Sales flat at Sherwin-Williams

Paint manufacturer Sherwin-Williams reported sales of $1.57 billion for its first fiscal quarter, a 1% rise over sales of $1.56 billion in the same period a year ago. The rise, attributed to the favorable impact of foreign currency translation rate changes, was partially offset by a decline in domestic paint sales volume.

During the quarter, net sales from stores open for more than 12 months decreased 5.4% over last year’s first quarter.

Net income for the first quarter, which ended on March 31, was $32.6 million, down 13% from $37.3 million a year ago. The rising costs of raw materials and the “unfavorable impact of the healthcare legislation” were cited as two factors pulling down on profits.

Commenting on the financial results for the first quarter, company chairman and CEO Christopher Connor said, “Sales in the quarter were slightly stronger than we anticipated, although domestic demand remains soft. Paint Stores Group volume decreased at the lowest rate since the fourth quarter of 2008, due to improvements in certain architectural segments. Our operating segment management teams continue to control costs and have announced or implemented price increases to help mitigate increasing raw material costs.”

The Cleveland-based company opened three new locations in its Paint Stores Group this past quarter and expects to open 40 to 50 new stores, “while slowing the rate at which we close redundant store locations,” Connor said.

Despite weak sales during the first quarter, Connor predicted a “high single-digit increase” in net sales during the second quarter when compared with a year ago. “For the full year 2010, we expect consolidated net sales to increase above 2009 levels by a mid-to-high single-digit percentage,” Connor added.

Sherwin-Williams manufactures a number of private-label and branded paint lines, including Dutch Boy, Krylon, Minwax and Thompson’s Water Seal.