SHERWIN WILLIAMS CO

Previous wording

•Consolidated Net sales increased 7.5% to $6.789 billion in the quarter and increased 7.2% to $12.456 billion in the year to date period

Current wording

•Consolidated Net sales increased 7.9% to $6.860 billion in the quarter and increased 7.4% to $19.316 billion in the year to date period

Previous wording

◦Net sales from stores in the Paint Stores Group open more than twelve calendar months increased 4.2% and 3.4% in the quarter and year to date period, respectively

Current wording

◦Net sales from stores in the Paint Stores Group open more than twelve calendar months increased 3.9% and 3.6% in the quarter and year to date period, respectively

Previous wording

◦Adjusted diluted net income per share increased 9.5% to $3.70 per share in the quarter compared to $3.38 per share in the second quarter of 2025 and increased 7.7% to $6.05 per share in the year to date period compared to $5.62 per share in the year to date period of 2025

Current wording

•Diluted net income per share increased 0.9% to $3.38 per share in the quarter compared to $3.35 per share in the third quarter of 2025 and increased 7.3% to $8.95 per share in the year to date period compared to $8.34 per share in the year to date period of 2025

Previous wording

•Generated Net operating cash of $1.487 billion in the year to date period compared to $1.052 billion in the year to date period of 2025

Current wording

•Generated Net operating cash of $2.591 billion in the year to date period compared to $2.359 billion in the year to date period of 2025

Previous wording

In an uncertain demand environment given current customer sentiment, our growth investments and execution on our differentiated strategy, Success by Design, continued to yield positive results. As the softer-for-longer demand environment is expected to continue in the second half of 2026, coupled with inflation in raw materials, energy, logistics and packaging, we continue to focus on securing incremental volume, balanced with appropriate and decisive pricing and cost-out actions in all our businesses while maintaining the products, services and supply solutions which drive productivity and profitability for our customers. Significant opportunities exist for each business, and we will continue to support our growth strategy by executing initiatives within our enterprise priorities, including talent, simplification, digitization, supply chain responsiveness and sustainability.

Current wording

During 2026, we continued to focus on the execution of our differentiated strategy, Success by Design, which supports our customers by providing value and productivity-oriented solutions for their businesses. In a softer-for-longer demand environment, this focus resulted in strong sales growth driven by new customer wins and share-of-wallet gains. We are addressing macroeconomic inflationary pressures by reducing costs, improving efficiency and taking measured and deliberate pricing actions with our customers in mind. Significant opportunities exist for each of our businesses, and we will continue to support our growth strategy by executing initiatives within our enterprise priorities, including talent, simplification, digitization, supply chain responsiveness and sustainability.

Previous wording

We employ a disciplined capital deployment strategy, while maintaining a balanced approach toward driving value for our customers and returns for our shareholders. We continue to pursue business acquisitions, transactions and investments that fit our long-term growth strategy and will return value to our shareholders through the payment of dividends and the reinvestment of excess cash through repurchases of shares of our stock. We have a strong liquidity position, with $293.5 million in cash and cash equivalents and $1.969 billion of unused capacity under our credit facilities at June 30, 2026. We are, and expect to remain, in compliance with all financing covenants.

Current wording

We employ a disciplined capital deployment strategy, while maintaining a balanced approach toward driving value for our customers and returns for our shareholders. We continue to pursue business acquisitions, transactions and investments that fit our long-term growth strategy and will return value to our shareholders through the payment of dividends and the reinvestment of excess cash through repurchases of shares of our stock. We have a strong liquidity position, with $264.2 million in cash and cash equivalents and $2.322 billion of unused capacity under our credit facilities at September 30, 2026. We are, and expect to remain, in compliance with all financing covenants.

Previous wording

The Company has historically experienced, and expects to continue to experience, variability in quarterly results. The results of operations for the three and six months ended June 30, 2026 are not indicative of the results to be expected for the full year as our business is seasonal in nature, with the majority of Net sales for the Reportable Segments traditionally occurring during the second and third quarters. However, periods of economic uncertainty can alter the Company’s seasonal patterns.

