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Acquisition-related amortization expense (2) | $ | 1.02 | | | $ | .24 | | | .78 | |
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| Adjusted diluted net income per share | | | | | $ | 11.33 | |
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| Year Ended |
| December 31, 2023 |
| Pre-Tax | | Tax
Effect (1) | | After-Tax |
| Diluted net income per share | | | | | $ | 9.25 | |
| | | | | |
| Items related to Restructuring Plan: | | | | | |
| Severance and other | $ | .06 | | | $ | .02 | | | .04 | |
| Impairment of assets related to China divestiture | .13 | | | .08 | | | .05 | |
| Gain on divestiture of domestic aerosol business | (.08) | | | (.02) | | | (.06) | |
Discrete income tax expense related to China divestiture (1) | — | | | (.06) | | | .06 | |
| Total | .11 | | | .02 | | | .09 | |
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| | | | | |
| Impairment related to trademarks | .09 | | | .02 | | | .07 | |
| Devaluation of the Argentine peso | .16 | | | — | | | .16 | |
Acquisition-related amortization expense (2) | 1.03 | | | .25 | | | .78 | |
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| Adjusted diluted net income per share | | | | | $ | 10.35 | |
(1) The tax effect is calculated based on the statutory rate and the nature of the item, unless otherwise noted.
(2) Acquisition-related amortization expense, which is included within Selling, general and administrative expenses, consists of the amortization of intangible assets related to the Valspar acquisition. These intangible assets are primarily customer relationships and intellectual property and are being amortized over their remaining useful lives.
Adjusted Segment Profit
Management believes investors’ understanding of the Company’s operating performance is enhanced by the disclosure of Segment profit excluding Valspar acquisition-related amortization expense and certain other adjustments. Valspar acquisition-related amortization expense is excluded from Segment profit due to its significance as a result of the purchase price assigned to finite-lived intangible assets at the date of acquisition and the related impact on underlying business performance and trends. While these intangible assets contribute to the Company’s revenue generation, the related revenue is not excluded. This Adjusted segment profit measurement is not in accordance with US GAAP. It should not be considered a substitute for Segment profit in accordance with US GAAP and may not be comparable to similarly titled measures reported by other companies. The following tables reconcile Segment profit computed in accordance with US GAAP to Adjusted segment profit.
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| Year Ended December 31, 2024 |
| Paint
Stores
Group | | Consumer Brands
Group | | Performance Coatings
Group | | Administrative | | Total |
| Net sales | $ | 13,188.0 | | | $ | 3,108.0 | | | $ | 6,797.3 | | | $ | 5.2 | | | $ | 23,098.5 | |
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| Income before income taxes | $ | 2,902.6 | | | $ | 589.9 | | | $ | 1,027.9 | | | $ | (1,068.6) | | | $ | 3,451.8 | |
| as a percent of Net sales | 22.0 | % | | 19.0 | % | | 15.1 | % | | nm | | 14.9 | % |
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Acquisition-related amortization expense (1) | | | 63.8 | | | 196.3 | | | | | 260.1 | |
| Adjusted segment profit | $ | 2,902.6 | | | $ | 653.7 | | | $ | 1,224.2 | | | $ | (1,068.6) | | | $ | 3,711.9 | |
| as a percent of Net sales | 22.0 | % | | 21.0 | % | | 18.0 | % | | nm | | 16.1 | % |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Year Ended December 31, 2023 |
| Paint
Stores
Group | | Consumer Brands
Group | | Performance Coatings
Group | | Administrative | | Total |
| Net sales | $ | 12,839.5 | | | $ | 3,365.6 | | | $ | 6,843.1 | | | $ | 3.7 | | | $ | 23,051.9 | |
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| Income before income taxes | $ | 2,860.8 | | | $ | 309.3 | | | $ | 991.6 | | | $ | (1,051.8) | | | $ | 3,109.9 | |
| as a percent of Net sales | 22.3 | % | | 9.2 | % | | 14.5 | % | | nm | | 13.5 | % |
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| Items related to Restructuring Plan: | | | | | | | | | |
| Severance and other | | | 14.2 | | | (0.2) | | | 1.3 | | | 15.3 | |
Impairment of assets related to China divestiture | | | 6.9 | | | | | 27.1 | | | 34.0 | |
| Gain on divestiture of domestic aerosol business | | | | | | | (20.1) | | | (20.1) | |
| Total | — | | | 21.1 | | | (0.2) | | | 8.3 | | | 29.2 | |
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| Impairment related to trademarks | | | 23.9 | | | | | | | 23.9 | |
| Devaluation of the Argentine peso | | | 30.8 | | | 11.0 | | | | | 41.8 | |
Acquisition-related amortization expense (1) | | | 69.3 | | | 196.8 | | | | | 266.1 | |
| Adjusted segment profit | $ | 2,860.8 | | | $ | 454.4 | | | $ | 1,199.2 | | | $ | (1,043.5) | | | $ | 3,470.9 | |
| as a percent of Net sales | 22.3 | % | | 13.5 | % | | 17.5 | % | | nm | | 15.1 | % |
nm -not meaningful
(1) Acquisition-related amortization expense, which is included within Selling, general and administrative expenses, consists of the amortization of intangible assets related to the Valspar acquisition. These intangible assets are primarily customer relationships and intellectual property and are being amortized over their remaining useful lives.
CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The preparation of financial statements in conformity with US GAAP requires management to make estimates and assumptions that affect amounts reported in the accompanying consolidated financial statements. These determinations were made based upon management’s best estimates, judgments and assumptions that were believed to be reasonable under the circumstances, giving due consideration to materiality. We do not believe there is a great likelihood that materially different amounts would be reported under different conditions or using different assumptions related to the critical accounting policies and estimates described below. However, application of these critical accounting policies and estimates involves the exercise of judgment and use of assumptions as to future uncertainties and as a result, actual results could differ from these estimates.
All of the significant accounting policies that were followed in the preparation of the consolidated financial statements are disclosed in Note 1 to the consolidated financial statements in Item 8. Management believes that the following critical accounting policies and estimates have a significant impact on our consolidated financial statements.
Inventories
Inventories are stated at the lower of cost or market with cost determined principally on the last-in, first-out (LIFO) method based on inventory quantities and costs determined during the fourth quarter and market representing current replacement cost, which is the cost to purchase or reproduce the inventory. Market shall not exceed net realizable value and shall not be less than net realizable value reduced by an allowance for an approximately normal profit margin. Inventory quantities are adjusted throughout the year as formal cycle counts are completed, or during the fourth quarter as a result of annual physical inventory counts. If inventories accounted for on the LIFO method are reduced on a year-over-year basis, then liquidation of certain quantities carried at costs prevailing in prior years occurs. Management records an estimate of the lower of cost or market whenever the utility of inventory is impaired by damage, deterioration, obsolescence, changes in price levels, or other causes based on historical experience and current trends through reductions to inventory cost by recording a provision included in Cost of goods sold. If management estimates that the reasonable market value is below cost or determines that future demand was lower than current inventory levels, based on historical experience, current and projected market demand, current and projected volume trends and other relevant current and projected factors associated with the current economic conditions, a reduction in inventory cost to current market price is provided for in the reserve for obsolescence. See Note 4 to the consolidated financial statements in Item 8 for more information regarding the impact of the LIFO inventory valuation and the reserve for obsolescence.
Goodwill and Intangible Assets
In accordance with the Goodwill and Other Intangibles Topic of the ASC, management performs impairment tests of goodwill and indefinite-lived intangible assets on an annual basis, as well as whenever an event occurs or circumstances change that indicate impairment has occurred on a more likely than not basis. An optional qualitative assessment allows companies to forego the annual quantitative test if it is not more likely than not that impairment has occurred based on monitoring key Company financial performance metrics and macroeconomic conditions. The qualitative assessment is performed when deemed appropriate.
Management tests goodwill for impairment at the reporting unit level. Per the Segment Reporting Topic of the ASC, a reporting unit is an operating segment or one level below the operating segment (component level) as determined by the availability of discrete financial information that is regularly reviewed by operating segment management or an aggregate of component levels of an operating segment having similar economic characteristics. At the time of goodwill impairment testing (if performing a quantitative assessment), management determines fair value through the use of a discounted cash flow valuation model incorporating discount rates commensurate with the risks involved for each reporting unit. If the calculated fair value is less than the current carrying value, the difference represents the amount of impairment attributable to the reporting unit. The use of a discounted cash flow valuation model to determine estimated fair value is common practice in impairment testing. The key assumptions used in the discounted cash flow valuation model for impairment testing include a discount rate, growth rates, cash flow projections and a terminal value rate. Discount rates are set by using the Weighted Average Cost of Capital (WACC) methodology. The WACC methodology considers market and industry data as well as Company-specific risk factors for each reporting unit in determining the appropriate discount rate to be used. The discount rate utilized for each reporting unit is indicative of the return an investor would expect to receive for investing in such a business. Management, considering industry and Company-specific historical and projected data, develops growth rates, sales projections and cash flow projections for each reporting unit. Terminal value rate determination follows common methodology of capturing the present value of perpetual cash flow estimates beyond the last projected period assuming a constant WACC and a long-term growth rate. As an indicator that each reporting unit has been valued appropriately through the use of the discounted cash flow valuation model, the aggregate of all reporting units’ fair value is reconciled to the total market capitalization of the Company within a reasonable and supportable control premium.
The Company had seven components, some of which are aggregated due to similar economic characteristics, to form three reporting units (also the reportable operating segments) with goodwill as of October 1, 2024, the date of the annual impairment test. The Company performed the optional qualitative impairment test as of October 1, 2024, and determined that there was no indication of impairment on a more likely than not basis in the Company’s reporting units.
Management tests indefinite-lived intangible assets for impairment at the asset level, as determined by appropriate asset valuations at acquisition. Management utilizes the royalty savings method to determine the estimated fair value for each indefinite-lived intangible asset or trademark. In this method, management estimates the royalty savings arising from the ownership of the intangible asset. The key assumptions used in estimating the royalty savings for impairment testing include a discount rate, a royalty rate, growth rates, sales projections, a terminal value rate and to a lesser extent, a tax rate. The discount rate used is similar to the rate developed by the WACC methodology considering any differences in Company-specific risk factors between reporting units and trademarks. The royalty rate is established by management and valuation experts and periodically substantiated by valuation experts. Management, considering industry and Company-specific historical and projected data, develops growth rates and sales projections for each significant trademark. Terminal value rate determination follows common methodology of capturing the present value of perpetual sales estimates beyond the last projected period assuming a constant WACC and a low long-term growth rate. The royalty savings valuation methodology and calculations used in 2024 impairment testing are consistent with prior years. The Company performed the optional qualitative impairment test as of October 1, 2024, and determined that there was indication of impairment on a more likely than not basis in certain of the Company’s trademarks. The resulting quantitative impairment test performed as of October 1, 2024 did not result in any trademark impairment.
The discounted cash flow and royalty savings valuation methodologies require management to make certain assumptions based upon information available at the time the valuations are performed from the perspective of a market participant. See Note 6 to the consolidated financial statements in Item 8 for a discussion of goodwill and intangible assets and the impairment tests performed in accordance with the Goodwill and Other Intangibles Topic of the ASC.
Valuation of Long-Lived Assets
In accordance with the Property, Plant and Equipment Topic of the ASC, if events or changes in circumstances indicate that the carrying value of long-lived assets, including operating and finance lease right-of-use assets, may not be recoverable or the useful life has changed, impairment tests are performed or the useful life is adjusted. Undiscounted cash flows are used to calculate the recoverable value of long-lived assets to determine if such assets are recoverable. If the carrying value of the assets is deemed to not be recoverable, the impairment to be recognized is the amount by which the carrying value of the assets exceeds the estimated fair value of the assets as determined in accordance with the Fair Value Topic of the ASC. If the usefulness of an asset is determined to be impaired, an updated useful life is assessed based on the period of time for projected use of the asset. Fair value approaches and changes in useful life are based on certain assumptions and information available at the time the valuation or determination is performed. Management believes the assumptions used are reflective of what a market participant would have used in calculating fair value or useful life considering the current economic conditions. As of October 1, 2024, the Company performed an analysis and determined that there were no events or changes in circumstances to suggest the carrying value of each long-lived asset group is not recoverable and therefore, no further impairment tests were performed. See Note 5 to the consolidated financial statements in Item 8 for a discussion of the reductions in carrying value or useful life of long-lived assets in accordance with the Property, Plant and Equipment Topic of the ASC.
Defined Benefit Pension and Other Postretirement Benefit Plans
To determine the Company’s ultimate obligation under its defined benefit pension and other postretirement benefit plans, management estimates the future cost of benefits and attributes that cost to the time period during which each covered employee works. To determine the obligations of the benefit plans, management uses actuaries to calculate such amounts using key assumptions which include discount rates, inflation rates, long-term investment returns, mortality, employee turnover, rate of compensation increases and medical and prescription drug costs. Management reviews all of these assumptions on an ongoing basis to ensure that the most current information available is considered. An increase or decrease in the assumptions or economic events outside management’s control could have a direct impact on the Company’s results of operations or financial condition.
In accordance with the Retirement Benefits Topic of the ASC, the Company recognizes each plan’s funded status as an asset for overfunded plans and as a liability for unfunded or underfunded plans. Actuarial gains and losses and prior service costs are recognized and recorded in Accumulated other comprehensive income (AOCI). The amounts recorded in AOCI will continue to be modified as actuarial assumptions and service costs change, and all such amounts will be amortized to expense over a period of years through the net pension and net periodic benefit costs. Based on facts and circumstances, the expense amounts recorded in AOCI can also have accelerated amortization due to certain plan changes, including those that result in a
curtailment. See Note 8 to the consolidated financial statements in Item 8 for information concerning the Company’s defined benefit pension plans and other postretirement benefit plans.
