MAS - Earnings call transcript Q3 2024

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Operator

Good morning, ladies and gentlemen. Welcome to Masco Corporation's Third Quarter 2024 Conference Call. My name is Ludie, and I will be your operator for today's call.

As a reminder, today's conference call is being recorded for replay purposes. [Operator Instructions]

the Relations to Corp. and turn Vice Robin now Investor President, FP&A will call over Zondervan, I of Masco

may begin. You

Robin Zondervan

Corporation's Vice Allman, President Thank Welcome CEO of Call. good and Rick and Chief me XXXX Westenberg, Financial and Masco Masco's With Keith you, Conference and Third are morning, today Masco; Quarter President operator, to everyone. Officer.

under and quarter slides are website earnings our release presentation Investor third Our on Relations. available

limit call Following your one yourself our me Please we XXX-XXXX. analyst remarks, If question take (XXX) call to the with can't for follow-up. open please one directly question at questions. will we now,

statements the These cause Commission. filed these We results to and Our future statements. statements our XX-Q disclosures and are in about differ materially our subject our our actual in from and the our will Form could with describe today Securities to that other views that uncertainties Form risk forward-looking XX-K Exchange performance, and which factors constitute risks our include we forward-looking statements. risks and uncertainties

also Our financial metrics. will include non-GAAP statements

profit slides, earnings on website to GAAP operating adjusted under our Relations. to as and We reconcile and otherwise available references per these metrics be share in release earnings adjusted which Our are unless presentation will noted. Investor our

With the now call turn that, will I over to Keith.

Keith Allman

joining Please turn today. us to Robin. you, for and morning, Good X. you Thank thank everyone, Slide

the we in we segment. results sales to portfolio the Net and notably on our For line customer through products delivered as innovative saw stabilize, as the in focused brands, exceptional full were year continue we operating strong plumbing of most with leading third driving demand potential our quarter, prior service.

to achieve XX savings. of profit basis a and to initiatives XX.X% gross result Our cost drive operational efficiencies rose as margin ongoing our points

execution million profit X% an resulted $XX in of prior or of solid the operating million, increase $XXX over year. Our

year-over-year margin the XX.X%, expansion. margin of consecutive basis points sixth profit quarter XX expanded to operating marking Our

addition, share. grew X% to In per share our $X.XX per earnings

key the growth to China. X% sales Moving American local was higher $XXX up of the excluding our by acquisitions to Plumbing markets basis increased our and of in our sales profit in XX.X%, currency. by and currency segments. XXX plumbing million. plumbing, efficiency for excluding local driven initiatives. North X% led points and increased overall In international sales overall continued X% million Operating increased margin the Europe and impact $XX expanded volumes savings segment cost and impact In on Operating productivity, acquisitions. of focus X% and to X% currency,

Additionally, we a continue brands. to Delta in and Brizo demonstrate filtration that system leverage reverse our and easy water osmosis is launched than water to is This system out filter through brands. to quality across install certified innovation launches contaminants product more tankless maintain. and and water channels our drinking this XX quarter leadership your and our new We both from

quality a from prestigious easier award the foods we lower fruits faucet to less and cleanup. our in quarter. flow received water launched dedication Hansgrohe powder for beneath Superbrand and excellence, cascades microfine at spout for the spray award Germany of and Hansgrohe, At vegetables washing This where recognized conservation like customers. the water service rate faucet to Hansgrohe's also the

quarter. the of X-year the anniversary reached our of we acquisition Finally, SaunaXXX during

to team integrate the successfully We includes business, proud network. into Watkins our of which Tylö-branded launch of the has work existing dealer done this are our recent saunas

this completion earlier quarter announced We segment. the Lighting. the of architectural decorative sale of our Kichler to Moving

initiatives focus Masco of architectural the We are and businesses. strategic this to shareholders plumbing drive on confident core greater as our for that we our streamline decorative will transaction portfolio further value

paint show Overall down continued the growing excluding X% decorative sales digits, to quarter segment and mid-single paint Sales sales impact pro decreasing architectural in the X% divestitures. digits. or DIY low while strength, were the of sales single challenged, remained high single paint decreased in currency digits.

