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Exhibit 99

 

 

MASCO REPORTS STRONG FOURTH QUARTER AND FULL-YEAR RESULTS AS TRANSFORMATION ENHANCES PROFITABILITY

 

2014 Fourth Quarter Key Highlights

 

·                  Sales for the fourth quarter increased 3 percent to $2.1 billion; sales increased 5 percent excluding the impact of foreign currency translation

·                  Adjusted operating profit grew 32 percent to $202 million

·                  Adjusted operating profit margin for the quarter increased to 9.8 percent

·                  Adjusted EPS for the quarter grew 60 percent to $.24 per common share

 

TAYLOR, Mich. (February 9, 2015) — Masco Corporation (NYSE: MAS) reported net sales and adjusted operating profit growth in the fourth quarter of 2014 driven primarily by the Plumbing Products, Decorative Architectural Products and Installation and Other Services segments. Adjusted operating profit margin rose to 9.8 percent, reflecting the Company’s execution on cost management and strong operating leverage.

 

2014 Fourth Quarter Commentary

 

·                  Net sales from continuing operations increased 3 percent to $2.1 billion. North American sales increased 4 percent and international sales decreased 2 percent in U.S. dollars, but increased 6 percent in local currency

·                  Compared to fourth quarter 2013, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 36 percent, were as follows:

·                  Gross margins improved to 27.7 percent compared to 27.1 percent

·                  Operating margins improved to 9.8 percent compared to 7.7 percent

·                  Income from continuing operations was $.24 per common share compared to $.15 per common share

·                  Income from continuing operations, as reported, was $.29 per common share

·                  Liquidity at the end of the fourth quarter was approximately $1.7 billion

·                  Five million shares were repurchased in the fourth quarter

 

2014 Fourth Quarter Operating Segment Highlights

 

·                  Plumbing Products’ net sales increased 1 percent (5 percent excluding the impact of currency translation) fueled by growth across the segment and continued strength in the wholesale channel

·                  Decorative Architectural Products’ net sales increased 7 percent, driven by new products and program wins across the businesses

·                  Cabinets and Related Products’ net sales decreased 3 percent due to challenges in retail and dealer channels

·                  Installation and Other Services’ net sales increased 7 percent with continued growth in custom homes and the commercial channel

·                  Other Specialty Products’ net sales increased 8 percent, fueled by growth in repair and remodeling

 

“We capped off 2014 with another solid quarter as sales increased 3 percent for the total company and, importantly, adjusted operating income increased 32 percent,” said Masco’s President and CEO, Keith

 

1



 

Allman. “Our portfolio of industry-leading plumbing businesses continues to perform, delivering increased revenue and profit growth, which resulted in a record sales year for both Delta Faucet and Hansgrohe. New products and program wins at Behr Process and Liberty Hardware drove the performance of our Decorative Architectural segment, and our Installation and Other Services segment capitalized on the housing recovery and ongoing growth of its commercial business. Our window businesses also benefitted from improving macro trends in their respective markets and continued success from recently introduced products. While our Cabinet and Related Products segment faced lingering demand challenges from an ERP implementation, we believe we are taking the necessary actions to position it for profitability in 2015.”

 

2014 Full-Year Commentary

 

·                  Net sales increased 4 percent to $8.5 billion, compared to 2013

·                  Compared to full-year 2013, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 36 percent, were as follows:

·                  Gross profit margins were 28.4 percent compared to 28.0 percent

·                  Operating profit margins were 10.0 percent compared to 8.8 percent

·                  Income from continuing operations was $1.02 per common share compared to $0.77 per common share

·                  Income from continuing operations, as reported, was $2.39 per common share compared to $0.83 per common share in 2013

·                  Free cash flow exceeded $440 million

 

“2014 was a notable year for Masco,” said Keith Allman. “Our customer-focused innovation as well as our productivity improvements and cost control yielded steady sales growth and substantially improved margins. Our balance sheet continues to improve as we ended the year with $1.7 billion of liquidity. Throughout the year we also took a number of actions to drive shareholder value. In September, we announced the spin-off of our Services Business and remain on-track for it to be complete by mid-year 2015. Additionally, the restructuring of our corporate office has resulted in a leaner operating model, yielding annual savings of approximately $35-40 million. Furthermore, our commitment to returning capital to shareholders was enhanced through an increase in our dividend and a new share repurchase authorization. During the fourth quarter of 2014 we repurchased 1.4 percent of our outstanding shares or 5 million shares.”