Environmental Matters
The Company is involved with environmental investigation and remediation activities at some of its currently and formerly owned sites (including sites which were previously owned and/or operated by businesses acquired by the Company). The Company initially provides for estimated costs of environmental-related activities relating to its past operations and third-party sites for which commitments or clean-up plans have been developed and when such costs can be reasonably estimated based on industry standards and professional judgment. These estimated costs, which are mostly undiscounted, are determined based on currently available facts regarding each site. If the reasonably estimable costs can only be identified as a range and no specific amount within that range can be determined more likely than any other amount within the range, the minimum of the range is provided.
The Company routinely assesses its potential liability for investigation and remediation-related activities and adjusts its environmental-related accruals as information becomes available upon which more accurate costs can be reasonably estimated and as additional accounting guidelines are issued. Actual costs incurred may vary from the accrued estimates due to the inherent uncertainties involved. See Note 10 to the consolidated financial statements in Item 8 for information concerning the accrual for extended environmental-related activities and a discussion concerning unaccrued future loss contingencies.
Litigation and Other Contingent Liabilities
In the course of its business, the Company is subject to a variety of claims and lawsuits, including, but not limited to, litigation relating to product liability and warranty, personal injury, environmental, intellectual property, commercial, contractual and antitrust claims. Management accrues for all known liabilities that existed and those where a loss was deemed probable for which a fair value was available or an amount could be reasonably estimated in accordance with US GAAP. However, because litigation is inherently subject to many uncertainties and the ultimate result of any present or future litigation is unpredictable, the Company’s ultimate liability may result in costs that are significantly higher than currently accrued. In the event that the Company’s loss contingency is ultimately determined to be significantly higher than currently accrued, the recording of the liability may result in a material impact on Net income for the annual or interim period during which such liability is accrued. Additionally, due to the uncertainties involved, any potential liability determined to be attributable to the Company arising out of such litigation may have a material adverse effect on the Company’s results of operations, liquidity or financial condition. See Note 11 to the consolidated financial statements in Item 8 for information concerning litigation.
Income Taxes
The Company estimates income taxes for each jurisdiction in which it conducts operations. This involves estimating taxable earnings, specific taxable and deductible items, the likelihood of generating sufficient future taxable income to utilize deferred tax assets and possible exposures related to future tax audits. To the extent these estimates change, adjustments to deferred and accrued income taxes will be made in the period in which the changes occur.
The Company recognizes a tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by the taxing authorities, based on the technical merits of the position. The tax benefits recognized in the consolidated financial statements from such a position are measured based on the largest benefit that has a greater than 50% likelihood of being realized upon ultimate resolution. These assessments of uncertain tax positions contain judgments related to the interpretation of tax regulations in the jurisdictions in which we transact business. The judgments and estimates made at a point in time may change based on the outcome of tax audits, expiration of statutes of limitations, as well as changes to, or further interpretations of, tax laws and regulations. Income tax expense is adjusted in our Statements of Consolidated Income in the period in which these events occur. See Note 20 to the consolidated financial statements in Item 8 for information concerning income taxes.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are exposed to market risk associated with interest rates, foreign currency and commodity fluctuations. We occasionally utilize derivative instruments as part of our overall financial risk management policy, but do not use derivative instruments for speculative or trading purposes. In 2024, 2023 and 2022, the Company utilized U.S. dollar to euro cross currency swap contracts to hedge the Company’s net investment in its European operations. The contracts have been designated as net investment hedges and have various maturity dates. See Note 16 to the consolidated financial statements in Item 8. The Company entered into forward foreign currency exchange contracts during 2024, 2023 and 2022 primarily to hedge against value changes in foreign currency. There were no material contracts outstanding at December 31, 2024. Forward foreign currency exchange contracts are described in Note 19 to the consolidated financial statements in Item 8. We believe we may experience continuing losses from foreign currency fluctuations. However, we do not expect currency translation, transaction or hedging contract losses to have a material adverse effect on our financial condition, results of operations or cash flows.
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
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| Index to Consolidated Financial Statements | |
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| Page |
| Report of Management on Internal Control Over Financial Reporting | |
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| Report of Independent Registered Public Accounting Firm on Internal Control Over Financial Reporting | |
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| Report of Management on the Consolidated Financial Statements | |
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Report of Independent Registered Public Accounting Firm on the Consolidated Financial Statements (PCAOB ID: ) | |
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| Statements of Consolidated Income | |
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| Statements of Consolidated Comprehensive Income | |
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| Consolidated Balance Sheets | |
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| Statements of Consolidated Cash Flows | |
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| Statements of Consolidated Shareholders’ Equity | |
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| Notes to Consolidated Financial Statements | |
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Report of Management
On Internal Control Over Financial Reporting
Shareholders of The Sherwin-Williams Company
We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended. We recognize that internal control over financial reporting cannot provide absolute assurance of achieving financial reporting objectives because of its inherent limitations. Internal control over financial reporting is a process that involves human diligence and is subject to the possibility of human error or the circumvention or the overriding of internal control. Therefore, there is a risk that material misstatements may not be prevented or detected on a timely basis by internal control over financial reporting. However, we believe we have designed into the process safeguards to reduce, though not eliminate, this risk. Projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with policies or procedures may deteriorate.
In order to ensure that the Company’s internal control over financial reporting was effective as of December 31, 2024, we conducted an assessment of its effectiveness under the supervision and with the participation of our management group, including our principal executive officer and principal financial officer. This assessment was based on the criteria established in the 2013 Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.
Based on our assessment of internal control over financial reporting under the criteria established in Internal Control – Integrated Framework, we have concluded that, as of December 31, 2024, the Company’s internal control over financial reporting was effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Our internal control over financial reporting as of December 31, 2024 has been audited by , an independent registered public accounting firm, and their report on the effectiveness of our internal control over financial reporting is included on page 43 of this report.
Heidi G. Petz
Chair, President and Chief Executive Officer
Allen J. Mistysyn
Senior Vice President - Finance and Chief Financial Officer
J. Paul Lang
Senior Vice President - Enterprise Finance and Chief Accounting Officer
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of The Sherwin-Williams Company
Opinion on Internal Control Over Financial Reporting
We have audited The Sherwin-Williams Company and subsidiaries internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, The Sherwin-Williams Company and subsidiaries (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2024, 2023 and 2022, the related statements of consolidated income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2024, and the related notes and financial statement schedule listed in the index at Item 15(a) and our report dated February 20, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Report of Management On Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young, LLP
Cleveland, Ohio
February 20, 2025
Report of Management
On the Consolidated Financial Statements
Shareholders of The Sherwin-Williams Company
We are responsible for the preparation and fair presentation of the consolidated financial statements, accompanying notes and related financial information included in this report of The Sherwin-Williams Company and its consolidated subsidiaries (collectively, the Company) as of December 31, 2024, 2023 and 2022 and for the years then ended in accordance with U.S. generally accepted accounting principles. The consolidated financial information included in this report contains certain amounts that were based upon our best estimates, judgments and assumptions that we believe were reasonable under the circumstances.
We have conducted an assessment of the effectiveness of internal control over financial reporting based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. As discussed in the Report of Management on Internal Control Over Financial Reporting on page 42 of this report, we concluded that the Company’s internal control over financial reporting was effective as of December 31, 2024.
The Board of Directors fulfills its responsibility for the oversight of the Company’s accounting policies and procedures, financial statement preparation and internal control over financial reporting through the Audit Committee, comprised exclusively of independent directors. The Audit Committee is responsible for the appointment and compensation of the independent registered public accounting firm. The Audit Committee meets at least quarterly with financial management, internal auditors and the independent registered public accounting firm to review the adequacy of financial controls, the effectiveness of the Company’s internal control over financial reporting and the nature, extent and results of the audit effort. Both the internal auditors and the independent registered public accounting firm have private and confidential access to the Audit Committee at all times.
We believe that the consolidated financial statements, accompanying notes and related financial information included in this report fairly reflect the form and substance of all material financial transactions and fairly present, in all material respects, the consolidated financial position, results of operations and cash flows as of and for the periods presented.
Heidi G. Petz
Chair, President and Chief Executive Officer
Allen J. Mistysyn
Senior Vice President - Finance and Chief Financial Officer
J. Paul Lang
Senior Vice President - Enterprise Finance and Chief Accounting Officer
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of The Sherwin-Williams Company
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of The Sherwin-Williams Company and subsidiaries (the Company) as of December 31, 2024, 2023 and 2022, the related statements of consolidated income, comprehensive income, cash flows and shareholders’ equity for each of the three years in the period ended December 31, 2024, and the related notes and the financial statement schedule listed in the index at Item 15(a) (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2024, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 20, 2025 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
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| Gibbsboro environmental-related accrual |
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| Description of the Matter | As described in Note 10 to the consolidated financial statements, the Company had short-term and long-term accruals for environmental-related activities of $66.4 million and $230.3 million, respectively, at December 31, 2024. The Company’s largest and most complex site is the Gibbsboro, New Jersey site (Gibbsboro) and the substantial majority of the environmental-related accrual relates to this site. Gibbsboro consists of six operable units which contain a combination of soil, sediment, surface water and groundwater contamination, and are in various phases of investigation and remediation with the Environmental Protection Agency (EPA). The Company’s estimated environmental-related accrual for Gibbsboro is based on industry standards and professional judgement, and the most significant assumptions underlying the estimated cost of remediation efforts reserved for Gibbsboro are the types and extent of future remediation.
Auditing the Company’s environmental-related accrual at the Gibbsboro site required complex judgement due to the inherent challenges in identifying the type and extent of future remedies in determining the probable and reasonably estimable loss for which the Company will be responsible. |
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How We Addressed the Matter
in Our Audit | We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company's processes to estimate the Gibbsboro environmental-related accrual. For example, we tested controls over management’s review of the environmental loss calculations and the key assumptions affecting those calculations as described above.
To test the Gibbsboro environmental-related accrual, our audit procedures included, among others, a review of correspondence with the EPA supporting the Company’s assessment of the type, extent and cost of remediation at the Gibbsboro site for which the Company is responsible. We assessed the appropriateness of the Company’s policies and procedures and tested management’s environmental reserve estimate. We involved our environmental specialists to confirm our understanding of the remediation plans for the most significant operable units within the Gibbsboro site and to evaluate the impact of current year investigation and remediation activities on the Company's methodology and assumptions used to estimate the cost and extent of remediation in accordance with industry practice, applicable laws and regulations. We reconciled types and extent of remediation identified in communications between the Company and the EPA, including agreed upon remediation plans with the EPA, to the Company’s remediation cost estimates recorded for Gibbsboro. We also conducted a search for publicly available information that might indicate facts contrary to the types and extent of remediation currently identified in the Company’s remediation cost estimates recorded for Gibbsboro.
|
/s/ Ernst & Young, LLP
We have served as the Company’s auditor since 1908.
February 20, 2025
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME
| | | | | | | | | | | | | | | | | |
| (in millions, except per share data) | Year Ended December 31, |
| 2024 | | 2023 | | 2022 |
| Net sales | $ | | | | $ | | | | $ | | |
| Cost of goods sold | | | | | | | | |
| Gross profit | | | | | | | | |
| Percent to Net sales | | % | | | % | | | % |
| Selling, general and administrative expenses | | | | | | | | |
| Percent to Net sales | | % | | | % | | | % |
| Other general (income) expense - net | () | | | | | | () | |
| Impairment | | | | | | | | |
| Interest expense | | | | | | | | |
| Interest income | () | | | () | | | () | |
| Other (income) expense - net | () | | | | | | | |
| Income before income taxes | | | | | | | | |
| Income taxes | | | | | | | | |
| Net income | $ | | | | $ | | | | $ | | |
| | | | | |
| Net income per common share: | | | | | |
| Basic | $ | | | | $ | | | | $ | | |
| Diluted | $ | | | | $ | | | | $ | | |
| | | | | |
| Weighted average shares outstanding: | | | | | |
| Basic | | | | | | | | |
| Diluted | | | | | | | | |
See notes to consolidated financial statements.
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED COMPREHENSIVE INCOME
| | | | | | | | | | | | | | | | | |
(in millions)
| Year Ended December 31, |
| 2024 | | 2023 | | 2022 |
| Net income | $ | | | | $ | | | | $ | | |
| Other comprehensive (loss) income, net of tax: | | | | | |
Foreign currency translation adjustments (1) | () | | | | | | () | |
| Pension and other postretirement benefit adjustments: | | | | | |
Amounts recognized in AOCI (2) | | | | | | | | |
Amounts reclassified from AOCI (3) | () | | | () | | | | |
| Total | | | | () | | | | |
| Unrealized net gains on cash flow hedges: | | | | | |
Amounts reclassified from AOCI (4) | () | | | () | | | () | |
| Other comprehensive (loss) income, net of tax | () | | | | | | () | |
| Comprehensive income | $ | | | | $ | | | | $ | | |
(1) million, $() million and $ million, respectively, related to net investment hedges. See Note 16.
(2) ) million, $() million and $() million in 2024, 2023 and 2022, respectively.
(3) million, $ million and $() million in 2024, 2023 and 2022, respectively.
(4) million in 2024 and 2023 and $ million in 2022.
See notes to consolidated financial statements.