Current wording

The Company has historically experienced, and expects to continue to experience, variability in quarterly results. The results of operations for the three and nine months ended September 30, 2026 are not indicative of the results to be expected for the full year as our business is seasonal in nature, with the majority of Net sales traditionally occurring during the second and third quarters. However, periods of economic uncertainty can alter the Company’s seasonal patterns.

Previous wording

The following discussion and analysis addresses comparisons of material changes in the condensed consolidated financial statements for the three and six months ended June 30, 2026 and 2025.

Current wording

The following discussion and analysis addresses comparisons of material changes in the condensed consolidated financial statements for the three and nine months ended September 30, 2026 and 2025.

Previous wording

Consolidated Net sales increased by 7.5% in the second quarter of 2026 primarily due to higher Net sales in all reportable segments, inclusive of the October 2025 acquisition of Suvinil. Net sales of all consolidated foreign subsidiaries increased to $1.358 billion in the second quarter of 2026 compared to $1.155 billion in the same period last year. The increase in Net sales for all consolidated foreign subsidiaries was due to higher Net sales in all regions, led by Latin America, which is inclusive of the Suvinil acquisition. Net sales of all operations other than consolidated foreign subsidiaries increased to $5.431 billion in the second quarter of 2026 compared to $5.159 billion in the same period last year.

Current wording

Consolidated Net sales increased by 7.9% in the third quarter of 2026 primarily due to higher Net sales in all reportable segments, inclusive of the October 2025 acquisition of Suvinil, and selling price increases, which impacted Net sales by a mid-single digit percentage. Net sales of all consolidated foreign subsidiaries increased to $1.366 billion in the third quarter of 2026 compared to $1.135 billion in the same period last year. The increase in Net sales for all consolidated foreign subsidiaries was due to higher Net sales in all regions, led by Latin America, which is inclusive of the Suvinil acquisition. Net sales of all operations other than consolidated foreign subsidiaries increased to $5.494 billion in the third quarter of 2026 compared to $5.223 billion in the same period last year.

Previous wording

Net sales in the Paint Stores Group increased by 5.1% in the second quarter of 2026 primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, as well as low-single digit percentage sales volume growth. Net sales increased in all professional customer end markets, led by a double-digit percentage increase in protective and marine, a high-single digit percentage increase in commercial and a mid-single digit percentage increase in residential repaint. Net sales from stores open for more than twelve calendar months increased by 4.2% in the second quarter of 2026 compared to last year’s comparable period. Net sales of non-paint products increased 4.2% in the second quarter of 2026 compared to last year’s comparable period. A discussion of changes in volume versus pricing for sales of non-paint products is not pertinent due to the wide assortment of general merchandise sold.

Current wording

Net sales in the Paint Stores Group increased by 4.7% in the third quarter of 2026 primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, as well as low-single digit percentage sales volume growth. Net sales increased in all professional customer end markets, led by a double-digit percentage increase in protective and marine, a high-single digit percentage increase in commercial and a mid-single digit percentage increase in residential repaint. Net sales from stores open for more than twelve calendar months increased by 3.9% in the third quarter of 2026 compared to last year’s comparable period. Net sales of non-paint products increased 3.8% in the third quarter of 2026 compared to last year’s comparable period. A discussion of changes in volume versus pricing for sales of non-paint products is not pertinent due to the wide assortment of general merchandise sold.

Previous wording

Net sales in the Consumer Brands Group increased by 21.5% in the second quarter of 2026 primarily as a result of the acquisition of Suvinil, increased Net sales in North America and a 1.6% impact from favorable foreign currency translation.

Current wording

Net sales in the Consumer Brands Group increased by 21.7% in the third quarter of 2026 primarily as a result of the acquisition of Suvinil, favorable foreign currency translation and a positive shift in mix, partially offset by soft demand in North America.

