasury Stock Acquired
Treasury Stock Acquired 2005-2014 Average Price Avg. Shares Shares Per Share Total Dollars Outstanding (000) 2005 8,076,000 44.14 356,493,265 141,079 2006 5,600,000 54.49 305,158,657 137,342 2007 13,200,000 65.39 863,138,211 130,925 2008 7,250,000 54.28 393,539,607 118,178 2009 9,000,000 58.93 530,3
Slide 19: Dividends Per Share
Dividends Per Share 1979 – 2015 $2.75 2.68 $2.50 2.20 $2.25 2.00 $2.00 $1.75 1.56 1.46 1.44 $1.50 1.40 1.42 1.26 $1.25 1.00 $1.00 .82 $0.75 .68 .62 .58 .60 .54 .45 .48 $0.50 .40 .32 .35 .28 .21 .22 .25 $0.25 .16 .18 .19 .12 .13 .14 .05 .06 .08 .10 .01 .04 $0.00 2015P 1987 2013 1979 1980 1981 1982 19
Slide 20: Uses of Cash
Uses of Cash 2010-2014 ($ Millions) 5-Year Net Operating Cash: $4,496 Cash Dividends $891.1 Treasury Stock $3,598.3 $803.3 Capital Purchases Expenditures $521.8 Acquisitions Financial Community Presentation – May 28, 2015
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