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
| | | | | | | | | | | | | | | | | |
| (in millions) | December 31, |
| 2024 | | 2023 | | 2022 |
| Assets | | | | | |
| Current assets: | | | | | |
| Cash and cash equivalents | $ | | | | $ | | | | $ | | |
| Accounts receivable, net | | | | | | | | |
| Inventories | | | | | | | | |
| Other current assets | | | | | | | | |
| Total current assets | | | | | | | | |
| Property, plant and equipment, net | | | | | | | | |
| Goodwill | | | | | | | | |
| Intangible assets | | | | | | | | |
| Operating lease right-of-use assets | | | | | | | | |
| Other assets | | | | | | | | |
| Total Assets | $ | | | | $ | | | | $ | | |
| | | | | |
| Liabilities and Shareholders’ Equity | | | | | |
| Current liabilities: | | | | | |
| Short-term borrowings | $ | | | | $ | | | | $ | | |
| Accounts payable | | | | | | | | |
| Compensation and taxes withheld | | | | | | | | |
| Accrued taxes | | | | | | | | |
| Current portion of long-term debt | | | | | | | | |
| Current portion of operating lease liabilities | | | | | | | | |
| Other accruals | | | | | | | | |
| Total current liabilities | | | | | | | | |
| Long-term debt | | | | | | | | |
| Postretirement benefits other than pensions | | | | | | | | |
| Deferred income taxes | | | | | | | | |
| Long-term operating lease liabilities | | | | | | | | |
| Other long-term liabilities | | | | | | | | |
| Shareholders’ equity: | | | | | |
Common stock - $-1/3 par value: | | | | | |
, and million shares outstanding | | | | | |
at December 31, 2024, 2023 and 2022, respectively | | | | | | | | |
| Other capital | | | | | | | | |
| Retained earnings | | | | | | | | |
| Treasury stock, at cost | () | | | () | | | () | |
| Accumulated other comprehensive loss | () | | | () | | | () | |
| Total shareholders’ equity | | | | | | | | |
| Total Liabilities and Shareholders’ Equity | $ | | | | $ | | | | $ | | |
See notes to consolidated financial statements.
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
| | | | | | | | | | | | | | | | | |
| (in millions) | Year Ended December 31, |
| | 2024 | | 2023 | | 2022 |
| Operating Activities | | | | | |
| Net income | $ | | | | $ | | | | $ | | |
| Adjustments to reconcile Net income to Net operating cash: | | | | | |
| Depreciation | | | | | | | | |
| Non-cash lease expense | | | | | | | | |
| Amortization of intangible assets | | | | | | | | |
| Gain on divestiture of business | | | | () | | | | |
| Loss on extinguishment of debt | | | | | | | | |
| Impairment | | | | | | | | |
| Provisions for environmental-related matters - net | () | | | | | | () | |
| Provisions for restructuring | | | | | | | | |
| Deferred income taxes | () | | | () | | | () | |
| Other postretirement benefit plan net cost | () | | | () | | | () | |
| Stock-based compensation expense | | | | | | | | |
| Amortization of non-traded investments | | | | | | | | |
| (Gain) loss on sale or disposition of assets | () | | | | | | () | |
| Other | | | | | | | | |
| Change in working capital accounts: | | | | | |
| (Increase) decrease in accounts receivable | () | | | | | | () | |
| (Increase) decrease in inventories | () | | | | | | () | |
| Increase (decrease) in accounts payable | | | | () | | | | |
| Decrease in accrued taxes | () | | | () | | | () | |
| (Decrease) increase in accrued compensation and taxes withheld | () | | | | | | | |
| Decrease in refundable income taxes | | | | | | | | |
| Other | () | | | | | | | |
| Change in operating lease liabilities | () | | | () | | | () | |
| Costs incurred for environmental-related matters | () | | | () | | | () | |
| Other | () | | | () | | | () | |
| Net operating cash | | | | | | | | |
| | | | | |
| Investing Activities | | | | | |
| Capital expenditures | () | | | () | | | () | |
| Acquisitions of businesses, net of cash acquired | () | | | () | | | () | |
| Proceeds from divestiture of business | | | | | | | | |
| Proceeds from sale of assets | | | | | | | | |
| Other | () | | | () | | | | |
| Net investing cash | () | | | () | | | () | |
| | | | | |
| Financing Activities | | | | | |
| Net increase (decrease) in short-term borrowings | | | | () | | | | |
| Proceeds from long-term debt | | | | | | | | |
| Payments of long-term debt | () | | | () | | | () | |
| Payments for credit facility and debt issuance costs | () | | | | | | () | |
| Payments of cash dividends | () | | | () | | | () | |
| Proceeds from stock options exercised | | | | | | | | |
| Treasury stock purchased | () | | | () | | | () | |
| Proceeds from treasury stock issued | | | | | | | | |
| Proceeds from real estate financing transactions | | | | | | | | |
| Other | () | | | () | | | () | |
| Net financing cash | () | | | () | | | () | |
| | | | | |
| Effect of exchange rate changes on cash | () | | | | | | | |
| Net (decrease) increase in cash and cash equivalents | () | | | | | | | |
| Cash and cash equivalents at beginning of year | | | | | | | | |
| Cash and cash equivalents at end of year | $ | | | | $ | | | | $ | | |
| | | | | |
|
|
| Supplemental cash flow information | | | | | |
| Income taxes paid | $ | | | | $ | | | | $ | | |
| Interest paid | $ | | | | $ | | | | $ | | |
See notes to consolidated financial statements.
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED SHAREHOLDERS’ EQUITY
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| (in millions, except per share data) | Common
Stock | | Other
Capital | | Retained
Earnings | | Treasury
Stock | | Accumulated
Other
Comprehensive
Loss | | Total |
| Balance at January 1, 2022 | $ | | | | $ | | | | $ | | | | $ | () | | | $ | () | | | $ | | |
Net income | | | | | | | | | | | | | |
| Other comprehensive loss | | | | | | | | | () | | | () | |
| Treasury stock purchased | | | | | | | () | | | | | () | |
| Treasury stock issued | | | | | | | | | | | | | |
| Stock-based compensation activity | | | | | | | | () | | | | | | |
| Other adjustments | | | () | | | () | | | | | | | () | |
Cash dividends -- $ per share | | | | | () | | | | | | | () | |
| Balance at December 31, 2022 | | | | | | | | | | () | | | () | | | | |
| Net income | | | | | | | | | | | | | |
| Other comprehensive income | | | | | | | | | | | | | |
| Treasury stock purchased | | | | | | | () | | | | | () | |
| | | | | |
| Stock-based compensation activity | | | | | | | | | () | | | | | | |
| Other adjustments | | | | | | | | | | | | | |
Cash dividends -- $ per share | | | | | () | | | | | | | () | |
| Balance at December 31, 2023 | | | | | | | | | | () | | | () | | | | |
| Net income | | | | | | | | | | | | | |
| Other comprehensive loss | | | | | | | | | () | | | () | |
| Treasury stock purchased | | | | | | | () | | | | | () | |
| | | | | |
| Stock-based compensation activity | | | | | | | | | () | | | | | | |
| Other adjustments | | | () | | | | | | | | | () | |
Cash dividends -- $ per share | | | | | () | | | | | | | () | |
| Balance at December 31, 2024 | $ | | | | $ | | | | $ | | | | $ | () | | | $ | () | | | $ | | |
See notes to consolidated financial statements.
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(millions of dollars, unless otherwise noted)
NOTE 1 –
to years for buildings and to years for machinery and equipment. Depreciation and amortization are included in the appropriate Cost of goods sold or Selling, general and administrative expenses caption on the Statements of Consolidated Income. See Note 5 for further details.
to years. See Note 6 for further details. See Note 5 for further details.
material foreign currency option and forward contracts outstanding at December 31, 2024, 2023 and 2022. See Note 19 for further details. The Company also entered into cross currency swap contracts to hedge its net investment in European operations in 2024, 2023 and 2022. These contracts qualified for and were designated as net investment hedges under US GAAP. The changes in fair value for the cross currency swaps are recognized in the Foreign currency translation adjustments component of AOCI. The cash flow impact of these instruments is classified as an investing activity in the Statements of Consolidated Cash Flows. See Note 16 for further details.
| | $ | | | | $ | | | | | | | | | | | |
million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively. | | $ | | | | $ | | | | Other accruals | | | | | | | | |
| Other long-term liabilities | | | | | | | | |
| Net deferred income tax asset | | | | | | | | |
Amounts outstanding under these agreements totaled $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively.
| | $ | | | | $ | | | | Charges to expense | | | | | | | | |
| Settlements | () | | | () | | | () | |
|
| Balance at December 31 | $ | | | | $ | | | | $ | | |
See Note 8 for further details.
See Note 13 for further details.
See Notes 10 and 19 for further details. See Note 14 for further details.
See Note 18 for further details.
Research and development costs were $ million, $ million and $ million during 2024, 2023 and 2022, respectively.
million, $ million and $ million in advertising costs during 2024, 2023 and 2022, respectively. General and administrative expenses include human resources, legal, finance and other support and administrative functions.
million of government incentives received as cash payments related to the construction of the Company’s new global headquarters and research and development center in 2022. These government incentives were recorded as a reduction in the carrying amount of the respective assets under construction within Property, plant and equipment, net on the Consolidated Balance Sheets and within Other as an investing activity on the Statements of Consolidated Cash Flows. There were material government incentives received in 2024 or 2023. on the Consolidated Balance Sheets and amounted to $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively. | | Invoices confirmed during the year | | |
| Confirmed invoices paid during the year | () | |
| Balance at December 31 | $ | | |
See Note 21 for further details.
NOTE 2 –
NOTE 3 –
million. The business develops, manufactures and sells a comprehensive portfolio of innovative products under the Suvinil and Glasu! brand names to professional painters, designers, architects, general contractors and consumers across the country. The business also operates two production facilities located in the Northeast and Southeast regions of Brazil.The closing of the transaction is subject to receipt of Brazilian antitrust approval, satisfaction or waiver of certain other customary closing conditions, as well as BASF’s completion of its carve-out of all relevant assets, properties, contracts, permits, rights and employees of the decorative paints business into a separate entity. The Company will acquire all issued and outstanding equity interests in this separate entity for an agreed-upon cash purchase price of $ billion, subject to customary post-closing adjustments. The Company intends to finance the transaction through a combination of cash on hand, liquidity available under existing facilities and new debt. The acquired business is expected to be reported within the Company’s Consumer Brands Group.
Pending
In December 2024, the Company signed an agreement to acquire a European coil and industrial coatings company. The transaction is subject to customary closing conditions and is expected to close in 2025. The acquired business will be reported within the Company’s Performance Coatings Group.
Closed in Current Year
In October 2024, the Company completed the acquisition of a metal packaging coatings business for approximately $ million. The acquired business develops, manufactures and sells coatings for the food and household product markets and is reported within the Company’s Performance Coatings Group. As of December 31, 2024, $ million of Property, plant and equipment, net, $ million of finite-lived intangibles and $ million of Goodwill were recognized from this transaction.
million, including an immaterial amount paid in 2024 to finalize certain representations, warranties and closing conditions. The Company finalized the purchase price allocation within the allowable measurement period, and $ million of finite-lived intangible assets, $ million of goodwill, $ million of other assets, net of cash and $ million of liabilities were recognized from this transaction.Closed in 2022
In April 2022, the Company completed the acquisition of the European industrial coatings business of Sika AG. In July 2022, the Company completed the acquisitions of Gross & Perthun GmbH, Dur-A-Flex, Inc. and Powdertech Oy Ltd. In December 2022, the Company completed the acquisition of Industria Chimica Adriatica S.p.A. (ICA). The aggregate purchase price for the acquisitions completed in 2022 was approximately $ billion, including amounts withheld as security for certain representations, warranties and obligations of the sellers. Based on the preliminary purchase price allocations for these transactions, as of December 31, 2022, the Company recognized intangible assets and goodwill of $ million and $ million, respectively, with the remaining purchase price for each transaction allocated to various other assets acquired and liabilities assumed. In June 2023, purchase price allocation adjustments were made to ICA which decreased goodwill by $ million, increased finite-lived intangible assets by $ million and increased deferred tax liabilities by $ million. There were no material adjustments related to the other acquisitions that closed in 2022 and the Company finalized the purchase price allocations for these transactions in the allowable measurement period. In accordance with certain purchase agreements, the Company paid $ million in 2023 related to holdbacks for acquisitions completed in prior years.
Divestitures
Closed in 2023
The Company completed the divestiture of a non-core domestic aerosol business within the Consumer Brands Group in April 2023. This transaction resulted in the recognition of a $ million gain in 2023 within the Administrative function. This gain was recorded within Other general (income) expense - net (see Note 19).
During the third quarter of 2023, the Company completed the divestiture of the China architectural business within the Consumer Brands Group. An immaterial working capital adjustment was finalized during the first quarter of 2024. The associated net assets were classified as held for sale at June 30, 2023 in accordance with the Property, Plant and Equipment Topic of the ASC. Following the prescribed order of impairment testing, the Company first reviewed individual tangible and intangible assets under their applicable Topic of the ASC to determine if their carrying value was higher than their respective fair value. As a result, the Company recorded an impairment charge of $ million within the Consumer Brands Group related to China architectural trademarks during 2023. The Company then compared the updated carrying value of the assets and liabilities comprising the disposal group as a whole to its respective fair value which was determined to be equal to the selling price, less costs to sell. As a result of this comparison, the Company recorded an additional impairment charge of $ million within the Administrative function in the second quarter of 2023. The fair value of the disposal group was classified as level 2 in the fair value hierarchy as it was based on a specific price and other observable inputs for similar items with no active market.
NOTE 4 –
| | $ | | | | $ | | | | Work in process and raw materials | | | | | | | | |
| Inventories | $ | | | | $ | | | | $ | | |
Inventories were stated at the lower of cost or market, with cost primarily determined on the LIFO method. Management believes that the use of LIFO results in a better matching of costs and revenues.
% | | | % | | | % | | Excess of FIFO over LIFO | $ | | | $ | | | $ | |
During 2024 and 2023, certain inventories accounted for on the LIFO method were reduced, resulting in the liquidation of certain quantities carried at costs prevailing in prior years. The 2024 and 2023 liquidations increased Net income by $ million and $ million, respectively. There were liquidations in 2022.
The Company recorded a reserve for obsolescence of $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively, to reduce Inventories to their estimated current market price.
NOTE 5 –
| | $ | | | | $ | | | | Buildings | | | | | | | | |
| Machinery and equipment | | | | | | | | |
| Construction in progress | | | | | | | | |
| Property, plant and equipment, gross | | | | | | | | |
| Less allowances for depreciation | | | | | | | | |
| Property, plant and equipment, net | $ | | | | $ | | | | $ | | |
The Company capitalizes interest costs incurred in the construction of certain property, plant and equipment. In 2024 and 2023, the Company capitalized interest of $ million and $ million, respectively. There was interest capitalized in 2022.