Previous wording

Net sales in the Performance Coatings Group increased by 6.3% in the second quarter of 2026 primarily due to selling price increases, mainly attributable to product mix, which impacted Net sales by a low-single digit percentage, low-single digit percentage sales volume growth and a 2.0% impact from favorable foreign currency translation. Net sales increased in all businesses, led by General Industrial and Automotive Refinish, which each increased by a high-single digit percentage, as well as Packaging, Industrial Wood and Coil, which each increased by a mid-single digit percentage.

Current wording

Net sales in the Performance Coatings Group increased by 8.8% in the third quarter of 2026 primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, and low-single digit percentage sales volume growth. Net sales increased in all businesses, led by General Industrial, Packaging and Coil, which each increased by a double-digit percentage, and Industrial Wood and Automotive Refinish, which each increased by a low-single digit percentage.

Previous wording

Consolidated Net sales increased by 7.2% in the first six months of 2026 due to higher sales in all reportable segments, inclusive of the October 2025 acquisition of Suvinil and a 1.2% impact from favorable currency translation. Net sales of all consolidated foreign subsidiaries increased to $2.637 billion in the first six months of 2026 compared to $2.200 billion in the same period last year. The increase in Net sales for all consolidated foreign subsidiaries was due to higher Net sales in all regions, led by Latin America, which is inclusive of the Suvinil acquisition. Net sales of all operations other than consolidated foreign subsidiaries increased 4.2% to $9.819 billion in the first six months of 2026 compared to $9.420 billion in the same period last year.

Current wording

Consolidated Net sales increased by 7.4% in the first nine months of 2026 due to higher Net sales in all reportable segments, inclusive of the October 2025 acquisition of Suvinil, and selling price increases, which impacted Net sales by a mid-single digit percentage. Net sales of all consolidated foreign subsidiaries increased to $4.003 billion in the first nine months of 2026 compared to $3.335 billion in the same period last year. The increase in Net sales for all consolidated foreign subsidiaries was due to higher Net sales in all regions, led by Latin America, which is inclusive of the Suvinil acquisition. Net sales of all operations other than consolidated foreign subsidiaries increased 4.6% to $15.313 billion in the first nine months of 2026 compared to $14.643 billion in the same period last year.

Previous wording

Net sales in the Paint Stores Group increased by 4.5% in the first six months of 2026 primarily due to selling price increases, which impacted Net sales by a low-single digit percentage, as well as a low-single digit percentage sales volume growth. Net sales increased in all but one professional customer end market, led by a double-digit percentage increase in protective and marine and mid-single digit percentage increases in commercial and residential repaint. New residential decreased by a low-single digit percentage, as expected. Net sales from stores open for more than twelve calendar months increased 3.4% in the first six months of 2026 compared to last year’s comparable period. Net sales of non-paint products increased 3.4% in the first six months of 2026 compared to last year’s comparable period. A discussion of changes in volume versus pricing for sales of products other than paint is not pertinent due to the wide assortment of general merchandise sold.

Current wording

Net sales in the Paint Stores Group increased by 4.6% in the first nine months of 2026 primarily due to selling price increases, which impacted Net sales by a mid-single digit percentage, as well as low-single digit percentage sales volume growth. Net sales increased in all but one professional customer end market, led by a double-digit percentage increase in protective and marine and mid-single digit percentage increases in commercial and residential repaint. New residential decreased by a low-single digit percentage, as expected. Net sales from stores open for more than twelve calendar months increased 3.6% in the first nine months of 2026 compared to last year’s comparable period. Net sales of non-paint products increased 3.6% in the first nine months of 2026 compared to last year’s comparable period. A discussion of changes in volume versus pricing for sales of products other than paint is not pertinent due to the wide assortment of general merchandise sold.

Previous wording

Net sales in the Consumer Brands Group increased by 20.4% in the first six months of 2026 primarily as a result of the acquisition of Suvinil, increased Net sales in North America and a 2.0% favorable impact from foreign currency translation.

