Document_and_Entity_Informatio
Document and Entity Information | 3 Months Ended | |
Aug. 31, 2012 | Oct. 02, 2012 | |
Document Information [Line Items] | ' | ' |
Document Type | '10-Q/A | ' |
Amendment Flag | 'true | ' |
Amendment Description | 'RPM International Inc. (the “Companyâ€) is filing this amended Quarterly Report on Form 10-Q/A because we determined that the consolidated financial statements contained in the Form 10-Q for the quarterly period ended August 31, 2012 and filed October 4, 2012 (“Original Form 10-Qâ€) should no longer be relied upon due to an error in the timing of the disclosure and accrual of certain loss reserves. These loss reserves were associated with our settlement of the previously disclosed General Services Administration (“GSAâ€) and Department of Justice (“DOJâ€) investigation into compliance issues related to GSA contracts at our Tremco Roofing Division (also referred to herein as our Building Solutions Group Roofing Division) (the “GSA matterâ€). As a result of the error, the estimated loss contingency for the first quarter of fiscal 2013 was understated by $11.4 million, producing an overstatement of net income of $7.2 million for the three months ended August 31, 2012. At the same time, our estimated loss contingency was understated by $16.9 million for the second quarter of fiscal 2013, and overstated by $28.3 million for the third quarter of fiscal 2013. As such, we are also restating our financial statements for the three and six month periods ending November 30, 2012, and the three month period ended February 28, 2013 to address the error. After the restatement of the first and second quarters of fiscal 2013, the resulting charge in the third quarter of fiscal 2013 of $40.5 million was due to the application of a “multiplier†negotiated between the DOJ and the Company. The error did not impact the results for the nine months ended February 28, 2013 or the fiscal year ended May 31, 2013. The error was identified as a result of an investigation by the Audit Committee of the Company’s Board of Directors (the “Audit Committeeâ€), with the assistance of independent advisors, into the timing of our third quarter of fiscal 2013 disclosure and accrual related to the GSA matter. The Audit Committee determined that the accounting errors described above did not result from intentional misconduct. The GSA matter is also the subject of a formal investigation by the Securities and Exchange Commission (the “SECâ€). The Company is cooperating with the SEC in its ongoing investigation.The Audit Committee of the Company’s Board of Directors approved a restatement of the Company’s financial statements for the three month period ended August 31, 2012, by filing an amendment to the Original Form 10-Q. The error, including the specific line item on each of the Company’s financial statements that were restated, is described in greater detail in Note A1 contained in this Form 10-Q/A.The Company believes the restatement reflects a material weakness in the Company’s internal control over financial reporting and that its disclosure controls and procedures were not effective as of August 31, 2012 and November 30, 2012. The Company’s controls did not operate as designed to prevent material misstatements, due to unique factors that were only associated with the GSA matter. The Company has concluded that the unique factors related to the GSA matter contributed to a break-down in communications, resulting in the material weakness. Based on developments that occurred during the third quarter of fiscal 2013 and the resulting disclosure of and accrual for the GSA matter, the material weakness no longer exists as of February 28, 2013. | ' |
Document Period End Date | 31-Aug-12 | ' |
Document Fiscal Year Focus | '2013 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Trading Symbol | 'RPM | ' |
Entity Registrant Name | 'RPM INTERNATIONAL INC/DE/ | ' |
Entity Central Index Key | '0000110621 | ' |
Current Fiscal Year End Date | '--05-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Entity Common Stock, Shares Outstanding | ' | 132,290,362 |
CONSOLIDATED_BALANCE_SHEETS
CONSOLIDATED BALANCE SHEETS (USD $) | Aug. 31, 2012 | 31-May-12 | ||
In Thousands, unless otherwise specified | ||||
Current Assets | ' | ' | ||
Cash and cash equivalents | $257,382 | [1] | $315,968 | [1] |
Trade accounts receivable (less allowances of $26,874 and $26,507, respectively) | 760,300 | [1] | 745,541 | |
Inventories | 525,323 | [1] | 489,978 | |
Deferred income taxes | 24,253 | [1] | 18,752 | |
Prepaid expenses and other current assets | 158,393 | [1] | 167,080 | |
Total current assets | 1,725,651 | [1] | 1,737,319 | |
Property, Plant and Equipment, at Cost | 1,094,665 | [1] | 1,050,965 | |
Allowance for depreciation and amortization | -648,961 | [1] | -632,133 | |
Property, plant and equipment, net | 445,704 | [1] | 418,832 | |
Other Assets | ' | ' | ||
Goodwill | 954,969 | [1] | 849,346 | |
Other intangible assets, net of amortization | 380,624 | [1] | 345,620 | |
Other | 169,030 | [1] | 210,696 | |
Total other assets | 1,504,623 | [1] | 1,405,662 | |
Total Assets | 3,675,978 | [1] | 3,561,813 | |
Current Liabilities | ' | ' | ||
Accounts payable | 347,245 | [1] | 391,467 | |
Current portion of long-term debt | 3,097 | [1] | 2,584 | |
Accrued compensation and benefits | 106,463 | [1] | 157,298 | |
Accrued loss reserves | 29,468 | [1] | 28,880 | |
Other accrued liabilities | 195,743 | [1] | 144,911 | |
Total current liabilities | 682,016 | [1] | 725,140 | |
Long-Term Liabilities | ' | ' | ||
Long-term debt, less current maturities | 1,199,513 | [1] | 1,112,952 | |
Other long-term liabilities | 386,236 | [1] | 381,619 | |
Deferred income taxes | 45,861 | [1] | 28,119 | |
Total long-term liabilities | 1,631,610 | [1] | 1,522,690 | |
Stockholders' Equity | ' | ' | ||
Preferred stock, par value $0.01; authorized 50,000 shares; none issued | ' | [1] | ' | |
Common stock, par value $0.01; authorized 300,000 shares; issued 136,231 and outstanding 132,013 as of August 2012; issued 135,741 and outstanding 131,555 as of May 2012 | 1,320 | [1] | 1,316 | |
Paid-in capital | 748,912 | [1] | 742,895 | |
Treasury stock, at cost | -69,740 | [1] | -69,480 | |
Accumulated other comprehensive income (loss) | -146,701 | [1] | -177,893 | |
Retained earnings | 685,201 | [1] | 686,818 | |
Total RPM International Inc. stockholders' equity | 1,218,992 | [1] | 1,183,656 | |
Noncontrolling interest | 143,360 | [1] | 130,327 | |
Total Equity | 1,362,352 | [1] | 1,313,983 | [1] |
Total Liabilities and Stockholders' Equity | $3,675,978 | [1] | $3,561,813 | |
[1] | Restated |
CONSOLIDATED_BALANCE_SHEETS_Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) | Aug. 31, 2012 | 31-May-12 | |
In Thousands, except Per Share data, unless otherwise specified | |||
Trade accounts receivable, allowances | $26,874 | [1] | $26,507 |
Preferred stock, par value | $0.01 | [1] | $0.01 |
Preferred stock, authorized | 50,000 | [1] | 50,000 |
Preferred stock, issued | ' | [1] | ' |
Common stock, par value | $0.01 | [1] | $0.01 |
Common stock, authorized | 300,000 | [1] | 300,000 |
Common stock, issued | 136,231 | [1] | 135,741 |
Common stock, outstanding | 132,013 | [1] | 131,555 |
[1] | Restated |
CONSOLIDATED_STATEMENTS_OF_INC
CONSOLIDATED STATEMENTS OF INCOME (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | ||
Net Sales | $1,046,714 | [1] | $985,918 | |
Cost of Sales | 612,834 | [1] | 576,292 | |
Gross Profit | 433,880 | [1] | 409,626 | |
Selling, General and Administrative Expenses | 310,940 | [1] | 273,943 | |
Estimated Loss Contingency | 11,418 | [1] | ' | |
Interest Expense | 18,430 | [1] | 17,806 | |
Investment (Income), Net | -6,974 | [1] | -24 | |
Other Expense (Income), Net | 39,422 | [1] | -803 | |
Income Before Income Taxes | 60,644 | [1] | 118,704 | |
Provision for Income Taxes | 30,025 | [1] | 35,364 | |
Net Income | 30,619 | [1] | 83,340 | |
Less: Net Income Attributable to Noncontrolling Interests | 3,954 | [1] | 6,529 | |
Net Income Attributable to RPM International Inc. Stockholders | $26,665 | [1] | $76,811 | |
Average Number of Shares of Common Stock Outstanding: | ' | ' | ||
Basic | 128,805 | [1] | 128,094 | |
Diluted | 129,570 | [1] | 128,626 | |
Earnings per Share of Common Stock Attributable to RPM International Inc. Stockholders | ' | ' | ||
Basic | $0.20 | [1] | $0.59 | |
Diluted | $0.20 | [1],[2] | $0.59 | [2] |
Cash Dividends Declared per Share of Common Stock | $0.22 | [1] | $0.21 | |
[1] | Restated | |||
[2] | For the quarters ended August 31, 2012 and 2011, approximately 2,954,000 and 2,750,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted earnings per share, as the effect would have been anti-dilutive. |
CONSOLIDATED_STATEMENTS_OF_COM
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | |
Net income | $30,619 | [1] | $83,340 |
Other Comprehensive Income, Net of Tax: | ' | ' | |
Foreign Currency Translation Adjustments | 39,230 | [1] | -9,104 |
Pension and Other Postretirement Benefit Liability Adjustments | 1,206 | [1] | 2,218 |
Unrealized Gain (Loss) on Securities | -352 | [1] | -3,253 |
Unrealized Gain on Derivatives | 187 | [1] | -1,079 |
Comprehensive Income | 70,890 | [1] | 72,122 |
Less: Comprehensive Income Attributable to Noncontrolling Interests | 13,033 | [1] | 7,194 |
Comprehensive Income Attributable to RPM International Inc. Stockholders | $57,857 | [1] | $64,928 |
[1] | Restated |
CONSOLIDATED_STATEMENTS_OF_CAS
CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | |
Cash Flows From Operating Activities: | ' | ' | |
Net income | $30,619 | [1] | $83,340 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' | |
Depreciation | 13,330 | [1] | 13,009 |
Amortization | 6,735 | [1] | 5,110 |
Impairment on investment in Kemrock | 40,273 | [1] | ' |
Estimated Loss Contingency | 11,418 | [1] | ' |
Deferred income taxes | -2,296 | [1] | -1,374 |
Stock-based compensation expense | 3,873 | [1] | 3,125 |
Other | -442 | [1] | -83 |
Changes in assets and liabilities, net of effect from purchases and sales of businesses: | ' | ' | |
Decrease (increase) in receivables | 7,162 | [1] | -4,211 |
(Increase) in inventory | -24,650 | [1] | -27,113 |
Decrease (increase) in prepaid expenses and other current and long-term assets | 554 | [1] | -6,370 |
(Decrease) in accounts payable | -54,226 | [1] | -27,069 |
(Decrease) in accrued compensation and benefits | -56,362 | [1] | -45,873 |
(Decrease) in accrued loss reserves | -118 | [1] | -2,622 |
Increase in other accrued liabilities | 53,198 | [1] | 14,818 |
Other | -11,334 | [1] | 2,789 |
Cash From Operating Activities | 17,734 | [1] | 7,476 |
Cash Flows From Investing Activities: | ' | ' | |
Capital expenditures | -12,702 | [1] | -4,913 |
Acquisition of businesses, net of cash acquired | -141,203 | [1] | -35,914 |
Purchase of marketable securities | -55,744 | [1] | -11,315 |
Proceeds from sales of marketable securities | 49,320 | [1] | 13,821 |
Other | 17,255 | [1] | 915 |
Cash (Used For) Investing Activities | -143,074 | [1] | -37,406 |
Cash Flows From Financing Activities: | ' | ' | |
Additions to long-term and short-term debt | 147,547 | [1] | 7,391 |
Reductions of long-term and short-term debt | -63,193 | [1] | -10,824 |
Cash dividends | -28,281 | [1] | -27,424 |
Repurchase of stock | -260 | [1] | -204 |
Exercise of stock options | 803 | [1] | 1,205 |
Cash From (Used For) Financing Activities | 56,616 | [1] | -29,856 |
Effect of Exchange Rate Changes on Cash and Cash Equivalents | 10,138 | [1] | -1,870 |
Net Change in Cash and Cash Equivalents | -58,586 | [1] | -61,656 |
Cash and Cash Equivalents at Beginning of Period | 315,968 | [1] | 435,011 |
Cash and Cash Equivalents at End of Period | $257,382 | [1] | $373,355 |
[1] | Restated |
Restatement
Restatement | 3 Months Ended | ||||||||||||
Aug. 31, 2012 | |||||||||||||
Restatement | ' | ||||||||||||
NOTE A1 — RESTATEMENT | |||||||||||||
The Company determined that the estimated loss contingency for the first quarter of fiscal 2013 was understated by $11.4 million, producing an overstatement of net income of $7.2 million for the three month period ended August 31, 2012. The error was identified as a result of an investigation by the Audit Committee, with the assistance of independent advisors, into the timing of our third quarter of fiscal 2013 disclosure and accrual associated with the settlement of the previously disclosed GSA matter. | |||||||||||||
The Company’s Consolidated Balance Sheets; Consolidated Statements of Income; Consolidated Statements of Comprehensive Income; Consolidated Statements of Cash Flows; Note 9. Contingencies and Other Accrued Losses; Note 12. Income Taxes; Note 14. Earnings Per Share; Note 15. Segment Information; and Note 17. Equity; included in this Form 10-Q/A have been restated to correct for the misstatements described above. | |||||||||||||
The following are previously reported and restated balances of affected line items in the Consolidated Balance Sheets as of August 31, 2012 (Unaudited), Consolidated Statements of Income and Consolidated Statements of Comprehensive Income for the three months ended August 31, 2012 (Unaudited), and the Consolidated Statements of Cash Flows for the three months ended August 31, 2012 (Unaudited). | |||||||||||||
As of August 31, 2012 | |||||||||||||
As Reported | Adjustment | Restated | |||||||||||
Consolidated Balance Sheet | |||||||||||||
Deferred income taxes | $ | 20,083 | $ | 4,170 | $ | 24,253 | |||||||
Other accrued liabilities | 184,325 | 11,418 | 195,743 | ||||||||||
Retained earnings | 692,449 | (7,248 | ) | 685,201 | |||||||||
Total RPM International Inc. stockholders’ equity | 1,226,240 | (7,248 | ) | 1,218,992 | |||||||||
Total equity | 1,369,600 | (7,248 | ) | 1,362,352 | |||||||||
Three Months Ended August 31, 2012 | |||||||||||||
As Reported | Adjustment | Restated | |||||||||||
Consolidated Statements of Income | |||||||||||||
Estimated Loss Contingency | $ | — | $ | 11,418 | $ | 11,418 | |||||||
Income before income taxes | 72,062 | (11,418 | ) | 60,644 | |||||||||
Provision for income taxes | 34,195 | (4,170 | ) | 30,025 | |||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Net income attributable to RPM International Inc. Stockholders | 33,913 | (7,248 | ) | 26,665 | |||||||||
Earnings Per Share—Basic | 0.26 | (0.06 | ) | 0.2 | |||||||||
Earnings Per Share—Diluted | 0.26 | (0.06 | ) | 0.2 | |||||||||
Consolidated Statements of Comprehensive Income | |||||||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Total Comprehensive Income | 78,138 | (7,248 | ) | 70,890 | |||||||||
Comprehensive Income Attributable to RPM International Inc. Stockholders | 65,105 | (7,248 | ) | 57,857 | |||||||||
Consolidated Statement of Cash Flows | |||||||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Estimated loss contingency | — | 11,418 | 11,418 | ||||||||||
Deferred income taxes | 1,874 | (4,170 | ) | (2,296 | ) | ||||||||
Cash From Operating Activities | 17,734 | — | 17,734 | ||||||||||
CONSOLIDATION_NONCONTROLLING_I
CONSOLIDATION, NONCONTROLLING INTERESTS AND BASIS OF PRESENTATION | 3 Months Ended |
Aug. 31, 2012 | |
CONSOLIDATION, NONCONTROLLING INTERESTS AND BASIS OF PRESENTATION | ' |
NOTE 1 — CONSOLIDATION, NONCONTROLLING INTERESTS AND BASIS OF PRESENTATION | |
Our financial statements include all of our majority-owned subsidiaries, except for certain subsidiaries that were deconsolidated on May 31, 2010 (please refer to Note 3). We account for our investments in less-than-majority-owned joint ventures, for which we have the ability to exercise significant influence, under the equity method. Effects of transactions between related companies, except for certain subsidiaries that were deconsolidated, are eliminated in consolidation. | |
Noncontrolling interests are presented in our Consolidated Financial Statements as if parent company investors (controlling interests) and other minority investors (noncontrolling interests) in partially-owned subsidiaries have similar economic interests in a single entity. As a result, investments in noncontrolling interests are reported as equity in our consolidated financial statements. Additionally, our Consolidated Financial Statements include 100% of a controlled subsidiary’s earnings, rather than only our share. Transactions between the parent company and noncontrolling interests are reported in equity as transactions between stockholders provided that these transactions do not create a change in control. | |