NOTE 6 –
million and finite-lived intangibles of $ million. The acquired intangibles are being amortized over a weighted-average useful life of approximately years.During 2023, the Company completed the acquisition of SIC Holding, which resulted in the recognition of goodwill of $ million and finite-lived intangibles of $ million. The acquired intangibles are being amortized over a weighted-average useful life of approximately years.
During 2022, the Company acquired companies which resulted in the recognition of goodwill of $ million and finite-lived intangibles of $ million. The acquired intangibles are being amortized over a weighted-average useful life of approximately years.
See Note 3 for additional information related to the acquisitions and divestitures.
In accordance with the Goodwill and Other Intangibles Topic of the ASC, goodwill at the reporting unit level and indefinite-lived intangible assets are tested for impairment annually. In addition, interim impairment tests are performed whenever required as a result of a specific event or circumstances which indicate potential impairment on a more likely than not basis. October 1 has been established for the annual impairment review. An optional qualitative assessment may alleviate the need to perform quantitative goodwill and indefinite-lived intangible asset impairment tests when there is no indication of impairment on a more likely than not basis. Should a quantitative impairment test be performed, values are estimated separately for goodwill and indefinite-lived intangible assets using applicable valuation models, incorporating discount rates commensurate with the risks involved for each group of assets.
The annual impairment review performed as of October 1, 2024 did not result in any trademark or goodwill impairment.
As a result of the Latin America architectural paint business moving to the Consumer Brands Group reportable segment effective January 1, 2023, the Company performed a quantitative impairment analysis for the impacted reporting units and determined both before and after the change, there was no indication of impairment. The annual impairment review performed as of October 1, 2023 resulted in no goodwill impairment and trademark impairment of $ million in the Consumer Brands Group primarily related to a trademark in Europe.
The annual impairment review performed as of October 1, 2022 resulted in trademark impairments totaling $ million in the Consumer Brands Group related to the discontinuation of an architectural paint brand and lower than anticipated sales of an acquired brand and no goodwill impairment.
| | $ | | | | $ | | | | $ | | | | Acquisitions and acquisition adjustments | | | | | | | | | | | | |
| Currency and other adjustments | | | | () | | | () | | | () | |
Balance at December 31, 2022 (1) | | | | | | | | | | | | |
| Acquisitions and acquisition adjustments | | | | | | | | | | |
| Currency and other adjustments | | | | () | | | | | | | |
Balance at December 31, 2023 (1) | | | | | | | | | | | | |
| Acquisitions and acquisition adjustments | | | | | | | | | | |
| Currency and other adjustments | | | | () | | | () | | | () | |
Balance at December 31, 2024 (1) | | $ | | | | $ | | | | $ | | | | $ | | |
(1) Net of accumulated impairment losses of $ million ($ million in Paint Stores Group, $ million in Consumer Brands Group and $ million in Performance Coatings Group).
| | $ | | | | $ | | | | $ | | | | $ | | | | | | | | Accumulated amortization | | () | | | () | | | () | | | () | | | () | | | | | |
| Net value | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | |
| December 31, 2023 | | | | | | | | | | | | | | |
| Gross | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | | | |
| Accumulated amortization | | () | | | () | | | () | | | () | | | () | | | | | |
| Net value | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | |
| December 31, 2022 | | | | | | | | | | | | | | |
| Gross | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | | | |
| Accumulated amortization | | () | | | () | | | () | | | () | | | () | | | | | |
| Net value | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
(1) Trademarks are net of accumulated impairment losses of $ million as of December 31, 2024 and 2023 and $ million as of December 31, 2022.
Amortization of finite-lived intangible assets is estimated as follows for the next five years: $ million in 2025, $ million in 2026, $ million in 2027, $ million in 2028 and $ million in 2029.
Although the Company believes its estimates of fair value related to reporting units and indefinite-lived intangible assets are reasonable, actual financial results could differ from these estimates due to the inherent uncertainty involved in making such estimates. Changes in assumptions concerning future financial results or other underlying assumptions could have a significant impact and future impairment charges may be required.
NOTE 7 –
% Senior Notes 2027 | | $ | | | | $ | | | | $ | | | % Senior Notes | 2047 | | | | | | | | | |
% Senior Notes | 2029 | | | | | | | | | |
% Senior Notes | 2049 | | | | | | | | | |
% Senior Notes | 2030 | | | | | | | | | |
% Senior Notes | 2032 | | | | | | | | | |
% Senior Notes | 2050 | | | | | | | | | |
% Senior Notes | 2052 | | | | | | | | | |
% Senior Notes | 2031 | | | | | | | | | |
% Senior Notes | 2025 | | | | | | | | | |
% Senior Notes | 2025 | | | | | | | | | |
% Senior Notes | 2045 | | | | | | | | | |
% Senior Notes | 2028 | | | | | | | | | |
% Senior Notes | 2026 | | | | | | | | | |
% Senior Notes | 2042 | | | | | | | | | |
% Senior Notes | 2025 | | | | | | | | | |
% Senior Notes | 2045 | | | | | | | | | |
% to % Promissory Notes | Through 2026 | | | | | | | | | |
% Senior Notes | 2024 | | | | | | | | | |
% Senior Notes | 2024 | | | | | | | | | |
% Debentures | 2027 | | | | | | | | | |
% Debentures | 2097 | | | | | | | | | |
Total (1) | | | | | | | | | | |
| Less amounts due within one year | | | | | | | | | | |
| Long-term debt | | | $ | | | | $ | | | | $ | | |
million, $ million and $ million and net of discounts and premiums of $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively.
Maturities of long-term debt are as follows for the next five years: $ billion in 2025; $ million in 2026; $ billion in 2027; $ million in 2028 and $ million in 2029. Interest expense on long-term debt was $ million, $ million and $ million for 2024, 2023 and 2022, respectively.
In August 2024, the Company repaid principal of $ million related to the Company’s % senior notes due August 8, 2024 using commercial paper and subsequently issued $ million of % senior notes due 2028 and $ million of % senior notes due 2031 in a public offering. The net proceeds from the issuance of these notes were used to repay outstanding borrowings under the Company’s domestic commercial paper program and for general corporate purposes. The newly issued senior notes contain customary qualitative covenants as defined in their respective agreements. During the second quarter of 2024, the Company repaid the principal of $ million related to its % senior notes due June 1, 2024 using commercial paper.
In December 2023, the Company exercised its call provision to make-whole the entire outstanding $ million aggregate principal amount of its % Debentures due 2027 and the entire outstanding $ million aggregate principal amount of its % Debentures due 2097. The retirement of the Debentures resulted in a loss of $ million recorded in Other general (income) expense - net. See Note 19.
In August 2022, the Company issued $ million of % Senior Notes due August 2024 and $ million of % Senior Notes due August 2025 in a public offering. The net proceeds from the issuance of these notes were used to repay
million of the commitments available for borrowing and obtaining the issuance, renewal, extension and increase of a letter of credit under the credit agreement from June 20, 2025 to December 20, 2029.In July 2024, the Company entered into a new $ billion revolving credit agreement maturing on July 31, 2029 (2024 Credit Agreement), which replaced the the 2022 Credit Agreement. Under the terms of the 2024 Credit Agreement, the Company may request to extend the maturity date for additional periods, request an uncommitted increase up to $ million and issue letters of credit under a $ million subfacility.
In August 2022, the Company entered into a credit agreement (2022 Credit Agreement), which replaced the $ billion credit agreement dated June 29, 2021. The 2022 Credit Agreement gave the Company the right to borrow $ billion and to obtain letters of credit in an amount of up to $ million.
In August 2021, the Company entered into an amended and restated $ million credit agreement (2021 Credit Agreement), which amends and restates the credit agreement entered into in September 2017. The 2021 Credit Agreement was subsequently amended on multiple dates to extend the maturity of commitments available for borrowing or letters of credit under the agreement.
In May 2016, the Company entered into a credit agreement (2016 Credit Agreement), subsequently amended on multiple dates to extend the maturity of commitments available for borrowing or letters of credit under the agreement. The 2016 credit agreement gives the Company the right to borrow and obtain letters of credit up to an aggregate availability of $ million. These credit agreements are/were used for general corporate purposes, including the financing of working capital requirements.
At December 31, 2024, 2023 and 2022, there were borrowings outstanding under these credit agreements.
The Company’s available capacity under its committed credit agreements is reduced for amounts outstanding under its domestic commercial paper program and letters of credit. At December 31, 2024, the Company had unused capacity under its various credit agreements of $ billion.
| | $ | | | | $ | | | | Foreign facilities | | | | | | | | |
| Total | $ | | | | $ | | | | $ | | |
| | | | | |
| Weighted average interest rate: | | | | | |
| Domestic | % | | % | | % |
| Foreign | % | | % | | % |
Interest expense on Short-term borrowings was $ million, $ million and $ million for 2024, 2023 and 2022, respectively.
Among other restrictions, the Company’s notes, debentures and revolving credit agreement contain certain covenants relating to liens, ratings changes, merger and sale of assets, consolidated leverage and change of control, as defined in the agreements. In the event of default under any one of these arrangements, acceleration of the maturity of any one or more of these borrowings may result. The Company was in compliance with all covenants for all years presented.
NOTE 8 –
, and active employees covered by the benefits under these plans at December 31, 2024, 2023 and 2022, respectively. The cost of these benefits for active employees, which includes claims incurred but not reported, amounted to $ million, $ million and $ million for 2024, 2023 and 2022, respectively.Defined Contribution Pension Plans
The Company’s annual contribution for its domestic defined contribution pension plan was $ million, $ million and $ million for 2024, 2023 and 2022, respectively. The contribution percentage ranges from percent to percent of compensation for covered employees based on an age and service formula. Assets in employee accounts of the domestic defined contribution pension plan are invested in various investment funds as directed by the participants. These investment funds did not own a significant number of shares of the Company’s common stock for any year presented.
The Company’s annual contributions for its foreign defined contribution pension plans, which are based on various percentages of compensation for covered employees up to certain limits, were $ million, $ million and $ million for 2024, 2023 and 2022, respectively. Assets in employee accounts of the foreign defined contribution pension plans are invested in various investment funds. These investment funds did not own a significant number of shares of the Company’s common stock for any year presented.
Defined Benefit Pension Plans
At December 31, 2024, the domestic defined benefit pension plan was overfunded, with a projected benefit obligation of $ million, fair value of plan assets of $ million and excess plan assets of $ million. The plan was funded in accordance with all applicable regulations at December 31, 2024.
The Company has foreign defined benefit pension plans. At December 31, 2024, of the Company’s foreign defined benefit pension plans were unfunded or underfunded, with combined accumulated benefit obligations, projected benefit obligations, fair values of net assets and deficiencies of plan assets of $ million, $ million, $ million and $ million, respectively.
The Company expects to make the following benefit payments for all domestic and foreign defined benefit pension plans: $ million in 2025; $ million in 2026; $ million in 2027; $ million in 2028; $ million in 2029; and $ million in 2030 through 2034. The Company expects to contribute $ million to the foreign defined benefit pension plans in 2025.
The estimated net actuarial gains and prior service costs for the defined benefit pension plans that are expected to be amortized from AOCI into net pension costs in 2025 are $ million and $ million, respectively.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Interest cost | | | | | | | | | | | | | | | | | |
| Expected return on plan assets | () | | | () | | | () | | | () | | | () | | | () | |
| Amortization of prior service cost (credit) | | | | | | | | | | () | | | () | | | () | |
| Amortization of actuarial (gains) losses | () | | | | | | | () | | | () | | | | |
| Ongoing pension cost | | | | | | | | | | | | | | | | | |
| Settlement credits | | | | | | | | | () | | | () | |
| Curtailment cost | | | | | | | | | | | | |
| Net pension cost | | | | | | | | | | | | | | | | | |
Other changes in plan assets and projected benefit obligation recognized in AOCI (before taxes): | | | | | | | | | | | |
| Net actuarial (gains) losses arising during the year | () | | | () | | | | | | () | | | | | | () | |
| Prior service cost (credit) arising during the year | | | | | | | | | | | | | | | | () | |
| Amortization of actuarial gains (losses) | | | | | | | | | | | | | | () | |
| Amortization of prior service (cost) credit | () | | | () | | | () | | | () | | | | | | | |
| Loss recognized for settlement | | | | | | | | | | | | | |
| | | | | |
| | | | | |
| Exchange rate loss (gain) recognized during the year | | | | | | | | | | () | | | () | |
| Total recognized in AOCI | () | | | () | | | | | | () | | | | | | () | |
Total recognized in net pension cost and AOCI | $ | () | | | $ | () | | | $ | | | | $ | | | | $ | | | | $ | () | |
Service cost is recorded in Cost of goods sold and Selling, general and administrative expenses. All other components of Net pension costs are recorded in Other (income) expense - net.
In December 2024, the Company amended one of its foreign defined benefit plans to freeze future benefit accruals as of December 31, 2024. As a result of the amendment, the Company recognized a non-cash pre-tax curtailment charge of $ million primarily related to the acceleration of amounts previously recorded within AOCI in the Statements of Consolidated Comprehensive Income.
