SEC Document

Table of Contents




This summary highlights information contained elsewhere in this Proxy Statement and in the Company’s Annual Report on Form 10-K. For more complete information about these topics, please review the Company’s complete Proxy Statement and Annual Report on Form 10-K.

RPM International Inc.

RPM International Inc. owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services across three segments. The Company’s industrial products include roofing systems, sealants, corrosion control coatings, flooring coatings and other construction chemicals. Industrial companies include Stonhard, Tremco, illbruck, Carboline, Flowcrete, Euclid Chemical and RPM Belgium Vandex. The Company’s consumer products are used by professionals and do-it-yourselfers for home maintenance and improvement and by hobbyists. Consumer brands include Rust-Oleum, DAP, Zinsser, Varathane and Testors. The Company’s specialty products include industrial cleaners, colorants, exterior finishes, specialty OEM coatings, edible coatings, restoration services equipment and specialty glazes for the pharmaceutical and food industries. Specialty segment companies include Day-Glo, Dryvit, RPM Wood Finishes, Mantrose-Haeuser, Legend Brands, Kop-Coat and TCI.

The Company’s consolidated net sales, net income, and diluted earnings per share for the fiscal year ended May 31, 2017 were as follows:


  Consolidated net sales increased 3.0% to a record $4.96 billion in fiscal 2017 from $4.81 billion in fiscal 2016;


  Net income decreased 48.7% to $181.8 million in fiscal 2017 from $354.7 million in fiscal 2016 (adjusted net income* decreased 3.5% to $333.4 million in fiscal 2017 from $345.5 million in fiscal 2016); and


  Diluted earnings per share decreased 48.3% to $1.36 in fiscal 2017 from $2.63 in fiscal 2016 (adjusted earnings per share* decreased 3.9% to $2.47 in fiscal 2017 from $2.57 in fiscal 2016).


* Fiscal 2016 adjusted net income of $345.5 million and adjusted earnings per share of $2.57 exclude the reversal of contingent obligations for earnout targets that were not met at our Kirker reporting unit for $14.5 million ($9.2 million after-tax), with a $0.06 impact on diluted earnings per share. Fiscal 2017 adjusted net income of $333.4 million and adjusted earnings per share of $2.47 exclude (i) a charge of $12.3 million related to the Flowcrete decision to exit the Middle East with a $0.09 impact on diluted earnings per share; (ii) a pretax charge of $188.3 million ($129.0 million after-tax) of goodwill and intangible asset impairment losses related to our Kirker reporting unit with a $0.94 impact on diluted earnings per share; and (iii) the pretax impact of $15.0 million ($10.2 million after-tax) for severance charges incurred during the fourth quarter of fiscal 2017 pursuant to a plan to reduce future SG&A expense with a $0.08 impact on diluted earnings per share. See our Annual Report to Stockholders, which can be found on our website at, for more information about these adjustments. The Compensation Committee considered our fiscal 2017 operating results, including our adjusted net income and our adjusted earnings per share, in connection with its compensation decisions.


On October 6, 2016, the Board of Directors increased the quarterly dividend on shares of the Company’s Common Stock to $0.30 per share, an increase of 9.1% from the prior year and the highest ever paid by the Company. With a 43-year track record of a continuously increasing cash dividend, the Company is in an elite category of less than one-half of one percent of all publicly traded U.S. companies to have increased the dividend for this period of time or longer, according to the 2017 edition of the Mergent Handbook of Dividend Achievers. During this timeframe, the Company has paid approximately $1.9 billion in cash dividends to its stockholders.

Corporate Transactions

The Company acquired ten companies with combined sales of more than $246 million during fiscal 2017 and early fiscal 2018:


  Tremco Group, in July 2016, acquired the assets of Duram Industries Pty Limited, an Australian manufacturer of commercial waterproofing products with annual net sales of $6 million.


  In July 2016, Applied Polymerics, Inc. & Marketing Associates, Inc. (API/MAI), a North Carolina-based manufacturer and supplier and installer of specialist construction products for use in major structures, was acquired to be part of our RPM Performance Coatings Group’s Universal Sealants (U.K.) Limited (USL) business unit. API/MAI has annual net sales of $14 million.


  In September 2016, Specialty Polymer Coatings, Inc. (SPC), a Canadian manufacturer of high performance coatings for the global oil and gas pipeline market, was acquired to be part of our RPM Performance Coatings Group. SPC has annual net sales of $26 million.



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