operating paint. painter, strong remained this pleased proud performance drive the XX.X%. again going were our Operating $XXX continuing once profit at we for $X our to segment the invest additional quarter million We're sales with with We million, in margin decreased continued growth are while pro growth of to and forward. pro to

over strong incredibly dates an years. Home back have We The XX which with Depot, relationship

our over distribute For multiple X,XXX The partnered Depot decades, have their stores. Home we with products to in

partner continue the to and categories. award-winning on in of strength products to the unmatched drive DIY of and brand, our share on gains paint centered with initiatives We quality both service strategic our them our pro

Turning allocation. to capital

generate continued balance quarter sheet. free a and cash to solid during the maintained We strong flow

we a $XXX million from share the sale allocate result, of acquisitions repurchases. to XXXX. capital and plan $XXX in now shareholders our strategy million dividends returned our with framework. executed proceeds approximately the deployment allocation and through We expect in deploy As on or to we Lighting, total net Therefore, repurchases to share cash to capital consistent Kichler

the first Now sales the within year quarters outlook. total X a for on full our of were year. expected few our range company Overall, comments for the

of DIY However, the and the year, will Kichler remainder divestiture the paint market our challenged. remains impact of

full our digits. the Therefore, or minus to we that digits expectations now will anticipate plus single previous sales be year compared low of single low for down

strength will operational top guided the previously our the XX% that we of end year-to-date, XX.X%, to to is performance approximately expect due be of at range of now operating our However, year which XX.X%. full our margin

$X.XX compared $X.XX to adjusted now for previous $X.XX $X.XX our share the per of in expectations share. We be per earnings anticipate XXXX share to to to of range per

strong fundamentals and [Technical our to and that that of repair long-term Difficulty] remodel the continue markets We believe are

that be There's done. know interruption. of I we're all I to apologize for calls today. busy Okay. lot very that need that a

So my apologies.

stock, capacity, longer, equity repair mid- structures age increased the capitalize well and drive in staying talking activity we're our the to believe to and home cost as will I consumers housing drive that our household of and their as such long-term future efficiency, markets, to formations repair productivity benefits millennials of we long homes remodel additional and and set As incremental from volume. they're We was factors, levels to volume term. believe fundamentals favorable remodel with respect for in up strong on structural the are positioned higher

these for are favorable double-digit competition With through execution deliver capital outperform and fundamentals, the the we our positioned across successful investors. portfolio our our deployment, to growth and strategic EPS cycles our initiatives continued of disciplined well

Rick third quarter the our turn I'll call in detail. over more go Now Rick? to to outlook and XXXX over results

Richard Westenberg

and Keith, you Thank good for you, everyone. morning, Thank joining.

rationalization performance, items. impact focus other of will onetime excluding As the charges Robin and mentioned, my adjusted comments today on

X. prior quarter Slide year to in increased the impact line Turning X%, in Sales were the with unfavorable and of currency. the excluding

third last year to third the of quarter in SaunaXXX of our acquisition added results. growth quarter X% Our

quarter. However, the this by of was offset the third Kichler divestiture impact during our

sales efficiencies basis prior sales expansion to at local quarter our currency. North year-over-year. the points In to contributed flat of while were line sales X% with American strong increased drive overall, local in in an of year XX XX.X%, currency, gross performance initiatives another operational international Despite relatively margin

impacted mentioned was as spend SG&A of our in segment, sales during of quarter timing as call. marketing percent XX.X% architectural by and was the second decorative our a

million to the grew $XX quarter, margin operating strong at our and in was $XXX million our profit Overall, XX.X%.

executing by was our performance driven initiatives. cost on savings margin Our primarily

X% by EPS the We to quarter during per $X.XX grew share. also

was X% drove third This acquisitions sales impact in to Currency the year-over-year. X%. in Slide segment X% growth of our by mix, Turning reduced increased to Plumbing the by and had X. increase in quarter. results. unfavorable on contributed partially which sales minimal sales Volume a plumbing an X%, offset

increased projects sales pricing driven international volume and plumbing by increased continues retail Europe, mix. in X%, our challenged, the channels. from of and American stabilizations our driven to benefited sales offset China unfavorable by pipeline X%, North market partially Demand local the quarter. currency, actions, and e-commerce signs performance we in acquisition the and solid while remains show by favorable In plumbing in of

primarily $XX Segment third margin by $XXX up and the driven up year-over-year. operating and was basis performance or was by volumes, savings And cost partially operating operating points. X% unfavorable commodity XX.X%, higher This and was profit freight XXX higher offset million mix profit initiatives in million, quarter costs.

