RPM International Inc (NYSE:RPM) stock fell 0.52% (As on October 3, 11:16:01 AM UTC-4, Source: Google Finance) after the company posted mixed result for the first quarter of FY 25. Geographically, sales declined 1.4% in North America (accounting for around 80% of total sales). Europe (13% of total sales) declined 5.2% due to a soft economic environment, foreign currency translation headwinds and divestitures. Latin America (4% of total sales) was down 10.4% year over year due to foreign currency headwinds. Nonetheless, Asia / Pacific (2% of total sales) and Africa / Middle East (1% of total sales) grew 1.2% and 6.6%, respectively, aided by spending on infrastructure and high-performance building projects.
Net sales fell 0.9% organically. Divestitures, net of acquisitions, reduced sales by 0.1% and foreign currency translation impacted sales by 1.1%. Adjusted EBIT increased 6.3% year over year to $328.3 million. Adjusted EBIT margin improved 130 basis points (bps) year over year to 16.7%. The upside was driven by MAP 2025 and improved fixed-cost leverage at businesses with volume growth.

Moreover, Construction Products Group segment sales increased 1.4% from a year ago to $794 million, owing to 2.2% organic growth and 0.4% contribution from buyouts. Performance Coatings Group segment’s sales decreased 1.8% year over year to $371.8 million. Sales were up 1.8% organically but declined 2% due to divestitures and 1.6% owing to currency headwinds. PCG’s organic sales improvement was led by the flooring business, which benefited from its focus on maintenance and restoration and specified solutions for high-performance new construction projects. Emerging markets also contributed to growth. Consumer Group sales in the segment declined 6.1% year over year to $628.5 million, owing to weaker DIY takeaway at retail stores, rationalization of lower-margin products and customer destocking.

RPM in the first quarter of FY 25 has reported the adjusted earnings per share of $1.84, beating the analysts’ estimates for the adjusted earnings per share of $1.76, according to Zacks Consensus Estimate. The company had reported the adjusted revenue decline of 2.1 percent to $1.97 billion in the first quarter of FY 25, missing the analysts’ estimates for revenue of $2.02 billion. Positive volume growth at the CPG and PCG segments, and slightly favorable pricing were more than offset by unfavorable foreign exchange and volume declines at Consumer Group and SPG units. Businesses aligned with new high-performance building projects and renovations performed better than the businesses associated with residential end markets.