 

2015 Outlook

 

“Our strong execution in 2014 gives us momentum as we enter 2015,” continued Mr. Allman. “We remain committed to serving the customer by accelerating our innovation pipeline and continuing our strong operating performance. We expect to gain share and drive consumer demand as we leverage our industry-leading brands and new products. We are confident in our ability to execute in this improving environment and believe the strategic initiatives we announced in 2014 will drive shareholder value as we move into 2015.”

 

About Masco

 

Headquartered in Taylor, Michigan, Masco Corporation is one of the world’s leading manufacturers of branded building products, as well as a leading provider of services that include the installation of insulation and other building products.

 

The 2014 fourth quarter supplemental material, including a presentation in PDF format, is available on the Company’s website at www.masco.com.

 

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Conference Call Details

 

A conference call regarding items contained in this release is scheduled for Monday, February 9, 2015 at 8:30 a.m. ET. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (855) 226-2726 (855-22MASCO) and from outside the U.S. at (706) 679-3614. Please use the conference identification number 63540876. The conference call will be webcast simultaneously and in its entirety through the Company’s website. Shareholders, media representatives and others interested in Masco may participate in the webcast by registering through the Investor Relations section on the Company’s website.

 

A replay of the call will be available on Masco’s website or by phone by dialing (855) 859-2056 and from outside the U.S. at (404) 537-3406. Please use the conference identification number 63540876. The telephone replay will be available approximately two hours after the end of the call and continue through March 2, 2015.

 

Financial Supplement

 

The 2014 fourth quarter and full-year supplemental material, including a presentation in PDF format, is available on the Company’s website at www.masco.com.

 

Safe Harbor Statement

 

Statements contained in this press release that reflect our views about our future performance constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “believe,” “anticipate,” “appear,” “may,” “will,” “should,” “intend,” “plan,” “estimate,” “expect,” “assume,” “seek,” “forecast,” and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements.  We caution you against relying on any of these forward-looking statements. Our future performance may be affected by our reliance on new home construction and home improvement, our reliance on key customers, the cost and availability of raw materials, uncertainty in the international economy, shifts in consumer preferences and purchasing practices, our ability to improve our underperforming businesses, our ability to maintain our competitive position in our industries, risks associated with the proposed spin-off of our Services Business, our ability to realize the expected benefits of the spin-off, the timing and terms of our share repurchase program, and our ability to reduce corporate expense and simplify our organizational structure. We discuss many of the risks we face in Item 1A, “Risk Factors” in our most recent Annual Report on Form 10-K, as well as in our Quarterly Reports on Form 10-Q and in other filings we make with the Securities and Exchange Commission. Our forward-looking statements in this press release speak only as of the date of this press release. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events or otherwise.

 

The Company believes that the non-GAAP performance measures and ratios that are contained herein, used in managing the business, may provide users of this financial information with additional meaningful comparisons between current results and results in prior periods. Non-GAAP performance measures and ratios should be viewed in addition to, and not as an alternative for, the Company’s reported results under accounting principles generally accepted in the United States. Additional information about the Company is contained in the Company’s filings with the Securities and Exchange Commission and is available on Masco’s website at www.masco.com.

 

3



 

Investor Contact

 

Irene Tasi

Director — Investor Relations

313.792.5500

irene_tasi@mascohq.com

 

# # #

 

4



 

MASCO CORPORATION

 

 

Condensed Consolidated Statements of Operations - Unaudited

For the Three Months and Twelve Months Ended December 31, 2014 and 2013

(in millions, except per common share data)

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

 

2014

 

2013

 

2014

 

2013

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

2,064

 

$

1,998

 

$

8,521

 

$

8,173

 

Cost of sales

 

1,496

 

1,467

 

6,134

 

5,918

 

Gross profit

 

568

 

531

 

2,387

 

2,255

 

 

 

 

 

 

 

 

 

 

 

Selling, general and administrative expenses

 

382

 

390

 

1,607

 

1,582

 

(Income) charge for litigation settlements

 

(9

)

 

(9

)

 

Impairment charges for other intangible assets

 

1

 

 

1

 

 

Operating profit

 

194

 

141

 

788

 

673

 

 

 

 

 

 

 

 

 

 

 

Other income (expense), net

 

(54

)

(68

)

(213

)

(223

)

Income from continuing operations before income taxes

 

