Highlights

• Sales increased 8 percent to $2,352 million; in local currency, sales increased 11 percent
• Operating profit was $408 million and operating margin was 17.3 percent; adjusted operating profit was $414 million and adjusted operating margin was 17.6 percent
• Earnings per share was $1.18; adjusted earnings per share matched prior year at $1.14
• Repurchased 10.4 million shares for $550 million
• Anticipate 2022 earnings per share in the range of $4.19 - $4.29 per share, and on an adjusted basis, in the range of $4.15 - $4.25 per share, narrowed from the previous range of $4.15 - $4.35 per share

Masco Corporation (NYSE: MAS), one of the world’s leading manufacturers of branded home improvement and building products, reported its second quarter results.

2022 Second Quarter Results

• On a reported basis, compared to second quarter 2021:
  • Net sales increased 8 percent to $2,352 million; in local currency and excluding acquisitions and divestitures, net sales increased 11 percent
  • North American sales increased 11 percent and international sales decreased 3 percent; in local currency, North American sales increased 11 percent and international sales increased 8 percent
  • Gross margin decreased 360 basis points to 32.7 percent from 36.3 percent
  • Operating profit decreased 7 percent to $408 million
  • Operating margin decreased 280 basis points to 17.3 percent from 20.1 percent
  • Net income (loss) increased to $1.18 per share, compared to $(0.14) per share
• Compared to second quarter 2021, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 25 percent, were as follows:
  • Gross margin decreased 330 basis points to 33.0 percent compared to 36.3 percent
  • Operating profit decreased 5 percent to $414 million from $438 million
  • Operating margin decreased 250 basis points to 17.6 percent compared to 20.1 percent
  • Net income matched prior year at $1.14 per share
• Liquidity as of June 30, 2022 was $1,440 million (including availability under our revolving credit facility)
• Plumbing Products’ net sales increased 3 percent; in local currency and excluding acquisitions and divestitures, sales increased 8 percent
• Decorative Architectural Products’ net sales increased 15 percent; in local currency, sales increased 16 percent

“In this challenging environment, I am proud of the results our team has achieved in the first half of 2022,” said Masco President and CEO, Keith Allman. “We delivered another strong quarter with sales growth of 8 percent and continued to execute our capital deployment strategy by returning $614 million to shareholders through dividends and share repurchases during the quarter.”

“As we enter the second half of the year, we expect growth to be more modest than the first half and largely driven by pricing actions,” continued Allman. “We continue to position ourselves for profitable growth while mitigating the impacts of the challenging supply chain environment. Given moderating demand and additional foreign currency headwinds, we are narrowing our previous guidance and now anticipate our adjusted earnings per share for 2022 to be in the range of $4.15 to $4.25 per share, a 14 percent increase compared to 2021 at the midpoint, from our previous expectation of $4.15 to $4.35 per share,” concluded Allman.

Dividend Declaration

Masco’s Board of Directors declared a quarterly dividend of $0.28 per share payable on August 29, 2022 to shareholders of record on August 12, 2022.

About Masco

Headquartered in Livonia, Michigan, Masco Corporation is a global leader in the design, manufacture and distribution of branded home improvement and building products. Our portfolio of industry-leading brands includes Behr® paint; Delta® and Hansgrohe® faucets, bath and shower fixtures; Kichler® decorative and outdoor lighting; and HotSpring® spas. We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders. For more information about Masco Corporation, visit www.masco.com.

The second quarter 2022 supplemental material, including a presentation in PDF format, is available on Masco’s website at www.masco.com.

Conference Call Detail

A conference call regarding items contained in this release is scheduled for Thursday, July 28, 2022 at 8:00 a.m. ET. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (844) 200-6205 from the U.S., (833) 950-0062 from Canada, and (929) 526-1599 from all other locations. Please use the conference identification number 593826. Alternatively, you can pre-register for the call using this link: https://ige.netroadshow.com/registration/q4inc/11232/masco-corporation-2022-second-quarter-conference-call/

The conference call will be webcast simultaneously and in its entirety through Masco’s website. Shareholders, media representatives and others interested in Masco may participate in the webcast by registering through the Investor Relations section on Masco’s website.

A replay of the call will be available on Masco’s website or by phone by dialing (866) 813-9403 from the U.S., (226) 828-7578 from Canada, and +44 204 525 0658 from all other locations. Please use the conference identification number 256946. The telephone replay will be available approximately two hours after the end of the call and continue through August 28, 2022.

Safe Harbor Statement

This press release contains statements that reflect our views about our future performance and constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,” “anticipate,” “appear,” “may,” “will,” “should,” “intend,” “plan,” “estimate,” “expect,” “assume,” “seek,” “forecast,” and similar references to future periods. Our views about future performance involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. We caution you against relying on any of these forward-looking statements.

Our future performance may be affected by the levels of residential repair and remodel activity, and to a lesser extent, new home construction, our ability to maintain our strong brands and reputation and to develop innovative products, our ability to maintain our competitive position in our industries, our reliance on key customers, the duration of the ongoing COVID-19 pandemic, including its impact on domestic and international economic activity, consumer discretionary spending, our employees and our supply chain, the cost and availability of materials, our dependence on third-party suppliers and service providers, extreme weather events and changes in climate, risks associated with our international operations and global strategies, our ability to achieve the anticipated benefits of our strategic initiatives, our ability to successfully execute our acquisition strategy and integrate businesses that we have and may acquire, our ability to attract, develop and retain talented and diverse personnel, risks associated with our reliance on information systems and technology, and risks associated with cybersecurity vulnerabilities, threats and attacks. These and other factors are discussed in detail in Item 1A. "Risk Factors" in our most recent Annual Report on Form 10-K, as well as in our Quarterly Reports on Form 10-Q and in other filings we make with the Securities and Exchange Commission. Any forward-looking statement made by us speaks only as of the date on which it was made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events or otherwise.