The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all of the information and notes required by Generally Accepted Accounting Principles in the U.S. (“GAAP”) for complete financial statements. In our opinion, all adjustments (consisting of normal, recurring accruals) considered necessary for a fair presentation have been included for the three month periods ended August 31, 2012 and 2011. For further information, refer to the Consolidated Financial Statements and Notes included in our Annual Report on Form 10-K for the year ended May 31, 2012. | |
Our business is dependent on external weather factors. Historically, we have experienced strong sales and net income in our first, second and fourth fiscal quarters comprising the three month periods ending August 31, November 30 and May 31, respectively, with weaker performance in our third fiscal quarter (December through February). | |
Certain reclassifications have been made to prior year amounts to conform to the current year presentation. |
INVESTMENT_IN_KEMROCK_INDUSTRI
INVESTMENT IN KEMROCK INDUSTRIES AND EXPORTS LTD. | 3 Months Ended |
Aug. 31, 2012 | |
INVESTMENT IN KEMROCK INDUSTRIES AND EXPORTS LTD. | ' |
NOTE 2 — INVESTMENT IN KEMROCK INDUSTRIES AND EXPORTS LTD. | |
During the second quarter of fiscal 2012, we increased our ownership in Kemrock Industries and Exports Limited (“Kemrock”) to over 20% of Kemrock’s outstanding shares of common stock. Kemrock is one of India’s leading manufacturers of high performance reinforced polymer composites. At that time, and as a result of our ownership exceeding 20% of their outstanding shares, we changed our method of accounting for our investment in Kemrock stock from an available for sale security to the equity method. | |
Additionally, during fiscal 2012, we entered into three other, separate agreements with Kemrock. First, we agreed to loan Kemrock $15.0 million, which was to be repaid in cash, or alternatively, goods and commercial materials, no later than September 15, 2012. The loan is classified as a note receivable and is included in prepaid and other current assets in our Consolidated Balance Sheet. Second, we entered into a global depository receipt (“GDR”) Purchase Agreement with Kemrock, whereby we purchased 693,072 GDRs of Kemrock for an aggregate purchase price of approximately $7.2 million. The GDRs are included in our investment in Kemrock, which had a carrying value at the end of fiscal 2012 of $42.2 million, and are classified as other long-term assets in our Consolidated Balance Sheet. Lastly, during fiscal 2012 we invested $22.7 million in 5.5% convertible bonds issued by Kemrock. The bonds are convertible into ordinary shares or global depositary receipts each representing one ordinary share of Kemrock stock, and may be converted at any time on or after June 4, 2012 and up to the close of business on June 12, 2017. Our investment in Kemrock’s convertible bonds is classified in other long-term assets in our Consolidated Balance Sheet. | |
The Indian economy and financial markets have experienced significant deterioration in recent months, including a devaluation of the Indian rupee versus the U.S. dollar. Additionally, the market value of shares of Kemrock common stock declined significantly, from 531.0 rupees per share as of May 31, 2012 to 116.6 rupees per share as of August 31, 2012. The majority of the decline in the market value of Kemrock shares occurred during the month of August. As a result of these factors, we determined that it was appropriate to record an impairment loss of approximately $32.1 million on our equity method investment. The loss is classified in other (income) expense, net in our Consolidated Statements of Income. Please see Note 11, where information related to this investment is more fully described. | |
As of August 31, 2012, Kemrock had repaid approximately $5.0 million of the $15.0 million loan. We anticipate that we will receive approximately half of this amount in goods and materials by the end of the current fiscal year, and therefore have recorded a loss of $5.0 million for the amount deemed uncollectible. The loss is classified in selling, general and administrative expense in our Consolidated Statements of Income. | |
Lastly, at August 31, 2012, we recorded a loss of approximately $8.2 million associated with the decline in the value of the conversion option feature associated with the 5.5% convertible bonds. Please see Note 6, where information related to this investment is more fully described. |
DECONSOLIDATION_OF_SPECIALTY_P
DECONSOLIDATION OF SPECIALTY PRODUCTS HOLDING CORP. ("SPHC") | 3 Months Ended | ||
Aug. 31, 2012 | |||
DECONSOLIDATION OF SPECIALTY PRODUCTS HOLDING CORP. ("SPHC") | ' | ||
NOTE 3 —DECONSOLIDATION OF SPECIALTY PRODUCTS HOLDING CORP. (“SPHC”) | |||
On May 31, 2010, Bondex International, Inc. (“Bondex”) and its parent, SPHC, filed Chapter 11 reorganization proceedings in the United States Bankruptcy Court for the District of Delaware. SPHC is our wholly owned subsidiary. In accordance with Accounting Standards Codification (“ASC”) 810, when a subsidiary becomes subject to the control of a government, court, administrator, or regulator, deconsolidation of that subsidiary is generally required. We have therefore deconsolidated SPHC and its subsidiaries from our balance sheet as of May 31, 2010, and have eliminated the results of SPHC’s operations from our results of operations beginning on that date. We believe we have no responsibility for liabilities of SPHC and Bondex. As a result of the Chapter 11 reorganization proceedings, on a prospective basis we will continue to account for our investment in SPHC under the cost method. | |||
We had a net receivable from SPHC at May 31, 2010, that we expect may change before the bankruptcy proceedings have been finalized. The potential change relates to our indemnification of an insurer on appeal bonds pertaining to Bondex’s appeal of two asbestos cases that had been underway prior to the bankruptcy filing, neither of which are material in amount. During our 2012 third fiscal quarter, one of the appeal bonds was satisfied, and one remains outstanding. Included in the net amount due from SPHC are receivables and payables, which we concluded we have the right to report as a net amount based on several factors, including the fact that all amounts are determinable, the balances are due to and from our subsidiaries, and we have been given reasonable assurance that netting the applicable receivables and payables would remain legally enforceable. We analyzed our net investment in SPHC as of May 31, 2010, which included a review of our advances to SPHC, an assessment of the collectibility of our net receivables due from SPHC, and a computation of the gain to be recorded upon deconsolidation based on the carrying amount of our investment in SPHC. In accordance with GAAP, the gain on deconsolidation related to the carrying amount of net assets of SPHC at May 31, 2010, was calculated in accordance with ASC 810-10-40-5, as follows: | |||
a) | the aggregate of (1) the fair value of consideration received, (2) the fair value of any retained noncontrolling investment in the former subsidiary at the date the subsidiary is deconsolidated, and (3) the carrying amount of any noncontrolling interest in the former subsidiary; less | ||
b) | the carrying amount of the former subsidiary’s assets and liabilities. | ||
In determining the carrying value of any retained noncontrolling investment in SPHC at the date of deconsolidation we considered several factors, including analyses of cash flows combined with various assumptions relating to the future performance of this entity and a discounted value of SPHC’s recorded asbestos-related contingent obligations based on information available to us as of the date of deconsolidation. The discounted cash flow approach relies primarily on Level 3 unobservable inputs, whereby expected future cash flows are discounted using a rate that includes assumptions regarding an entity’s average cost of debt and equity, incorporates expected future cash flows based on internal business plans, and applies certain assumptions about risk and uncertainties due to the bankruptcy filing. Our estimates are based upon assumptions we believe to be reasonable, but which by nature are uncertain and unpredictable. As a result of this analysis, we determined that the carrying value of our retained interest in SPHC approximated zero. | |||
As a result of the combined analyses of each of the components of our net investment in SPHC, we recorded a net loss of approximately $7.9 million, which was reflected in Other Expense, Net, during the fourth fiscal quarter of the year ended May 31, 2010. No changes have been made to these amounts through August 31, 2012. |
NEW_ACCOUNTING_PRONOUNCEMENTS
NEW ACCOUNTING PRONOUNCEMENTS | 3 Months Ended |
Aug. 31, 2012 | |
NEW ACCOUNTING PRONOUNCEMENTS | ' |
NOTE 4 — NEW ACCOUNTING PRONOUNCEMENTS | |
In June 2011, the FASB issued amended disclosure requirements for the presentation of other comprehensive income (OCI) and accumulated other comprehensive income (AOCI). OCI is comprised of costs, expenses, gains and losses that are included in comprehensive income but excluded from net income, and AOCI comprises the aggregated balances of OCI in equity. The amended guidance eliminated the option to present period changes (OCI) as part of the Statement of Changes in Equity. Under the amended guidance, all period changes (OCI) are to be presented either in a single continuous statement of comprehensive income, or in two separate but consecutive financial statements. Only summary totals are to be included in the AOCI section of the Statement of Changes in Equity. In December 2011, the FASB deferred the requirement to present reclassifications from AOCI on the face of the Consolidated Statement of Income. We adopted these provisions as of June 1, 2012. There was no impact on our consolidated financial results as the amendments relate only to changes in financial statement presentation. |
INVENTORIES
INVENTORIES | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
INVENTORIES | ' | ||||||||
NOTE 5 — INVENTORIES | |||||||||
Inventories were composed of the following major classes: | |||||||||
August 31, 2012 | May 31, 2012 | ||||||||
(In thousands) | |||||||||
Raw material and supplies | $ | 182,352 | $ | 160,869 | |||||
Finished goods | 342,971 | 329,109 | |||||||
Total Inventory | $ | 525,323 | $ | 489,978 | |||||
MARKETABLE_SECURITIES
MARKETABLE SECURITIES | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
MARKETABLE SECURITIES | ' | ||||||||||||||||
NOTE 6 — MARKETABLE SECURITIES | |||||||||||||||||
The following tables summarize marketable securities held at August 31, 2012 and May 31, 2012 by asset type: | |||||||||||||||||
Available-For-Sale Securities | |||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||
Cost | Unrealized | Unrealized | (Net | ||||||||||||||
Gains | Losses | Carrying | |||||||||||||||
Amount) | |||||||||||||||||
August 31, 2012 | |||||||||||||||||
Equity securities: | |||||||||||||||||
Stocks — foreign | $ | 1,321 | $ | 234 | $ | (1 | ) | $ | 1,554 | ||||||||
Stocks — domestic | 26,657 | 1,877 | (922 | ) | 27,612 | ||||||||||||
Mutual funds — foreign | 19,053 | 1,167 | (5 | ) | 20,215 | ||||||||||||
Mutual funds — domestic | 39,685 | 165 | (40 | ) | 39,810 | ||||||||||||
Total equity securities | 86,716 | 3,443 | (968 | ) | 89,191 | ||||||||||||
Fixed maturity: | |||||||||||||||||
U.S. treasury and other government | 20,641 | 484 | (17 | ) | 21,108 | ||||||||||||
Kemrock convertible bonds | 14,273 | — | — | 14,273 | |||||||||||||
Corporate bonds | 1,832 | 268 | — | 2,100 | |||||||||||||
Foreign bonds | 38 | 3 | — | 41 | |||||||||||||
Mortgage-backed securities | 180 | 65 | (1 | ) | 244 | ||||||||||||
Total fixed maturity securities | 36,964 | 820 | (18 | ) | 37,766 | ||||||||||||
Total | $ | 123,680 | $ | 4,263 | $ | (986 | ) | $ | 126,957 | ||||||||
Available-For-Sale Securities | |||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||
Cost | Unrealized | Unrealized | (Net | ||||||||||||||
Gains | Losses | Carrying | |||||||||||||||
Amount) | |||||||||||||||||
May 31, 2012 | |||||||||||||||||
Equity securities: | |||||||||||||||||
Stocks — foreign | $ | 1,016 | $ | 79 | $ | — | $ | 1,095 | |||||||||
Stocks — domestic | 24,380 | 2,776 | (1,046 | ) | 26,110 | ||||||||||||
Mutual funds — foreign | 17,489 | 521 | (936 | ) | 17,074 | ||||||||||||
Mutual funds — domestic | 39,246 | 1,114 | (1,077 | ) | 39,283 | ||||||||||||
Total equity securities | 82,131 | 4,490 | (3,059 | ) | 83,562 | ||||||||||||
Fixed maturity: | |||||||||||||||||
U.S. treasury and other government | 19,347 | 530 | (12 | ) | 19,865 | ||||||||||||
Kemrock convertible bonds | 13,670 | — | — | 13,670 | |||||||||||||
Coporate bonds | 2,305 | 349 | (5 | ) | 2,649 | ||||||||||||
Foreign bonds | 38 | 1 | — | 39 | |||||||||||||
Mortgage-backed securities | 241 | 105 | (2 | ) | 344 | ||||||||||||
Total fixed maturity securities | 35,601 | 985 | (19 | ) | 36,567 | ||||||||||||
Total | $ | 117,732 | $ | 5,475 | $ | (3,078 | ) | $ | 120,129 | ||||||||
Marketable securities, included in other current and long-term assets, totaling $39.1 million and $87.9 million at August 31, 2012, respectively, and $30.5 million and $89.6 million at May 31, 2012, respectively, are composed of available-for-sale securities and are reported at fair value. In April 2012, we invested $22.7 million in 5.5% convertible bonds issued by Kemrock. The bonds are convertible into ordinary shares or global depositary receipts each representing one ordinary share of Kemrock stock, and may be converted at any time on or after June 4, 2012 and up to the close of business on June 12, 2017. Our investment in Kemrock convertible bonds is an available for sale security, which reflects the offsetting value of the discount on the bond as of the balance sheet date, and is classified in other long-term assets in our Consolidated Balance Sheet. We reclassified approximately $73.6 million and $76.0 million out of other current assets into long-term assets as of August 31, 2012 and May 31, 2012, respectively, in order to reflect the timeframe over which these assets are intended to be used. | |||||||||||||||||
Marketable securities are composed of available-for-sale securities and are reported at fair value. Realized gains and losses on sales of investments are recognized in net income on the specific identification basis. Changes in the fair values of securities that are considered temporary are recorded as unrealized gains and losses, net of applicable taxes, in accumulated other comprehensive income (loss) within stockholders’ equity. Other-than-temporary declines in market value from original cost are reflected in operating income in the period in which the unrealized losses are deemed other than temporary. In order to determine whether other-than-temporary declines in market value have occurred, the duration of the decline in value and our ability to hold the investment are considered in conjunction with an evaluation of the strength of the underlying collateral and the extent to which the investment’s amortized cost or cost, as appropriate, exceeds its related market value. | |||||||||||||||||
Gross gains and losses realized on sales of investments were $5.0 million and $0.4 million, respectively, for the quarter ended August 31, 2012. Gross gains and losses realized on sales of investments were $1.9 million and $2.8 million, respectively, for the quarter ended August 31, 2011. During the first quarter of fiscal 2013 and 2012, we recognized losses of $0.1 million and $0.4 million, respectively, for securities deemed to have other-than-temporary impairments. These amounts are included in investment expense (income), net in the Consolidated Statements of Income. | |||||||||||||||||
Summarized below are the securities we held at August 31, 2012 and May 31, 2012 that were in an unrealized loss position and that were included in accumulated other comprehensive income, aggregated by the length of time the investments had been in that position: | |||||||||||||||||
August 31, 2012 | May 31, 2012 | ||||||||||||||||
(In thousands) | Fair Value | Gross | Fair Value | Gross | |||||||||||||
Unrealized | Unrealized | ||||||||||||||||
Losses | Losses | ||||||||||||||||
Total investments with unrealized losses | $ | 24,325 | $ | (986 | ) | $ | 43,772 | $ | (3,078 | ) | |||||||
Unrealized losses with a loss position for less than 12 months | 22,723 | (441 | ) | 42,114 | (2,596 | ) | |||||||||||
Unrealized losses with a loss position for more than 12 months | 1,602 | (545 | ) | 1,658 | (482 | ) | |||||||||||