140

 

73

 

575

 

450

 

 

 

 

 

 

 

 

 

 

 

Income tax (expense) benefit

 

(28

)

(20

)

333

 

(111

)

Income from continuing operations

 

112

 

53

 

908

 

339

 

 

 

 

 

 

 

 

 

 

 

(Loss) income from discontinued operations, net

 

(3

)

6

 

(5

)

(10

)

Net income

 

109

 

59

 

903

 

329

 

 

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

9

 

11

 

47

 

41

 

Net income attributable to Masco Corporation

 

$

100

 

$

48

 

$

856

 

$

288

 

 

 

 

 

 

 

 

 

 

 

Income per common share attributable to Masco Corporation (diluted):

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.29

 

$

0.12

 

$

2.39

 

$

0.83

 

(Loss) income from discontinued operations, net

 

(0.01

)

 

0.02

 

(0.01

)

 

(0.03

)

Net income

 

$

0.28

 

$

0.13

 

$

2.38

 

$

0.80

 

 

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

 

351

 

352

 

352

 

352

 

 

 

 

 

 

 

 

 

 

 

Amounts attributable to Masco Corporation:

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

103

 

$

42

 

$

861

 

$

298

 

(Loss) income from discontinued operations, net

 

(3

)

6

 

(5

)

(10

)

Net income attributable to Masco Corporation

 

$

100

 

$

48

 

$

856

 

$

288

 

 

Historical information is available on our website.

 

5



 

MASCO CORPORATION

 

 

Exhibit A: Reconciliations - Unaudited

For the Three Months and Twelve Months Ended December 31, 2014 and 2013

(in millions, except per common share data)

 

 

 

Three Months Ended
December 31,

 

Twelve Months Ended
December 31,

 

 

 

2014

 

2013

 

2014

 

2013

 

Gross Profit and Operating Profit Reconciliations

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

2,064

 

$

1,998

 

$

8,521

 

$

8,173

 

 

 

 

 

 

 

 

 

 

 

Gross profit, as reported

 

$

568

 

$

531

 

$

2,387

 

$

2,255

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

3

 

10

 

35

 

33

 

 

 

 

 

 

 

 

 

 

 

Gross profit, as adjusted

 

$

571

 

$

541

 

$

2,422

 

$

2,288

 

 

 

 

 

 

 

 

 

 

 

Gross margin, as reported

 

27.5

%

26.6

%

28.0

%

27.6

%

Gross margin, as adjusted

 

27.7

%

27.1

%

28.4

%

28.0

%

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

194

 

$

141

 

$

788

 

$

673

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

11

 

12

 

66

 

48

 

Costs related to spin-off of Services Business

 

6

 

 

6

 

 

(Income) charge for litigation settlements

 

(9

)

 

(9

)

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as adjusted

 

$

202

 

$

153

 

$

851

 

$

721

 

 

 

 

 

 

 

 

 

 

 

Operating margin, as reported

 

9.4

%

7.1

%

9.2

%

8.2

%

Operating margin, as adjusted

 

9.8

%

7.7

%

10.0

%

8.8

%

 

 

 

 

 

 

 

 

 

 

Earnings Per Common Share Reconciliation

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations before income taxes, as reported

 

$

140

 

$

73

 

$

575

 

$

450

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

11

 

12

 

66

 

48

 

Costs related to spin-off of Services Business

 

6

 

 

6

 

 

(Income) charge for litigation settlements

 

(9

)

 

(9

)

 

Currency Translation Expense - Masco Denmark

 

 

18

 

 

18

 

Gains from financial investments, net

 

 

(3

)

(4

)

(11

)

Loss (earnings) from equity investments, net

 

 

(3

)

2

 

(16

)

Income from continuing operations before income taxes, as adjusted

 

148

 

97

 

636

 

489

 

 

 

 

 

 

 

 

 

 

 

Tax at 36% rate

 

(53

)

(35

)

(229

)

(176

)

 

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

9

 

11

 

47

 

41

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations, as adjusted

 

$

86

 

$

51

 

$

360

 

$

272

 

 

 

 

 

 

 

 

 

 

 

Income per common share, as adjusted

 

$

0.24

 

$

0.15

 

$

1.02

 

$

0.77

 

 

 

 

 

 

 

 

 

 

 

Average diluted common shares outstanding

 

351

 

352

 

352

 

352

 

 

Historical information is available on our website.

