Sherwin-Williams Reports Slight Decline in Q1 2025 Sales, Acquires European Coatings Company

The Sherwin-Williams Company reported a slight decline in financial performance for the first quarter of 2025, with consolidated net sales of $5.306 billion, down 1.1% from $5.367 billion in the same period last year. The decrease was primarily attributed to unfavorable foreign currency translation and lower sales in the Consumer Brands and Performance Coatings Groups, although the Paint Stores Group saw a 2.3% increase in sales. Gross profit increased to $2.559 billion, representing 48.2% of net sales, compared to 47.2% in the prior year. Net income for the quarter was $503.9 million, slightly down from $505.2 million, resulting in diluted earnings per share of $2.00, up from $1.97.

In terms of operational changes, the company experienced a 3.2% decrease in the cost of goods sold, which fell to $2.747 billion. Selling, general, and administrative expenses were effectively managed, decreasing to $1.794 billion from $1.800 billion. The company also reported an increase in adjusted EBITDA of 4.6% to $937 million, or 17.7% of net sales. The effective tax rate rose to 22.8% from 21.1% year-over-year, primarily due to less favorable tax benefits related to employee share-based payments.

Strategically, Sherwin-Williams has been active in acquisitions, completing the purchase of a European coil and industrial coatings company for approximately $80 million in March 2025. Additionally, the company signed an agreement to acquire BASF's Brazilian decorative paints business for $1.15 billion, pending regulatory approval. These acquisitions are expected to enhance the company's market presence and product offerings, particularly in the Consumer Brands Group.

The company reported a significant increase in its total assets, which rose to $24.636 billion from $23.428 billion a year earlier, driven by increases in accounts receivable and inventories. Current liabilities also increased, primarily due to a rise in short-term borrowings, which reached $1.799 billion. The company maintained a strong liquidity position with $199.8 million in cash and $2.148 billion in unused credit facilities. Looking ahead, Sherwin-Williams aims to continue its focus on stability and growth through strategic acquisitions and investments in digital technologies, while navigating a challenging macroeconomic environment.