We have reviewed all of the securities included in the table above and have concluded that we have the ability and intent to hold these investments until their cost can be recovered, based upon the severity and duration of the decline. Therefore, we did not recognize any other-than-temporary impairment losses on these investments. Unrealized losses at August 31, 2012 were generally related to the volatility in valuations over the last several months for a portion of our portfolio of investments in marketable securities. The unrealized losses generally relate to investments whose fair values at August 31, 2012 were less than 15% below their original cost or have been in a loss position for less than six consecutive months. Although we have begun to see recovery in general economic conditions over the past year, if we were to experience continuing or significant unrealized losses within our portfolio of investments in marketable securities in the future, we may recognize additional other-than-temporary impairment losses. Such potential losses could have a material impact on our results of operations in any given reporting period. As such, we continue to closely evaluate the status of our investments and our ability and intent to hold these investments. | |||||||||||||||||
The net carrying values of debt securities at August 31, 2012, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. | |||||||||||||||||
(In thousands) | Amortized | Fair | |||||||||||||||
Cost | Value | ||||||||||||||||
Due: | |||||||||||||||||
Less than one year | $ | 913 | $ | 914 | |||||||||||||
One year through five years | 29,643 | 29,935 | |||||||||||||||
Six years through ten years | 4,557 | 4,776 | |||||||||||||||
After ten years | 1,851 | 2,141 | |||||||||||||||
$ | 36,964 | $ | 37,766 | ||||||||||||||
FAIR_VALUE_MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
FAIR VALUE MEASUREMENTS | ' | ||||||||||||||||
NOTE 7 — FAIR VALUE MEASUREMENTS | |||||||||||||||||
Financial instruments recorded on the balance sheet include cash and cash equivalents, trade accounts receivable, marketable securities, notes and accounts payable, and debt. | |||||||||||||||||
An allowance for anticipated uncollectible trade receivable amounts is established using a combination of specifically identified accounts to be reserved, and a reserve covering trends in collectibility. These estimates are based on an analysis of trends in collectibility, past experience, and individual account balances identified as doubtful based on specific facts and conditions. Receivable losses are charged against the allowance when we confirm uncollectibility. | |||||||||||||||||
All derivative instruments are recognized on our Consolidated Balance Sheet and measured at fair value. Changes in the fair values of derivative instruments that do not qualify as hedges and/or any ineffective portion of hedges are recognized as a gain or (loss) in our Consolidated Statement of Income in the current period. Changes in the fair value of derivative instruments used effectively as cash flow hedges are recognized in other comprehensive income (loss), along with the change in the value of the hedged item. We do not hold or issue derivative instruments for speculative purposes. | |||||||||||||||||
The valuation techniques utilized for establishing the fair values of assets and liabilities are based on observable and unobservable inputs. Observable inputs reflect readily obtainable data from independent sources, while unobservable inputs reflect management’s market assumptions. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value, as follows: | |||||||||||||||||
Level 1 Inputs — Quoted prices for identical instruments in active markets. | |||||||||||||||||
Level 2 Inputs — Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable. | |||||||||||||||||
Level 3 Inputs — Instruments with primarily unobservable value drivers. | |||||||||||||||||
The following tables present our assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. | |||||||||||||||||
(In thousands) | Quoted Prices in | Significant | Significant | Fair Value at | |||||||||||||
Active Markets | Other | Unobservable | August 31, 2012 | ||||||||||||||
for Identical | Observable | Inputs (Level 3) | |||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
U.S. Treasury and other government | $ | — | $ | 21,108 | $ | — | $ | 21,108 | |||||||||
Foreign bonds | 41 | 41 | |||||||||||||||
Mortgage-backed securities | 244 | 244 | |||||||||||||||
Corporate bonds | 2,100 | 2,100 | |||||||||||||||
Stocks — foreign | 1,554 | 1,554 | |||||||||||||||
Stocks — domestic | 27,612 | 27,612 | |||||||||||||||
Mutual funds — foreign | 20,215 | 20,215 | |||||||||||||||
Mutual funds — domestic | 39,810 | 39,810 | |||||||||||||||
Cross-currency swap | — | (4,503 | ) | — | (4,503 | ) | |||||||||||
Conversion option, Kemrock 5.5% bonds | 847 | 847 | |||||||||||||||
Investment in Kemrock convertible debt | 14,273 | 14,273 | |||||||||||||||
Total | $ | 29,166 | $ | 93,288 | $ | 847 | $ | 123,301 | |||||||||
(In thousands) | Quoted Prices in | Significant | Significant | Fair Value at | |||||||||||||
Active Markets | Other | Unobservable | May 31, 2012 | ||||||||||||||
for Identical | Observable | Inputs (Level 3) | |||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
U.S. Treasury and other government | $ | — | $ | 19,865 | $ | — | $ | 19,865 | |||||||||
Foreign bonds | 39 | 39 | |||||||||||||||
Mortgage-backed securities | 344 | 344 | |||||||||||||||
Corporate bonds | 2,649 | 2,649 | |||||||||||||||
Stocks — foreign | 1,095 | 1,095 | |||||||||||||||
Stocks — domestic | 26,110 | 26,110 | |||||||||||||||
Mutual funds — foreign | 17,074 | 17,074 | |||||||||||||||
Mutual funds — domestic | 39,283 | 39,283 | |||||||||||||||
Foreign currency forward contract | (1,356 | ) | (1,356 | ) | |||||||||||||
Cross-currency swap | (2,159 | ) | (2,159 | ) | |||||||||||||
Conversion option, Kemrock 5.5% bonds | 9,031 | 9,031 | |||||||||||||||
Investment in Kemrock convertible debt | 13,670 | 13,670 | |||||||||||||||
Total | $ | 27,205 | $ | 89,409 | $ | 9,031 | $ | 125,645 | |||||||||
Our marketable securities are composed of mainly available-for-sale securities, and are valued using a market approach based on quoted market prices for identical instruments. The availability of inputs observable in the market varies from instrument to instrument and depends on a variety of factors including the type of instrument, whether the instrument is actively traded, and other characteristics particular to the transaction. For most of our financial instruments, pricing inputs are readily observable in the market, the valuation methodology used is widely accepted by market participants, and the valuation does not require significant management discretion. For other financial instruments, pricing inputs are less observable in the market and may require management judgment. | |||||||||||||||||
Our cross-currency swap is a liability that has a fair value of $4.5 million at August 31, 2012, that was originally designed to fix our interest and principal payments in euros for the life of our unsecured 6.70% senior notes due November 1, 2015, which resulted in an effective euro fixed-rate borrowing of 5.31%. The basis for determining the rates for this swap included three legs at the inception of the agreement: the U.S. dollar (USD) fixed rate to a USD floating rate; the euro floating to euro fixed rate; and the dollar to euro basis fixed rate at inception. Therefore, we essentially exchanged fixed payments denominated in USD for fixed payments denominated in euros, paying fixed euros at 5.31% and receiving fixed USD at 6.70%. The ultimate payments are based on the notional principal amounts of 150 million USD and approximately 125 million euros. There will be an exchange of the notional amounts at maturity. The rates included in this swap are based upon observable market data, but are not quoted market prices, and therefore, the cross-currency swap is considered a Level 2 liability on the fair value hierarchy. Additionally, this cross-currency swap has been designated as a hedging instrument, and is classified as other long-term liabilities in our Consolidated Balance Sheets. | |||||||||||||||||
Our investment in Kemrock 5.5% convertible bonds includes the fair value of the conversion option feature as of the balance sheet date, and is classified in other long-term assets in our Consolidated Balance Sheet. During the quarter ended August 31, 2012, we recognized a loss of approximately $8.2 million resulting from the decline in the fair value of the conversion option feature associated with the bond, driven primarily from the decline in the market value of Kemrock common stock, from 531.0 rupees per share at May 31, 2012 to 116.6 rupees per share at August 31, 2012. The majority of the decline in the market value of Kemrock shares occurred during the Month of August. This amount is reflected in other expense (income) in the Consolidated Statements of Income. | |||||||||||||||||
The carrying value of our current financial instruments, which include cash and cash equivalents, marketable securities, trade accounts receivable, accounts payable and short-term debt approximates fair value because of the short-term maturity of these financial instruments. At August 31, 2012 and May 31, 2012, the fair value of our long-term debt was estimated using active market quotes, based on our current incremental borrowing rates for similar types of borrowing arrangements, which are considered to be Level 2 inputs. Based on the analysis performed, the fair value and the carrying value of our financial instruments and long-term debt as of August 31, 2012 and May 31, 2012 are as follows: | |||||||||||||||||
At August 31, 2012 | |||||||||||||||||
(In thousands) | Carrying | Fair Value | |||||||||||||||
Value | |||||||||||||||||
Cash and cash equivalents | $ | 257,382 | $ | 257,382 | |||||||||||||
Marketable equity securities | 89,191 | 89,191 | |||||||||||||||
Marketable debt securities | 37,766 | 37,766 | |||||||||||||||
Long-term debt, including current portion | 1,202,610 | 1,484,689 | |||||||||||||||
At May 31, 2012 | |||||||||||||||||
(In thousands) | Carrying | Fair Value | |||||||||||||||
Value | |||||||||||||||||
Cash and cash equivalents | $ | 315,968 | $ | 315,968 | |||||||||||||
Marketable equity securities | 83,562 | 83,562 | |||||||||||||||
Marketable debt securities | 36,567 | 36,567 | |||||||||||||||
Long-term debt, including current portion | 1,115,536 | 1,232,180 |
REORGANIZATION_PROCEEDINGS_OF_
REORGANIZATION PROCEEDINGS OF CERTAIN SUBSIDIARIES | 3 Months Ended |
Aug. 31, 2012 | |
REORGANIZATION PROCEEDINGS OF CERTAIN SUBSIDIARIES | ' |
NOTE 8 — REORGANIZATION PROCEEDINGS OF CERTAIN SUBSIDIARIES | |
General — Bondex and SPHC are defendants in various asbestos-related bodily injury lawsuits filed in various state courts. These cases generally seek unspecified damages for asbestos-related diseases based on alleged exposures to asbestos-containing products. | |
On May 31, 2010, Bondex and its parent, SPHC, filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. SPHC is the parent company of Bondex and is also the parent company for various operating companies that are not part of the reorganization filing, including Chemical Specialties Manufacturing Corp.; Day-Glo Color Corp.; Dryvit Holdings, Inc.; Guardian Protection Products Inc.; Kop-Coat Inc.; TCI, Inc. and RPM Wood Finishes Group, Inc. SPHC and Bondex (the “filing entities”) took this action to permanently and comprehensively resolve all pending and future asbestos-related liability claims associated with Bondex and SPHC-related products. As a result of the filing, all Bondex and SPHC asbestos personal injury lawsuits have been stayed due to the imposition of an automatic stay applicable in bankruptcy cases, with the exception of the cases referenced in Note 3 with respect to which the stay was lifted. In addition, at the request of SPHC and Bondex, the bankruptcy court has entered orders staying all claims against RPM International Inc. and its affiliates that are derivative of the asbestos claims against SPHC and Bondex. Through the Chapter 11 proceedings, the filing entities intend ultimately to establish a trust in accordance with section 524(g) of the Bankruptcy Code and seek the imposition of a channeling injunction that will direct all future SPHC-related and Bondex-related claims to the trust. It is anticipated that the trust will compensate claims at appropriate values established by the trust documents and approved by the bankruptcy court. At this time, it is not possible to predict how long the proceedings will last, the form of any ultimate resolution or when an ultimate resolution might occur. | |
Prior to the bankruptcy filing, the filing entities had engaged in a strategy of litigating asbestos-related products liability claims brought against them. Claims paid during the year ended May 31, 2010, prior to the bankruptcy filing, were $92.6 million, which included defense-related payments during the year of $42.6 million. With the exception of the appeal bond satisfied during our 2012 third fiscal quarter and the potential payment described in Note 3, no claims have been paid since the bankruptcy filing and it is not contemplated that any claims will be paid until a plan of reorganization is confirmed and an asbestos trust is established and operating. | |
Prior to the Chapter 11 bankruptcy filing, we recorded asbestos-related contingent liabilities that included estimations of future costs, which by nature are subject to many uncertainties that may change over time, including (i) the ultimate number of claims filed; (ii) the amounts required to resolve both currently known and future unknown claims; (iii) the amount of insurance, if any, available to cover such claims, including the outcome of coverage litigation against the filing entities’ third-party insurers; (iv) future earnings and cash flow of the filing entities; (v) the impact of bankruptcies of other companies whose share of liability may be imposed on the filing entities under certain state liability laws; (vi) the unpredictable aspects of the litigation process including a changing trial docket and the jurisdictions in which trials are scheduled; (vii) the outcome of any such trials including judgments or jury verdicts, as a result of our more aggressive defense posture, which included taking selective cases to verdict; (viii) the lack of specific information in many cases concerning exposure to products for which one of our subsidiaries is responsible and the claimants’ diseases; (ix) potential changes in applicable federal and/or state law; and (x) the potential impact of various proposed structured settlement transactions or subsidiary bankruptcies by other companies, some of which are the subject of federal appellate court review, the outcome of which could have materially affected future asbestos-related liability estimates. | |
As a result of their bankruptcy filing, SPHC and Bondex are precluded from paying dividends to shareholders and from making payments on any pre-bankruptcy filing accounts or notes payable that are due and owing to any other entity within the RPM group of companies (the “Pre-Petition Intercompany Payables”) or other pre-petition creditors during the pendency of the bankruptcy case, without the Bankruptcy Court’s approval. Moreover, no assurances can be given that any of the Pre-Petition Intercompany Payables will ever be paid or otherwise satisfied. | |
When SPHC emerges from the jurisdiction of the Bankruptcy Court, the subsequent accounting will be determined based upon the applicable circumstances and facts at such time, including the terms of any plan of reorganization. | |
SPHC has assessed its liquidity position as a result of the bankruptcy filing and believes that it can continue to fund its and its subsidiaries’ operating activities and meet its debt and capital requirements for the foreseeable future. | |
Historical Asbestos Liability Reserve — In fiscal 2006, management retained Crawford & Winiarski (“C&W”), an independent, third-party consulting firm with expertise in the area of asbestos valuation work, to assist it in calculating an estimate of Bondex’s liability for unasserted-potential-future-asbestos-related claims. C&W’s methodology to project Bondex’s liability for unasserted-potential-future-asbestos-related claims included an analysis of: (a) a widely accepted forecast of the population likely to have been exposed to asbestos; (b) epidemiological studies estimating the number of people likely to develop asbestos-related diseases; (c) the historical rate at which mesothelioma incidences resulted in the payment of claims by Bondex; (d) the historical settlement averages to value the projected number of future compensable mesothelioma claims; (e) the historical ratio of mesothelioma-related indemnity payments to non-mesothelioma indemnity payments; and (f) the historical defense costs and their relationship with total indemnity payments. Based upon the results of this analysis, Bondex recorded an accrued liability for asbestos claims through 2016 as of May 31, 2006 of $421.3 million. This amount was calculated on a pretax basis and was not discounted for the time value of money. | |