 

6



 

MASCO CORPORATION

 

 

Condensed Consolidated Balance Sheets and

Other Financial Data - Unaudited

(dollars in millions)

 

 

 

December 31,

 

December 31,

 

 

 

2014

 

2013

 

Balance Sheet 

 

 

 

 

 

Assets

 

 

 

 

 

Current Assets:

 

 

 

 

 

Cash and cash investments

 

$

1,383

 

$

1,223

 

Short-term bank deposits

 

306

 

321

 

Receivables

 

1,040

 

1,004

 

Inventories

 

819

 

765

 

Prepaid expenses and other

 

315

 

155

 

Total Current Assets

 

3,863

 

3,468

 

 

 

 

 

 

 

Property and equipment, net

 

1,139

 

1,252

 

Goodwill

 

1,884

 

1,903

 

Other intangible assets, net

 

145

 

149

 

Other assets

 

136

 

185

 

Total Assets

 

$

7,167

 

$

6,957

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

Current Liabilities:

 

 

 

 

 

Accounts payable

 

$

950

 

$

902

 

Notes payable

 

505

 

6

 

Accrued liabilities

 

756

 

778

 

Total Current Liabilities

 

2,211

 

1,686

 

 

 

 

 

 

 

Long-term debt

 

2,919

 

3,421

 

Deferred income taxes and other

 

909

 

1,063

 

Total Liabilities

 

6,039

 

6,170

 

Equity

 

1,128

 

787

 

Total Liabilities and Equity

 

$

7,167

 

$

6,957

 

 

 

 

As of

 

 

 

December 31,

 

December 31,

 

 

 

2014

 

2013

 

Other Financial Data

 

 

 

 

 

Working Capital Days

 

 

 

 

 

Receivable days

 

47

 

46

 

Inventory days

 

49

 

49

 

Accounts Payable days

 

71

 

67

 

Working capital

 

$

909

 

$

867

 

Working capital as a % of sales (LTM)

 

10.7

%

10.6

%

 

Historical information is available on our website.

 

7



 

MASCO CORPORATION

 

 

Condensed Consolidated Statement of Cash Flows

 

and Other Data - Unaudited

(dollars in millions)

 

 

 

Twelve Months Ended
December 31,

 

 

 

2014

 

2013

 

Cash Flows From (For) Operating Activities:

 

 

 

 

 

Cash provided by operating activities

 

$

695

 

$

607

 

Working capital changes

 

(93

)

38

 

Net cash from operating activities

 

602

 

645

 

 

 

 

 

 

 

Cash Flows From (For) Financing Activities:

 

 

 

 

 

Purchase of Company common stock

 

(158

)

(35

)

Issuance of Company common stock

 

1

 

 

Cash dividends paid

 

(117

)

(107

)

Dividends paid to noncontrolling interest

 

(34

)

(34

)

Debt, net

 

(2

)

(202

)

Credit Agreement costs

 

 

(4

)

Tax benefit from stock-based compensation

 

13

 

 

Net cash for financing activities

 

(297

)

(382

)

 

 

 

 

 

 

Cash Flows From (For) Investing Activities:

 

 

 

 

 

Capital expenditures

 

(128

)

(126

)

Other, net

 

28

 

49

 

Net cash for investing activities

 

(100

)

(77

)

 

 

 

 

 

 

Effects of exchange rate changes on cash and cash investments

 

(45

)

(3

)

 

 

 

 

 

 

Cash and Cash Investments:

 

 

 

 

 

Increase for the year

 

160

 

183

 

At January 1

 

1,223

 

1,040

 

At December 31

 

$

1,383

 

$

1,223

 

 

 

 

As of December 31,

 

 

 

2014

 

2013

 

Liquidity

 

 

 

 

 

Cash and cash investments

 

$

1,383

 

$

1,223

 

Short-term bank deposits

 

306

 

321

 

Total Liquidity

 

$

1,689

 

$

1,544

 

 

Historical information is available on our website.