The Company employs a total return investment approach for the domestic and foreign defined benefit pension plan assets. A mix of equities and fixed income investments are used to maximize the long-term return of assets for a prudent level of risk. In determining the expected long-term rate of return on defined benefit pension plan assets, management considers the historical rates of return, the nature of investments and an expectation of future investment strategies. The target allocations for the domestic defined benefit pension plan assets are % – % equity securities, % – % fixed income securities and % – % other (including alternative investments and cash). The target allocations for the foreign defined benefit pension plan assets vary by plan, but are generally within the following ranges: % – % equity securities, % – % fixed income securities and % – % other (including alternative investments and cash).
| | $ | | | | $ | | | | | Equity investments (1) | | | | | | | | | | |
Fixed income investments (2) | | | | | | | | | | |
Other assets (3) | | | | | | | | | |
| Total investments in fair value hierarchy | $ | | | | $ | | | | $ | | | | |
Investments measured at NAV or its equivalent (4) | | | | | | | | |
| Total investments | $ | | | | | | | | |
| | | | | | | |
| Fair Value at December 31, 2023 | | Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1) | | Significant
Other
Observable
Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) |
| Investments at fair value: | | | | | | | |
Equity investments (1) | $ | | | | $ | | | | $ | | | | |
Fixed income investments (2) | | | | | | | | | | |
Other assets (3) | | | | | | | | | |
| Total investments in fair value hierarchy | $ | | | | $ | | | | $ | | | | |
Investments measured at NAV or its equivalent (4) | | | | | | | | |
| Total investments | $ | | | | | | | | |
| | | | | | | |
| Fair Value at December 31, 2022 | | Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1) | | Significant
Other
Observable
Inputs
(Level 2) | | Significant
Unobservable
Inputs
(Level 3) |
| Investments at fair value: | | | | | | | |
Equity investments (1) | $ | | | | $ | | | | $ | | | | |
Fixed income investments (2) | | | | | | | | | |
Other assets (3) | | | | | | | | | |
| Total investments in fair value hierarchy | $ | | | | $ | | | | $ | | | | |
Investments measured at NAV or its equivalent (4) | | | | | | | | |
| Total investments | $ | | | | | | | | |
(1) This category includes actively managed equity assets that track primarily to the S&P 500 or an international equity index.
(2) This category includes government and corporate bonds that track primarily to a domestic or an international bond index.
(3) This category primarily includes insurance contracts and real estate.
(4) This category includes pooled investment funds and private equity funds that are measured at NAV or its equivalent using the practical expedient. Therefore, these investments are not classified in the fair value hierarchy.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Projected benefit obligations: | | | | | | | | | | | |
| Balances at beginning of year | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Service cost | | | | | | | | | | | | | | | | | |
| Interest cost | | | | | | | | | | | | | | | | | |
| Actuarial (gains) losses | () | | | | | | () | | | () | | | | | | () | |
| | | | | |
| Plan amendments and other | | | | | | | | | | | | | | | | | |
| Settlements | | | | | | | () | | | () | | | () | |
| Effect of foreign exchange | | | | | | | () | | | | | | () | |
| Benefits paid | () | | | () | | | () | | | () | | | () | | | () | |
| Balances at end of year | | | | | | | | | | | | | | | | | |
| Plan assets: | | | | | | | | | | | |
| Balances at beginning of year | | | | | | | | | | | | | | | | | |
| Actual returns on plan assets | | | | | | | () | | | () | | | | | | () | |
| | | | | |
| Contributions and other | | | | | | | | | | | | | | |
| Settlements | | | | | | | () | | | () | | | () | |
| | | | | |
| Effect of foreign exchange | | | | | | | () | | | | | | () | |
| Benefits paid | () | | | () | | | () | | | () | | | () | | | () | |
| Balances at end of year | | | | | | | | | | | | | | | | | |
Excess (deficient) plan assets over projected benefit obligations | $ | | | | $ | | | | $ | | | | $ | () | | | $ | () | | | $ | () | |
Assets and liabilities recognized in the Consolidated Balance Sheets: | | | | | | | | | | | |
| Deferred pension assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Other accruals | | | | | | | () | | | () | | | () | |
| Other long-term liabilities | | | | | | | () | | | () | | | () | |
| $ | | | | $ | | | | $ | | | | $ | () | | | $ | () | | | $ | () | |
| Amounts recognized in AOCI: | | | | | | | | | | | |
| Net actuarial gains | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Prior service (costs) credits | () | | | () | | | () | | | | | | | | | | |
| $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
Weighted-average assumptions used to determine projected benefit obligations: | | | | | | | | | | | |
| Discount rate | | % | | | % | | | % | | | % | | | % | | | % |
| Rate of compensation increase | | % | | | % | | | % | | | % | | | % | | | % |
Weighted-average assumptions used to determine net pension cost: | | | | | | | | | | | |
| Discount rate | | % | | | % | | | % | | | % | | | % | | | % |
Expected long-term rate of return on assets | | % | | | % | | | % | | | % | | | % | | | % |
| Rate of compensation increase | | % | | | % | | | % | | | % | | | % | | | % |
, and retired employees covered by these postretirement benefits at December 31, 2024, 2023 and 2022, respectively. | | $ | | | | $ | | | | Service cost | | | | | | | | |
| Interest cost | | | | | | | | |
| Actuarial gain | () | | | () | | | () | |
| Plan amendments | | | | | () | |
| Benefits paid | () | | | () | | | () | |
| Balance at end of year - unfunded | $ | | | | $ | | | | $ | | |
| Liabilities recognized in the Consolidated Balance Sheets: | | | | | |
| Other accruals | $ | () | | | $ | () | | | $ | () | |
| Postretirement benefits other than pensions | () | | | () | | | () | |
| $ | () | | | $ | () | | | $ | () | |
| Amounts recognized in AOCI: | | | | | |
| Net actuarial gains | $ | | | | $ | | | | $ | | |
| Prior service credits | | | | | | | | |
| $ | | | | $ | | | | $ | | |
| Weighted-average assumptions used to determine benefit obligation: | | | | | |
| Discount rate | | % | | | % | | | % |
| Health care cost trend rate - pre-65 | | % | | | % | | | % |
| Health care cost trend rate - post-65 | | % | | | % | | | % |
| Prescription drug cost increases | | % | | | % | | | % |
| Weighted-average assumptions used to determine net periodic benefit cost: | | | | | |
| Discount rate | | % | | | % | | | % |
| Health care cost trend rate - pre-65 | | % | | | % | | | % |
| Health care cost trend rate - post-65 | | % | | | % | | | % |
| Prescription drug cost increases | | % | | | % | | | % |
| | $ | | | | $ | | | | Interest cost | | | | | | | | |
| Amortization of actuarial (gains) losses | () | | | | | | | |
| Amortization of prior service credit | () | | | () | | | () | |
| Net periodic benefit (credit) cost | () | | | () | | | | |
| | | | | |
Other changes in projected benefit obligation recognized in AOCI (before taxes): | | | | | |
| Net actuarial gain arising during the year | () | | | () | | | () | |
| Prior service credit arising during the year | | | | | () | |
| Amortization of actuarial gains (losses) | | | | () | | | () | |
| Amortization of prior service credit | | | | | | | | |
| Total recognized in AOCI | | | | | | | () | |
| Total recognized in net periodic benefit cost and AOCI | $ | () | | | $ | | | | $ | () | |
The estimated net actuarial gains and prior service credits for other postretirement benefits that are expected to be amortized from AOCI into net periodic benefit cost in 2025 are $ million and $ million, respectively.
The assumed health care cost trend rate and prescription drug cost increases used to determine the net periodic benefit cost for postretirement health care benefits for 2025 both decrease in each successive year until reaching % in 2034.
| | 2026 | | |
| 2027 | | |
| 2028 | | |
| 2029 | | |
| 2030 through 2034 | | |
| Total expected benefit cash payments | $ | | |
NOTE 9 –
million and $ million, respectively.Operating and finance lease ROU assets and lease liabilities are recognized based on the present value of lease payments over the lease term. The majority of the operating lease ROU asset and lease liability balances are related to the retail operations of the Paint Stores Group. The majority of the finance lease ROU asset and lease liability balances are related to a distribution facility within the Consumer Brands Group. Most leases include or more options to renew. The exercise of lease renewal options is at the Company’s discretion and is not reasonably certain at lease commencement.
The Company does not account for lease and non-lease components of contracts separately for any underlying asset class. Some leases have variable payments, however, because they are not based on an index or rate, they are not included in the ROU assets and liabilities. Variable payments for real estate leases relate primarily to common area maintenance, insurance, taxes and utilities associated with the properties. Variable payments for equipment leases relate primarily to hours, miles or other quantifiable usage factors which are not determinable at the time the lease agreement is entered into by the Company. The Company has made an accounting policy election by underlying asset class to not apply the recognition requirements of ASC 842 to short-term leases. As a result, certain leases with a term of 12 months or less are not recorded on the Consolidated Balance Sheets and expense is recognized on a straight-line basis over the lease term.
Most leases do not contain an incremental borrowing rate which is readily determinable from their associated contract. Therefore, the Company uses its estimated incremental borrowing rate on a collateralized basis which is derived from information available at the lease commencement date, giving consideration to publicly available credit rating data, other risk characteristics and the term of the lease in determining the present value of lease payments.
| | $ | | | | $ | | | | | | | | |
| Finance lease cost: | | | | | |
| Amortization of right-of-use assets | $ | | | | | | |
| Interest on lease liabilities | | | | | | |
| Total | $ | | | | $ | | | | $ | | |
| | | | | |
| Short-term lease cost | $ | | | | $ | | | | $ | | |
| | | | | |
| Variable lease cost | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | | | | |
|
| Supplemental Cash Flow Information | | | | | |
| Cash paid for amounts included in the measurement of lease liabilities: | | | | | |
| Operating cash outflows from operating leases | $ | | | | $ | | | | $ | | |
| Operating cash outflows from finance leases | | | | | | |
| Financing cash outflows from finance leases | | | | | | |
| | | | | |
| Leased assets obtained in exchange for new lease liabilities: | | | | | |
| Operating leases | $ | | | | $ | | | | $ | | |
| Finance leases | | | | | | |
| | $ | | | | $ | | | | Current portion of operating lease liabilities | | | | | | | | |
| Long-term operating lease liabilities | | | | | | | | |
| | | | | |
| Finance Leases: | | | | | |
| Other assets | $ | | | | | | |
| Other accruals | | | | | | |
| Other long-term liabilities | | | | | | |
| | | | | | | | | | | | | | | | | |
|
|
|
| Balance at December 31, 2024 | | | | | |
(1) During the year ended December 31, 2022, the Company sold treasury shares to fund Company contributions to the domestic defined contribution plan. The related proceeds were $ million.
Dividends
| | $ | | | | $ | | | | Total dividends (in millions) | | | | | | | | |
Treasury Stock
The Company acquires its common stock for general corporate purposes through its publicly announced share repurchase program. As of December 31, 2024, the Company had remaining authorization from its Board of Directors to purchase million shares of its common stock.
| | $ | | | | $ | | | | Treasury stock purchases (shares) | | | | | | | | |
| Average price per share | $ | | | | $ | | | | $ | | |
NOTE 13 –
employees contributed to the Company’s defined contribution savings plan, voluntary to all eligible salaried employees and any employee in a group of employees to which coverage has been extended on a non-discriminatory basis by the plan’s Administration Committee. Participants are allowed to contribute, on a pretax or after-tax basis, up to the lesser of percent of their annual compensation or the maximum dollar amount allowed under the Internal Revenue Code. The Company matches percent of all contributions up to percent of eligible employee contributions. Such participant contributions may be invested in a variety of investment funds or a Company common stock
million, $ million and $ million in 2024, 2023 and 2022, respectively. The Company’s matching contributions to the defined contribution savings plan charged to operations were $ million, $ million and $ million for 2024, 2023 and 2022, respectively. At December 31, 2024, there were shares of the Company’s common stock being held by the defined contribution savings plan, representing % of the total number of voting shares outstanding. Shares of Company common stock credited to each member’s account under the defined contribution savings plan are voted by the trustee under instructions from each individual plan member. Shares for which no instructions are received are voted by the trustee in the same proportion as those for which instructions are received.
NOTE 14 –
shares of common stock, plus any shares relating to awards that expire, are forfeited or canceled. The Company issues new shares upon exercise of option rights (options) and vesting of restricted stock units (RSUs). The 2006 Employee Plan permits the granting of options, appreciation rights, restricted stock, RSUs, performance shares and performance units to eligible employees. At December 31, 2024, appreciation rights, performance shares or performance units had been granted under the 2006 Employee Plan. Shares available for future grants under the 2006 Employee Plan were at December 31, 2024. The 2006 Stock Plan for Nonemployee Directors (Nonemployee Director Plan) authorizes the Board of Directors, or a committee of the Board of Directors, to issue or transfer up to an aggregate of shares of common stock, plus any shares relating to awards that expire, are forfeited or canceled. The Nonemployee Director Plan permits the granting of options, appreciation rights, restricted stock and RSUs to members of the Board of Directors who are not employees of the Company. At December 31, 2024, options or appreciation rights had been granted under the Nonemployee Director Plan. Shares available for future grants under the Nonemployee Director Plan were at December 31, 2024.
million that is expected to be recognized over a weighted-average period of years. | | | | | | | | | | | | | | | | | |
| 2024 | | 2023 | | 2022 |
| Stock-based compensation expense | $ | | | | $ | | | | $ | | |
| Income tax benefit recognized | | | | | | | | |
Excess tax benefits from share-based payments are recognized as an income tax benefit in the Statements of Consolidated Income when options are exercised and RSUs vest. For the years ended December 31, 2024, 2023 and 2022, the Company’s excess tax benefit from options exercised and RSUs vested reduced the income tax provision by $ million, $ million and $ million, respectively.
Options
% | | | % | | | % | | Expected life of options | years | | years | | years |
| Expected dividend yield of stock | | % | | | % | | | % |
| Expected volatility of stock | | % | | | % | | | % |
after the date of grant. Unrecognized compensation expense with respect to options granted to eligible employees amounted to $ million at December 31, 2024. The unrecognized compensation expense is being amortized on a straight-line basis over the vesting period, net of estimated forfeitures based on historical activity, and is expected to be recognized over a weighted-average period of years. | | $ | | | | $ | | | | | | Granted | | | | | | | | | |
| Exercised | () | | | | | | | | |
| Forfeited | () | | | | | | | | |
| Expired | () | | | | | | | | |
Outstanding at December 31, 2024 | | | | | | | $ | | | | |
| | | | | | | |
Exercisable at December 31, 2024 | | | | $ | | | | $ | | | | |
The following table summarizes fair value and intrinsic value information for option activity:
| | | | | | | | | | | | | | | | | |
| 2024 | | 2023 | | 2022 |
| Weighted average grant date fair value per share | $ | | | | $ | | | | $ | | |
| Total fair value of options vested | | | | | | | | |
| Total intrinsic value of options exercised | | | | | | | | |
RSUs
The fair value of each RSU is equal to the market value of a share of the Company’s stock on the grant date. Grants of time-based RSUs, which generally require of continuous employment from the date of grant before vesting and receiving the stock without restriction, have been awarded to certain officers and key employees under the 2006 Employee Plan. The February 2024, 2023 and 2022 grants of performance-based RSUs vest at the end of a period based on the Company’s achievement of specified financial and operating performance goals relating to earnings per share and return on net assets employed.
