Stock Analysis on Net
Stock Analysis on Net

Sherwin-Williams Co. (NYSE:SHW)

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Common-Size Income Statement

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Sherwin-Williams Co., common-size consolidated income statement

Microsoft Excel
12 months ended: Dec 31, 2024 Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020
Net sales
Cost of goods sold
Gross profit
Selling, general and administrative expenses
Provisions for environmental matters, net
Gain (loss) on divestiture of business
Gain (loss) on sale or disposition of assets
Other
Other general income (expense), net
Impairment
Operating income
Interest expense
Interest income
Investment gains (losses)
Gain (loss) on extinguishment of debt
Net expense from banking activities
Foreign currency transaction related losses, net
Miscellaneous pension and benefit income (expense)
Other income
Other expense
Other income (expense), net
Income before income taxes
Income taxes
Net income

Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).

Cost of Goods Sold and Gross Profit Trends
The cost of goods sold (COGS) as a percentage of net sales showed a fluctuating pattern over the years. It increased from -52.71% in 2020 to a peak of -57.9% in 2022, followed by a notable decline to -51.53% in 2024. Correspondingly, gross profit margin declined from 47.29% in 2020 to 42.1% in 2022, before recovering to 48.47% in 2024. This indicates a period of margin compression followed by an improvement in profitability linked to production or purchasing efficiency.
Selling, General and Administrative Expenses (SG&A)
SG&A expenses declined from -31.54% in 2020 to a low of -28.59% in 2022, suggesting tighter control over operational costs during this period. However, there was a reversal afterward, with SG&A rising to -32.13% by 2024, surpassing the 2020 level. This resurgence may imply increased spending possibly related to growth initiatives or inflationary pressures.
Provisions and Gains/Losses on Business Transactions
Provisions for environmental matters were generally negligible with some volatility, ranging from small positive to negative values. Gains and losses on divestitures appeared irregular, with a loss of -0.56% in 2021 and a slight gain reported in 2023. Gains on sale or disposition of assets remained modest but positive overall, indicating some non-core asset monetizations contributing marginally to income.
Other Income and Expense Items
Other general income (expense), net, displayed variability with both negative and positive figures, reflecting occasional non-recurring items influencing income. Impairment charges were minor but noticeable in 2020, 2022, and 2023, with an increasing negative impact in 2023. Foreign currency transaction losses increased significantly in 2023 to -0.35% but improved substantially by 2024, indicating currency risk volatility management issues during that period.
Operating Income and Financial Expenses
Operating income showed a decline from 15.58% in 2020 to 12.83% in 2021, then progressively improved to 16.5% in 2024, indicating a recovery and strengthening of core profitability. Interest expense as a percentage of sales remained relatively stable, fluctuating narrowly around -1.8%, suggesting consistent debt servicing costs. Interest income and investment gains had minor impacts, fluctuating slightly without large effects on overall income.
Income Before and After Taxes
Income before income taxes followed a similar trajectory to operating income, decreasing from 13.72% in 2020 to 11.27% in 2021, then increasing to 14.94% in 2024. Income tax expense was lowest in 2021 at -1.93%, increasing steadily thereafter to -3.34% by 2024, which may reflect changing tax rates or higher taxable income. Net income mirrored these trends, falling to 9.12% in 2022 followed by a rebound to 11.61% in 2024.
Summary of Financial Performance
The data reveal a cycle of margin contraction and expansion, with operating and net income margins dipping in the early years before recovering strongly by the latest period. Cost management showed mixed results, with improved COGS efficiency after 2022 but higher SG&A costs in the final year. Non-operating items, including currency effects and environmental provisions, introduced some volatility but were not dominant drivers of performance. Overall, the company returned to enhanced profitability by 2024, supported by better gross margins and controlled financial expenses.