 

8



 

MASCO CORPORATION

 

 

Segment Data - Unaudited

For the Three Months and Twelve Months Ended December 31, 2014 and 2013

(dollars in millions)

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

 

December 31,

 

 

 

December 31,

 

 

 

 

 

2014

 

2013

 

Change

 

2014

 

2013

 

Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cabinets and Related Products

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

243

 

$

251

 

-3

%

$

999

 

$

1,014

 

-1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating (loss), as reported

 

$

(7

)

$

(6

)

 

 

$

(62

)

$

(10

)

 

 

Operating margin, as reported

 

-2.9

%

-2.4

%

 

 

-6.2

%

-1.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

 

2

 

 

 

30

 

6

 

 

 

Accelerated depreciation related to plant closures

 

 

 

 

 

1

 

6

 

 

 

Operating (loss) profit, as adjusted

 

(7

)

(4

)

 

 

(31

)

2

 

 

 

Operating margin, as adjusted

 

-2.9

%

-1.6

%

 

 

-3.1

%

0.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

7

 

7

 

 

 

32

 

35

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

 

$

3

 

 

 

$

1

 

$

37

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Plumbing Products

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

804

 

$

799

 

1

%

$

3,308

 

$

3,183

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

113

 

$

88

 

 

 

$

512

 

$

394

 

 

 

Operating margin, as reported

 

14.1

%

11.0

%

 

 

15.5

%

12.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

3

 

8

 

 

 

5

 

21

 

 

 

Accelerated depreciation related to plant closures

 

 

1

 

 

 

 

3

 

 

 

Operating profit, as adjusted

 

116

 

97

 

 

 

517

 

418

 

 

 

Operating margin, as adjusted

 

14.4

%

12.1

%

 

 

15.6

%

13.1

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

17

 

16

 

 

 

63

 

61

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

133

 

$

113

 

 

 

$

580

 

$

479

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Installation and Other Services

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

398

 

$

373

 

7

%

$

1,515

 

$

1,412

 

7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

25

 

$

15

 

 

 

$

58

 

$

37

 

 

 

Operating margin, as reported

 

6.3

%

4.0

%

 

 

3.8

%

2.6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

1

 

 

 

 

2

 

1

 

 

 

Operating profit, as adjusted

 

26

 

15

 

 

 

60

 

38

 

 

 

Operating margin, as adjusted

 

6.5

%

4.0

%

 

 

4.0

%

2.7

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

7

 

7

 

 

 

26

 

28

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

33

 

$

22

 

 

 

$

86

 

$

66

 

 

 

 

Historical information is available on our website.

 

9



 

MASCO CORPORATION

 

 

Segment Data - Unaudited

For the Three Months and Twelve Months Ended December 31, 2014 and 2013

(dollars in millions)

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

 

December 31,

 

 

 

December 31,

 

 

 

 

 

2014

 

2013

 

Change

 

2014

 

2013

 

Change

 

Decorative Architectural Products

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

438

 

$

408

 

7

%

$

1,998

 

$

1,927

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

80

 

$

65

 

 

 

$

360

 

$

351

 

 

 

Operating margin, as reported

 

18.3

%

15.9

%

 

 

18.0

%

18.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

 

1

 

 

 

 

2

 

 

 

Operating profit, as adjusted

 

80

 

66

 

 

 

360

 

353

 

 

 

Operating margin, as adjusted

 

18.3

%

16.2

%

 

 

18.0

%

18.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

4

 

4

 

 

 

16

 

16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

84

 

$

70

 

 

 

$

376

 

$

369

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Specialty Products

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

181

 

$

167

 

8

%

$

701

 

$

637

 

10

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

8

 

$

9

 

 

 

$

47

 

$

35

 

 

 

Operating margin, as reported

 

4.4

%

5.4

%

 

 

6.7

%

5.5

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

 

 

 

 

1

 

2

 

 

 

Accelerated depreciation related to plant closures

 

 

 

 

 

 

4

 

 

 

Operating profit, as adjusted

 

8

 

9

 

 

 

48

 

41

 

 

 

Operating margin, as adjusted

 

4.4

%

5.4

%

 

 

6.8

%

6.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

4

 

5

 

 

 

18

 

19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

12

 

$

14

 

 

 

$

66

 

$

60

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

2,064

 

$

1,998

 

3

%

$

8,521

 

$

8,173

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

 

$

219

 

$

171

 

 

 

$

915

 

$

807

 

 

 

General corporate expense, net (GCE)

 

(34

)

(30

)

 

 

(136

)

(134

)

 

 

Income (charge) for litigation settlements

 

9

 

 

 

 

9

 

 

 

 

Operating profit, as reported

 

194

 

141

 

 

 

788

 

673

 

 

 

Operating margin, as reported

 

9.4

%

7.1

%

 

 

9.2

%

8.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

 

4

 

11

 

 

