MEDINA, Ohio  -- RPM International Inc. (NYSE: RPM) today reported marked increases in net sales, net income and diluted earnings per share for its fiscal 2012 third quarter ended February 29, 2012.

Third-Quarter Results

Net sales, net income and earnings per share for the third quarter all posted strong improvements versus prior-year results in the seasonally weak period. Net sales grew 14.0% to $773.6 million from $678.9 million, while consolidated earnings before interest and taxes (EBIT) grew 99.8%, to $27.1 million from $13.6 million a year ago. Net income attributable to RPM stockholders increased 503.9% to $6.6 million, compared to $1.1 million in the year-ago period. Diluted earnings per share were $0.05, compared to $0.01 in the fiscal 2011 third quarter.

"RPM's operations delivered exceptional performance during our third quarter, with market share gains and improved demand, as nearly all of our business units generated solid sales increases and substantially stronger growth in earnings," stated Frank C. Sullivan, chairman and chief executive officer.

Third-Quarter Segment Sales and Earnings

Industrial segment sales grew 11.8% to $501.9 million in the fiscal 2012 third quarter from $449.1 million a year ago. Organic sales improved 5.0%, including a 2.0% decline attributable to foreign exchange, while acquisition growth added 6.8%. Industrial segment EBIT increased 56.9%, to $21.3 million from $13.6 million in the fiscal 2011 third quarter.

"Most of our industrial product lines, both domestically and in Europe, posted gains in sales and EBIT, with high-performance industrial coatings and maintenance products continuing to perform exceptionally well. Overall unit volume in the segment was up more than 5%. Some units serving commercial construction markets, notably concrete admixtures and construction sealants, had sharp improvements over the prior year. We are heartened by the sales improvements by most of our businesses serving commercial construction, as depressed conditions in that market have challenged us for the past three years," Sullivan stated.

RPM's consumer segment enjoyed an 18.2% increase in net sales to $271.7 million from $229.8 million in the fiscal 2011 third quarter, including a 17.9% gain in organic sales, which included a 0.6% decline due to unfavorable foreign exchange, while acquisition growth contributed 0.3%. Consumer segment EBIT increased 34.4%, to $21.5 million from $16.0 million a year ago.

"Our consumer segment benefited from the introduction of new products, market share gains and increased consumer spending. The strong, double-digit growth in our consumer businesses also resulted from the mild weather in comparison to last year's extended cold and snowy winter season," stated Sullivan.

Cash Flow and Financial Position

For the first nine months of fiscal 2012, cash from operations was $153.5 million, compared to $191.0 million in the first nine months of fiscal 2011. Capital expenditures during the current nine-month period of $34.4 million compare to depreciation of $38.8 million over the same time. Total debt at the end of the first nine months was $1.1 billion, approximately equal to the level at the end of fiscal 2011 and compared to $935.7 million at the end of the third quarter of fiscal 2011. RPM's net (of cash) debt-to-total capitalization ratio was 39.6%, compared to 34.8% at May 31, 2011, and both remain at the low end of the company's historic norms.

"RPM continues to utilize our strong cash and liquidity position to support acquisitions that will enhance the geographic footprint and product line offerings of our operating companies and add strategic platforms to our operating groups. At February 29, 2012, liquidity, including cash and long-term committed available credit, stood at $733.3 million," Sullivan stated.

Nine-Month Sales and Earnings

Fiscal 2012 nine-month net sales, net income and diluted earnings per share all posted double-digit gains. Net sales increased 11.5% to $2.68 billion from $2.40 billion during the first nine months of fiscal 2011. Consolidated EBIT increased 14.1% to $256.6 million from $225.0 million during the first nine months of fiscal 2011. Net income attributable to RPM stockholders grew 12.2% to $133.4 million from $118.9 million a year ago. Diluted earnings per share attributable to RPM stockholders improved 12.1% to $1.02 from $0.91 in fiscal 2011.

Nine-Month Segment Sales and Earnings

Sales for RPM's industrial segment increased 10.8%, to $1.81 billion from $1.63 billion in the fiscal 2011 first nine months. The organic sales increase was 6.8%, including foreign exchange gains of 1.2%, while acquisition growth added 4.0%. Industrial segment EBIT grew 16.0% to $192.0 million from $165.6 million in the first nine months of fiscal 2011.

In the consumer segment, nine-month sales increased 12.9% to $865.2 million from $766.2 million reported in the first nine months of fiscal 2011. Organic sales increased by 12.8%, including foreign exchange gains of 0.6%, and acquisition growth added 0.1%. Consumer segment EBIT improved 8.0%, to $99.7 million from $92.3 million in the first nine months a year ago.

Two Acquisitions Completed

On January 3, 2012, the RPM Building Solutions Group acquired FEMA Farben + Putze GmbH (FEMA GmbH), a $40 million German manufacturer and supplier of External Insulating and Finishing Systems (EIFS) and complementary product lines for the German and French construction markets.

On April 4, 2012, the company announced that its Rust-Oleum Group acquired HiChem Paint Technologies Pty. Ltd., a $23 million Australian manufacturer of automotive aftermarket coatings, as well as specialty coatings for industrial applications and home maintenance.

Terms of both transactions, which are expected to be accretive to earnings within one year, were not disclosed.

Business Outlook

"Having recently completed our annual growth and strategy meetings with our operating companies, we remain confident in our initial guidance for the 2012 fiscal year of diluted earnings per share growth of 10% to 15%, and that fiscal 2013 will be another year of solid sales and earnings growth for RPM, " Sullivan stated.

About RPM

RPM International Inc., a holding company, owns subsidiaries that are world leaders in specialty coatings, sealants, building materials and related services serving both industrial and consumer markets. RPM's industrial products include roofing systems, sealants, corrosion control coatings, flooring coatings and specialty chemicals. Industrial brands include Stonhard, Tremco, illbruck, Carboline, Flowcrete, Universal Sealants and Euco. RPM's consumer products are used by professionals and do-it-yourselfers for home maintenance and improvement and by hobbyists. Consumer brands include Zinsser, Rust-Oleum, DAP, Varathane and Testors. Additional details can be found at www.RPMinc.com and by following RPM on Twitter at www.twitter.com/RPMintl.

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