Unrecognized compensation expense with respect to grants of RSUs to eligible employees amounted to $ million at December 31, 2024. The unrecognized compensation expense is being amortized on a straight-line basis over the vesting period and is expected to be recognized over a weighted-average period of years.
Grants of RSUs have been awarded to nonemployee directors under the Nonemployee Director Plan. These grants generally vest and stock is received without restriction to the extent of one-third of the RSUs for each year following the date of grant. Unrecognized compensation expense with respect to grants of RSUs to nonemployee directors amounted to $ million at December 31, 2024. The unrecognized compensation expense is being amortized on a straight-line basis over the vesting period and is expected to be recognized over a weighted-average period of years.
| | $ | | | | $ | | | | | | Granted | | | | | | | | | |
| Vested | () | | | | | | | | |
| Forfeited | () | | | | | | | | |
Outstanding at December 31, 2024 | | | | $ | | | | $ | | | | |
The following table summarizes the fair value and intrinsic value information for RSU activity:
| | | | | | | | | | | | | | | | | |
| 2024 | | 2023 | | 2022 |
| Weighted average grant date fair value per share | $ | | | | $ | | | | $ | | |
| Intrinsic value of RSUs vested during year | | | | | | | | |
NOTE 15 –
) | | $ | () | | | $ | | | | $ | () | | | Amounts recognized in AOCI | () | | | | | | | | () | |
| Amounts reclassified from AOCI | | | | | | () | | | () | |
Balance at December 31, 2022 | () | | | | | | | | | () | |
| Amounts recognized in AOCI | | | | | | | | | | |
| Amounts reclassified from AOCI | | | () | | | () | | | () | |
Balance at December 31, 2023 | () | | | | | | | | | () | |
| Amounts recognized in AOCI | () | | | | | | | | () | |
| Amounts reclassified from AOCI | | | () | | | () | | | () | |
Balance at December 31, 2024 | $ | () | | | $ | | | | $ | | | | $ | () | |
(1) Includes changes in the fair value of cross currency swap contracts of $ million, $() million and $ million in 2024, 2023 and 2022, respectively. See Note 16.
(2) Net of taxes of $() million, $ million and $() million in 2024, 2023 and 2022, respectively. See Note 8.
(3) Net of taxes of $ million in 2024 and 2023 and $ million in 2022. See Statements of Consolidated Comprehensive Income.
NOTE 16 –
| | August 8, 2025 | | | | | June 1, 2027 |
| | | | March 1, 2028 |
| | | | August 15, 2029 |
| | | | September 1, 2031 |
| $ | | | | |
In August 2024, the Company settled its $ million U.S. dollar to euro cross currency swap contract entered into on March 28, 2023. In May 2024, the Company settled its $ million U.S. dollar to euro cross currency swap contract entered into on February 13, 2020. At the time of both of these settlements, an immaterial unrealized loss was recognized in AOCI.
In December 2023, the Company settled its $ million U.S. dollar to euro cross currency swap contract entered into on August 1, 2023. At the time of settlement, an immaterial unrealized gain was recognized in AOCI.
| | $ | | | | $ | | | | Other assets | | | | | | | | |
| Other accruals | | | | | | | | |
| Other long-term liabilities | | | | | | | | |
The changes in fair value of the cross currency swap contracts are recognized in the foreign currency translation adjustments component of AOCI. See Note 15.
| | $ | () | | | $ | | | | Tax effect | () | | | | | | () | |
| Gains (losses), net of taxes | $ | | | | $ | () | | | $ | | |
Derivatives Not Designated as Hedging Instruments
NOTE 17 –
| | $ | | | | $ | | | | $ | | | | $ | | | | | | $ | | | | $ | | | | $ | | | | Qualified replacement plan | | | | | | | | | | | | | | | | | | | | | |
| Net investment hedges | | | | | | | | | | | | | | | | | | | | | | |
| $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| | | | | | | | | | | | | | | | | |
| Liabilities: | | | | | | | | | | | | | | | | | |
| Net investment hedges | $ | | | | | | | | $ | | | | | | $ | | | | $ | | | | | | |
The deferred compensation plan assets consist of the investment funds maintained for future payments under the Company’s executive deferred compensation plans, which are structured as rabbi trusts. The investments are marketable securities accounted for under the Debt and Equity Securities Topic of the ASC. The level 1 investments are valued using quoted market prices multiplied by the number of shares. The level 2 investments are valued based on vendor or broker models. There was $ million and $ million of deferred compensation plan assets held in partnership funds measured using NAV (or its equivalent) as a practical expedient as of December 31, 2024 and 2023, respectively. These investments are not classified in the fair value hierarchy. The cost basis of all investments within the deferred compensation plan and qualified replacement plan was $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively.
The qualified replacement plan assets consisted of investment funds maintained for future contributions to the Company’s domestic defined contribution pension plan. See Note 8. During 2023, the remaining balance was fully utilized to fund the Company’s domestic defined contribution pension plan. The cost basis of the investment funds was $ million at December 31, 2022.
The net investment hedge asset and liability represent the fair value of the cross currency swaps. See Note 16. The fair value is based on a valuation model that uses observable inputs, including interest rate curves and the euro foreign currency rate.
The carrying amounts reported for Cash and cash equivalents and Short-term borrowings approximate fair value.
The fair value of the Company’s publicly traded debt is based on quoted market prices. The fair value of the Company’s non-publicly traded debt is estimated using discounted cash flow analyses, based on the Company’s current incremental borrowing rates for similar types of borrowing arrangements. The Company’s publicly traded debt and non-traded debt are classified as level 1 and level 2, respectively, in the fair value hierarchy.
| | $ | | | | $ | | | | $ | | | | $ | | | | $ | | | | Non-traded debt | | | | | | | | | | | | | | | | | |
NOTE 18 –
, not to exceed one year. Many customers who purchase on account take advantage of early payment discounts offered by paying within 30 days of being invoiced. The Company estimates variable consideration for these sales on the basis of both historical information and current trends to estimate the expected amount of discounts to which customers are likely to be entitled.The remaining revenue is governed by long-term supply agreements and related purchase orders (contracts) that specify shipping terms and aspects of the transaction price including rebates, discounts and other sales incentives, such as advertising support. Contracts are at standalone pricing. The performance obligation in these contracts is determined by each of the individual purchase orders and the respective stated quantities, with revenue being recognized at a point in time when obligations under the terms of the agreement are satisfied. This generally occurs with the transfer of control of our products to the customer. Sales, value add and other taxes we collect concurrent with revenue-producing activities are excluded from revenue.
See Note 22 for the Company’s disaggregation of Net sales by Reportable Segment. As the Reportable Segments are aligned by similar economic factors, trends and customers, this disaggregation best depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. Approximately % of the Company’s net external sales are in the Company’s North America region (which is comprised of the United States, Canada and the Caribbean region), slightly less than % in the EMEAI region (Europe, Middle East, Africa and India), with the remaining global regions accounting for the residual balance. No individual country outside of the United States is individually significant.
The Company has made payments or given credits for various incentives at the beginning of a long-term contract where future revenue is expected and before satisfaction of performance obligations. Under these circumstances, the Company recognizes a contract asset and amortizes these prepayments over the expected benefit life of the long-term contract, typically on a straight-line basis.
The majority of variable consideration in the Company’s contracts include volume rebates, discounts and other incentives, where the customer receives a retrospective percentage rebate based on the amount of their purchases. In these situations, the rebates are accrued as a fixed percentage of sales and recorded as a reduction of Net sales until paid to the customer per the terms of the contract. Forms of variable consideration such as tiered rebates, whereby a customer receives a retrospective price decrease dependent on the volume of their purchases, are calculated using a forecasted percentage to determine the most likely amount to accrue. Management creates a baseline calculation using historical sales and then utilizing forecast information, estimates the anticipated sales volume each quarter to calculate the expected reduction to Net sales. The remainder of the transaction price is fixed as agreed upon with the customer, limiting estimation of revenues, including constraints.
| | $ | | | | $ | | | | $ | | | | $ | | | | Balance at December 31, 2024 | | | | | | | | | | | | | | |
The difference between the opening and closing balances of the Company’s contract assets and contract liabilities primarily results from the timing difference between the contractual performance obligation and the associated payment.
Provisions for estimated returns are established and the expected costs continue to be recognized as contra-revenue per ASC 606 when the products are sold. The Company only offers an assurance type warranty on products sold, and there is no material service to the customer beyond fixing defects that existed at the time of sale and no warranties are sold separately.
Warranty liabilities are excluded from the table above. Amounts recognized during the year from deferred revenue were not material. The Company records a right of return liability within each of its operations to accrue for expected customer returns. Historical actual returns are used to estimate future returns as a percentage of current sales. Obligations for returns and refunds were not material individually or in the aggregate.
Allowance for Current Expected Credit Losses
| | $ | | | | $ | | | | Bad debt expense | | | | | | | | | |
| Uncollectible accounts written off, net of recoveries | | () | | | () | | | () | |
| Ending balance | | $ | | | | $ | | | | $ | | |
NOTE 19 –
) | | $ | | | | $ | () | | | Gain on divestiture of business (see Note 3) | | | | () | | | | |
| (Gain) loss on sale or disposition of assets | () | | | | | | () | |
| Other | | | | | | | | |
| Total | $ | () | | | $ | | | | $ | () | |
Provisions for environmental matters – net represent initial provisions for site-specific estimated costs of environmental investigation or remediation and increases or decreases to environmental-related accruals as information becomes available upon which more accurate costs can be reasonably estimated and as additional accounting guidelines are issued. Provisions for environmental matters - net for the year ended December 31, 2024 included an immaterial amount of insurance proceeds related to environmental cleanup at a current manufacturing site. See Note 10 for further details on the Company’s environmental-related activities.
The (gain) loss on sale or disposition of assets represents the net realized (gain) loss associated with the sale or disposal of property, plant and equipment and intangible assets previously used in the conduct of the primary business of the Company. (Gain) loss on sale or disposition of assets for the year ended December 31, 2024 included an immaterial amount of insurance proceeds related to a current manufacturing site.
) | | $ | () | | | $ | | | | Loss on extinguishment of debt (see Note 7) | | | | | | | | |
| Net expense from banking activities | | | | | | | | |
| Foreign currency transaction related losses - net | | | | | | | | |
| Miscellaneous pension and benefit (income) expense | () | | | () | | | | |
| Other income | () | | | () | | | () | |
| Other expense | | | | | | | | |
| Total | $ | () | | | $ | | | | $ | | |
Investment (gains) losses primarily relate to the change in market value of the investments held in the deferred compensation plan. See Note 17 for additional information on the fair value of these investments.
Foreign currency transaction related losses - net include the impact from foreign currency transactions, including from highly inflationary economies such as Argentina, and net realized losses from foreign currency option and forward contracts. See Note 16 for further details regarding these foreign currency contracts.
Miscellaneous pension and benefit (income) expense consists of the non-service components of net periodic pension and benefit cost (credit). See Note 8.
Other income and other expense included items of revenue, gains, expenses and losses that were unrelated to the primary business purpose of the Company. There were no items within other income or other expense that were individually significant at December 31, 2024, 2023 and 2022.
NOTE 20 –
| | $ | | | | $ | | | | Foreign | | | | | | | | |
| State and local | | | | | | | | |
| Total current | | | | | | | | |
| Deferred: | | | | | |
| Federal | () | | | () | | | () | |
| Foreign | () | | | () | | | () | |
| State and local | () | | | | | | () | |
| Total deferred | () | | | () | | | () | |
| Total provisions for income taxes | $ | | | | $ | | | | $ | | |
% | | | % | | | % | | Effect of: | | | | | |
| State and local income taxes | | | | | | | | |
| Investment vehicles | () | | | () | | | () | |
| Employee share-based payments | () | | | () | | | () | |
| Research and development credits | () | | | () | | | () | |
| Amended returns and refunds | () | | | | | | | |
| Taxes on non-U.S. earnings | | | | | | | | |
| Other - net | | | | | | | () | |
| Reported effective tax rate | | % | | | % | | | % |
The decrease in the effective tax rate for 2024 compared to 2023 was primarily related to a more favorable impact from tax benefits related to employee share-based payments. The other significant components of the Company’s effective tax rate were consistent year-over-year.
| | $ | | | | $ | | | | Foreign | | | | | | | | |
| $ | | | | $ | | | | $ | | |
Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes using the enacted tax rates and laws that are currently in effect.
| | $ | | | | $ | | | | Employee related and benefit items | | | | | | | | |
| Operating lease liabilities | | | | | | | | |
| Research and development capitalization | | | | | | | | |
| Other items | | | | | | | | |
| Total deferred tax assets | | | | | | | | |
| | | | | |
| Deferred tax liabilities: | | | | | |
| Intangible assets and Property, plant and equipment | | | | | | | | |
| LIFO inventories | | | | | | | | |
| Operating lease right-of-use assets | | | | | | | | |
| Other items | | | | | | | | |
| Total deferred tax liabilities | | | | | | | | |
| | | | | |
Net deferred tax liabilities | $ | | | | $ | | | | $ | | |
Netted against the Company’s other deferred tax assets were valuation allowances of $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively. The Company has $ million of domestic net operating loss carryforwards acquired through acquisitions that have expiration dates through tax year 2037, foreign tax credits of $ million that expire in calendar years 2028 through 2034 and foreign net operating losses of $ million. The foreign net
| | $ | | | | $ | | | | Additions based on tax positions related to the current year | | | | | | | | |
| Additions for tax positions of prior years | | | | | | | | |
| Reductions for tax positions of prior years | () | | | () | | | () | |
| Settlements | () | | | () | | | () | |
| Lapses of statutes of limitations | () | | | () | | | () | |
| Balance at end of year | $ | | | | $ | | | | $ | | |
The decrease in unrecognized tax benefits was primarily related to settlements of federal adjustments with the IRS in the tax years 2017 through 2019. There were also additions in unrecognized tax benefits related to the reversal of benefits recognized from certain positions taken on current and prior year income tax returns filed in U.S. federal and various state jurisdictions. These additions were partially offset by various positions taken on prior year income tax returns filed in U.S. and various foreign jurisdictions that were no longer deemed to be at risk. At December 31, 2024, 2023 and 2022, the total amount of unrecognized tax benefits that, if recognized, would affect the effective tax rate was $ million, $ million and $ million, respectively.