Current wording

Net sales in the Consumer Brands Group increased by 20.8% in the first nine months of 2026 primarily as a result of the acquisition of Suvinil and a 1.7% favorable impact from foreign currency translation. A positive shift in mix was partially offset by soft demand in North America.

Previous wording

Net sales in the Performance Coatings Group increased by 6.4% in the first six months of 2026 primarily attributable to low-single digit percentage sales volume growth, selling price increases, primarily attributable to product mix, which impacted Net sales by a low-single digit percentage, and a 3.0% favorable impact from foreign currency translation. Net sales increased in all businesses, led by a double-digit percentage increase in General Industrial, a high-single digit percentage increase in Automotive Refinish and mid-single digit percentage increases in Packaging and Coil.

Current wording

Net sales in the Performance Coatings Group increased by 7.2% in the first nine months of 2026 primarily attributable to low-single digit percentage sales volume growth, selling price increases, which impacted Net sales by a low-single digit percentage, and a 2.2% favorable impact from foreign currency translation. Net sales increased in all businesses, led by a double-digit percentage increase in General Industrial, and a high-single digit percentage increase in Packaging, Coil and Automotive Refinish.

Previous wording

Consolidated Cost of goods sold increased $255.1 million, or 8.0%, in the second quarter of 2026 compared to the same period in 2025 primarily due to higher Net sales, inclusive of the Suvinil acquisition, a moderate rise in raw material costs and an unfavorable foreign currency related impact.

Current wording

Consolidated Cost of goods sold increased $350.1 million, or 10.8%, in the third quarter of 2026 compared to the same period in 2025 primarily due to higher sales volume, inclusive of the Suvinil acquisition, and higher raw material and supply chain related costs.

Previous wording

Consolidated Gross profit increased $219.7 million in the second quarter of 2026 compared to the same period in 2025 primarily due to higher Net sales in all reportable segments, inclusive of the Suvinil acquisition, partially offset by a moderate rise in raw material costs. Consolidated Gross profit as a percent of consolidated Net sales in the second quarter of 2026 decreased slightly to 49.2% compared to 49.4% during the same period in 2025 primarily due to the dilutive impact of the Suvinil acquisition.

Current wording

Consolidated Gross profit increased $151.7 million in the third quarter of 2026 compared to the same period in 2025 primarily due to higher Net sales in all reportable segments, inclusive of the Suvinil acquisition, partially offset by higher raw material and supply chain related costs. Consolidated Gross profit as a percent of consolidated Net sales in the third quarter of 2026 decreased to 47.8% compared to 49.2% during the same period in 2025 primarily due to mix, including dilution from the Suvinil acquisition and higher growth in lower margin reportable segments, as well as higher raw material and supply chain related costs.

Previous wording

The Paint Stores Group’s Gross profit in the second quarter of 2026 was higher than the same period last year by $106.8 million due primarily to higher Net sales as a result of selling price increases and sales volume growth, partially offset by a moderate rise in raw material costs. The Paint Stores Group’s Gross profit as a percent of Net sales was flat in the second quarter of 2026 compared to the same period last year for these same reasons. The Consumer Brands Group’s Gross profit increased by $73.0 million in the second quarter of 2026 compared to the same period last year primarily due to higher Net sales, inclusive of the Suvinil acquisition, favorable mix, supply chain efficiencies and favorable impacts from foreign currency, partially offset by a moderate rise in raw material costs. The Consumer Brands Group’s Gross profit as a percent of Net sales decreased in the second quarter of 2026 compared to the same period last year related to the dilutive impact of the Suvinil acquisition. The Performance Coatings Group’s Gross profit increased $43.3 million in the second quarter of 2026 compared to the same period last year primarily due to higher Net sales as a result of selling price increases, primarily attributable to product mix, sales volume growth and favorable foreign currency translation, partially offset by a moderate rise in raw material costs. The Performance Coatings Group’s Gross profit as a percent of Net sales increased modestly in the second quarter of 2026 compared to the same period last year for these same reasons.