During the fiscal year ended May 31, 2008, the ten-year asbestos liability established as of May 31, 2006 was reviewed and evaluated. As part of that process, the credibility of epidemiological studies of Bondex’s mesothelioma claims, first introduced to management by C&W some two-and-one-half years earlier, was validated. At the core of the evaluation process, and the basis of C&W’s actuarial work on behalf of Bondex, is the Nicholson Study. The Nicholson Study is the most widely recognized reference in bankruptcy trust valuations, global settlement negotiations and the Congressional Budget Office’s work done on the proposed FAIR Act in 2006. Based on our ongoing comparison of the Nicholson Study projections and Bondex’s specific actual experience, which at that time continued to bear an extremely close correlation to the study’s projections, the asbestos liability projection was extended out to the year 2028. C&W assisted in calculating an estimate of our liability for unasserted-potential-future-asbestos-related claims out to 2028. C&W projected that the cost of extending the asbestos liability to 2028, coupled with an updated evaluation of Bondex’s current known claims to reflect its most recent actual experience, would be $288.1 million. Therefore, management added $288.1 million to the existing asbestos liability, which brought Bondex’s total asbestos-related balance sheet liabilities at May 31, 2008 to $559.7 million. On May 30, 2010, the day prior to the bankruptcy filing, Bondex had recorded an asbestos related product liability of $397.7 million. |
CONTINGENCIES_AND_OTHER_ACCRUE
CONTINGENCIES AND OTHER ACCRUED LOSSES | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
CONTINGENCIES AND OTHER ACCRUED LOSSES | ' | ||||||||
NOTE 9 — CONTINGENCIES AND OTHER ACCRUED LOSSES | |||||||||
We provide, through our wholly owned insurance subsidiaries, certain insurance coverage, primarily product liability coverage, to our other subsidiaries. Excess coverage is provided by third-party insurers. Our reserves provide for these potential losses as well as other uninsured claims. | |||||||||
We also offer warranty programs at several of our industrial businesses and have established a product warranty liability. We review this liability for adequacy on a quarterly basis and adjust it as necessary. The primary factors that could affect this liability may include changes in the historical system performance rate as well as the costs of replacement. Provision for estimated warranty costs is recorded at the time of sale and periodically adjusted, as required, to reflect actual experience. It is probable that we will incur future losses related to warranty claims we have received but that have not been fully investigated and related to claims not yet received. While our warranty liability represents our best estimate at August 31, 2012, we can provide no assurances that we will not experience material claims in the future or that we will not incur significant costs to resolve such claims beyond the amounts accrued or beyond what we may recover from our suppliers. Product warranty expense is recorded within selling, general and administrative expense. | |||||||||
The following table includes the changes in our accrued warranty balances: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
(In thousands) | 2012 | 2011 | |||||||
Beginning Balance | $ | 14,751 | $ | 17,196 | |||||
Deductions (1) | (3,905 | ) | (4,072 | ) | |||||
Provision charged to SG&A expense | 3,681 | 3,841 | |||||||
Ending Balance | $ | 14,527 | $ | 16,965 | |||||
-1 | Primarily claims paid during the year. | ||||||||
In addition, like other companies participating in similar lines of business, some of our subsidiaries are involved in several proceedings relating to environmental matters. It is our policy to accrue remediation costs when it is probable that such efforts will be required and the related costs can be reasonably estimated. These liabilities are undiscounted and are not material to our financial statements during any of the periods presented. | |||||||||
During our fiscal year ended May 31, 2013, we recorded an adjustment to our current product liability reserves to remove the impact of claims that we determined will not likely be paid out over the next 12 months, which should have been included in the long-term product liability reserves as of May 31, 2012. As a result, long-term accrued product liability reserves (a component of other long-term liabilities on our Consolidated Balance Sheets) were increased by $26.6 million and $25.8 million, and current accrued product liability reserves (a component of accrued loss reserves on our Consolidated Balance Sheets) were decreased by an equal amount, in order to reflect this reclassification as of August 31, 2012 and May 31, 2012, respectively. | |||||||||
During the first quarter of fiscal 2013, we recorded an $11.4 million accrual associated the GSA matter. The substantial majority of the accrual relates to the sale of products and services from 2004 to 2008. Our Tremco Roofing Division is in ongoing discussions with the DOJ and the GSA aimed at resolving the investigation. We are cooperating with the investigation, which involves compliance with certain pricing terms and conditions of GSA contracts under which our Tremco Roofing Division sold products and services to the federal government. The accrual recorded during the first quarter for this contingency represents our best estimate of the amount of probable loss that may result from this matter. In assessing our probable loss, we have considered the potentially disputed amounts under the relevant contracts, together with our understanding of policies for resolving such matters. It is reasonably possible that the actual amount of our loss may vary materially from the amount of the accrual, and given the state of the investigation, the Company is unable to estimate the range of loss. The ultimate loss related to this investigation may be subject to a “multiplier” that is determined by the DOJ, based on their consideration of the facts and circumstances related to this matter. This “multiplier” can range from one to three times the amount due to the government. The accrual for this contingency is classified in other accrued liabilities in our Consolidated Balance Sheets and the loss is classified as estimated loss contingency in our Consolidated Statements of Income as of and for the period ended August 31, 2012. | |||||||||
INVESTMENT_INCOME_EXPENSE_NET
INVESTMENT (INCOME) EXPENSE, NET | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
INVESTMENT (INCOME) EXPENSE, NET | ' | ||||||||
NOTE 10 — INVESTMENT (INCOME) EXPENSE, NET | |||||||||
Investment (income) expense, net, consists of the following components: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
(In thousands) | 2012 | 2011 | |||||||
Interest (income) | $ | (2,295 | ) | $ | (1,117 | ) | |||
(Gain) loss on sale of marketable securities | (4,584 | ) | 914 | ||||||
Other-than-temporary impairment on securities | 113 | 406 | |||||||
Dividend (income) | (208 | ) | (227 | ) | |||||
Investment (income) expense, net | $ | (6,974 | ) | $ | (24 | ) | |||
OTHER_EXPENSE_INCOME_NET
OTHER EXPENSE (INCOME), NET | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
OTHER EXPENSE (INCOME), NET | ' | ||||||||
NOTE 11 — OTHER EXPENSE (INCOME), NET | |||||||||
Other expense (income), net, consists of the following components: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
Year Ended May 31, | 2012 | 2011 | |||||||
(In thousands) | |||||||||
Royalty (income), net | $ | (294 | ) | $ | (324 | ) | |||
Loss on Kemrock conversion option | 8,183 | ||||||||
Loss (income) related to unconsolidated equity affiliates | 31,533 | (479 | ) | ||||||
Other expense (income), net | $ | 39,422 | $ | (803 | ) | ||||
Equity in Income of Unconsolidated Affiliates | |||||||||
Beginning with our fiscal year ended May 31, 2007, we began purchasing shares of Kemrock Industries and Exports Limited (“Kemrock”) common stock. Kemrock is one of India’s leading manufacturers of high performance reinforced polymer composites, and is also part of a strategic alliance with certain of our subsidiaries for licensed manufacturing and supply of molded and pultruded gratings. By May 31, 2011, we had acquired a total of approximately 3.2 million shares of Kemrock common stock, for an accumulated cost approximating $24.2 million, which represented approximately 18% of Kemrock’s outstanding shares at that time. Our investment in Kemrock common stock had been classified in other long-term assets on our balance sheet and included with available-for-sale securities, which are carried at fair value based on quoted market prices. | |||||||||
During fiscal 2012, we purchased approximately 870,000 additional shares of Kemrock common stock, which increased our ownership to 23% of Kemrock’s outstanding shares. Also during fiscal 2012, we entered into a GDR Purchase Agreement with Kemrock, whereby we purchased from Kemrock 693,072 GDRs of Kemrock for an aggregate purchase price of approximately $7.2 million. We account for our investment in the Kemrock GDRs as common stock equivalents within our total investment in Kemrock. | |||||||||
Due to the presumption under GAAP that an entity with an ownership percentage greater than 20% has significant influence, and no other factors would refute that presumption, we changed our accounting for this investment to the equity method. Adjustments are made to our investment in order to recognize our share of Kemrock’s earnings as they occur, rather than as dividends or other distributions are received. Any changes in our proportionate share of the underlying equity of Kemrock, which could result from their issuance of additional equity securities, are recognized as increases or decreases in shareholders’ equity, net of any related tax effects. | |||||||||
As discussed in Note 2, the Indian economy and financial markets have experienced significant deterioration in recent months, including a devaluation of the Indian rupee versus the U.S. dollar. Additionally, the market value of shares of Kemrock common stock declined significantly, from 531.0 rupees per share as of May 31, 2012 to 116.6 rupees per share as of August 31, 2012. The majority of the decline in the market value of Kemrock shares occurred during the month of August. As a result of these factors, we determined that it was appropriate to record an impairment loss of approximately $32.1 million on our equity method investment. The loss is classified in other (income) expense, net in our Consolidated Statements of Income. | |||||||||
Our investment in Kemrock is reported in our Consolidated Balance Sheet at its adjusted carrying value and classified as a long-term asset. Our investment in Kemrock had a carrying value of $10.0 million and $42.2 million at August 31, 2012 and May 31, 2012, respectively. |
INCOME_TAXES
INCOME TAXES | 3 Months Ended |
Aug. 31, 2012 | |
INCOME TAXES | ' |
NOTE 12 — INCOME TAXES | |
The effective income tax rate was 49.5% for the three months ended August 31, 2012 compared to an effective income tax rate of 29.8% for the three months ended August 31, 2011. | |
For the three months ended August 31, 2012 and, to a lesser extent for three months ended August 31, 2011, the effective tax rate differed from the federal statutory rate principally due to lower effective tax rates of certain of our foreign subsidiaries, including a reduction in the United Kingdom income tax rate, and lower valuation allowances on foreign tax credit carryforwards. Furthermore, for the three months ended August 31, 2011 decreases in the effective income tax rate resulted from net adjustments to reserves for contingencies, including interest thereon. These decreases in taxes were partially offset by increases in tax as a result of the impact of non-deductible business operating expenses, state and local income taxes, and the impact on our effective tax rate in certain foreign jurisdictions where income tax benefits are offset by adjustments to valuation allowances associated with losses incurred by those foreign businesses. Additionally for the three months ended August 31, 2012, the effective tax rate increased as a result of valuation allowances related to losses associated with our investments in Kemrock. | |
As of August 31, 2012, we had unrecognized tax benefits of approximately $3.3 million, of which approximately $2.4 million would impact the effective tax rate, if recognized. We recognize interest and penalties related to unrecognized tax benefits in income tax expense. At August 31, 2012 the accrual for interest and penalties was $1.5 million. Unrecognized tax benefits, including interest and penalties, have been classified as other long-term liabilities unless expected to be paid in one year. We do not anticipate any significant changes to the total unrecognized tax benefits within the next 12 months. | |
We, or our subsidiaries, file income tax returns in the U.S. and in various state, local and foreign jurisdictions. As of August 31, 2012 we are subject to U.S. federal income tax examinations for the fiscal years 2009 through 2012. In addition, with limited exceptions, we, or our subsidiaries, are generally subject to state and local or non-U.S. income tax examinations by tax authorities for the fiscal years 2005 through 2012. | |
We are currently under examination, or have been notified of an upcoming tax examination for various Non-U.S. and U.S. jurisdictions including an ongoing Internal Revenue Service (“IRS”) examination of the company’s U.S. income tax returns for the fiscal 2009 and 2010 tax years. Although it is possible that certain tax examinations, including the IRS examination of fiscal years 2009 and 2010, could be resolved during the next 12 months, the timing and outcomes are uncertain. | |
As of August 31, 2012, we have determined, based on the available evidence, that it is uncertain whether we will be able to recognize certain deferred tax assets. Therefore, we intend to maintain the tax valuation allowances recorded at August 31, 2012 for those deferred tax assets until sufficient positive evidence (for example, cumulative positive foreign earnings or additional foreign source income) exists to support their reversal. These valuation allowances relate to U.S. foreign tax credit carryforwards, U.S. capital loss carryforwards, certain foreign net operating losses and net foreign deferred tax assets. A portion of the valuation allowance is associated with deferred tax assets recorded in purchase accounting for prior year acquisitions. |
PENSION_PLANS
PENSION PLANS | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
PENSION PLANS | ' | ||||||||||||||||
NOTE 13 — PENSION PLANS | |||||||||||||||||
We offer defined benefit pension plans, defined contribution pension plans, as well as several unfunded health care benefit plans primarily for certain of our retired employees. The following tables provide the retirement-related benefit plans’ impact on income before income taxes for the quarters month periods ended August 31, 2012 and 2011: | |||||||||||||||||
U.S. Plans | Non-U.S. Plans | ||||||||||||||||
Quarter Ended | Quarter Ended | ||||||||||||||||
August 31, | August 31, | ||||||||||||||||
Pension Benefits | 2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 6,488 | $ | 4,977 | $ | 1,050 | $ | 965 | |||||||||
Interest cost | 4,060 | 3,827 | 1,769 | 2,040 | |||||||||||||
Expected return on plan assets | (4,358 | ) | (4,354 | ) | (1,846 | ) | (2,036 | ) | |||||||||
Amortization of: | |||||||||||||||||
Prior service cost | 87 | 88 | 2 | 3 | |||||||||||||
Net actuarial losses recognized | 4,222 | 2,127 | 692 | 560 | |||||||||||||
Net Periodic Benefit Cost | $ | 10,499 | $ | 6,665 | $ | 1,667 | $ | 1,532 | |||||||||
U.S. Plans | Non-U.S. Plans | ||||||||||||||||
Quarter Ended | Quarter Ended | ||||||||||||||||
August 31, | August 31, | ||||||||||||||||
Postretirement Benefits | 2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | — | $ | — | $ | 288 | $ | 192 | |||||||||
Interest cost | 88 | 104 | 289 | 250 | |||||||||||||
Amortization of: | |||||||||||||||||
Prior service cost | (22 | ) | (22 | ) | |||||||||||||
Net actuarial (gains) losses recognized | 4 | (14 | ) | 114 | 18 | ||||||||||||
Net Periodic Benefit Cost | $ | 70 | $ | 68 | $ | 691 | $ | 460 | |||||||||
