RPM earnings analysis
What we found in RPM's 10-K: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
RPM delivered stronger fiscal-2026 sales, segment earnings and cash flow, led by CPG and PCG exposure to infrastructure, high-performance buildings and protective coatings. However, the Consumer segment posted a 2.6% organic decline, gross margin remained flat at 41.4%, and GAAP diluted EPS declined to $5.17 from $5.35 as the prior year benefited from a lower 12.9% tax rate. The company has financial flexibility—$1.090B of liquidity and 1.70x net leverage—but fiscal 2027 faces tariff/inflation pressure and continued restructuring execution.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Revenue growth accelerated to 6.7%
- Fiscal 2026 revenue increased 6.7% to $7.863B, following $7.373B in fiscal 2025 and $7.335B in fiscal 2024. Growth included 2.0% organic growth, 3.6% from acquisitions/divestitures and 1.1% from foreign exchange.
- Construction and performance coatings lead
- CPG and PCG were the core organic growth engines: CPG organic sales grew 4.5% on high-performance building, infrastructure, roofing and concrete-admixture demand, while PCG grew 4.1% on flooring, protective/fireproofing coatings and demand in India and the Middle East.
- Pre-tax margin improved despite flat gross margin
- Consolidated income before tax rose to $870.3M, or 11.1% of sales, from $792.8M, or 10.8%, despite gross margin holding at 41.4%. MAP savings and fiscal-2026 restructuring savings partly offset inflation, mix pressure and consolidation inefficiencies.
- Cash conversion improved materially
- Cash generation strengthened: operating cash flow increased to $898.7M from $768.2M, while capex was $223.5M. This implies free cash flow of approximately $675.2M, versus approximately $538.3M in fiscal 2025.
- Portfolio strategy adds brands and building systems
- The company continued a portfolio-and-efficiency strategy, completing six acquisitions in fiscal 2026, including Ready Seal in Consumer and Kalzip in CPG. Acquisitions used $202.4M of cash, down from $595.8M in fiscal 2025.
- Deleveraging alongside dividends and buybacks
- Capital allocation remained balanced: RPM paid $271.7M of dividends ($2.13 per share), repurchased $77.5M of stock, and repaid $197.8M on its revolving credit facility. Net leverage was 1.70x and debt-to-capital improved to 43.3% from 47.8%.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Consumer organic decline and Color Group impairment
- Consumer is the principal weak spot: its fiscal-2026 organic sales declined 2.6% due to soft DIY and European markets, product rationalization and weak Color Group demand. Color Group softness also triggered a $9.7M property, plant and equipment impairment in Q4.
- Restructuring execution and residual charges
- A new fiscal-2026 SG&A optimization program incurred $24.4M of restructuring charges and has $7.2M of identified future charges. MAP 2025 incurred another $18.2M in fiscal 2026 and has $5.3M of remaining expected charges, while management warns of possible disruption, lower productivity and associate turnover.
- Tariffs and inflation remain FY27 headwinds
- Tariff-related cost inflation, lower fixed-cost absorption and unfavorable sales mix held fiscal-2026 gross margin flat at 41.4%. Management specifically expects inflationary and geopolitical-driven inflation headwinds to affect fiscal 2027 results.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $5.17
- Gross margin
- 41.4%
- Operating margin
- 11.7%
- Segment
- CPG: $3.070B revenue, +6.8% YoY (+4.5% organic)
- Segment
- PCG: $2.132B revenue, +6.8% YoY (+4.1% organic)
- Segment
- Consumer: $2.662B revenue, +6.4% YoY (-2.6% organic; acquisitions contributed 8.4%)
What they said about what is next.
The 10-K provides no numeric revenue, EPS or EBITDA outlook. Management says fiscal 2027 results will reflect inflationary headwinds, including tariff-related and geopolitical-driven inflation; it expects approximately $5.3M of remaining MAP 2025 charges and $7.2M of additional charges from the fiscal 2026 restructuring action. Annual operating outlook was provided separately in the Q4 earnings release/call.
The filing reads about the same as the one before it.
What came before.
- 10-Q · April 8, 2026
- RPM reported quarterly net sales of $1,607,949 (thousands) for the three months ended February 28, 2026, up from $1,476,562 (thousands) a year ago, with gross profit rising to $634,816 (thousands) and gross margin…
- 10-Q · October 1, 2025
- RPM reported quarterly net sales of $2,113,743 (in thousands), up from $1,968,789 in the year-ago quarter, while diluted EPS was unchanged at $1.77. Gross margin remained around 42.3% and operating margin declined…
- 10-K · July 24, 2025
- RPM reports net sales of $7.4 billion for the fiscal year ended May 31, 2025, with a diversified four-segment portfolio (CPG, PCG, Consumer, SPG) and global operations in approximately 163 countries. The company…
- 10-Q · April 8, 2025
- RPM reported third-quarter net sales of $1,476,562 (in thousands), down from $1,522,982 (in thousands) in the prior-year quarter, with gross profit of $567,490 (in thousands) and diluted EPS of $0.40. Operating results…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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