sales divestiture X% high up each. Slide of single the lowered decreased by quarter, decreased low X. DIY were decreased architectural the paint digits. third paint sales in digits, In sales the Turning Kichler Currency paint quarter. sales total single sales X% Pro and Decorative and to digits. mid-single

soft, our previous increase we DIY and business single remains continue now of year The DIY market paint our paint for the digits. down to however, to versus pro year digits full low expect In down digits. mid-single our sales to be single paint business, expectation we high anticipate

by of timing XX.X%. Operating $X and $XXX partially price/cost by lower was savings down profit the unfavorable marketing impacted and million, Operating million initiatives. profit cost spend, margin volume, offset was relationship year-over-year, was an operating

Turning to Slide XX.

at remains quarter at ended of cash sheet revolving strong, and debt balance availability facility. Our billion including with We to the liquidity, our Xx under $X.X quarter credit with EBITDA gross end.

of Working with capital capital Kichler as working discipline the regards divestiture of was impact our and our the as XX.X% as reflects percent continued of a levels. well sales to

a As a sales approximately result of XX.X%. guidance previous to percent anticipate XX% year-end now be working we of at of capital our our versus impact, as the divestiture

repurchased During a $XXX $XX million the paid shares X.X we dividend of quarter, million and shareholders. million for third to

of to plan with from Kichler, As sale capital our deploy framework. we proceeds Keith mentioned, net the allocation consistent the

expect now million deploy to repurchases million we $XXX during approximately result, $XXX or from year a the acquisitions. As share towards up

and for XXXX. let's Slide our review XX turn to outlook Now,

updated market line The our conditions be line For total however, Last will Masco, by now quarter, also we quarter, flat impacted half second of remain our roughly year-to-date largely Kichler. divestiture in to with expectations been challenged. as has fourth top expectations. our

XX% low Despite year strong or our As single minus change, versus be low of sales this high operating plus of be expect anticipate single to currently result, year-to-date, year we digits. which guide down previous approximately and a at digits full our previous with margin guide full our operating performance XX.X%, is now the approximately we to execution XX.X%. of end margin to

are or top to prior our expected approximately we year year year XXXX margin of XX%. versus segment, sales and minus single low operating to plus line our expectation maintaining full digits full be plumbing our In be

divestiture. architectural XXXX guidance of year-over-year In down to single previous primarily our down digits versus to due we segment, our our decorative our are mid-single sales be lowering digits, low expectation

signs shown soft In not of remains has a addition, and the paint rebound. material DIY market

we of However, despite maintaining operating anticipated margin full approximately our are XX%. sales, expected year lower

per EPS to year be Keith the XXX of rate. as our mentioned earlier, updating the share we estimate $X.XX a average for tax a Finally, and range diluted $X.XX XX.X% effective are XXXX count assumes to share. This in million

market. control can to controlling we As are deliver focused on in mentioned, within what to That range. and said, we overall choppiness results be continues the there this execution

deck. earnings for Lastly, our assumptions XXXX additional XX financial found on be Slide can of

would With to I call questions. up the that, Operator? like open for

Operator

Instructions] Sachs. first comes line Your Susan the question with Maklari of from [Operator Goldman

Susan Maklari

My get that perhaps first question think you the architectural. over is how that, couple a weakness and, election in those about uncertainty through things bit focusing you trended the you in highlighted of how DIY next we back there thinking implications the as how past the as some the you're quarter, look of sales just the broader about of on come and macro talk quarters? Can we could decorative

Keith Allman

Susan, it's Keith.

what As new be of break the regards cetera. quite year-over-year down, et stock, to performances and particularly infill can launches, really product variable you happened know, we depending as month-to-month don't quarter, inside on that with

the any it's So particular the wasn't that you been through quarter. consistent I fairly within there would and quarter notable change tell that