Current wording

The Paint Stores Group’s Gross profit in the third quarter of 2026 was higher than the same period last year by $77.3 million due primarily to higher Net sales, partially offset by higher raw material and supply chain related costs. The Paint Stores Group’s Gross profit as a percent of Net sales decreased in the third quarter of 2026 compared to the same period last year primarily due to the impact of inflation on raw material and supply chain related costs. The Consumer Brands Group’s Gross profit increased by $37.8 million in the third quarter of 2026 compared to the same period last year primarily due to higher Net sales, inclusive of the Suvinil acquisition, partially offset by higher raw material and supply chain costs. The Consumer Brands Group’s Gross profit as a percent of Net sales decreased in the third quarter of 2026 compared to the same period last year primarily due to the dilutive impact of the Suvinil acquisition and the impact of inflation on raw material and supply chain costs. The Performance Coatings Group’s Gross profit increased $47.0 million in the third quarter of 2026 compared to the same period last year primarily due to higher Net sales, partially offset by higher raw material and supply chain related costs. The Performance Coatings Group’s Gross profit as a percent of Net sales decreased in the third quarter of 2026 compared to the same period last year primarily due to the impact of inflation on raw material and supply chain related costs.

Previous wording

Consolidated SG&A increased $92.1 million in the second quarter of 2026 versus the same period last year primarily due to an increase in employee-related costs to support higher Net sales, incremental SG&A expenses associated with the Suvinil acquisition and higher costs in the Administrative function related to the new global headquarters and technology center. As a percent of Net sales, consolidated SG&A decreased by 90 basis points in the second quarter of 2026 compared to the same period last year.

Current wording

Consolidated SG&A increased $116.3 million in the third quarter of 2026 versus the same period last year primarily due to an increase in employee-related costs to support higher Net sales, incremental SG&A expenses associated with the Suvinil acquisition and higher costs in the Administrative function related to the new global headquarters and technology center. As a percent of Net sales, consolidated SG&A decreased by 50 basis points in the third quarter of 2026 compared to the same period last year.

Previous wording

The Paint Stores Group’s SG&A increased $63.3 million in the second quarter of 2026 compared to the same period last year primarily due to increased costs to support higher sales, including investments in additional sales reps and stores. The Consumer Brands Group’s SG&A increased $32.9 million in the second quarter of 2026 compared to the same period last year primarily due to incremental SG&A expenses associated with the Suvinil acquisition. The Performance Coatings Group’s SG&A increased $19.4 million in the second quarter of 2026 compared to the same period last year primarily due to an increase in employee-related costs to support higher sales. The Administrative function’s SG&A decreased $23.5 million in the second quarter of 2026 compared to the same period last year due primarily due to lower employee costs related to non-recurring severance from the prior period, partially offset by increased costs related to the new global headquarters and technology center.

Current wording

The Paint Stores Group’s SG&A increased $51.9 million in the third quarter of 2026 compared to the same period last year primarily due to investments in additional sales reps and stores. The Consumer Brands Group’s SG&A increased $43.6 million in the third quarter of 2026 compared to the same period last year primarily due to incremental SG&A expenses associated with the Suvinil acquisition. The Performance Coatings Group’s SG&A increased $26.1 million in the third quarter of 2026 compared to the same period last year primarily due to an increase in employee-related and other costs to support higher sales. The Administrative function’s SG&A decreased $5.3 million in the third quarter of 2026 compared to the same period last year due primarily due to effective cost control, partially offset by increased costs related to the new global headquarters and technology center.

Previous wording

Interest expense increased $23.5 million in the second quarter of 2026 compared to the same period last year due to an increase in short-term borrowings and long-term debt as well as interest expense related to real estate financing associated with the new global headquarters. See Note 6 in Item 1 for further information on the Company’s outstanding debt.

