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# RPM's Construction Unit Adjusted EBITDA Fell 9.7% As Company Narrows Its Full-Year Forecast
- URL: https://www.bullished.co/rpms-construction-unit-adjusted-ebitda-fell-9-7-as-company-narrows-its-full-year-forecast/
- Published: 2026-10-06T11:08:22.000Z
- Updated: 2026-10-06T11:08:22.000Z
- Description: Record quarterly sales of $2.22 billion came with a tighter outlook of mid-single-digit growth, RPM's earnings release says.
- Author: Matteo Parrino
- Tags: Earnings, RPM, Industry: Materials

RPM International reported record first-quarter [sales of $2.22 billion](https://www.sec.gov/Archives/edgar/data/0000110621/000119312526414916/d80757dex991.htm?ref=bullished.co), up 4.8% from a year earlier, while its Construction Products Group saw adjusted EBITDA fall 9.7%. The company, which makes Rust-Oleum and DAP, also narrowed its full-year forecast, according to an [8-K filed Tuesday](https://www.sec.gov/Archives/edgar/data/0000110621/000119312526414916/d80757d8k.htm?ref=bullished.co).

## What the results show

Net income was $256.4 million, or $2.01 a share on a diluted basis, against $227.6 million and $1.77 a year earlier. Adjusted earnings per share, which excludes items management says are not part of ongoing operations, rose 5.3% to $1.98\. Adjusted EBITDA, operating profit before interest, taxes, depreciation and amortization, rose 4.5% to $405.5 million.

Sales growth came from 3.1% organic growth and 1.6% from acquisitions net of divestitures, with a 0.1% currency tailwind, the company said.

By segment:

- Performance Coatings Group sales rose 10.2% to $629.7 million, with 7.9% organic growth and adjusted EBITDA up 18.2% to $121.1 million.
- Consumer Group sales rose 5.3% to $726.7 million, with 5.2% organic growth and adjusted EBITDA up 5.5% to $146.6 million.
- Construction Products Group sales rose 0.8% to $859.2 million, helped by the Kalzip acquisition, despite a 1.7% organic decline.

## Why construction slipped

Construction adjusted EBITDA fell to $166.2 million from $183.9 million. RPM cited lower fixed-cost absorption from reduced volumes and raw material inflation tied to supply shortages.

Two items hit the segment: a $4.4 million increase in bad-debt expense from a customer bankruptcy, and a $6.3 million warranty charge at a small European business under review for closure. The company blamed softer sales on delays in the healthcare and education markets and on supplier raw material availability.

Chairman and CEO Frank C. Sullivan said the quarter's results overcame "raw material inflation and a temporary slowdown in our Construction Products Group."

## Outlook, cash and debt

RPM now expects full-year sales and adjusted EBITDA to grow in the mid-single-digit range. The prior ranges were 3% to 7% for sales and 5% to 10% for adjusted EBITDA. For the second quarter it expects sales and adjusted EBITDA to rise in the low- to mid-single-digit range.

Sullivan said the company anticipates construction "will return to positive organic growth by the end of the year."

Operating cash flow was $263.9 million versus $237.5 million a year earlier. Total debt was $2.41 billion as of August 31, 2026, down from $2.67 billion, and liquidity was $1.21 billion versus $933.4 million. The company returned $90.5 million to stockholders through dividends and buybacks, up 10.2%.

RPM hosts an investor day on November 9 at its Stonhard facility in New Jersey, with a webcast expected to start at about 12:00 p.m. ET.

### Sources

- [8-K Filing — RPM INTERNATIONAL INC/DE/ (RPM)](https://www.sec.gov/Archives/edgar/data/0000110621/000119312526414916/d80757d8k.htm?ref=bullished.co) — SEC EDGAR
- [Exhibit d80757dex991.htm — RPM INTERNATIONAL INC/DE/ 8-K exhibit](https://www.sec.gov/Archives/edgar/data/0000110621/000119312526414916/d80757dex991.htm?ref=bullished.co) — SEC EDGAR
- [Exhibit d80757dex992.htm — RPM INTERNATIONAL INC/DE/ 8-K exhibit](https://www.sec.gov/Archives/edgar/data/0000110621/000119312526414916/d80757dex992.htm?ref=bullished.co) — SEC EDGAR