Included in the balance of unrecognized tax benefits at December 31, 2024 is $ million related to tax positions for which it is reasonably possible that the total amounts could significantly change during the next twelve months. This amount represents a decrease in unrecognized tax benefits comprised primarily of items related to federal audits of partnership investments and expiring statutes in federal, foreign and state jurisdictions.
The Company classifies all income tax related interest and penalties as income tax expense. During the year ended December 31, 2024, there was an increase in income tax interest and penalties of $ million. During the years ended December 31, 2023 and 2022, there was an increase in income tax interest and penalties of $ million and $ million, respectively. The Company accrued $ million, $ million and $ million at December 31, 2024, 2023 and 2022, respectively, for the potential payment of interest and penalties.
NOTE 21 –
| | $ | | | | $ | | | | Weighted average shares outstanding | | | | | | | | |
| Basic net income per share | $ | | | | $ | | | | $ | | |
| | | | | |
| Diluted | | | | | |
| Net income | $ | | | | $ | | | | $ | | |
| Weighted average shares outstanding assuming dilution: | | | | | |
| Weighted average shares outstanding | | | | | | | | |
Stock options and other contingently issuable shares (1) | | | | | | | | |
|
| Weighted average shares outstanding assuming dilution | | | | | | | | |
| Diluted net income per share | $ | | | | $ | | | | $ | | |
(1) Stock options and other contingently issuable shares excludes million, million and million shares at December 31, 2024, 2023 and 2022, respectively, due to their anti-dilutive effect.
NOTE 22 –
reportable operating segments: Paint Stores Group, Consumer Brands Group and Performance Coatings Group (individually, a Reportable Segment and collectively, the Reportable Segments). Factors considered in determining the Reportable Segments of the Company include the nature of business activities, the management structure directly accountable to the Company’s Chief Operating Decision Maker (CODM) for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors. The Company reports all other business activities within the Administrative function. The Company’s CODM has been identified as the Chair, President and Chief Executive Officer because she has the final authority over performance assessment and resource allocation decisions. Because of the diverse operations of the Company, the CODM regularly receives and uses discrete financial information about each Reportable Segment as well as select supplemental financial information about certain divisions, business units or subsidiaries of the Company. The CODM uses all such financial information for performance assessments and resource allocation decisions. The CODM evaluates the performance of and allocates resources to the Reportable Segments based on Segment profit or loss, which represents the segments’ Income before income taxes. The accounting policies of the Reportable Segments are the same as those described in Note 1.
The Paint Stores Group consisted of company-operated specialty paint stores in the United States, Canada and the Caribbean region at December 31, 2024. Each store in this segment is engaged in servicing the needs of architectural and industrial paint contractors and do-it-yourself homeowners. These stores market and sell Sherwin-Williams® and other controlled brand architectural paint and coatings, protective and marine products, OEM product finishes and related products. The majority of these products are produced by manufacturing facilities in the Consumer Brands Group. In addition, each store sells select purchased associated products. The loss of any single customer would not have a material adverse effect on the business of this segment. During 2024, this segment opened net new stores, consisting of new stores opened and stores closed. In 2023 and 2022, this segment opened and net new stores, respectively. In accordance with ASC 280-10-50-9, the Paint Stores Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment.
The Consumer Brands Group manufactures and supplies a broad portfolio of branded and private-label architectural paint, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks and adhesives to retailers, including home centers and hardware stores, dedicated dealers and distributors throughout North America, Latin America and Europe. Sales and marketing of certain controlled brand and private-label products is performed by a direct sales staff. The products distributed through third-party customers are intended for resale to the ultimate
company-operated specialty paint stores in Latin America at December 31, 2024. Each store in this segment is engaged in servicing the needs of home, commercial and industrial projects to contractors and do-it-yourself customers in Latin America. These stores market and sell Sherwin-Williams® and other controlled brand architectural paint and coatings, protective and marine products, OEM product finishes and related products which are branded for the Latin America market. In addition, each store sells select purchased associated products. The Consumer Brands Group had sales to certain customers that, individually, may be a significant portion of the sales and related profitability of the segment. During 2024, the segment opened net new stores, consisting of stores opened and stores closed. In 2023 and 2022, this segment opened (closed) and () net new stores, respectively.The Consumer Brands Group also supports the Company’s other businesses around the world with new product research and development, manufacturing, distribution and logistics. Approximately % of the total sales of the Consumer Brands Group in 2024 were intersegment transfers of products primarily sold through the Paint Stores Group. This segment incurred most of the Company’s capital expenditures related to ongoing environmental compliance measures, manufacturing capacity expansion, operational efficiencies and maintenance projects at sites currently in operation. In accordance with ASC 280-10-50-9, the Consumer Brands Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment.
The Performance Coatings Group develops and sells industrial coatings for wood finishing and general industrial (metal and plastic) applications, automotive refinish, protective and marine coatings, coil coatings, packaging coatings and performance-based resins and colorants worldwide. This segment licenses certain technology and trade names worldwide, including Sherwin-Williams® and other controlled brand products which are distributed through the Paint Stores Group, this segment’s company-operated branches and by a direct sales staff and outside sales representatives to retailers, dealers, jobbers, licensees and other third-party distributors. The Performance Coatings Group had sales to certain customers that, individually, may be a significant portion of the sales of the segment. However, the loss of any single customer would not have a material adverse effect on the overall profitability of the segment. During 2024, the segment added new branches ( branches were closed). In 2023 and 2022, this segment added and net new branches, respectively. In accordance with ASC 280-10-50-9, the Performance Coatings Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment.
The Administrative function includes the administrative expenses and assets of the Company’s new global headquarters and research and development center, both currently under construction. In addition, it includes the operations of a real estate management unit that is responsible for the ownership, management and leasing of non-retail properties held primarily for use by the Company, including the Company’s current global headquarters and research and development center and disposal of idle facilities. The Administrative function’s remaining assets consist primarily of cash and cash equivalents, investments and deferred pension assets. Also included in the Administrative function was interest expense, interest and investment income, certain expenses related to closed facilities and environmental-related matters and other expenses that were not directly associated with the Reportable Segments. Sales of this function represented external leasing revenue. The Administrative function did not include any significant foreign operations. Gains and losses from the sale of property were not a significant operating factor in determining the performance of the Administrative function.
Net external sales of all consolidated foreign subsidiaries were $ billion, $ billion and $ billion for 2024, 2023 and 2022, respectively.
Long-lived assets consisted of Property, plant and equipment, net, Goodwill, Intangible assets, net, Operating lease right-of-use assets, deferred pension assets and Other assets. The aggregate total of long-lived assets for the Company was $ billion, $ billion and $ billion at December 31, 2024, 2023 and 2022, respectively. Long-lived assets of consolidated foreign subsidiaries totaled $ billion, $ billion and $ billion at December 31, 2024, 2023 and 2022, respectively.
Total Assets of the Company were $ billion, $ billion and $ billion at December 31, 2024, 2023 and 2022, respectively. Total assets of consolidated foreign subsidiaries were $ billion, $ billion and $ billion, which represented %, % and % of the Company’s total assets at December 31, 2024, 2023 and 2022, respectively.
No single geographic area outside the United States was significant relative to consolidated Net sales or consolidated long-lived assets. Export sales and sales to any individual customer were each less than 10 percent of consolidated sales to unaffiliated customers during all years presented.
| | $ | | | | $ | | | | $ | | | | $ | | | | Intersegment transfers | — | | | | | | | | | () | | | — | |
| Total net sales and intersegment transfers | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| | | | | | | | | |
| Cost of goods sold | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| Selling, general and administrative expenses | | | | | | | | | | | | | | |
| Interest expense | | | | | | | | | | | | | | |
Other segment items (1) | () | | | | | | () | | | () | | | () | |
| Income before income taxes | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| % to Net sales | | % | | | % | | | % | | nm | | | % |
| | | | | | | | | |
| Supplemental Information: | | | | | | | | | |
| Identifiable assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Capital expenditures | | | | | | | | | | | | | | |
Depreciation (2) | | | | | | | | | | | | | | |
Amortization (3) | | | | | | | | | | | | | | |
| | | | | | | | | |
| nm - not meaningful | | | | | | | | | |
(1) Other segment items includes Other general (income) expense - net, Interest income and Other (income) expense - net. See Note 19.
(2) Depreciation is recorded within Cost of goods sold and Selling, general and administrative expenses.
(3) Amortization is recorded within Selling, general and administrative expenses.
| | $ | | | | $ | | | | $ | | | | $ | | | | Intersegment transfers | — | | | | | | | | | () | | | — | |
| Total net sales and intersegment transfers | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| | | | | | | | | |
| Cost of goods sold | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| Selling, general and administrative expenses | | | | | | | | | | | | | | |
| Interest expense | | | | | | | | | | | | | | |
Other segment items (1) | () | | | | | | | | | | | | | |
| Income before income taxes | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| % to Net sales | | % | | | % | | | % | | nm | | | % |
| | | | | | | | | |
| Supplemental Information: | | | | | | | | | |
| Identifiable assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Capital expenditures | | | | | | | | | | | | | | |
Depreciation (2) | | | | | | | | | | | | | | |
Amortization (3) | | | | | | | | | | | | | | |
| | | | | | | | | |
| nm - not meaningful | | | | | | | | | |
(1) Other segment items includes Other general (income) expense - net, Impairment, Interest income and Other (income) expense - net. See Notes 3 and 6 for information on Impairment and Note 19 for information on Other general (income) expense - net and Other (income) expense - net.
(2) Depreciation is recorded within Cost of goods sold and Selling, general and administrative expenses.
(3) Amortization is recorded within Selling, general and administrative expenses.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| 2022 |
| Paint
Stores
Group | | Consumer Brands
Group | | Performance Coatings
Group | | Administrative | | Consolidated
Totals |
| Net sales | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Intersegment transfers | — | | | | | | | | | () | | | — | |
| Total net sales and intersegment transfers | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| | | | | | | | | |
| Cost of goods sold | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| Selling, general and administrative expenses | | | | | | | | | | | | | | |
| Interest expense | | | | | | | | | | | | | | |
Other segment items (1) | () | | | | | | | | | | | | | |
| Income before income taxes | $ | | | | $ | | | | $ | | | | $ | () | | | $ | | |
| % to Net sales | | % | | | % | | | % | | nm | | | % |
| | | | | | | | | |
| Supplemental Information: | | | | | | | | | |
| Identifiable assets | $ | | | | $ | | | | $ | | | | $ | | | | $ | | |
| Capital expenditures | | | | | | | | | | | | | | |
Depreciation (2) | | | | | | | | | | | | | | |
Amortization (3) | | | | | | | | | | | | | | |
| | | | | | | | | |
| nm - not meaningful | | | | | | | | | |
(1) Other segment items includes Other general (income) expense - net, Impairment, Interest income and Other (income) expense - net. See Note 6 for information on Impairment and Note 19 for information on Other general (income) expense - net and Other (income) expense - net.
(2) Depreciation is recorded within Cost of goods sold and Selling, general and administrative expenses.
.
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
None.
ITEM 9A. CONTROLS AND PROCEDURES
Disclosure Controls and Procedures
As of the end of the period covered by this report, we carried out an evaluation, under the supervision and with the participation of our Chair, President and Chief Executive Officer and our Senior Vice President – Finance and Chief Financial Officer, of the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15 and Rule 15d-15 of the Securities Exchange Act of 1934, as amended (Exchange Act). Based upon that evaluation, our Chair, President and Chief Executive Officer and our Senior Vice President – Finance and Chief Financial Officer concluded that as of the end of the period covered by this report, our disclosure controls and procedures were effective to ensure that information required to be disclosed by us in reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms, and accumulated and communicated to our management, including our Chair, President and Chief Executive Officer and our Senior Vice President – Finance and Chief Financial Officer, to allow timely decisions regarding required disclosure.
Internal Control Over Financial Reporting
The “Report of Management on Internal Control over Financial Reporting” and the “Report of the Independent Registered Public Accounting Firm on Internal Control over Financial Reporting” are set forth in Item 8.
There have been no changes in our internal control over financial reporting identified in connection with the evaluation that occurred during the period covered by this report that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
ITEM 9B. OTHER INFORMATION
Trading Arrangements
During the quarter ended December 31, 2024, none of the Company’s directors or “officers,” as defined in Rule 16a-1(f) of the Exchange Act, , modified, or a “Rule 10b5-1 trading arrangement” or a “non-Rule 10b5-1 trading arrangement,” as each term is defined in Item 408 of Regulation S-K.
ITEM 9C. DISCLOSURE REGARDING JURISDICTIONS THAT PREVENT INSPECTIONS
Not applicable.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
Directors
The information regarding our directors and director nominees is set forth in our Proxy Statement under the caption “Proposal 1 – Election of 9 Directors” and is incorporated herein by reference.