Current wording

Interest expense increased $22.1 million in the third quarter of 2026 compared to the same period last year due to an increase in total debt outstanding as well as interest expense related to real estate financing associated with the new global headquarters. See Note 6 in Item 1 for further information on the Company’s outstanding debt.

Previous wording

Consolidated Cost of goods sold increased $394.9 million, or 6.6%, in the first six months of 2026 compared to the same period in 2025 primarily due to higher sales volume, inclusive of the Suvinil acquisition, a moderate rise in raw material costs and an unfavorable foreign currency related impact.

Current wording

Consolidated Cost of goods sold increased $745.0 million, or 8.1%, in the first nine months of 2026 compared to the same period in 2025 primarily due to higher sales volume, inclusive of the Suvinil acquisition, higher raw material and supply chain related costs and an unfavorable foreign currency related impact.

Previous wording

Consolidated gross profit increased $441.1 million in the first six months of 2026 compared to the same period in 2025 primarily due to higher Net sales in all reportable segments, inclusive of the Suvinil acquisition, partially offset by a moderate rise in raw material costs. Consolidated gross profit as a percent of consolidated Net sales increased in the first six months of 2026 to 49.1% compared to 48.9% during the same period in 2025 for these same reasons, including the dilutive impact of the Suvinil acquisition.

Current wording

Consolidated gross profit increased $592.8 million in the first nine months of 2026 compared to the same period in 2025 primarily due to higher Net sales in all reportable segments, inclusive of the Suvinil acquisition, partially offset by higher raw material and supply chain related costs. Consolidated gross profit as a percent of consolidated Net sales decreased in the first nine months of 2026 to 48.6% compared to 49.0% during the same period in 2025 due to the dilutive impact of the Suvinil acquisition. Excluding the dilutive impact of the Suvinil acquisition, consolidated gross profit as a percent of consolidated Net sales was flat year over year.

Previous wording

The Paint Stores Group’s gross profit in the first six months of 2026 was higher than the same period last year by $192.6 million due primarily tohigher Net sales as a result of selling price increases and sales volume growth, partially offset by a moderate rise in raw material costs. The Paint Stores Group’s gross profit as a percent of Net sales increased in the first six months of 2026 compared to the same period in 2025 for these same reasons. The Consumer Brands Group’s gross profit increased by $172.8 million in the first six months of 2026 compared to the same period last year due primarily to higher Net sales, inclusive of the Suvinil acquisition, and favorable impacts from foreign currency, partially offset by a moderate rise in raw material costs. The Consumer Brands Group’s gross profit as a percent of Net sales increased in the first six months of 2026 compared to the same period last year for these same reasons, inclusive of the dilutive impact of the Suvinil acquisition. The Performance Coatings Group’s gross profit increased $83.5 million in the first six months of 2026 compared to the same period last year primarily due to higher Net sales as a result of sales volume growth, selling price increases, primarily attributable to product mix, and favorable foreign currency translation. The Performance Coatings Group’s gross profit as a percent of Net sales increased modestly in the first six months of 2026 compared to the same period last year for these same reasons.

Current wording

The Paint Stores Group’s gross profit in the first nine months of 2026 was higher than the same period last year by $269.9 million due primarily to higher Net sales, partially offset by higher raw material and supply chain related costs. The Paint Stores Group’s gross profit as a percent of Net sales was flat in the first nine months of 2026 compared to the same period in 2025 for these same reasons. The Consumer Brands Group’s gross profit increased by $210.6 million in the first nine months of 2026 compared to the same period last year due primarily to higher Net sales, inclusive of the Suvinil acquisition, partially offset by higher raw material and supply chain costs. The Consumer Brands Group’s gross profit as a percent of Net sales decreased in the first nine months of 2026 compared to the same period last year primarily due to the dilutive impact of the Suvinil acquisition and the impact of inflation on raw material and supply chain costs. The Performance Coatings Group’s gross profit increased $130.5 million in the first nine months of 2026 compared to the same period last year primarily due to higher Net sales, partially offset by higher raw material and supply chain related costs. The Performance Coatings Group’s gross profit as a percent of Net sales was flat in the first nine months of 2026 compared to the same period last year for these same reasons.