I'll to speak in So fashion. that that

to for to in ability And innovation the of both how price paint. and about to strength brands environment overall the strength a needed the pipeline regards it that as election, are puts results and with more business. the supply like have chains it holistically now, get the so what go we doing of and overall the of relates we our ability in don't terms face really many how think commercial on fundamentally, volatile share. or -- our With premium DIY specifically really we We I like shelf for means think based our of and market us if our we regards it election to that view the a teams, space to our the respond on issues

for to it's of in election, So able a us, how we're of the terms really, respond. well question

we you you where if position resilient, various the our levels our with the to sit challenges put up the the over together we we've operating faced capacity of our with that whether several faced those fact I years we've look more team and that and tariff a paint in look portfolio I last system that And we and course whether above operating to in years, point to small experienced our our able all situation ticket, our we're you less that a volatile of look couple the think how to at ago, things team of margin brought pretariff has products, today, think us respond. system, the issues

the the may our looking being being or challenges So at high we're to alert just election as of come really and respond not ready way. to may on that --

Susan Maklari

and even noted then initiatives those factors you thinking continuing company-specific Okay. around That's helpful the we the come about maybe despite that's end how the all as higher uncertainty year-end to about of turning those to through next some color. out into the of be talk that the year? should guide. there, and we consolidated just think you And to Can impressive to the it's margin, expectations at see

Keith Allman

pleased as we executed remarks, expected. Sure. this our come quarter as we're a said It's volatile prepared consecutive it in performance. was definitely sixth in our environment. And margin -- of in this the was with has margin been And expansion. sixth our

I intended we we to when cyclical, what So me, more goes resilient, -- be or back excuse less portfolio resilient to our margin. less that again, higher think, designed

combination that system it's the robust and So teams. of portfolio, a operating our

from gross XX.X% cost particularly that's is our top And it's course, really end And strong at and range. for on the us, got excellence, margin operational We our savings strong of of performance. initiatives. yes, focus

our both decorative year. and next and that segments, entire full year the certainly into we company for will expect to carry for and plumbing expand the We momentum margins

Operator

next comes JPMorgan. Rehaut with Michael question the Your from of line

Andrew Azzi

XXXX This to is for your couple I next R&R on predicated Andrew years. just of Rehaut. I to were ask Azzi X% on for Michael growth X% targets wanted believe a the way maybe maybe year? your -- And of Is that level, end at to a for next on if it? maybe remodel can market the we right still the and about think high get thoughts kind repair rate

Keith Allman

today we Sure. We X% Thanks, about and growth that our R&R, of normalized to not is, that. what growth -- "normal" or expect changed have rate you that and that. that we a a this to when as growth historical X% ball rate is for our crystal than that turns And that, no on ability to I market for think Andrew. demonstrated premium R&R for Certainly, is is else. said, And of up capability. still clearer more debate. earlier That normal have expectation rate when anyone quickly, we've puts our we respond

So fundamentals R&R drives we long of haven't to it's about expectations what confidence. the R&R, think it's at look changed equity, consumer our appreciation, strong. market about term price is. home very We are you it's mid- home of the about what When

when you will in that or deferred to we're reduction our And in so XXXX that or long in, We're not expectations just turn, if think you when underbuilt in guide, the and mid- when turn. poised you the changing the term. start unpredictable and R&R deferral It's when see state rates things we about the spend will. to those we're the think

Andrew Azzi

the business, growth that we pro And of appreciate to size Can I the resilient few how the it current nice about should you opportunity business then terms the color. in review the think kind to forward? it's being of and in maybe maybe of pretty going past see obviously, paint quarters.

Keith Allman

together, of and the ability hold back very with And in growth strength the the in We're our deep the of paint can been the great our pipeline, that strength share in recognized in and well working goes and pleased our our years XX mentioned. brand, is. that the share. quality innovation pro Behr Home we as that that to to with the gain how Certainly, we've to channel partner relationship Depot

Scores Promoter when buy, Net customers look Score are new Promoter have share and Net pro our we of customers the gain side their And or our fantastic. in we at the of increased who the share

like as try what's really happening. you and thing, sort that's So of

our very pro. happy in the we're with -- So performance

was the question? what part your Andrew, second of

Andrew Azzi

think suppose growth how maybe DIY size I the the going the forward? of even should kind opportunity, like we about and business of alongside

Keith Allman

of terms and we forward. It's the above $XXX size market going approximately grow paint continue million pro to our Right. in of to and gain market, expect share

Andrew Azzi

the that is on pro pro? the just growth, or on on And kind the is -- of and above-market that DIY

Keith Allman

We we're challenged. But and own believe holding DIY -- the share quarter DIY judge in little and it's particularly hard from believe to our on market holding to I've but we market quarter, X gaining continues as size calls, to a said bit. be DIY the these market, maybe our consistently

Operator

Kim from comes of the question Stephen next Evercore line with Your ISI.