We previously disclosed in our financial statements for the fiscal year ended May 31, 2012 that we expected to contribute approximately $29.9 million to our retirement plans in the U.S. and approximately $8.3 million to plans outside the U.S. during the current fiscal year. As of August 31, 2012, we do not anticipate any changes to those planned contribution levels. |
EARNINGS_PER_SHARE
EARNINGS PER SHARE | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
EARNINGS PER SHARE | ' | ||||||||
NOTE 14 — EARNINGS PER SHARE | |||||||||
The following table sets forth the reconciliation of the numerator and denominator of basic and diluted earnings per share, as calculated using the two-class method, for the three months ended August 31, 2012 and 2011: | |||||||||
Three Months Ended | |||||||||
August 31, | |||||||||
(In thousands, except per share amounts) | 2012 | 2011 | |||||||
(Restated) | |||||||||
Numerator for earnings per share: | |||||||||
Net income attributable to RPM International Inc. stockholders | $ | 26,665 | $ | 76,811 | |||||
Less: Allocation of earnings and dividends to participating securities | (479 | ) | (1,530 | ) | |||||
Net income available to common shareholders — basic | 26,186 | 75,281 | |||||||
Add: Undistributed earnings reallocated to unvested shareholders | — | 4 | |||||||
Net income available to common shareholders — diluted | $ | 26,186 | $ | 75,285 | |||||
Denominator for basic and diluted earnings per share: | |||||||||
Basic weighted average common shares | 128,805 | 128,094 | |||||||
Average diluted options | 765 | 532 | |||||||
Total shares for diluted earnings per share | 129,570 | 128,626 | |||||||
Earnings Per Share of Common Stock Attributable to RPM International Inc. Stockholders: | |||||||||
Basic | $ | 0.2 | $ | 0.59 | |||||
Diluted (1) | $ | 0.2 | $ | 0.59 | |||||
-1 | For the quarters ended August 31, 2012 and 2011, approximately 2,954,000 and 2,750,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted earnings per share, as the effect would have been anti-dilutive. |
SEGMENT_INFORMATION
SEGMENT INFORMATION | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
SEGMENT INFORMATION | ' | ||||||||
NOTE 15 — SEGMENT INFORMATION | |||||||||
We operate a portfolio of businesses and product lines that manufacture and sell a variety of specialty paints, protective coatings and roofing systems, sealants and adhesives. We manage our portfolio by organizing our businesses and product lines into two reportable segments: the industrial reportable segment and the consumer reportable segment. Within each reportable segment, we aggregate several operating segments that consist of individual groups of companies and product lines, which generally address common markets, share similar economic characteristics, utilize similar technologies and can share manufacturing or distribution capabilities. Our five operating segments represent components of our business for which separate financial information is available that is utilized on a regular basis by our chief executive officer in determining how to allocate the assets of the company and evaluate performance. These five operating segments are each managed by an operating segment manager, who is responsible for the day-to-day operating decisions and performance evaluation of the operating segment’s underlying businesses. | |||||||||
Our industrial reportable segment products are sold throughout North America and also account for the majority of our international sales. Our industrial product lines are sold directly to contractors, distributors and end-users, such as industrial manufacturing facilities, public institutions and other commercial customers. This reportable segment comprises three separate operating segments — Building Solutions Group, Performance Coatings Group and RPM2 Group. Products and services within this reportable segment include construction chemicals; roofing systems; weatherproofing and other sealants; polymer flooring; edible coatings and specialty glazes for pharmaceutical, cosmetic and food industries; and other specialty chemicals. | |||||||||
Our consumer reportable segment manufactures and markets professional use and do-it-yourself (“DIY”) products for a variety of mainly consumer applications, including home improvement and personal leisure activities. Our consumer segment’s major manufacturing and distribution operations are located primarily in North America, along with a few locations in Europe. Consumer segment products are sold directly to mass merchandisers, home improvement centers, hardware stores, paint stores, craft shops and to other smaller customers through distributors. This reportable segment comprises two operating segments — DAP Group and Rust-Oleum Group. Products within this reportable segment include specialty, hobby and professional paints; caulks; adhesives; silicone sealants and wood stains. | |||||||||
In addition to our two reportable segments, there is a category of certain business activities and expenses, referred to as corporate/other, that does not constitute an operating segment. This category includes our corporate headquarters and related administrative expenses, results of our captive insurance companies, gains or losses on the sales of certain assets and other expenses not directly associated with either reportable segment. Assets related to the corporate/other category consist primarily of investments, prepaid expenses and headquarters’ property and equipment. These corporate and other assets and expenses reconcile reportable segment data to total consolidated income before income taxes and identifiable assets. | |||||||||
We reflect income from our joint ventures on the equity method, and receive royalties from our licensees. | |||||||||
The following tables reflect the results of our reportable segments consistent with our management philosophy, and represent the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses. | |||||||||
Three Months Ended | |||||||||
August 31, | August 31, | ||||||||
2012 | 2011 | ||||||||
(In thousands) | |||||||||
(Restated) | |||||||||
Net Sales | |||||||||
Industrial Segment | $ | 703,335 | $ | 667,016 | |||||
Consumer Segment | 343,379 | 318,902 | |||||||
Consolidated | $ | 1,046,714 | $ | 985,918 | |||||
Income (Loss) Before Income Taxes | |||||||||
Industrial Segment | $ | 62,886 | $ | 91,546 | |||||
Consumer Segment | 58,788 | 51,512 | |||||||
Corporate/Other | (61,030 | ) | (24,354 | ) | |||||
Consolidated | $ | 60,644 | $ | 118,704 | |||||
August 31, | May 31, | ||||||||
2012 | 2012 | ||||||||
Identifiable Assets | |||||||||
Industrial Segment | $ | 2,359,243 | $ | 2,195,702 | |||||
Consumer Segment | 1,216,807 | 1,184,609 | |||||||
Corporate/Other | 99,928 | 181,502 | |||||||
Consolidated | $ | 3,675,978 | $ | 3,561,813 | |||||
STOCK_REPURCHASE_PROGRAM
STOCK REPURCHASE PROGRAM | 3 Months Ended |
Aug. 31, 2012 | |
STOCK REPURCHASE PROGRAM | ' |
NOTE 16 — STOCK REPURCHASE PROGRAM | |
On January 8, 2008, we announced our authorization of a stock repurchase program under which we may repurchase shares of RPM International Inc. common stock at management’s discretion for general corporate purposes. Our current intent is to limit our repurchases only to amounts required to offset dilution created by stock issued in connection with our equity-based compensation plans, or approximately one to two million shares per year. As a result of this authorization, we may repurchase shares from time to time in the open market or in private transactions at various times and in amounts and for prices that our management deems appropriate, subject to insider trading rules and other securities law restrictions. The timing of our purchases will depend upon prevailing market conditions, alternative uses of capital and other factors. We may limit or terminate the repurchase program at any time. During the three months ended August 31, 2012, we did not repurchase any shares of our common stock under this program. |
EQUITY
EQUITY | 3 Months Ended | ||||||||||||
Aug. 31, 2012 | |||||||||||||
EQUITY | ' | ||||||||||||
NOTE 17 — EQUITY | |||||||||||||
The following tables illustrate the components of total equity and comprehensive income for the quarters ended August 31, 2012 and 2011: | |||||||||||||
(In thousands) | Total RPM | Noncontrolling | Total Equity | ||||||||||
International | Interest | ||||||||||||
Inc. Equity | |||||||||||||
(Restated) | (Restated) | ||||||||||||
Total equity at May 31, 2012 | $ | 1,183,656 | $ | 130,327 | $ | 1,313,983 | |||||||
Net income | 26,665 | 3,954 | 30,619 | ||||||||||
Other Comprehensive Income: | |||||||||||||
Foreign currency translation adjustments | 28,664 | 10,566 | 39,230 | ||||||||||
Pension and other postretirement benefit liability adjustments, | 1,534 | (328 | ) | 1,206 | |||||||||
net of tax | |||||||||||||
Unrealized gain (loss) on securities, net of tax | 825 | (1,177 | ) | (352 | ) | ||||||||
Unrealized gain on derivatives, net of tax | 169 | 18 | 187 | ||||||||||
Total Other Comprehensive Income, net of tax | 31,192 | 9,079 | 40,271 | ||||||||||
Comprehensive Income | 57,857 | 13,033 | 70,890 | ||||||||||
Dividends paid | (28,281 | ) | (28,281 | ) | |||||||||
Other | 1,284 | 1,284 | |||||||||||
Stock option exercises, net | 603 | 603 | |||||||||||
Stock based compensation expense | 588 | 588 | |||||||||||
Restricted awards, net | 3,285 | 3,285 | |||||||||||
Total Equity at August 31, 2012 | $ | 1,218,992 | $ | 143,360 | $ | 1,362,352 | |||||||
(In thousands) | Total RPM | Noncontrolling | Total Equity | ||||||||||
International | Interest | ||||||||||||
Inc. Equity | |||||||||||||
Total equity at May 31, 2011 | $ | 1,263,164 | $ | 124,204 | $ | 1,387,368 | |||||||
Net income | 76,811 | 6,529 | 83,340 | ||||||||||
Other Comprehensive Income: | |||||||||||||
Foreign currency translation adjustments | (9,433 | ) | 329 | (9,104 | ) | ||||||||
Pension and other postretirement benefit liability adjustments, | 2,041 | 177 | 2,218 | ||||||||||
net of tax | |||||||||||||
Unrealized gain (loss) on securities, net of tax | (3,643 | ) | 390 | (3,253 | ) | ||||||||
Unrealized gain on derivatives, net of tax | (848 | ) | (231 | ) | (1,079 | ) | |||||||
Total Other Comprehensive Income, net of tax | (11,883 | ) | 665 | (11,218 | ) | ||||||||
Comprehensive Income | 64,928 | 7,194 | 72,122 | ||||||||||
Dividends paid | (27,424 | ) | (27,424 | ) | |||||||||
Other noncontrolling interest activity | (390 | ) | (390 | ) | |||||||||
Shares repurchased | (206 | ) | (206 | ) | |||||||||
Stock option exercises, net | 1,206 | 1,206 | |||||||||||
Stock based compensation expense | 3,125 | 3,125 | |||||||||||
Restricted awards, net | (64 | ) | (64 | ) | |||||||||
Total Equity at August 31, 2011 | $ | 1,304,339 | $ | 131,398 | $ | 1,435,737 | |||||||
SUBSEQUENT_EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Aug. 31, 2012 | |
SUBSEQUENT EVENTS | ' |
NOTE 18 — SUBSEQUENT EVENTS | |
Subsequent to the end of the current fiscal quarter, we completed two acquisitions. On September 5, 2012, we acquired Kirker Enterprises, Inc., a leading manufacturer of nail care enamels, coatings components and related products for the personal care industry. Based in Paterson, New Jersey, Kirker has annual sales in excess of $100 million. Kirker will be managed and reported by our RPM2 operating segment. | |
On September 21, 2012, we acquired Synta, Inc., a producer and marketer of innovative and unique exterior wood deck and concrete restoration systems sold through leading national home centers and marketed under the brands of Deck Restore and Concrete Restore. Synta’s products also include a craft coatings line. Based in Clarkston Georgia, Synta has annualized sales expected to exceed $40 million. Synta will be managed and reported by our Rust-Oleum operating segment. |
Restatement_Tables
Restatement (Tables) | 3 Months Ended | ||||||||||||
Aug. 31, 2012 | |||||||||||||
Previously Reported and Restated Balances of Affected Line Items in Financial Statements | ' | ||||||||||||
The following are previously reported and restated balances of affected line items in the Consolidated Balance Sheets as of August 31, 2012 (Unaudited), Consolidated Statements of Income and Consolidated Statements of Comprehensive Income for the three months ended August 31, 2012 (Unaudited), and the Consolidated Statements of Cash Flows for the three months ended August 31, 2012 (Unaudited). | |||||||||||||
As of August 31, 2012 | |||||||||||||
As Reported | Adjustment | Restated | |||||||||||
Consolidated Balance Sheet | |||||||||||||
Deferred income taxes | $ | 20,083 | $ | 4,170 | $ | 24,253 | |||||||
Other accrued liabilities | 184,325 | 11,418 | 195,743 | ||||||||||
Retained earnings | 692,449 | (7,248 | ) | 685,201 | |||||||||
Total RPM International Inc. stockholders’ equity | 1,226,240 | (7,248 | ) | 1,218,992 | |||||||||
Total equity | 1,369,600 | (7,248 | ) | 1,362,352 | |||||||||
Three Months Ended August 31, 2012 | |||||||||||||
As Reported | Adjustment | Restated | |||||||||||
Consolidated Statements of Income | |||||||||||||
Estimated Loss Contingency | $ | — | $ | 11,418 | $ | 11,418 | |||||||
Income before income taxes | 72,062 | (11,418 | ) | 60,644 | |||||||||
Provision for income taxes | 34,195 | (4,170 | ) | 30,025 | |||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Net income attributable to RPM International Inc. Stockholders | 33,913 | (7,248 | ) | 26,665 | |||||||||
Earnings Per Share—Basic | 0.26 | (0.06 | ) | 0.2 | |||||||||
Earnings Per Share—Diluted | 0.26 | (0.06 | ) | 0.2 | |||||||||
Consolidated Statements of Comprehensive Income | |||||||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Total Comprehensive Income | 78,138 | (7,248 | ) | 70,890 | |||||||||
Comprehensive Income Attributable to RPM International Inc. Stockholders | 65,105 | (7,248 | ) | 57,857 | |||||||||
Consolidated Statement of Cash Flows | |||||||||||||
Net income | 37,867 | (7,248 | ) | 30,619 | |||||||||
Estimated loss contingency | — | 11,418 | 11,418 | ||||||||||
Deferred income taxes | 1,874 | (4,170 | ) | (2,296 | ) | ||||||||
Cash From Operating Activities | 17,734 | — | 17,734 |
INVENTORIES_Tables
INVENTORIES (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Major Classes of Inventories | ' | ||||||||
Inventories were composed of the following major classes: | |||||||||
August 31, 2012 | May 31, 2012 | ||||||||
(In thousands) | |||||||||
Raw material and supplies | $ | 182,352 | $ | 160,869 | |||||
Finished goods | 342,971 | 329,109 | |||||||
Total Inventory | $ | 525,323 | $ | 489,978 | |||||
MARKETABLE_SECURITIES_Tables
MARKETABLE SECURITIES (Tables) | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
Summary of Marketable Securities by Asset Type | ' | ||||||||||||||||
The following tables summarize marketable securities held at August 31, 2012 and May 31, 2012 by asset type: | |||||||||||||||||
Available-For-Sale Securities | |||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||
Cost | Unrealized | Unrealized | (Net | ||||||||||||||
Gains | Losses | Carrying | |||||||||||||||
Amount) | |||||||||||||||||
August 31, 2012 | |||||||||||||||||
Equity securities: | |||||||||||||||||
Stocks — foreign | $ | 1,321 | $ | 234 | $ | (1 | ) | $ | 1,554 | ||||||||
Stocks — domestic | 26,657 | 1,877 | (922 | ) | 27,612 | ||||||||||||
Mutual funds — foreign | 19,053 | 1,167 | (5 | ) | 20,215 | ||||||||||||
Mutual funds — domestic | 39,685 | 165 | (40 | ) | 39,810 | ||||||||||||
Total equity securities | 86,716 | 3,443 | (968 | ) | 89,191 | ||||||||||||
Fixed maturity: | |||||||||||||||||
U.S. treasury and other government | 20,641 | 484 | (17 | ) | 21,108 | ||||||||||||
Kemrock convertible bonds | 14,273 | — | — | 14,273 | |||||||||||||
Corporate bonds | 1,832 | 268 | — | 2,100 | |||||||||||||
Foreign bonds | 38 | 3 | — | 41 | |||||||||||||
Mortgage-backed securities | 180 | 65 | (1 | ) | 244 | ||||||||||||
Total fixed maturity securities | 36,964 | 820 | (18 | ) | 37,766 | ||||||||||||
Total | $ | 123,680 | $ | 4,263 | $ | (986 | ) | $ | 126,957 | ||||||||
Available-For-Sale Securities | |||||||||||||||||
(In thousands) | Amortized | Gross | Gross | Fair Value | |||||||||||||
Cost | Unrealized | Unrealized | (Net | ||||||||||||||
Gains | Losses | Carrying | |||||||||||||||
Amount) | |||||||||||||||||
May 31, 2012 | |||||||||||||||||
Equity securities: | |||||||||||||||||
Stocks — foreign | $ | 1,016 | $ | 79 | $ | — | $ | 1,095 | |||||||||
Stocks — domestic | 24,380 | 2,776 | (1,046 | ) | 26,110 | ||||||||||||
Mutual funds — foreign | 17,489 | 521 | (936 | ) | 17,074 | ||||||||||||
Mutual funds — domestic | 39,246 | 1,114 | (1,077 | ) | 39,283 | ||||||||||||