Previous wording

Consolidated SG&A increased $267.9 million in the first six months of 2026 versus the same period last year primarily due to an increase in employee-related costs to support higher Net sales, incremental SG&A expenses associated with the Suvinil acquisition and higher costs in the Administrative function related to the new global headquarters and technology center. As a percent of Net sales, consolidated SG&A was flat in the first six months of 2026 compared to the same period last year for these same reasons.

Current wording

Consolidated SG&A increased $384.2 million in the first nine months of 2026 versus the same period last year primarily due to an increase in employee-related costs to support higher Net sales, incremental SG&A expenses associated with the Suvinil acquisition and higher costs in the Administrative function related to the new global headquarters and technology center. As a percent of Net sales, consolidated SG&A was decreased modestly in the first nine months of 2026 compared to the same period last year for these same reasons.

Previous wording

The Paint Stores Group’s SG&A increased $127.3 million in the first six months of 2026 compared to the same period last year primarily due to higher employee-related costs related toinvestments in additional sales reps and stores. The Consumer Brands Group’s SG&A increased $74.5 million in the first six months of 2026 compared to the same period last year primarily due toincremental SG&A expenses associated with the Suvinil acquisition as well as higher employee-related costs to support higher sales. The Performance Coatings Group’s SG&A increased $51.9 million in the first six months of 2026 compared to the same period last year due primarily to higher employee-related costs to support higher sales. The Administrative function’s SG&A increased $14.2 million in the first six months of 2026 compared to the same period last year due primarily to costs related to the new global headquarters and technology center, partially offset by a decrease in employee-related costs related to non-recurring severance from the prior period.

Current wording

The Paint Stores Group’s SG&A increased $179.2 million in the first nine months of 2026 compared to the same period last year primarily due to investments in additional sales reps and stores. The Consumer Brands Group’s SG&A increased $118.1 million in the first nine months of 2026 compared to the same period last year primarily due to incremental SG&A expenses associated with the Suvinil acquisition as well as higher employee-related costs to support higher sales. The Performance Coatings Group’s SG&A increased $78.0 million in the first nine months of 2026 compared to the same period last year due primarily to higher employee-related costs to support higher sales. The Administrative function’s SG&A increased $8.9 million in the first nine months of 2026 compared to the same period last year due primarily to costs related to the new global headquarters and technology center, partially offset by a decrease in employee-related costs related to non-recurring severance from the prior year period.

Previous wording

Other general expense - net decreased $5.5 million in the first six months of 2026 compared to the same period last year primarily due to lower individually insignificant miscellaneous expenses, partially offset by an decrease in the gain on sale or disposition of assets. See Note 15 in Item 1 for further information.

Current wording

Other general expense - net increased $4.4 million in the first nine months of 2026 compared to the same period last year primarily due to a loss on the sale or disposition of assets in the current year versus a gain recognized in the prior year, partially offset by lower individually insignificant miscellaneous expenses and higher provisions for environmental matters in the prior year which did not recur in the current year. See Note 15 in Item 1 for further information.

Previous wording

Interest expense increased $51.3 million in the first six months of 2026 compared to the same period last year due to an increase in short-term borrowings and long-term debt as well as interest expense related to real estate financing associated with the new global headquarters. See Note 6 in Item 1 for further information on the Company’s outstanding debt.

Current wording

Interest expense increased $73.4 million in the first nine months of 2026 compared to the same period last year due to an increase in total debt outstanding as well as interest expense related to real estate financing associated with the new global headquarters. See Note 6 in Item 1 for further information on the Company’s outstanding debt.

