RPM International Inc. (NYSE:RPM) Q2 2024 Earnings Call Transcript

Arun Viswanathan: Got it. And then, you mentioned fiscal ’25, I think previously you had put out some MAP 2025 targets of that 16% adjusted EBIT margin. Do you still see that in the cards? I think we’re maybe a couple of 100 basis points below that on an annual basis right now, but maybe what’s kind of the bridge to getting there? What are some of the factors that we would need to see to realize that level of margin performance?

Frank Sullivan: Sure. I think we’re on target for that. I think whether we can achieve that on the timeliness or within the timeframe that we communicated depends on when we see the turn in positive unit growth in Consumer and Specialty Products Group. But we’ll have a pretty robust appraisal of that when we release our fourth quarter results in July and talk about the balance of our 2025 fiscal year, which is the end of the MAP ’25 program.

Arun Viswanathan: And just lastly, I think this question, you may have offered some comments, but I just wanted to ask again, within any of the businesses, are there any particular areas that you think that are just likely — not likely to recover as you see, and may be candidates for divestiture? How is kind of the portfolio review going? Thanks.

Frank Sullivan: Sure. Yeah. Not at this time, but back to your earlier question, one of the key elements of getting to that 16% consolidated EBIT margin, is especially Products Group who’s consolidated — or Group level EBIT margins are in the mid-teens or slightly higher, which is up from about 9% or 10% level today. So, there needs to be a significant recovery there and we’re focused on it. Without that, we will not hit the 16% consolidated goal.

Arun Viswanathan: Great. Thanks a lot.

Operator: This concludes our question-and-answer session. I would like to turn the conference back over to Frank Sullivan for any closing remarks.

Frank Sullivan: Thank you. We appreciate everybody’s participation in our investor call this morning and for your continuing interest in RPM. I’d also like to thank our associates for their tremendous dedication and hard work in fiscal 2024. We are executing at a high level and you can see it in our results. And lastly, to all on the call, we wish you a happy, healthy, and prosperous New Year. Thank you and have a great day.

Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.