Total equity securities | 82,131 | 4,490 | (3,059 | ) | 83,562 | ||||||||||||
Fixed maturity: | |||||||||||||||||
U.S. treasury and other government | 19,347 | 530 | (12 | ) | 19,865 | ||||||||||||
Kemrock convertible bonds | 13,670 | — | — | 13,670 | |||||||||||||
Coporate bonds | 2,305 | 349 | (5 | ) | 2,649 | ||||||||||||
Foreign bonds | 38 | 1 | — | 39 | |||||||||||||
Mortgage-backed securities | 241 | 105 | (2 | ) | 344 | ||||||||||||
Total fixed maturity securities | 35,601 | 985 | (19 | ) | 36,567 | ||||||||||||
Total | $ | 117,732 | $ | 5,475 | $ | (3,078 | ) | $ | 120,129 | ||||||||
Summary of Securities in Unrealized Loss Position and Included in Accumulated Other Comprehensive Income, Aggregated by Length of Time Investments | ' | ||||||||||||||||
Summarized below are the securities we held at August 31, 2012 and May 31, 2012 that were in an unrealized loss position and that were included in accumulated other comprehensive income, aggregated by the length of time the investments had been in that position: | |||||||||||||||||
August 31, 2012 | May 31, 2012 | ||||||||||||||||
(In thousands) | Fair Value | Gross | Fair Value | Gross | |||||||||||||
Unrealized | Unrealized | ||||||||||||||||
Losses | Losses | ||||||||||||||||
Total investments with unrealized losses | $ | 24,325 | $ | (986 | ) | $ | 43,772 | $ | (3,078 | ) | |||||||
Unrealized losses with a loss position for less than 12 months | 22,723 | (441 | ) | 42,114 | (2,596 | ) | |||||||||||
Unrealized losses with a loss position for more than 12 months | 1,602 | (545 | ) | 1,658 | (482 | ) | |||||||||||
Net Carrying Values of Debt Securities by Contractual Maturity | ' | ||||||||||||||||
The net carrying values of debt securities at August 31, 2012, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because the issuers of the securities may have the right to prepay obligations without prepayment penalties. | |||||||||||||||||
(In thousands) | Amortized | Fair | |||||||||||||||
Cost | Value | ||||||||||||||||
Due: | |||||||||||||||||
Less than one year | $ | 913 | $ | 914 | |||||||||||||
One year through five years | 29,643 | 29,935 | |||||||||||||||
Six years through ten years | 4,557 | 4,776 | |||||||||||||||
After ten years | 1,851 | 2,141 | |||||||||||||||
$ | 36,964 | $ | 37,766 | ||||||||||||||
FAIR_VALUE_MEASUREMENTS_Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
Assets and Liabilities Measured at Fair Value on Recurring Basis and Categorized using Fair Value Hierarchy | ' | ||||||||||||||||
The following tables present our assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. | |||||||||||||||||
(In thousands) | Quoted Prices in | Significant | Significant | Fair Value at | |||||||||||||
Active Markets | Other | Unobservable | August 31, 2012 | ||||||||||||||
for Identical | Observable | Inputs (Level 3) | |||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
U.S. Treasury and other government | $ | — | $ | 21,108 | $ | — | $ | 21,108 | |||||||||
Foreign bonds | 41 | 41 | |||||||||||||||
Mortgage-backed securities | 244 | 244 | |||||||||||||||
Corporate bonds | 2,100 | 2,100 | |||||||||||||||
Stocks — foreign | 1,554 | 1,554 | |||||||||||||||
Stocks — domestic | 27,612 | 27,612 | |||||||||||||||
Mutual funds — foreign | 20,215 | 20,215 | |||||||||||||||
Mutual funds — domestic | 39,810 | 39,810 | |||||||||||||||
Cross-currency swap | — | (4,503 | ) | — | (4,503 | ) | |||||||||||
Conversion option, Kemrock 5.5% bonds | 847 | 847 | |||||||||||||||
Investment in Kemrock convertible debt | 14,273 | 14,273 | |||||||||||||||
Total | $ | 29,166 | $ | 93,288 | $ | 847 | $ | 123,301 | |||||||||
(In thousands) | Quoted Prices in | Significant | Significant | Fair Value at | |||||||||||||
Active Markets | Other | Unobservable | May 31, 2012 | ||||||||||||||
for Identical | Observable | Inputs (Level 3) | |||||||||||||||
Assets (Level 1) | Inputs (Level 2) | ||||||||||||||||
U.S. Treasury and other government | $ | — | $ | 19,865 | $ | — | $ | 19,865 | |||||||||
Foreign bonds | 39 | 39 | |||||||||||||||
Mortgage-backed securities | 344 | 344 | |||||||||||||||
Corporate bonds | 2,649 | 2,649 | |||||||||||||||
Stocks — foreign | 1,095 | 1,095 | |||||||||||||||
Stocks — domestic | 26,110 | 26,110 | |||||||||||||||
Mutual funds — foreign | 17,074 | 17,074 | |||||||||||||||
Mutual funds — domestic | 39,283 | 39,283 | |||||||||||||||
Foreign currency forward contract | (1,356 | ) | (1,356 | ) | |||||||||||||
Cross-currency swap | (2,159 | ) | (2,159 | ) | |||||||||||||
Conversion option, Kemrock 5.5% bonds | 9,031 | 9,031 | |||||||||||||||
Investment in Kemrock convertible debt | 13,670 | 13,670 | |||||||||||||||
Total | $ | 27,205 | $ | 89,409 | $ | 9,031 | $ | 125,645 | |||||||||
Fair Value and Carrying Value of Financial Instruments and Long-Term Debt | ' | ||||||||||||||||
Based on the analysis performed, the fair value and the carrying value of our financial instruments and long-term debt as of August 31, 2012 and May 31, 2012 are as follows: | |||||||||||||||||
At August 31, 2012 | |||||||||||||||||
(In thousands) | Carrying | Fair Value | |||||||||||||||
Value | |||||||||||||||||
Cash and cash equivalents | $ | 257,382 | $ | 257,382 | |||||||||||||
Marketable equity securities | 89,191 | 89,191 | |||||||||||||||
Marketable debt securities | 37,766 | 37,766 | |||||||||||||||
Long-term debt, including current portion | 1,202,610 | 1,484,689 | |||||||||||||||
At May 31, 2012 | |||||||||||||||||
(In thousands) | Carrying | Fair Value | |||||||||||||||
Value | |||||||||||||||||
Cash and cash equivalents | $ | 315,968 | $ | 315,968 | |||||||||||||
Marketable equity securities | 83,562 | 83,562 | |||||||||||||||
Marketable debt securities | 36,567 | 36,567 | |||||||||||||||
Long-term debt, including current portion | 1,115,536 | 1,232,180 |
CONTINGENCIES_AND_OTHER_ACCRUE1
CONTINGENCIES AND OTHER ACCRUED LOSSES (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Changes in Accrued Warranty Balances | ' | ||||||||
The following table includes the changes in our accrued warranty balances: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
(In thousands) | 2012 | 2011 | |||||||
Beginning Balance | $ | 14,751 | $ | 17,196 | |||||
Deductions (1) | (3,905 | ) | (4,072 | ) | |||||
Provision charged to SG&A expense | 3,681 | 3,841 | |||||||
Ending Balance | $ | 14,527 | $ | 16,965 | |||||
-1 | Primarily claims paid during the year. |
INVESTMENT_INCOME_EXPENSE_NET_
INVESTMENT (INCOME) EXPENSE, NET (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Investment (Income) Expenses, Net | ' | ||||||||
Investment (income) expense, net, consists of the following components: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
(In thousands) | 2012 | 2011 | |||||||
Interest (income) | $ | (2,295 | ) | $ | (1,117 | ) | |||
(Gain) loss on sale of marketable securities | (4,584 | ) | 914 | ||||||
Other-than-temporary impairment on securities | 113 | 406 | |||||||
Dividend (income) | (208 | ) | (227 | ) | |||||
Investment (income) expense, net | $ | (6,974 | ) | $ | (24 | ) | |||
OTHER_EXPENSE_INCOME_NET_Table
OTHER EXPENSE (INCOME), NET (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Other Expense (Income), Net | ' | ||||||||
Other expense (income), net, consists of the following components: | |||||||||
Quarter Ended | |||||||||
August 31, | |||||||||
Year Ended May 31, | 2012 | 2011 | |||||||
(In thousands) | |||||||||
Royalty (income), net | $ | (294 | ) | $ | (324 | ) | |||
Loss on Kemrock conversion option | 8,183 | ||||||||
Loss (income) related to unconsolidated equity affiliates | 31,533 | (479 | ) | ||||||
Other expense (income), net | $ | 39,422 | $ | (803 | ) | ||||
PENSION_PLANS_Tables
PENSION PLANS (Tables) | 3 Months Ended | ||||||||||||||||
Aug. 31, 2012 | |||||||||||||||||
Retirement-Related Benefit Plans' Impact on Income Before Income Taxes | ' | ||||||||||||||||
The following tables provide the retirement-related benefit plans’ impact on income before income taxes for the quarters month periods ended August 31, 2012 and 2011: | |||||||||||||||||
U.S. Plans | Non-U.S. Plans | ||||||||||||||||
Quarter Ended | Quarter Ended | ||||||||||||||||
August 31, | August 31, | ||||||||||||||||
Pension Benefits | 2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | 6,488 | $ | 4,977 | $ | 1,050 | $ | 965 | |||||||||
Interest cost | 4,060 | 3,827 | 1,769 | 2,040 | |||||||||||||
Expected return on plan assets | (4,358 | ) | (4,354 | ) | (1,846 | ) | (2,036 | ) | |||||||||
Amortization of: | |||||||||||||||||
Prior service cost | 87 | 88 | 2 | 3 | |||||||||||||
Net actuarial losses recognized | 4,222 | 2,127 | 692 | 560 | |||||||||||||
Net Periodic Benefit Cost | $ | 10,499 | $ | 6,665 | $ | 1,667 | $ | 1,532 | |||||||||
U.S. Plans | Non-U.S. Plans | ||||||||||||||||
Quarter Ended | Quarter Ended | ||||||||||||||||
August 31, | August 31, | ||||||||||||||||
Postretirement Benefits | 2012 | 2011 | 2012 | 2011 | |||||||||||||
(In thousands) | |||||||||||||||||
Service cost | $ | — | $ | — | $ | 288 | $ | 192 | |||||||||
Interest cost | 88 | 104 | 289 | 250 | |||||||||||||
Amortization of: | |||||||||||||||||
Prior service cost | (22 | ) | (22 | ) | |||||||||||||
Net actuarial (gains) losses recognized | 4 | (14 | ) | 114 | 18 | ||||||||||||
Net Periodic Benefit Cost | $ | 70 | $ | 68 | $ | 691 | $ | 460 | |||||||||
EARNINGS_PER_SHARE_Tables
EARNINGS PER SHARE (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Reconciliation of Numerator and Denominator of Basic and Diluted Earnings Per Share Calculated using Two-Class Method | ' | ||||||||
The following table sets forth the reconciliation of the numerator and denominator of basic and diluted earnings per share, as calculated using the two-class method, for the three months ended August 31, 2012 and 2011: | |||||||||
Three Months Ended | |||||||||
August 31, | |||||||||
(In thousands, except per share amounts) | 2012 | 2011 | |||||||
(Restated) | |||||||||
Numerator for earnings per share: | |||||||||
Net income attributable to RPM International Inc. stockholders | $ | 26,665 | $ | 76,811 | |||||
Less: Allocation of earnings and dividends to participating securities | (479 | ) | (1,530 | ) | |||||
Net income available to common shareholders — basic | 26,186 | 75,281 | |||||||
Add: Undistributed earnings reallocated to unvested shareholders | — | 4 | |||||||
Net income available to common shareholders — diluted | $ | 26,186 | $ | 75,285 | |||||
Denominator for basic and diluted earnings per share: | |||||||||
Basic weighted average common shares | 128,805 | 128,094 | |||||||
Average diluted options | 765 | 532 | |||||||
Total shares for diluted earnings per share | 129,570 | 128,626 | |||||||
Earnings Per Share of Common Stock Attributable to RPM International Inc. Stockholders: | |||||||||
Basic | $ | 0.2 | $ | 0.59 | |||||
Diluted (1) | $ | 0.2 | $ | 0.59 | |||||
-1 | For the quarters ended August 31, 2012 and 2011, approximately 2,954,000 and 2,750,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted earnings per share, as the effect would have been anti-dilutive. |
SEGMENT_INFORMATION_Tables
SEGMENT INFORMATION (Tables) | 3 Months Ended | ||||||||
Aug. 31, 2012 | |||||||||
Results of Reportable Segments | ' | ||||||||
The following tables reflect the results of our reportable segments consistent with our management philosophy, and represent the information we utilize, in conjunction with various strategic, operational and other financial performance criteria, in evaluating the performance of our portfolio of businesses. | |||||||||
Three Months Ended | |||||||||
August 31, | August 31, | ||||||||
2012 | 2011 | ||||||||
(In thousands) | |||||||||
(Restated) | |||||||||
Net Sales | |||||||||
Industrial Segment | $ | 703,335 | $ | 667,016 | |||||
Consumer Segment | 343,379 | 318,902 | |||||||
Consolidated | $ | 1,046,714 | $ | 985,918 | |||||
Income (Loss) Before Income Taxes | |||||||||
Industrial Segment | $ | 62,886 | $ | 91,546 | |||||
Consumer Segment | 58,788 | 51,512 | |||||||
Corporate/Other | (61,030 | ) | (24,354 | ) | |||||
Consolidated | $ | 60,644 | $ | 118,704 | |||||
August 31, | May 31, | ||||||||
2012 | 2012 | ||||||||
Identifiable Assets | |||||||||
Industrial Segment | $ | 2,359,243 | $ | 2,195,702 | |||||
Consumer Segment | 1,216,807 | 1,184,609 | |||||||
Corporate/Other | 99,928 | 181,502 | |||||||
Consolidated | $ | 3,675,978 | $ | 3,561,813 | |||||
EQUITY_Tables
EQUITY (Tables) | 3 Months Ended | ||||||||||||
Aug. 31, 2012 | |||||||||||||
Components of Total Equity and Comprehensive Income | ' | ||||||||||||
The following tables illustrate the components of total equity and comprehensive income for the quarters ended August 31, 2012 and 2011: | |||||||||||||
(In thousands) | Total RPM | Noncontrolling | Total Equity | ||||||||||
International | Interest | ||||||||||||
Inc. Equity | |||||||||||||
(Restated) | (Restated) | ||||||||||||
Total equity at May 31, 2012 | $ | 1,183,656 | $ | 130,327 | $ | 1,313,983 | |||||||
Net income | 26,665 | 3,954 | 30,619 | ||||||||||
Other Comprehensive Income: | |||||||||||||
Foreign currency translation adjustments | 28,664 | 10,566 | 39,230 | ||||||||||
Pension and other postretirement benefit liability adjustments, | 1,534 | (328 | ) | 1,206 | |||||||||
net of tax | |||||||||||||
Unrealized gain (loss) on securities, net of tax | 825 | (1,177 | ) | (352 | ) | ||||||||
Unrealized gain on derivatives, net of tax | 169 | 18 | 187 | ||||||||||
Total Other Comprehensive Income, net of tax | 31,192 | 9,079 | 40,271 | ||||||||||
Comprehensive Income | 57,857 | 13,033 | 70,890 | ||||||||||
Dividends paid | (28,281 | ) | (28,281 | ) | |||||||||
Other | 1,284 | 1,284 | |||||||||||
Stock option exercises, net | 603 | 603 | |||||||||||
Stock based compensation expense | 588 | 588 | |||||||||||
Restricted awards, net | 3,285 | 3,285 | |||||||||||
Total Equity at August 31, 2012 | $ | 1,218,992 | $ | 143,360 | $ | 1,362,352 | |||||||
(In thousands) | Total RPM | Noncontrolling | Total Equity | ||||||||||
International | Interest | ||||||||||||
Inc. Equity | |||||||||||||
Total equity at May 31, 2011 | $ | 1,263,164 | $ | 124,204 | $ | 1,387,368 | |||||||
Net income | 76,811 | 6,529 | 83,340 | ||||||||||
Other Comprehensive Income: | |||||||||||||
Foreign currency translation adjustments | (9,433 | ) | 329 | (9,104 | ) | ||||||||
Pension and other postretirement benefit liability adjustments, | 2,041 | 177 | 2,218 | ||||||||||
net of tax | |||||||||||||
Unrealized gain (loss) on securities, net of tax | (3,643 | ) | 390 | (3,253 | ) | ||||||||
Unrealized gain on derivatives, net of tax | (848 | ) | (231 | ) | (1,079 | ) | |||||||
Total Other Comprehensive Income, net of tax | (11,883 | ) | 665 | (11,218 | ) | ||||||||
Comprehensive Income | 64,928 | 7,194 | 72,122 | ||||||||||
Dividends paid | (27,424 | ) | (27,424 | ) | |||||||||
Other noncontrolling interest activity | (390 | ) | (390 | ) | |||||||||
Shares repurchased | (206 | ) | (206 | ) | |||||||||
Stock option exercises, net | 1,206 | 1,206 | |||||||||||
Stock based compensation expense | 3,125 | 3,125 | |||||||||||
Restricted awards, net | (64 | ) | (64 | ) | |||||||||
Total Equity at August 31, 2011 | $ | 1,304,339 | $ | 131,398 | $ | 1,435,737 | |||||||
Restatement_Additional_Informa
Restatement - Additional Information (Detail) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | |
Estimated Loss on Contingency | $11,418 | [1] | ' |
Net income | 30,619 | [1] | 83,340 |
Adjustments | ' | ' | |
Estimated Loss on Contingency | 11,418 | ' | |
Net income | ($7,248) | ' | |
[1] | Restated |
Previously_Reported_and_Restat
Previously Reported and Restated Balances of Affected Line Items in Financial Statements (Detail) (USD $) | 3 Months Ended | ||||||
In Thousands, except Per Share data, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | 31-May-12 | 31-May-11 | |||
Consolidated Balance Sheet | ' | ' | ' | ' | |||
Deferred income taxes | $24,253 | [1] | ' | $18,752 | ' | ||
Other accrued liabilities | 195,743 | [1] | ' | 144,911 | ' | ||
Retained earnings | 685,201 | [1] | ' | 686,818 | ' | ||
Total RPM International Inc. stockholders' equity | 1,218,992 | [1] | ' | 1,183,656 | ' | ||
Total equity | 1,362,352 | [1] | 1,435,737 | 1,313,983 | [1] | 1,387,368 | |
Consolidated Statements of Income | ' | ' | ' | ' | |||
Estimated Loss Contingency | 11,418 | [1] | ' | ' | ' | ||
Income before income taxes | 60,644 | [1] | 118,704 | ' | ' | ||
Provision for Income Taxes | 30,025 | [1] | 35,364 | ' | ' | ||
Net income | 30,619 | [1] | 83,340 | ' | ' | ||
Net income attributable to RPM International Inc. Stockholders | 26,665 | [1] | 76,811 | ' | ' | ||
Earnings Per Share-Basic | $0.20 | [1] | $0.59 | ' | ' | ||
Earnings Per Share-Diluted | $0.20 | [1],[2] | $0.59 | [2] | ' | ' | |
