Valspar Sales Slow Ahead of Merger
December 20 2016 - 9:20AM
Dow Jones News
By Imani Moise
Valspar Corp., which is merging with rival paint maker
Sherwin-Williams Co., said its revenue dropped in its
fourth-quarter, hurt by lower sales and foreign currency
effects.
The Minneapolis-based paint maker in March agreed to be acquired
for $9.3 billion in cash, a price tag that represented a 35%
premium. The deal gives Sherwin-Williams more access to
do-it-yourself painters who tend to buy supplies at retailers such
as Lowe's Cos. and Ace Hardware Corp., places where Valspar is
particularly strong.
In the quarter ended Oct. 28, Valspar said merger-related costs
totaled $3 million, including employee expenses, professional
services and regulatory fees. Additionally, restructuring costs
came up to $5 million during the quarter. Combined, these items
dented earnings 10 cents per share.
Across the company, volume decreased 2%. Revenue in its coatings
segment fell 2% to $626 million, and sales in its paints segment
dropped 7% to $421 million.
In all for the quarter ended Oct. 28, Valspar reported a profit
of $103.6 million, or $1.27 a share, up from $102.4 million, or
$1.26 a share, a year earlier. The company is no longer provided
adjusted figures.
Revenue fell 3.7%% to $1.11 billion.
Analysts polled by Thomson Reuters had forecast $1.17 billion in
revenue.
Shares closed at $103.64 and were inactive premarket. The stock
has risen 25% so far this year.
Write to Imani Moise at imani.moise@wsj.com
(END) Dow Jones Newswires
December 20, 2016 09:05 ET (14:05 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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