Aatish Shah

Steve. on piece, margin dec mentioned would This current with due arc, due updated say sales it margin to a is But to divestiture Kichler? divestiture guidance for to to turning of the Aatish of the the was benefit within just to much want the how of primarily start Kichler. I was is guide you the

Richard Westenberg

this is Aatish, Rick.

us regards indicated, to of the segment Architectural you Kichler sale the for Products down downward digits translated our for Masco revising mid-single into single low guidance to as to down with total line, regards Decorative well with as top our digits. -- as So

unit. individual by disclose don't We business profitability

Kichler's margin Masco have below of We overall. the that in below the of segment performance past that and was indicated that

the is accretive. So divestiture

expectations year, the expecting through came really but it, We profit you a the of that quantified through of times profit for may our the expectation recall, of operating an couple course with increase that because margins our margin. year the the I we're haven't We and say increased the year. would XX.X% in about into we margin XX% of as year operating course now

more But that efficiencies productivity deliver business our and units to able operating that. to is margin operating performance I being factor challenging contributing market. than continue cost the the of expansion to, a and equal able Keith is the in the alluded face would to to be to that profit deliver Kichler or yes, across a And say,

Aatish Shah

helpful. super That's Great.

Then up -- one or overall, trade can you talking specifically are talk the trade about down about paint any you within DIY, the And just more. category then mix trends Just effect? for the within category? seeing

Keith Allman

in in our a the that in assortment worked them saw but hard et quarter our done channels, mix work across really the Not really some across the little impact variability haven't still a a in reduce and bit particularly We've in we in broad no really assortment, across with of portfolio, coatings. paint. our in -- to haven't really job paint, plumbing much but seen We to cetera, of we've There's margin. we point our terms exists, in hit seen good significant price mix coverage, paint.

Operator

question of Wolfe from next the Your Allinson line with comes Trevor Research.

Trevor Allinson

First one pandemic. during you the few expect Do the some performance some over following really where, paint. overall that strong with would in line faced forward, you grow headwinds that's Clearly, think has DIY it years R&R on reset market? the market the to moving point last

Keith Allman

that R&R think us for I a But in to in and know would declining past, market. growth. the it terms don't you that line been DIY, around to about turn has in when subsegment overall I'd going say believe go grow do I it the how that's with of

are the DIYers, couple only the DIY the through years. they're position, getting a fundamentals. research, know, support over the to our investment but be follow home millennials the levels not DIYers the it's look And that continue of them we into fact as influx you and because last I repeat we healthy that the millennials are of think at market, When and of the housing your forming equity home that households in of that

be The to that So paint. DIY there when. a in question think is we return do will growth

Trevor Allinson

that Yes, Right. makes sense.

a the on to for small Kichler, clearly exposure an outsized then size relatively China of business. imports And had Okay.

last gave your here post with call I frame China imports Kichler would rough divestiture. You on a roughly framework that, exposure updated about Any sale? import you exposure. assume to can your improves your Chinese the that way

Keith Allman

overall relatively perspective of to concentration business. relates that it higher the But scheme look tell a you small when would the at imports had our you I other portions of things. a from it's than as concentration the Kichler Chinese of revenue, Yes.