Consolidated Statements of Comprehensive Income | ' | ' | ' | ' | |||
Net income | 30,619 | [1] | 83,340 | ' | ' | ||
Total Comprehensive Income | 70,890 | [1] | 72,122 | ' | ' | ||
Comprehensive Income Attributable to RPM International Inc. Stockholders | 57,857 | [1] | 64,928 | ' | ' | ||
Consolidated Statement of Cash Flows | ' | ' | ' | ' | |||
Net income | 30,619 | [1] | 83,340 | ' | ' | ||
Estimated Loss Contingency | 11,418 | [1] | ' | ' | ' | ||
Deferred income taxes | -2,296 | [1] | -1,374 | ' | ' | ||
Cash From Operating Activities | 17,734 | [1] | 7,476 | ' | ' | ||
As Reported | ' | ' | ' | ' | |||
Consolidated Balance Sheet | ' | ' | ' | ' | |||
Deferred income taxes | 20,083 | ' | ' | ' | |||
Other accrued liabilities | 184,325 | ' | ' | ' | |||
Retained earnings | 692,449 | ' | ' | ' | |||
Total RPM International Inc. stockholders' equity | 1,226,240 | ' | ' | ' | |||
Total equity | 1,369,600 | ' | ' | ' | |||
Consolidated Statements of Income | ' | ' | ' | ' | |||
Income before income taxes | 72,062 | ' | ' | ' | |||
Provision for Income Taxes | 34,195 | ' | ' | ' | |||
Net income | 37,867 | ' | ' | ' | |||
Net income attributable to RPM International Inc. Stockholders | 33,913 | ' | ' | ' | |||
Earnings Per Share-Basic | $0.26 | ' | ' | ' | |||
Earnings Per Share-Diluted | $0.26 | ' | ' | ' | |||
Consolidated Statements of Comprehensive Income | ' | ' | ' | ' | |||
Net income | 37,867 | ' | ' | ' | |||
Total Comprehensive Income | 78,138 | ' | ' | ' | |||
Comprehensive Income Attributable to RPM International Inc. Stockholders | 65,105 | ' | ' | ' | |||
Consolidated Statement of Cash Flows | ' | ' | ' | ' | |||
Net income | 37,867 | ' | ' | ' | |||
Deferred income taxes | 1,874 | ' | ' | ' | |||
Cash From Operating Activities | 17,734 | ' | ' | ' | |||
Adjustments | ' | ' | ' | ' | |||
Consolidated Balance Sheet | ' | ' | ' | ' | |||
Deferred income taxes | 4,170 | ' | ' | ' | |||
Other accrued liabilities | 11,418 | ' | ' | ' | |||
Retained earnings | -7,248 | ' | ' | ' | |||
Total RPM International Inc. stockholders' equity | -7,248 | ' | ' | ' | |||
Total equity | -7,248 | ' | ' | ' | |||
Consolidated Statements of Income | ' | ' | ' | ' | |||
Estimated Loss Contingency | 11,418 | ' | ' | ' | |||
Income before income taxes | -11,418 | ' | ' | ' | |||
Provision for Income Taxes | -4,170 | ' | ' | ' | |||
Net income | -7,248 | ' | ' | ' | |||
Net income attributable to RPM International Inc. Stockholders | -7,248 | ' | ' | ' | |||
Earnings Per Share-Basic | ($0.06) | ' | ' | ' | |||
Earnings Per Share-Diluted | ($0.06) | ' | ' | ' | |||
Consolidated Statements of Comprehensive Income | ' | ' | ' | ' | |||
Net income | -7,248 | ' | ' | ' | |||
Total Comprehensive Income | -7,248 | ' | ' | ' | |||
Comprehensive Income Attributable to RPM International Inc. Stockholders | -7,248 | ' | ' | ' | |||
Consolidated Statement of Cash Flows | ' | ' | ' | ' | |||
Net income | -7,248 | ' | ' | ' | |||
Estimated Loss Contingency | 11,418 | ' | ' | ' | |||
Deferred income taxes | ($4,170) | ' | ' | ' | |||
[1] | Restated | ||||||
[2] | For the quarters ended August 31, 2012 and 2011, approximately 2,954,000 and 2,750,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted earnings per share, as the effect would have been anti-dilutive. |
Recovered_Sheet1
Investment in Kemrock Industries and Exports Ltd - Additional Information (Detail) | 3 Months Ended | 3 Months Ended | 12 Months Ended | 12 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||
Aug. 31, 2012 | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2012 | 31-May-12 | 31-May-11 | 31-May-12 | Apr. 30, 2012 | Aug. 31, 2012 | 31-May-12 | Apr. 30, 2012 | 31-May-12 | Apr. 30, 2012 | 31-May-12 | |
USD ($) | INR | INR | Kemrock Industries and Exports Limited | Kemrock Industries and Exports Limited | Kemrock Industries and Exports Limited | Kemrock global depository receipts | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | |
USD ($) | USD ($) | USD ($) | USD ($) | USD ($) | Minimum | Minimum | Maximum | Maximum | ||||||
Basis of Presentation [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Advances to affiliate | ' | ' | ' | ' | $15,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Agreement expiration period | ' | ' | ' | ' | 15-Sep-12 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Acquisition of equity method investment, shares | ' | ' | ' | ' | 870,000 | 3,200,000 | 693,072 | ' | ' | ' | ' | ' | ' | ' |
Purchase of global depository receipt, value | ' | ' | ' | ' | ' | ' | 7,200,000 | ' | ' | ' | ' | ' | ' | ' |
Equity method investment carrying value | ' | ' | ' | ' | ' | ' | 42,200,000 | ' | ' | ' | ' | ' | ' | ' |
Investment in affiliate | ' | ' | ' | ' | ' | ' | ' | 22,700,000 | ' | 22,700,000 | ' | ' | ' | ' |
Investment in affiliate, interest rate | ' | ' | ' | ' | ' | ' | ' | 5.50% | 5.50% | 5.50% | ' | ' | ' | ' |
Debt securities, conversion date | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 4-Jun-12 | 4-Jun-12 | 12-Jun-17 | 12-Jun-17 |
Kemrock common stock market value per share | ' | 116.6 | 531 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Impairment loss on equity method investment | -32,100,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Proceeds from affiliate | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loans deemed uncollectible, recorded as loss | ' | ' | ' | 5,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loss on Kemrock conversion option | ($8,183,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Recovered_Sheet2
Deconsolidation of Specialty Products Holding Corp. ("SPHC") - Additional Information (Detail) (USD $) | 3 Months Ended | |
31-May-10 | Aug. 31, 2012 | |
Reorganization [Line Items] | ' | ' |
Number of appeal bonds satisfied | ' | 1 |
Number of appeal bonds outstanding | ' | 1 |
Carrying value of retained interest in SPHC | $0 | ' |
Net loss from deconsolidation of business | ($7,900,000) | ' |
Major_Classes_of_Inventories_D
Major Classes of Inventories (Detail) (USD $) | Aug. 31, 2012 | 31-May-12 | |
In Thousands, unless otherwise specified | |||
Inventory [Line Items] | ' | ' | |
Raw material and supplies | $182,352 | $160,869 | |
Finished goods | 342,971 | 329,109 | |
Total Inventory | $525,323 | [1] | $489,978 |
[1] | Restated |
Summary_of_Marketable_Securiti
Summary of Marketable Securities by Asset Type (Detail) (USD $) | Aug. 31, 2012 | 31-May-12 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | $123,680 | $117,732 |
Available-for-Sale Securities, Gross Unrealized Gains | 4,263 | 5,475 |
Available-for-Sale Securities, Gross Unrealized Losses | -986 | -3,078 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 126,957 | 120,129 |
Equity securities | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 86,716 | 82,131 |
Available-for-Sale Securities, Gross Unrealized Gains | 3,443 | 4,490 |
Available-for-Sale Securities, Gross Unrealized Losses | -968 | -3,059 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 89,191 | 83,562 |
Equity securities | Stocks | Foreign | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 1,321 | 1,016 |
Available-for-Sale Securities, Gross Unrealized Gains | 234 | 79 |
Available-for-Sale Securities, Gross Unrealized Losses | -1 | ' |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 1,554 | 1,095 |
Equity securities | Stocks | Domestic | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 26,657 | 24,380 |
Available-for-Sale Securities, Gross Unrealized Gains | 1,877 | 2,776 |
Available-for-Sale Securities, Gross Unrealized Losses | -922 | -1,046 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 27,612 | 26,110 |
Equity securities | Mutual funds | Foreign | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 19,053 | 17,489 |
Available-for-Sale Securities, Gross Unrealized Gains | 1,167 | 521 |
Available-for-Sale Securities, Gross Unrealized Losses | -5 | -936 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 20,215 | 17,074 |
Equity securities | Mutual funds | Domestic | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 39,685 | 39,246 |
Available-for-Sale Securities, Gross Unrealized Gains | 165 | 1,114 |
Available-for-Sale Securities, Gross Unrealized Losses | -40 | -1,077 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 39,810 | 39,283 |
Fixed maturity | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 36,964 | 35,601 |
Available-for-Sale Securities, Gross Unrealized Gains | 820 | 985 |
Available-for-Sale Securities, Gross Unrealized Losses | -18 | -19 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 37,766 | 36,567 |
Fixed maturity | U.S. Treasury and other government | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 20,641 | 19,347 |
Available-for-Sale Securities, Gross Unrealized Gains | 484 | 530 |
Available-for-Sale Securities, Gross Unrealized Losses | -17 | -12 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 21,108 | 19,865 |
Fixed maturity | Kemrock convertible bonds | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 14,273 | 13,670 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 14,273 | 13,670 |
Fixed maturity | Corporate bonds | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 1,832 | 2,305 |
Available-for-Sale Securities, Gross Unrealized Gains | 268 | 349 |
Available-for-Sale Securities, Gross Unrealized Losses | ' | -5 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 2,100 | 2,649 |
Fixed maturity | Foreign bonds | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 38 | 38 |
Available-for-Sale Securities, Gross Unrealized Gains | 3 | 1 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | 41 | 39 |
Fixed maturity | Mortgage-backed securities | ' | ' |
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Available-for-Sale Securities, Amortized Cost | 180 | 241 |
Available-for-Sale Securities, Gross Unrealized Gains | 65 | 105 |
Available-for-Sale Securities, Gross Unrealized Losses | -1 | -2 |
Available-for-Sale Securities, Fair Value (Net Carrying Amount) | $244 | $344 |
Marketable_Securities_Addition
Marketable Securities - Additional Information (Detail) (USD $) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||
In Millions, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | 31-May-12 | Apr. 30, 2012 | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2012 | Apr. 30, 2012 | 31-May-12 | Apr. 30, 2012 | 31-May-12 |
Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Maximum | Maximum | Maximum | Minimum | Minimum | ||||
Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | ||||||||
Schedule of Available-for-sale Securities [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Available-for-sale securities, current | $39.10 | ' | $30.50 | ' | ' | ' | ' | ' | ' | ' | ' |
Available-for-sale securities, long-term | 87.9 | ' | 89.6 | ' | ' | ' | ' | ' | ' | ' | ' |
Investment in affiliate | ' | ' | ' | 22.7 | ' | 22.7 | ' | ' | ' | ' | ' |
Investment in affiliate, interest rate | ' | ' | ' | 5.50% | 5.50% | 5.50% | ' | ' | ' | ' | ' |
Debt securities, conversion date | ' | ' | ' | ' | ' | ' | ' | 12-Jun-17 | 12-Jun-17 | 4-Jun-12 | 4-Jun-12 |
Reclassification of other current assets into long-term assets | ' | ' | ' | ' | 73.6 | 76 | ' | ' | ' | ' | ' |
Gross gains realized on sales of investments | 5 | 1.9 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Gross losses realized on sales of investments | 0.4 | 2.8 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Losses recognized for securities deemed to have other-than-temporary impairments | $0.10 | $0.40 | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investments with unrealized loss, percentage of fair values less than original cost | ' | ' | ' | ' | ' | ' | 15.00% | ' | ' | ' | ' |
Summary_of_Securities_in_Unrea
Summary of Securities in Unrealized Loss Position and Included in Accumulated Other Comprehensive Income, Aggregated by Length of Time Investments (Detail) (USD $) | Aug. 31, 2012 | 31-May-12 |
In Thousands, unless otherwise specified | ||
Schedule of Available-for-sale Securities [Line Items] | ' | ' |
Total investments with unrealized losses, fair value | $24,325 | $43,772 |
Unrealized losses with a loss position for less than 12 months, fair value | 22,723 | 42,114 |
Unrealized losses with a loss position for more than 12 months, fair value | 1,602 | 1,658 |
Total investments with unrealized losses, gross unrealized losses | -986 | -3,078 |
Unrealized losses with a loss position for less than 12 months, gross unrealized losses | -441 | -2,596 |
Unrealized losses with a loss position for more than 12 months, gross unrealized losses | ($545) | ($482) |
Net_Carrying_Values_of_Debt_Se
Net Carrying Values of Debt Securities by Contractual Maturity (Detail) (USD $) | Aug. 31, 2012 |
In Thousands, unless otherwise specified | |
Available-for-Sale Securities, amortized cost | ' |
Less than one year, amortized cost | $913 |
One year through five years, amortized cost | 29,643 |
Six years through ten years, amortized cost | 4,557 |
After ten years, amortized cost | 1,851 |
Available-for-sale Securities, Debt Maturities, Amortized Cost Basis, Total | 36,964 |
Available-for-Sale Securities, fair value | ' |
Less than one year, fair value | 914 |
One year through five years, fair value | 29,935 |
Six years through ten years, fair value | 4,776 |
After ten years, fair value | 2,141 |
Available-for-sale Securities, Debt Securities, Total | $37,766 |
Assets_and_Liabilities_Measure
Assets and Liabilities Measured at Fair Value on Recurring Basis and Categorized using Fair Value Hierarchy (Detail) (Fair Value, Measurements, Recurring, USD $) | Aug. 31, 2012 | 31-May-12 |
In Thousands, unless otherwise specified | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets (liabilities) at fair value | $123,301 | $125,645 |
U.S. Treasury and other government | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 21,108 | 19,865 |
Foreign bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 41 | 39 |
Mortgage-backed securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 244 | 344 |
Corporate bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 2,100 | 2,649 |
Stocks | Foreign | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 1,554 | 1,095 |
Stocks | Domestic | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 27,612 | 26,110 |
Mutual funds | Foreign | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 20,215 | 17,074 |
Mutual funds | Domestic | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 39,810 | 39,283 |
Cross-currency swap | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Foreign currency contracts, fair value of liability | -4,503 | -2,159 |
Conversion option, Kemrock 5.5% bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 847 | 9,031 |
Investment in Kemrock convertible debt | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 14,273 | 13,670 |
Foreign currency forward contract | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Foreign currency contracts, fair value of liability | ' | -1,356 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets (liabilities) at fair value | 29,166 | 27,205 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Stocks | Foreign | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 1,554 | 1,095 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Stocks | Domestic | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 27,612 | 26,110 |
Significant Other Observable Inputs (Level 2) | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets (liabilities) at fair value | 93,288 | 89,409 |
Significant Other Observable Inputs (Level 2) | U.S. Treasury and other government | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 21,108 | 19,865 |
Significant Other Observable Inputs (Level 2) | Foreign bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 41 | 39 |
Significant Other Observable Inputs (Level 2) | Mortgage-backed securities | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 244 | 344 |
Significant Other Observable Inputs (Level 2) | Corporate bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 2,100 | 2,649 |
Significant Other Observable Inputs (Level 2) | Mutual funds | Foreign | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 20,215 | 17,074 |
Significant Other Observable Inputs (Level 2) | Mutual funds | Domestic | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 39,810 | 39,283 |
Significant Other Observable Inputs (Level 2) | Cross-currency swap | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Foreign currency contracts, fair value of liability | -4,503 | -2,159 |
Significant Other Observable Inputs (Level 2) | Investment in Kemrock convertible debt | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | 14,273 | 13,670 |