There have been no material changes to the procedures by which security holders may recommend nominees to our Board of Directors. Please refer to the information set forth in our Proxy Statement under the caption “Board Committees,” which is incorporated herein by reference.
Executive Officers
The information regarding our executive officers is set forth under the caption “Information About Our Executive Officers” in Part I of this report, which is incorporated herein by reference.
Section 16(a) Beneficial Ownership Reporting Compliance
To the extent disclosure of any delinquent form under Section 16(a) of the Securities Exchange Act of 1934 is made by the Company, such disclosure will be set forth in our Proxy Statement under the caption “Delinquent Section 16(a) Reports” and is incorporated herein by reference.
Audit Committee
The information regarding the Audit Committee of our Board of Directors and audit committee financial experts is set forth in our Proxy Statement under the caption “Board Committees” and is incorporated herein by reference.
Code of Ethics
We have adopted a Code of Conduct, which applies to all directors, officers and employees, including our principal executive officer, principal financial officer, principal accounting officer or controller and persons performing similar functions, of Sherwin-Williams and our subsidiaries wherever located. Our Code of Conduct contains the general guidelines and principles for conducting Sherwin-Williams’ business consistent with the highest standards of business ethics.
We have also adopted a Code of Ethics for Senior Financial Management, pursuant to which our chief executive officer, chief financial officer and senior financial management are responsible for creating and maintaining a culture of high ethical standards and of commitment to compliance throughout our Company to ensure the fair and timely reporting of Sherwin-Williams’ financial results and condition. Senior financial management includes the controller, the treasurer, the principal financial/accounting personnel in our operating groups and divisions and all other financial/accounting personnel within our corporate departments and operating groups and divisions with staff supervision responsibilities.
Our Code of Conduct and Code of Ethics for Senior Financial Management are available on our Investor Relations website, investors.sherwin.com.
We intend to disclose on our Investor Relations website, investors.sherwin.com, any amendment to, or waiver from, a provision of our Code of Conduct or Code of Ethics for Senior Financial Management that applies to our directors and executive officers, including our principal executive officer, principal financial officer, principal accounting officer or controller or any persons performing similar functions, and that is required to be publicly disclosed pursuant to the rules of the SEC.
Insider Trading Policy
The information regarding our Insider Trading Policy is set forth in our Proxy Statement under the caption “Insider Trading Policy” and is incorporated herein by reference. A copy of our Insider Trading Policy is filed with this Annual Report on Form 10-K as Exhibit 19.
ITEM 11. EXECUTIVE COMPENSATION
The information required by this item is set forth in our Proxy Statement under the captions “2024 Director Compensation Table,” “Director Compensation Program,” “Executive Compensation,” “Executive Compensation Tables” and “2024 CEO Pay Ratio” and is herein by reference (other than the Compensation Committee Report, which will be deemed furnished).
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS
The information regarding security ownership of certain beneficial owners and management is set forth in our Proxy Statement under the captions “Security Ownership of Management, Directors and Director Nominees” and “Security Ownership of Certain Beneficial Owners” and is incorporated herein by reference.
The information regarding securities authorized for issuance under the Company’s equity compensation plans is set forth in our Proxy Statement under the caption “Equity Compensation Plan Information” and is incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE
The information required by this item is set forth in our Proxy Statement under the captions “Certain Relationships and Transactions with Related Persons” and “Director Independence” and is incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
The information required by this item is set forth in our Proxy Statement under the caption “Matters Relating to the Independent Registered Public Accounting Firm” and is incorporated herein by reference.
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)(1)Financial Statements
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| Page Number in Form 10-K |
| Statements of Consolidated Income | |
| Statements of Consolidated Comprehensive Income | |
| Consolidated Balance Sheets | |
| Statements of Consolidated Cash Flows | |
| Statements of Consolidated Shareholders’ Equity | |
| Notes to Consolidated Financial Statements | |
(2)
| | $ | | | | $ | | | Additions (deductions) (1) | | | | | | | | |
|
| Ending balance | $ | | | | $ | | | | $ | | |
(3) Exhibits
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| 3.1 | |
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| 3.2 | |
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| 3.3 | |
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| 4.1 | |
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| 4.2 | |
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| 4.2.1 | |
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| 4.3 | |
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| 4.3.1 | |
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| 4.3.2 | |
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| 4.3.3 | |
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| 4.3.4 | |
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| 4.3.5 | |
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| 4.3.6 | |
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| 4.3.7 | |
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| 4.3.8 | |
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| 4.3.9 | |
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| 4.3.10 | |
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| 4.3.11 | |
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| 4.3.12 | |
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| 4.4 | |
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| 4.4.1 | |
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| 4.4.2 |
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| 4.4.3 | |
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| 10.1 | Credit Agreement, dated as of May 9, 2016, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 9, 2016, and incorporated herein by reference. |
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| 10.1.1 | Amendment No. 1 to the Credit Agreement, dated as of May 12, 2016, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 12, 2016, and incorporated herein by reference. |
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| 10.1.2 | Amendment No. 2 to the Credit Agreement, dated as of June 20, 2016, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated June 20, 2016, and incorporated herein by reference. |
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| 10.1.3 | Amendment No. 3 to the Credit Agreement, dated as of August 1, 2016, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 1, 2016, and incorporated herein by reference. |
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| 10.1.4 | Amendment No. 4 to the Credit Agreement, dated as of January 31, 2017, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated January 31, 2017, and incorporated herein by reference. |
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| 10.1.5 | Amendment No. 5 to the Credit Agreement, dated as of February 13, 2017, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 13, 2017, and incorporated herein by reference. |
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| 10.1.6 | Amendment No. 6 to the Credit Agreement, dated as of February 27, 2017, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 27, 2017, and incorporated herein by reference. |
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| 10.1.7 | Amendment No. 7 to the Credit Agreement, dated as of May 8, 2017, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 8, 2017, and incorporated herein by reference. |
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| 10.1.8 | Amendment No. 8 to the Credit Agreement, dated as of May 11, 2017, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 11, 2017, and incorporated herein by reference. |
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| 10.1.9 | Amendment No. 9 to the Credit Agreement, dated as of February 27, 2018, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 27, 2018, and incorporated herein by reference. |
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| 10.1.10 | Amendment No. 10 to the Credit Agreement, dated as of July 26, 2018, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated July 26, 2018, and incorporated herein by reference. |
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| 10.1.11 | Amendment No. 11 to the Credit Agreement, dated as of September 14, 2020, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated September 14, 2020, and incorporated herein by reference. |
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| 10.1.12 | Amendment No. 12 to the Credit Agreement, dated as of November 9, 2020, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 9, 2020, and incorporated herein by reference. |
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| 10.1.13 | Amendment No. 13 to the Credit Agreement, dated as of December 7, 2020, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated December 7, 2020, and incorporated herein by reference. |
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| 10.1.14 | Amendment No. 14 to the Credit Agreement, dated as of February 16, 2021, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 16, 2021, and incorporated herein by reference. |
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| 10.1.15 | Amendment No. 15 to the Credit Agreement, dated as of May 3, 2021, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 3, 2021, and incorporated herein by reference. |
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| 10.1.16 | Amendment No. 16 to the Credit Agreement, dated as of May 23, 2022, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 23, 2022, and incorporated herein by reference. |
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| 10.1.17 | Amendment No. 17 to the Credit Agreement, dated as of October 31, 2022, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated October 31, 2022, and incorporated herein by reference. |
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| 10.1.18 | Amendment No. 18 to the Credit Agreement, dated as of November 28, 2022, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 28, 2022, and incorporated herein by reference. |
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| 10.1.19 | Amendment No. 19 to the Credit Agreement, dated as of May 1, 2023, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated May 1, 2023, and incorporated herein by reference. |
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| 10.1.20 | Amendment No. 20 to the Credit Agreement, dated as of November 18, 2024, by and among the Company, Citicorp USA, Inc., as administrative agent and issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 18, 2024, and incorporated herein by reference. |
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| 10.2 | |
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| 10.2.1 | |
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| 10.3 | Amended and Restated Credit Agreement, dated as of August 2, 2021, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 2, 2021, and incorporated herein by reference. |
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| 10.3.1 | Amendment No. 1 to the Amended and Restated Credit Agreement, dated as of August 6, 2021, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 6, 2021, and incorporated herein by reference. |
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| 10.3.2 | Amendment No. 2 to the Amended and Restated Credit Agreement, dated as of November 18, 2021, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 18, 2021, and incorporated herein by reference. |
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| 10.3.3 | Amendment No. 3 to the Amended and Restated Credit Agreement, dated as of November 30, 2021, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated November 30, 2021, and incorporated herein by reference. |
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| 10.3.4 | Amendment No. 4 to the Amended and Restated Credit Agreement, dated as of August 15, 2022, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 15, 2022, and incorporated herein by reference. |
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| 10.3.5 | Amendment No. 5 to the Amended and Restated Credit Agreement, dated as of August 26, 2022, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 26, 2022, and incorporated herein by reference. |
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| 10.3.6 | Amendment No. 6 to the Amended and Restated Credit Agreement, dated as of September 8, 2022, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated September 8, 2022, and incorporated herein by reference. |
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| 10.3.7 | Amendment No. 7 to the Amended and Restated Credit Agreement, dated as of September 14, 2022, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated September 14, 2022, and incorporated herein by reference. |
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| 10.3.8 | Amendment No. 8 to the Amended and Restated Credit Agreement, dated as of February 28, 2023, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated February 28, 2023, and incorporated herein by reference. |
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| 10.3.9 | Amendment No. 9 to the Amended and Restated Credit Agreement, dated as of May 1, 2024, by and among the Company, Goldman Sachs Bank USA, as administrative agent, Goldman Sachs Mortgage Company, as issuing bank, and the lenders party thereto, filed as Exhibit 4.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2024, and incorporated herein by reference. |
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| 10.4 | Credit Agreement, dated as of July 31, 2024, by and among The Sherwin-Williams Company, Sherwin-Williams Canada Inc. and Sherwin-Williams Luxembourg S.à r.l., as borrowers, the lenders party thereto, the issuing lenders party thereto and Citibank, N.A., as administrative agent, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 2, 2024, and incorporated herein by reference. |
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| *10.5 | |
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| *10.5.1 | |
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| *10.6 | |
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^ *10.7 | |
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| *10.8 | |
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| *10.9 | |
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| *10.10 | |
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| *10.11 | The Sherwin-Williams Company Executive Disability Income Plan filed as Exhibit 10(g) to the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 1991 (SEC File Number 001-04851), and incorporated herein by reference. |
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| *10.11.1 | |
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| *10.12 | |
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| *10.13 | |
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| *10.14 | |
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| *10.14.1 | |
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| *10.14.2 | |
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| *10.14.3 | |
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| *10.14.4 | |
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| *10.14.5 | |
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| *10.14.6 | |
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| *10.14.7 | |
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| *10.14.6 | |
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| *10.14.9 | |
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| *10.15 | |
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| *10.15.1 | |
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| *10.16 | |
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| *10.17 | |
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| 19.1 | |
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| 21.1 | |
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| 23.1 | |
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| 24.1 | |
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| 24.2 | |
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| 31.1 | |
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| 31.2 | |
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| 32.1 | |
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| 32.2 | |
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| *97.1 | |
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| 101.INS | Inline XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the Inline XBRL document. |
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| 101.SCH | Inline XBRL Taxonomy Extension Schema Document |
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| 101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document |
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| 101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document |
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| 101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document |
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| 101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document |
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| 104 | The cover page from this Annual Report on Form 10-K for the fiscal year ended December 31, 2024, formatted in Inline XBRL and contained in Exhibit 101. |
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| ^ | Certain exhibits and schedules have been omitted in accordance with Item 601(a)(5) of Regulation S-K and the Company agrees to furnish supplementally to the SEC a copy of any omitted exhibits and schedules upon request. |
| * | Management contract or compensatory plan or arrangement. |
ITEM 16. FORM 10-K SUMMARY
None.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Company has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, on February 20, 2025.
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities indicated on February 20, 2025.
| | | | | | | | |
| THE SHERWIN-WILLIAMS COMPANY |
| |
| By: | /S/ | MARY L. GARCEAU |
| | Mary L. Garceau, Secretary |
| | | | | | | | |
| * HEIDI G. PETZ | | Chair, President and Chief Executive Officer, Director
(Principal Executive Officer) |
| Heidi G. Petz | |
| * ALLEN J. MISTYSYN | | Senior Vice President – Finance and Chief Financial Officer (Principal Financial Officer) |
| Allen J. Mistysyn | |
| * J. PAUL LANG | | Senior Vice President – Enterprise Finance and Chief Accounting Officer (Principal Accounting Officer) |
| J. Paul Lang | |
| * KERRII B. ANDERSON | | Director |
| Kerrii B. Anderson | |
| * ARTHUR F. ANTON | | Director |
| Arthur F. Anton | |
| * JEFF M. FETTIG | | Director |
| Jeff M. Fettig | |
| * JOHN G. MORIKIS | | Director |
| John G. Morikis | |
| * CHRISTINE A. POON | | Director |
| Christine A. Poon | |
| * AARON M. POWELL | | Director |
| Aaron M. Powell | | |
| * MARTA R. STEWART | | Director |
| Marta R. Stewart | | |
| * MICHAEL H. THAMAN | | Director |
| Michael H. Thaman | |
| * MATTHEW THORNTON III | | Director |
| Matthew Thornton III | |
| * THOMAS L. WILLIAMS | | Director |
| Thomas L. Williams | |
| | | | | |
| * | The undersigned, by signing her name hereto, does sign this report on behalf of the designated officers and directors of the Company pursuant to powers of attorney executed on behalf of each such officer and director and filed as an exhibit to this report. |
| | | | | | | | | | | | | | |
| By: | /S/ | MARY L. GARCEAU | | February 20, 2025 |
| | Mary L. Garceau, Attorney-in-fact | | |
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