The Sherwin-Williams Company

Good morning. Thank you for joining the Sherwin-Williams Company's review of first quarter 2021 results and our outlook for the second quarter and full year of 2021. With us on today's call are John Marikis, Chairman, President, and CEO, Al Mestician, CFO, Jane Cronin, Senior Vice President, Corporate Controller, and Jim Jay, Senior Vice President, Investor Relations and Communications. This conference call is being webcast simultaneously in listen-only mode by issuer direct and via the Internet at www.sherwin.com. An archived replay of this webcast will be available at www.sherwin.com, beginning approximately two hours after this conference call concludes. This conference call will include certain forward-looking statements as defined under the U.S. federal securities laws with respect to sales, earnings, and other matters. Any forward-looking statement speaks only as of the date on which such statement is made The company undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise. A full declaration regarding forward-looking statements is provided in the company's earnings release transmitted earlier this morning. After the company's prepared remarks, we'll open this session to questions. I'll now turn the call over to Jim Jay.

Thank you. Good morning, everyone. Sherwin-Williams delivered terrific results in the first quarter. The momentum with which we exited the fourth quarter continued in the first quarter. We entered the quarter with strong expectations and we finished stronger. We capitalized on extremely robust demand across both architectural and industrial markets, leading to sales in two of our segments that exceeded the guidance we provided at the beginning of the quarter. We generated double-digit growth once again in residential repaint. as well as in new residential and DIY. We also generated double digit growth in our industrial business with improvement in every region. Before getting into some of the specific numbers, I'll remind you that in February, our board of directors approved and declared a three for one stock split in the form of a stock dividend to make the stock more accessible to employees and a broader base of investors. trading of our shares on a stock split adjusted basis began on April 1st, 2021. All share and per share amounts in today's press release and conference call commentary have been adjusted to reflect the three for one stock split. Additionally, all comparisons in our prepared commentary this morning are to the first quarter of 2020, unless otherwise specified. So starting with the top line, First quarter 2021 consolidated sales increased 12.3% to $4.66 billion. Consolidated gross margin decreased 20 basis points to 45.4% due to greater than anticipated raw material cost inflation. SG&A expense as a percent of sales decreased 300 basis points to 28.5%. Consolidated profit before tax increased $116.7 million or 29.8% to $509 million. The first quarter of 2021 included $75.6 million of acquisition related depreciation and amortization expense and one-time costs of $111.9 million related to the divestiture of the Wattle Australia business. The first quarter of 2020 included $75.6 million of acquisition related depreciation and amortization expense. Excluding these items, consolidated profit before tax increased 48.8% to $696.5 million with flow through of 44.9%. Diluted net income per share in the quarter increased to $1.51 per share from $1.15 per share a year ago. The first quarter of 2021 included acquisition-related depreciation and amortization expense of 21 cents per share and one-time costs related to the wattle divestiture of 34 cents per share. The first quarter of 2020 included acquisition-related depreciation and amortization expense of 21 cents per share. Excluding these items, First quarter adjusted diluted earnings per share increased 51.5% to $2.06 per share from $1.36 per share. Adjusted EBITDA grew to $848.7 million in the quarter or 18.2% of sales. Net operating cash grew to $195.7 million in the quarter. All three of our operating segments delivered excellent top line growth, margin expansion, and strong flow through in the quarter. Segment margin in the Americas Group improved 240 basis points to 19.2% of sales, resulting primarily from operating leverage on the high single digit top line growth. Flow through was 46.4%. Adjusted segment margin in consumer brands group improved 440 basis points to 21.4% of sales, resulting primarily from operating leverage on the double digit top line growth. Flow through was 38.9%. And adjusted segment margin in performance coatings group improved 60 basis points to 14.3% of sales, driven by operating leverage on the double digit sales growth which was partially offset by higher raw material costs. Flow through was 19.1%. Let me now turn the call over to John Marikas for additional commentary on the first quarter, along with our guidance for the second quarter and full year 2021.

John.