Richard Westenberg

dimension that our the were XXX XX%. Yes, our I to Trevor, a tariffs implemented maybe you to Masco XXXX, in in total alluded bit, we've since that just exposure the reduced about think we Section enterprise as commented call QX a by fact earnings

to do terms exposure. but With exposure. in still us our XX% the terms lot reduction lot we've our manage of work, to Kichler, significant work a a footprint to divestiture of sourcing mitigate and of that of exposure, continue takes leaves to in we and a closer of of It done that up a continue

Operator

from the line comes question of UBS. with next John Your Lovallo

Spencer Kaufman

This is Kaufman John. actually Spencer on for

levels? market how The about today talked lower continues you amount first one, DIY relative be DIY challenged. How paint to much the to a paint fair are volumes XXXX

Keith Allman

get have top that but of after lower, I that have are of number I the they don't that know I top actual mind. mind. don't to Well, number slightly can I call.

Spencer Kaufman

No little talk played assets of that pursue how Depot? you Or strategy Okay. its decision now your there has to can those aggressively? should not a bit conflict the with Was out? Masco more to process? about these did how look Home AIP, we just this with Did think a the you your about at assets? business And bidding coatings engage announced architectural sale the how And problem. in closely PPG

Keith Allman

ability to to do acquisition that long-term successfully. course, and of at shareholder analytics. in end this the against And a to gave just beside depth, we're for were go just wasn't tell -- strong, interest and PPG beyond of in competed others in. day, a looked at believe that that. our our we Of interested will continue something at fit into be we details I'll that confident we it. it value, so in hard the this industry to it and the we've decisions wasn't and the are make going looked in you, very had we we But We not us. I'm

Operator

of Your from next comes question Barclays. Bouley Matthew with line the

Matthew Bouley

either the higher guess come freight I commodity thought result initially actually and they plumbing, -- have have curious in indeed -- if if taken those we greater should the you in as cost I'm about and additional in the a or segment? need think price the XXXX, despite kind of we a good is get more as -- than reductions costs you've then by for any if And headwind plumbing price. as be into margin commodity what result, freight. there specifically, So to and, offset

Richard Westenberg

at Rick. we $X into QX we pipeline. the a time significantly. pound. you is to results. freight headwind high Obviously, of they they per costs a represent an for commented I as And This the market or recall, commodity And with significant commented would came that's tailwind. regards call a year P&L copper to on namely overall, the as May our through go all the appreciation that copper, between until is not Sure. And guess that before, as second zinc, hit our and half costs, in a calendar X we we've commodity commodity over provide of headwind saw and when as QX, bit and inventory it when line Actually, expecting all-time it our we to in takes observe up months may in flow hit sourcing about be because,

came expect locked we year. of our out that call. QX, unfavorable right we're perspective in that price/cost now in for our expectations. that's so as is as from we pretty continue of we And we in in and the And the QX. indicated, line And terms And to with our guidance QX seeing in That's into dialed headwind. a expectations that are

plumbing cost, despite thus, year, margin able And the offset headwinds calendar And those the during year perspective. margin in plumbing. that the would in the terms in and pricing this points to and XXX the our course of expect an actually, basis we QX are cost we quarter, the commodity from margins for in initiatives through of and in overall expanding we're expansion

levels. costs subsided remain have more to They elevated but remain remain commodity XXXX. relative recently, still elevated a historical elevated. they to They Now bit

factor we and strategy a factor so that's And go into year. into next will go our XXXX, as as that into we pricing

Matthew Bouley

And secondly, Okay. QX question, think wanted then of ahead, sit your as market we around here the year Very going to of R&R X% ask growth. kind color. and was to XXXX to around I exiting prior overall. in given that longer-term back on a kind how specifically we're helpful X% DIY looking I

what for we're XXXX R&R planning planning implications what kind year how shape relative sort of and you're the could look starting like, Just any to on thoughts to to XXXX of any up. initial you're how

Keith Allman

specific but that I've call next. Appreciate talking strong we'll the to thought on the leave get I fundamentals XXXX think with we the in with next fundamentals. industry, would question, together are you we'll our the talk about consistently we're next when about to in regards the XXXX our And our but been call.