Significant Other Observable Inputs (Level 2) | Foreign currency forward contract | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Foreign currency contracts, fair value of liability | ' | -1,356 |
Significant Unobservable Inputs (Level 3) | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets (liabilities) at fair value | 847 | 9,031 |
Significant Unobservable Inputs (Level 3) | Conversion option, Kemrock 5.5% bonds | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' |
Assets measured at fair value on recurring basis | $847 | $9,031 |
Assets_and_Liabilities_Measure1
Assets and Liabilities Measured at Fair Value on Recurring Basis and Categorized using Fair Value Hierarchy (Parenthetical) (Detail) (Conversion option, Kemrock 5.5% bonds) | 1 Months Ended | 3 Months Ended | 12 Months Ended |
Apr. 30, 2012 | Aug. 31, 2012 | 31-May-12 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' |
Investment in affiliate, interest rate | 5.50% | 5.50% | 5.50% |
Fair Value, Measurements, Recurring | ' | ' | ' |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' |
Investment in affiliate, interest rate | ' | 5.50% | 5.50% |
Fair_Value_Measurements_Additi
Fair Value Measurements - Additional Information (Detail) | 3 Months Ended | 1 Months Ended | 3 Months Ended | 12 Months Ended | 3 Months Ended | 3 Months Ended | 12 Months Ended | |||||
Aug. 31, 2012 | Aug. 31, 2012 | Aug. 31, 2012 | 31-May-12 | Apr. 30, 2012 | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2012 | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2012 | 31-May-12 | |
USD ($) | EUR (€) | INR | INR | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | Unsecured Senior Notes | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | Fair Value, Measurements, Recurring | |
Cross-currency swap | Cross-currency swap | Conversion option, Kemrock 5.5% bonds | Conversion option, Kemrock 5.5% bonds | |||||||||
USD ($) | USD ($) | |||||||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Foreign currency contracts, fair value of liability | ' | ' | ' | ' | ' | ' | ' | ' | $4,503,000 | $2,159,000 | ' | ' |
Debt, interest rate | ' | ' | ' | ' | ' | ' | ' | 6.70% | ' | ' | ' | ' |
Debt, due date | ' | ' | ' | ' | ' | ' | ' | 1-Nov-15 | ' | ' | ' | ' |
Effective euro fixed-rate borrowing | 5.31% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Notional principal amount of cross-currency swap | 150,000,000 | 125,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Loss on Kemrock conversion option | ($8,183,000) | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Investment in affiliate, interest rate | ' | ' | ' | ' | 5.50% | 5.50% | 5.50% | ' | ' | ' | 5.50% | 5.50% |
Kemrock common stock market value per share | ' | ' | 116.6 | 531 | ' | ' | ' | ' | ' | ' | ' | ' |
Fair_Value_and_Carrying_Value_
Fair Value and Carrying Value of Financial Instruments and Long-Term Debt (Detail) (USD $) | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2011 | 31-May-11 | ||
In Thousands, unless otherwise specified | ||||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ||
Cash and cash equivalents, carrying value | $257,382 | [1] | $315,968 | [1] | $373,355 | $435,011 |
Marketable equity securities, carrying value | 89,191 | 83,562 | ' | ' | ||
Marketable debt securities, carrying value | 37,766 | 36,567 | ' | ' | ||
Long-term debt, including current portion, carrying value | 1,202,610 | 1,115,536 | ' | ' | ||
Cash and cash equivalents, fair value | 257,382 | 315,968 | ' | ' | ||
Marketable securities, fair value | 126,957 | 120,129 | ' | ' | ||
Long-term debt, including current portion, fair value | 1,484,689 | 1,232,180 | ' | ' | ||
Equity securities | ' | ' | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ||
Marketable securities, fair value | 89,191 | 83,562 | ' | ' | ||
Fixed maturity | ' | ' | ' | ' | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ' | ' | ' | ' | ||
Marketable securities, fair value | $37,766 | $36,567 | ' | ' | ||
[1] | Restated |
Recovered_Sheet3
Reorganization Proceedings of Certain Subsidiaries - Additional Information (Detail) (USD $) | 12 Months Ended | ||||
In Millions, unless otherwise specified | 31-May-10 | 31-May-08 | 31-May-08 | 30-May-10 | 31-May-06 |
Subsidiaries | Subsidiaries | Subsidiaries | |||
Reorganization [Line Items] | ' | ' | ' | ' | ' |
Asbestos-related products liability claims paid | $92.60 | ' | ' | ' | ' |
Asbestos-related products liability, defense-related payments | 42.6 | ' | ' | ' | ' |
Accrued liability for asbestos | ' | ' | 559.7 | 397.7 | 421.3 |
Asbestos liability, term | ' | '10 years | ' | ' | ' |
Increase in Asbestos liability | ' | ' | $288.10 | ' | ' |
Changes_in_Accrued_Warranty_Ba
Changes in Accrued Warranty Balances (Detail) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | ||
Product Liability Contingency [Line Items] | ' | ' | ||
Beginning Balance | $14,751 | $17,196 | ||
Deductions | -3,905 | [1] | -4,072 | [1] |
Provision charged to SG&A expense | 3,681 | 3,841 | ||
Ending Balance | $14,527 | $16,965 | ||
[1] | Primarily claims paid during the year. |
Recovered_Sheet4
Contingencies and Other Accrued Losses - Additional Information (Detail) (USD $) | 3 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Aug. 31, 2012 | 31-May-12 |
Schedule Of Commitments And Contingencies [Line Items] | ' | ' |
Increase in long-term accrued product liability reserves | $26.60 | $25.80 |
Accrual contingencies | $11.40 | ' |
Recovered_Sheet5
Investment (Income) Expense, Net (Detail) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | |
Component of Other Income, Nonoperating [Line Items] | ' | ' | |
Interest (income) | ($2,295) | ($1,117) | |
(Gain) loss on sale of marketable securities | -4,584 | 914 | |
Other-than-temporary impairment on securities | 113 | 406 | |
Dividend (income) | -208 | -227 | |
Investment (income) expense, net | ($6,974) | [1] | ($24) |
[1] | Restated |
Other_Expense_Income_Net_Detai
Other Expense (Income), Net (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 |
Component of Other Income, Nonoperating [Line Items] | ' | ' |
Royalty (income), net | ($294) | ($324) |
Loss on Kemrock conversion option | 8,183 | ' |
Loss (income) related to unconsolidated equity affiliates | 31,533 | -479 |
Other expense (income), net | $39,422 | ($803) |
Other_Expense_Income_Net_Addit
Other Expense (Income), Net - Additional Information (Detail) | 3 Months Ended | 12 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2012 | 31-May-12 | Aug. 31, 2012 | 31-May-12 | 31-May-11 | 31-May-12 |
USD ($) | INR | INR | Kemrock Industries and Exports Limited | Kemrock Industries and Exports Limited | Kemrock Industries and Exports Limited | Kemrock global depository receipts | |
USD ($) | USD ($) | USD ($) | USD ($) | ||||
Component of Other Income, Nonoperating [Line Items] | ' | ' | ' | ' | ' | ' | ' |
Acquisition of equity method investment, shares | ' | ' | ' | ' | 870,000 | 3,200,000 | 693,072 |
Equity method investment, carrying value | ' | ' | ' | $10 | $42.20 | $24.20 | ' |
Equity method investment, ownership percentage | ' | ' | ' | ' | 23.00% | 18.00% | ' |
Purchase of global depository receipt, value | ' | ' | ' | ' | ' | ' | 7.2 |
Kemrock common stock market value per share | ' | 116.6 | 531 | ' | ' | ' | ' |
Impairment loss on equity method investment | ($32.10) | ' | ' | ' | ' | ' | ' |
Income_Taxes_Additional_Inform
Income Taxes - Additional Information (Detail) (USD $) | 3 Months Ended | |
In Millions, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 |
Income Tax [Line Items] | ' | ' |
Effective income tax rate | 49.50% | 29.80% |
Unrecognized tax benefits | $3.30 | ' |
Unrecognized tax benefits that would impact effective tax rate, if recognized | 2.4 | ' |
Accrued interest and penalties related to unrecognized tax benefits | $1.50 | ' |
RetirementRelated_Benefit_Plan
Retirement-Related Benefit Plans' Impact on Income Before Income Taxes (Detail) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 |
Pension Benefits, U.S. Plans | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ' |
Service cost | $6,488 | $4,977 |
Interest cost | 4,060 | 3,827 |
Expected return on plan assets | -4,358 | -4,354 |
Amortization of: | ' | ' |
Prior service cost | 87 | 88 |
Net actuarial (gains) losses recognized | 4,222 | 2,127 |
Net Periodic Benefit Cost | 10,499 | 6,665 |
Pension Benefits, Non-U.S. Plans | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ' |
Service cost | 1,050 | 965 |
Interest cost | 1,769 | 2,040 |
Expected return on plan assets | -1,846 | -2,036 |
Amortization of: | ' | ' |
Prior service cost | 2 | 3 |
Net actuarial (gains) losses recognized | 692 | 560 |
Net Periodic Benefit Cost | 1,667 | 1,532 |
Postretirement Benefits, U.S. Plans | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ' |
Interest cost | 88 | 104 |
Amortization of: | ' | ' |
Prior service cost | -22 | -22 |
Net actuarial (gains) losses recognized | 4 | -14 |
Net Periodic Benefit Cost | 70 | 68 |
Postretirement Benefits, Non-U.S. Plans | ' | ' |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ' | ' |
Service cost | 288 | 192 |
Interest cost | 289 | 250 |
Amortization of: | ' | ' |
Net actuarial (gains) losses recognized | 114 | 18 |
Net Periodic Benefit Cost | $691 | $460 |
Pension_Plans_Additional_Infor
Pension Plans - Additional Information (Detail) (USD $) | 3 Months Ended |
In Millions, unless otherwise specified | Aug. 31, 2012 |
Pension Benefits, U.S. Plans | ' |
Schedule of Pension and Other Postretirement Benefits Expected Benefit Payments [Line Items] | ' |
Contribution to retirement plans in current fiscal year | $29.90 |
Pension Benefits, Non-U.S. Plans | ' |
Schedule of Pension and Other Postretirement Benefits Expected Benefit Payments [Line Items] | ' |
Contribution to retirement plans in current fiscal year | $8.30 |
Reconciliation_of_Numerator_an
Reconciliation of Numerator and Denominator of Basic and Diluted Earnings Per Share, Calculated using Two-Class Method (Detail) (USD $) | 3 Months Ended | |||
In Thousands, except Per Share data, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | ||
Numerator for earnings per share: | ' | ' | ||
Net income attributable to RPM International Inc. Stockholders | $26,665 | [1] | $76,811 | |
Less: Allocation of earnings and dividends to participating securities | -479 | [1] | -1,530 | |
Net income available to common shareholders - basic | 26,186 | [1] | 75,281 | |
Add: Undistributed earnings reallocated to unvested shareholders | ' | 4 | ||
Net income available to common shareholders - diluted | $26,186 | [1] | $75,285 | |
Denominator for basic and diluted earnings per share: | ' | ' | ||
Basic weighted average common shares | 128,805 | [1] | 128,094 | |
Average diluted options | 765 | [1] | 532 | |
Total shares for diluted earnings per share | 129,570 | [1] | 128,626 | |
Earnings Per Share of Common Stock Attributable to RPM International Inc. Stockholders: | ' | ' | ||
Basic Earnings Per Share of Common Stock | $0.20 | [1] | $0.59 | |
Diluted Earnings Per Share of Common Stock | $0.20 | [1],[2] | $0.59 | [2] |
[1] | Restated | |||
[2] | For the quarters ended August 31, 2012 and 2011, approximately 2,954,000 and 2,750,000 shares of stock, respectively, granted under stock-based compensation plans were excluded from the calculation of diluted earnings per share, as the effect would have been anti-dilutive. |
Reconciliation_of_Numerator_an1
Reconciliation of Numerator and Denominator of Basic and Diluted Earnings Per Share, Calculated using Two-Class Method (Parenthetical) (Detail) | 3 Months Ended | |
Aug. 31, 2012 | Aug. 31, 2011 | |
Earnings Per Share Disclosure [Line Items] | ' | ' |
Stock-based compensation plans, excluded from the calculation of diluted earnings per share, anti-dilutive shares of stock | 2,954,000 | 2,750,000 |
Segment_Information_Additional
Segment Information - Additional Information (Detail) | 1 Months Ended |
31-May-12 | |
Segment | |
Segment Reporting Information [Line Items] | ' |
Number of reportable segments | 2 |
Number of operating segments | 5 |
Results_of_Reportable_Segments
Results of Reportable Segments (Detail) (USD $) | 3 Months Ended | |||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | 31-May-12 | |
Segment Reporting Information [Line Items] | ' | ' | ' | |
Net Sales | $1,046,714 | [1] | $985,918 | ' |
Income (Loss) Before Income Taxes | 60,644 | [1] | 118,704 | ' |
Total Assets | 3,675,978 | [1] | ' | 3,561,813 |
Industrial Segment | ' | ' | ' | |
Segment Reporting Information [Line Items] | ' | ' | ' | |
Net Sales | 703,335 | [1] | 667,016 | ' |
Income (Loss) Before Income Taxes | 62,886 | [1] | 91,546 | ' |
Total Assets | 2,359,243 | ' | 2,195,702 | |
Consumer Segment | ' | ' | ' | |
Segment Reporting Information [Line Items] | ' | ' | ' | |
Net Sales | 343,379 | [1] | 318,902 | ' |
Income (Loss) Before Income Taxes | 58,788 | [1] | 51,512 | ' |
Total Assets | 1,216,807 | ' | 1,184,609 | |
Corporate/Other | ' | ' | ' | |
Segment Reporting Information [Line Items] | ' | ' | ' | |
Income (Loss) Before Income Taxes | -61,030 | [1] | -24,354 | ' |
Total Assets | $99,928 | ' | $181,502 | |
[1] | Restated |
Stock_Repurchase_Program_Addit
Stock Repurchase Program - Additional Information (Detail) | Aug. 31, 2012 |
In Millions, unless otherwise specified | |
Minimum | ' |
Stock Repurchase Programs [Line Items] | ' |
Shares authorized to be repurchased, per year | 1 |
Maximum | ' |
Stock Repurchase Programs [Line Items] | ' |
Shares authorized to be repurchased, per year | 2 |
Components_of_Total_Equity_and
Components of Total Equity and Comprehensive Income (Detail) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Aug. 31, 2012 | Aug. 31, 2011 | |
Stockholders Equity Note [Line Items] | ' | ' | |
Total equity, beginning of period | $1,313,983 | [1] | $1,387,368 |
Net income | 30,619 | [1] | 83,340 |
Other Comprehensive Income: | ' | ' | |
Foreign Currency Translation Adjustments | 39,230 | [1] | -9,104 |
Pension and other postretirement benefit liability adjustments, net of tax | 1,206 | [1] | 2,218 |
Unrealized gain (loss) on securities, net of tax | -352 | [1] | -3,253 |
Unrealized gain on derivatives, net of tax | 187 | [1] | -1,079 |
Total Other Comprehensive Income, net of tax | 40,271 | [1] | -11,218 |
Comprehensive Income | 70,890 | [1] | 72,122 |
Dividends paid | -28,281 | [1] | -27,424 |
Other noncontrolling interest activity | ' | -390 | |
Other | 1,284 | [1] | ' |
Shares repurchased | ' | -206 | |
Stock option exercises, net | 603 | [1] | 1,206 |
Stock based compensation expense | 588 | [1] | 3,125 |
Restricted awards, net | 3,285 | [1] | -64 |
Total Equity, end of period | 1,362,352 | [1] | 1,435,737 |
Total RPM International Inc. Equity | ' | ' | |
Stockholders Equity Note [Line Items] | ' | ' | |
Total equity, beginning of period | 1,183,656 | [1] | 1,263,164 |
Net income | 26,665 | [1] | 76,811 |
Other Comprehensive Income: | ' | ' | |
Foreign Currency Translation Adjustments | 28,664 | [1] | -9,433 |
Pension and other postretirement benefit liability adjustments, net of tax | 1,534 | [1] | 2,041 |
Unrealized gain (loss) on securities, net of tax | 825 | [1] | -3,643 |
Unrealized gain on derivatives, net of tax | 169 | [1] | -848 |
Total Other Comprehensive Income, net of tax | 31,192 | [1] | -11,883 |
Comprehensive Income | 57,857 | [1] | 64,928 |
Dividends paid | -28,281 | [1] | -27,424 |
Other noncontrolling interest activity | ' | -390 | |
Other | 1,284 | [1] | ' |
Shares repurchased | ' | -206 | |
Stock option exercises, net | 603 | [1] | 1,206 |
Stock based compensation expense | 588 | [1] | 3,125 |
Restricted awards, net | 3,285 | [1] | -64 |
Total Equity, end of period | 1,218,992 | [1] | 1,304,339 |
Noncontrolling Interest | ' | ' | |
Stockholders Equity Note [Line Items] | ' | ' | |
Total equity, beginning of period | 130,327 | 124,204 | |
Net income | 3,954 | 6,529 | |
Other Comprehensive Income: | ' | ' | |
Foreign Currency Translation Adjustments | 10,566 | 329 | |
Pension and other postretirement benefit liability adjustments, net of tax | -328 | 177 | |
Unrealized gain (loss) on securities, net of tax | -1,177 | 390 | |
Unrealized gain on derivatives, net of tax | 18 | -231 | |
Total Other Comprehensive Income, net of tax | 9,079 | 665 | |
Comprehensive Income | 13,033 | 7,194 | |
Total Equity, end of period | $143,360 | $131,398 | |
[1] | Restated |
Subsequent_Events_Additional_i
Subsequent Events - Additional information (Detail) (Subsequent Event, USD $) | 1 Months Ended | ||
In Millions, unless otherwise specified | Sep. 30, 2012 | Sep. 05, 2012 | Sep. 21, 2012 |
Entity | Kirker Enterprises, Inc. | Synta, Inc. | |
Minimum | Minimum | ||
Subsequent Event [Line Items] | ' | ' | ' |
Number of business acquisitions | 2 | ' | ' |
Annual sales | ' | $100 | $40 |