 

38

 

32

 

 

 

Accelerated depreciation - segment

 

 

1

 

 

 

1

 

13

 

 

 

(Income) charge for litigation settlements

 

(9

)

 

 

 

(9

)

 

 

 

Rationalization charges - GCE

 

7

 

 

 

 

27

 

3

 

 

 

Costs related to spin-off of Services Business

 

6

 

 

 

 

6

 

 

 

 

Operating profit, as adjusted

 

202

 

153

 

 

 

851

 

721

 

 

 

Operating margin, as adjusted

 

9.8

%

7.7

%

 

 

10.0

%

8.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

 

39

 

39

 

 

 

155

 

159

 

 

 

Depreciation and amortization - non-operating

 

3

 

3

 

 

 

11

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

244

 

$

195

 

 

 

$

1,017

 

$

892

 

 

 

 

Historical information is available on our website.

 

10



 

MASCO CORPORATION

 

 

North American and International Data - Unaudited

For the Three Months and Twelve Months Ended December 31, 2014 and 2013

(dollars in millions)

 

 

 

Three Months Ended

 

 

 

Twelve Months Ended

 

 

 

 

 

December 31,

 

 

 

December 31,

 

 

 

 

 

2014

 

2013

 

Change

 

2014

 

2013

 

Change

 

North American

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

1,675

 

$

1,603

 

4

%

$

6,892

 

$

6,634

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

174

 

$

131

 

 

 

$

701

 

$

649

 

 

 

Operating margin, as reported

 

10.4

%

8.2

%

 

 

10.2

%

9.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

4

 

11

 

 

 

37

 

25

 

 

 

Accelerated depreciation related to plant closures

 

 

1

 

 

 

1

 

9

 

 

 

Operating profit, as adjusted

 

178

 

143

 

 

 

739

 

683

 

 

 

Operating margin, as adjusted

 

10.6

%

8.9

%

 

 

10.7

%

10.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

30

 

29

 

 

 

116

 

119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

208

 

$

172

 

 

 

$

855

 

$

802

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

389

 

$

395

 

-2

%

$

1,629

 

$

1,539

 

6

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported

 

$

45

 

$

40

 

 

 

$

214

 

$

158

 

 

 

Operating margin, as reported

 

11.6

%

10.1

%

 

 

13.1

%

10.3

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges

 

 

 

 

 

1

 

7

 

 

 

Accelerated depreciation related to plant closures

 

 

 

 

 

 

4

 

 

 

Operating profit, as adjusted

 

45

 

40

 

 

 

215

 

169

 

 

 

Operating margin, as adjusted

 

11.6

%

10.1

%

 

 

13.2

%

11.0

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization

 

9

 

10

 

 

 

39

 

40

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

54

 

$

50

 

 

 

$

254

 

$

209

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

Net sales

 

$

2,064

 

$

1,998

 

3

%

$

8,521

 

$

8,173

 

4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating profit, as reported - segment

 

$

219

 

$

171

 

 

 

$

915

 

$

807

 

 

 

General corporate expense, net (GCE)

 

(34

)

(30

)

 

 

(136

)

(134

)

 

 

Income (charge) for litigation settlements

 

9

 

 

 

 

9

 

 

 

 

Operating profit, as reported

 

194

 

141

 

 

 

788

 

673

 

 

 

Operating margin, as reported

 

9.4

%

7.1

%

 

 

9.2

%

8.2

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rationalization charges - segment

 

4

 

11

 

 

 

38

 

32

 

 

 

Accelerated depreciation - segment

 

 

1

 

 

 

1

 

13

 

 

 

(Income) charge for litigation settlements

 

(9

)

 

 

 

(9

)

 

 

 

Rationalization charges - GCE

 

7

 

 

 

 

27

 

3

 

 

 

Costs related to spin-off of Services Business

 

6

 

 

 

 

6

 

 

 

 

Operating profit, as adjusted

 

202

 

153

 

 

 

851

 

721

 

 

 

Operating margin, as adjusted

 

9.8

%

7.7

%

 

 

10.0

%

8.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation and amortization - segment

 

39

 

39

 

 

 

155

 

159

 

 

 

Depreciation and amortization - non-operating

 

3

 

3

 

 

 

11

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EBITDA, as adjusted

 

$

244

 

$

195

 

 

 

$

1,017

 

$

892

 

 

 

 

Historical information is available on our website.

 

11