Operator

question Your next Jefferies. Ng comes from the Phil with line of

Philip Ng

constructive bottoming America, out generally your international inflection think actually quarter, were North maybe was on is a little an little but quite bit, last that I at strong. a be in you look could plumbing I International when slower. business, Keith, recovery thought

seeing got recovery you do subsegments you but and can no one's of within obviously, and the these you So momentum kind And crystal how these the see are talk in plumbing? pace about markets? in a the X ball, what both

Keith Allman

starting with to performance. accomplish. at So team That Phil, X% the speaks Hansgrohe market quarter able been to kind We international, his the environment. pleased with in and this what and Jürgen Hans grew in they've really of third

of a more in Europe quarter. we to stability and pipeline ability particularly is trade continue to We Germany. would markets, through. it gain able deliver particularly have And speaks our growth team I strong characterize to in share flow China the bit the as of in the the to volatile. were key signs showing that and is projects that that in again,

outperform is So that's the to opportunity and year. plan to us said, in and be aggregate, good doing. this the to a market we mid-single share, for down expect digits low we full international, gain That for what on

the close grow we to, market little market. home continues bit States, there. a seeing here, good e-commerce United we're believe, In to The

U.S. America. bit as the is well. North would Our stable challenged strong retail I in performance The has fundamentally but little in been say, quite more a trade,

Philip Ng

pro Okay. Super. growth for the paint, outperformed your side On great market.

to As that perhaps year, some you work of your pro you with because just any slated next seeing have you're channel momentum production from alliance partner, paint you've the to ability other more have for swing seen maybe certainly just of growth in weakness do kind of there? given the kind shelf your DIY space? initiatives And DIY, then more more

Keith Allman

go to margin less on cyclical, our We to of be our our do. key demand work flex more And component have to should of And plant coming across Yes, channel have flexibility. very differentials whole differentials type to installation to be strategy resilient, process and across we in another. absolutely assortment Heath, able margin channels, online from That a work or nicely on one we that's Ohio. margin. is capacity to new the a that higher

what this in really that's puts good shape. portfolio So

We capacity support growth have to years. for several expected our

with available very we're capacity, even that produce And able to strong margins.

the very on when in deliver and occur, the does nice some to in position that also So incremental turnaround we're demand meet drop-downs a market volume.

the have to capacity our yes, So -- capacity we is flexible.

that we've pros the And it, pro doing maintain that what working. drive gain pros to that more like we're recipe and In shown have the we're terms be paint, is of able it, and our that more try to sticky. share

continue We're pick partners we're closely with loyalty options, channel expanding grow buy at job So And sales programs. outside things our I to it, delivery doing good expanding store, force, very online, to a believe. this our enhancing like segment. working up in

Operator

Hughes with question comes the line from Your Truist. of next Keith

Keith Hughes

flow. your would little divestiture know Kichler, look things will Products, market? the something future something to the for are like With continue part looking M&A of maybe Plumbing bolt-on transactions Or terms you cash in you use a we activity? or as in just that see still of But further feel in of coverings I a of

Richard Westenberg

Yes, Rick. it's Keith,

So from our clear. consistent and is an M&A perspective, pretty strategy

We wellness opportunities, acquisition are focused our plumbing, within businesses. primarily bolt-on on or coatings really

one us. be anniversaried the quarter. that core our you example, with, So not of SaunaXXX expect that's our see demonstrated this a and But but within would from transaction would really that we segments. bigger focus, transaction, business for we've to what averse to We're still that's that

Keith Hughes

close? Okay. And one follow-up. When did Kichler

Richard Westenberg

September XX.

Operator

the Mike next Dahl of RBC Your from comes Capital. with question line

Christopher Kalata

Kalata on Chris actually for Mike. It's

M&A. follow-up a Just the on

your Given outcome will is Kichler for this the assume most at to buybacks time? it pipeline share to safe proceeds date, be likely

Richard Westenberg

We M&A any in from -- haven't announced an perspective. particular thing

from announcement capital we proceeds framework, would would allocated buyback. to be yes, our our an the absent share So follow and perspective, allocation

-- the So about $XXX of just we had net to clarify, million proceeds.

that acquisitions million million $XXX from our share or capacity for So the increased $XXX buybacks year. for to

Christopher Kalata

overall margins paint And then Got margins just we us to Could more of just next expectations, it. your specifically. are on more arc how give color compared performed kind to and where your of dec in relationship relative price/cost over relative of the bit date and and, expectations Understood. a kind color bit on a core paint expectations? you to just in timing and marketing to trends spend for in kind of the savings, terms cost shifting shift how quarter

