RPM International Inc.

Good morning and welcome to the RPM International Fiscal Fourth Quarter and Fiscal Year 2025 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. Please note this event is being recorded. I would now like to turn the conference over to Matt Schlarb, Vice President of Investor Relations and Sustainability. Please go ahead.

Thank you, Gary, and welcome to RPM International's conference call for the Fiscal 2025 Fourth Quarter and Full Year. Today's call is being recorded. Joining today's call are Frank Sullivan, RPM's Chair and CEO, Rusty Gordon, Vice President and Chief Financial Officer, and Michael LaRoche, Vice President, Controller, and Chief Accounting Officer. This call is also being webcast and can be accessed live or replayed on the RPM website at .rpminc.com. Comments made on this call may include forward-looking statements based on current expectations that involve risks and uncertainties which can cause actual results to be materially different. For more information on these risks and uncertainties, please view RPM's reports filed with the SEC. During this conference call, references may be made to non-GAAP financial measures. To assist you in understanding these non-GAAP items or terms, RPM has posted Reconciliation's The Most Directly Comparable GAAP Financial Measures on the RPM website. Also, please note that our comments will be on an as-adjusted basis, and all comparisons are to the Fourth Quarter of Fiscal 2024 unless otherwise indicated. We have provided a supplemental slide presentation to support our comments on this call. It can be accessed in the Presentation and Webcast section of the RPM website at .rpminc.com. Now I would like to turn the call over to Frank.

Thank you, Matt. I'll begin today's call with a high-level review of our Fourth Quarter and full-year results and some additional details on our newly announced three-segment operating structure. Then Michael LaRoche will cover the financials in more detail, Matt Schlarb will provide an update on cash flow and the balance sheet, and finally Rusty Gordon will then conclude our prepared remarks with our outlook for Fiscal 2026 full-year in the first quarter. As always, we'll be happy to answer your questions after our prepared remarks. Highlights from our Fourth Quarter results can be found on Slide 3. Thanks to the hard work of RPM associates, we demonstrated the power of RPM as we combine solid top-line growth with improved operating efficiency that has been enabled by our MAP 2025 Operating Improvement Initiatives. This resulted in Fourth Quarter sales, adjusted EBIT, and adjusted DPS all at record levels. We generated positive volumes led by systems and turnkey solutions for high-performance buildings as well as our focus on maintenance and repair. The volume growth resulted in improved fixed cost leverage and allowed us to better realize the financial benefits of our MAP 2025 Operating Improvements. All segments increased adjusted EBIT with the largest growth coming from our Construction Products Group and Performance Codings Group, which generated volume growth that leveraged MAP 25 benefits to the bottom line. Additionally, three of four segments generated record Q4 adjusted EBIT. Turning to Slide 4, the record results we generated in the Fourth Quarter reflected a strong and consistent trend as we had delivered record adjusted EBIT in 13 of the last 14 quarters. In fact, we generated record annual sales, adjusted EBIT, and adjusted DPS in each year since we began the MAP 2025 program in what can be best described as a mixed economic environment. Additionally, in Fiscal 2025, we generated a record adjusted EBIT margin. Moving to Slide 5, in addition to the consistent progress we've achieved, the cumulative impact of these improvements during MAP 25 has been significant. Compared to our baseline fiscal year of 2022, we expanded gross margins close to our 42% goal, adjusted EBIT margin by 260 basis points, and improved working capital as a percent of sales by 320 basis points. These improvements and margins in working capital efficiency strengthened our cash flow and allowed us to complete the largest year of acquisition in RPM's history in Fiscal 2025. Importantly, our balance sheet remained strong with credit metrics still close to our best ever. These results are a testament to the dedication and relentless persistence of our associates, and I want to thank them for their execution of our operating improvement initiatives and commitment to RPM during this challenging low-growth, no-growth environment. As we look to the future, we are focused on realizing the full power of RPM, essentially building on the efficiencies we have ingrained into our businesses and accelerating growth to take full advantage of those efficiencies. To accelerate growth, we are taking a more strategic approach to allocating capital to both organic and inorganic opportunities. This includes leveraging the progress we have made in data analytics through MAP25 to capture true profitability so we can focus investments on the highest potential opportunities and then aggressively pursue growth in those areas. We are starting to see this take hold as we begin Fiscal 2026. As an example, we recently implemented $15 million in SG&A streamlining actions and a portion of these savings are being reallocated into our highest growth opportunities in attractive end markets like turnkey engineered solutions, cleaners, and international markets in the developing world. These investments are in areas such as technical sales force expansion, marketing, new products, and new facility build-out. One other key element of our growth plan that has been enabled by our MAP 2025 initiative is the cultural shift that has taken place to allow our businesses and associates to collaborate more closely or what we call connections creating value. This will drive additional organic growth opportunities and synergies in 2026 and beyond. To accelerate this shift towards realizing the full power of RPM, we've changed our operating structure to three segments. Construction products group, performance coding group, and the consumer group. As you can see, this new structure on slide six. Businesses that have previously been part of our specialty products group are now reorganized under the three groups mentioned above. This new structure will allow us to achieve additional operational administrative efficiency and enable our businesses to work more closely to realize synergies in new business generation, product development, and insourcing. For example, our industrial coding group of businesses has joined the performance coding group and will benefit from improved collaboration on high performance coding development with our carb line division, as well as a broad distribution network which will improve customer service levels. The color business has now joined the consumer group, which through insourcing has become Dayglow's largest customer. The new structure will allow cooperation more closely and efficiently in color specifications, a critical component of our consumer products, in particular Rust-Oleum. This change will also allow the color group to operate with a more streamlined overhead structure and leverage our consumer segment's strong marketing know-how to raise the profile of our well-known Dayglow fluorescent pigment brand. Importantly, this will not change what has served RPM so well throughout our history. Having an entrepreneurial culture that serves our customers with leading brands, products, and services and staying true to our core values of operating with transparency, trust, and respect. We are pleased with the fourth quarter results our associates achieved in a continuing low to no growth environment, which continues to be unsettled due to the ongoing tariff uncertainty. We are optimistic about our opportunities to continue this positive momentum into and throughout fiscal 2026. I now turn the call over to Mike LaRoche to cover our financials for the quarter in more details.