Richard Westenberg

margins at off performance relationship. what in would driven we Decorative we of cost From a negative Architectural year our we of consider XX%. is -- our we based at first -- guidance And strong what within because that delivered Products XX.X%. all, this our a Decorative margins the the reaffirmed for terms quarter price/cost approximately are of Sure. perspective, in the Effectively, facing is Products segment businesses Architectural XX within segment expectation

mentioned segment single low down Decorative Architectural Products be is So expected as before, we've digits. pricing to our in

roughly Our commodity dynamic flat. is

We are this pressure commodity a our and is perspective, input largely flat. seeing resin. some from expectation TiOX year, But

this we and what our down year So low therefore, was price/cost the digits. for quarter single expectation saw

initiatives we're versus that expansion last offsetting headwind expecting year. with this and our So savings that question. year margin Hopefully profit with addresses modest your operating cost basically regards

Operator

Capital. the Loop comes with Garik of question next Shmois from line Your

Garik Shmois

a ask pro on I and paint wanted follow-up your there. gain share on to

year, this that outperformance your you least at Is market? of the is For really are gaining share broader gains? Or against space? shelf the coming basis the

Keith Allman

installation, more the installation and of strong ease our Behr the business, and offering, the about and say. against ease about comes appropriate pro Shelf broader change our It's innovation. got item. sufficient No that and space. is the of market, not critical when from brand that of it. the It's real quality segment, the really But in space shelf the customer an of I we've consumer our doing you're would that talking pull

effectiveness, course, So those sales of space factors are all of per than force the and our more determining shelf se.

Garik Shmois

the of Okay. gears bit what on it's you're And parts some little bigger-ticket wondering portfolio there of to I a wellness to smaller considering shift your offering I of was the want side. a kind of seeing more you that provide?

Richard Westenberg

Rick. Yes, sure. It's

Effectively, with And overall been performance performance relative in the stability. segment. in plumbing and We stability. line wellness are has seeing disclose our but seeing of don't we we're itself,

QX. I in call. we we similar growth as disclosed QX, some in in prior we're it flattish. And seeing in performance Largely, consider So would saw wellness, our

Now did business, our keep wellness we SaunaXXX. in mind, in acquire

benefit an we're seeing But in and So seeing improvement. the from organic growth we're terms rough perspective, year-over-year. stability inorganically of

the now in going -- the well is and positioned to the business, with of terms So forward. really product the the acquisition market. business sauna think in complementary with continue particularly we gain its We products about share SaunaXXX, offering, we're of optimistic its

positioned would as it So today, stable. around. we're well when the does I But turn market characterize

Operator

the comes Citigroup. Pettinari Your of line next from Anthony question with

Gregory Andreopoulos

This is has on this already, Anthony maybe discussed but been morning. one just A Gregory on for lot plumbing.

the about kind relative you wholesale you've inventories I'm thinking if of channel volume, e-commerce time kind discuss is your for specifically where retail historical can trade, wondering in on performance and seen solid channels. this sentiment in So about what of in thoughts and you year. norms and that of plumbing spoke to

Keith Allman

would a fluctuations some of typically with us QX terms are right segment. be. for And they generally Certainly, Inventories where inventory are that there strong quarter really in is associated that.

variation, no change be. I real would seasonal Accounting they are there. for need So inventories to where say

segment ready whole our It's a folks the from sentiment, bit, the There's the was portfolio, that market. talk we certainly to and down across it's bit characterize this share the is I will trade a customers, feeling stable And putting a little in when in that trade the having terms is right spot nothing question little the in of trade. talked same all The as channel is is fact we're the concerns would that other being channel. particularly than to, premium and really trade sentiment and this the pressure, overall capacity. which respond volatile to I that And the fundamentals. unpredictable. inventories how I That's of on with the the optimism able in turn? There's a much very

Operator

at for [Operator I Instructions] And questions back are no this would Robin time. Zondervan remarks. there further closing like it to to turn

Robin Zondervan

We'd a this in wonderful Thank for day. you, for like and of to joining interest you thank us on your and morning have Masco. the all call

Operator

participating. Thank Thank you today's for call. you. concludes This all conference

You may disconnect. now

Masco (MAS) 29 Oct 242024 Q3 Earnings call transcript