Previous wording

Other (income) expense - net was income of $12.1 million in the second quarter of 2026 compared to expense of $4.7 million in the same period last year primarily due to lower foreign currency transaction related net losses, higher investment gains and lower individually insignificant miscellaneous expenses, partially offset by pension related expense in the second quarter of 2026 compared to pension related income in the second quarter of 2025. See Note 15 in Item 1 for further information.

Current wording

Other expense (income) - net was income of $10.1 million in the first nine months of 2026 compared to expense of $9.9 million in the same period last year primarily due to lower foreign currency transaction related net losses and lower individually insignificant miscellaneous expenses, partially offset by pension related expense recognized in the current period as compared to pension related income in the prior year period. See Note 15 in Item 1 for further information.

Previous wording

The effective tax rate was 24.2% for the second quarter of 2026 compared to 23.4% for the second quarter of 2025, and 23.1% for the first six months of 2026 compared to 23.2% for the first six months of 2025. The increase in the effective tax rate for the second quarter of 2026 was primarily due to a less favorable impact from tax benefits related to employee share-based payments. The effective tax rate was essentially flat for the first six months of 2026 compared to the same period last year. The other significant components of the Company’s effective tax rate were consistent in both comparable periods. See Note 16 in Item 1 for further information.

Current wording

The effective tax rate was 22.8% for the third quarter of 2026 compared to 21.4% for the third quarter of 2025, and 23.0% for the first nine months of 2026 compared to 22.5% for the first nine months of 2025. The increase in the effective tax rate for the third quarter of 2026 was primarily due to a less favorable impact from tax benefits related to employee share-based payments. The effective tax rate increased for the first nine months of 2026 compared to the same period last year for these same reasons. See Note 16 in Item 1 for further information.

Previous wording

Diluted net income per share increased 14.3% to $3.43 per share in the second quarter of 2026 compared to $3.00 per share in the second quarter of 2025. Diluted net income per share in the second quarter of 2026 included Valspar acquisition-related amortization expense of $0.20 per share and severance and other restructuring expenses of $0.07 per share. Diluted net income per share in the second quarter of 2025 included charges for Valspar acquisition-related amortization expense of $0.20 per share and severance and other restructuring expenses of $0.18 per share. Foreign currency translation rate changes increased diluted net income per share by $0.02 in the second quarter of 2026.

Current wording

Diluted net income per share increased 0.9% to $3.38 per share in the third quarter of 2026 compared to $3.35 per share in the third quarter of 2025. Diluted net income per share in the third quarter of 2026 included Valspar acquisition-related amortization expense of $0.21 per share and severance and other restructuring expenses of $0.04 per share. Diluted net income per share in the third quarter of 2025 included charges for Valspar acquisition-related amortization expense of $0.20 per share and severance and other restructuring expenses of $0.04 per share. Foreign currency translation rate changes increased diluted net income per share by $0.01 in the third quarter of 2026.

Previous wording

Diluted net income per share for the first six months of 2026 increased 11.6% to $5.58 per share compared to $5.00 per share in the first six months of 2025. Diluted net income per share for the first six months of 2026 included charges for Valspar acquisition-related amortization expense of $0.40 per share and severance and other restructuring expenses of $0.07 per share. Diluted net income per share in the first six months of 2025 included a charge for Valspar acquisition-related amortization expense of $0.38 per share and severance and other restructuring expenses of $0.24 per share. Foreign currency translation rate changes increased diluted net income per share by $0.06 in the first six months of 2026.

Current wording

Diluted net income per share for the first nine months of 2026 increased 7.3% to $8.95 per share compared to $8.34 per share in the first nine months of 2025. Diluted net income per share for the first nine months of 2026 included charges for Valspar acquisition-related amortization expense of $0.61 per share and severance and other restructuring expenses of $0.11 per share. Diluted net income per share in the first nine months of 2025 included a charge for Valspar acquisition-related amortization expense of $0.59 per share and severance and other restructuring expenses of $0.27 per share. Foreign currency translation rate changes increased diluted net income per share by $0.07 in the first nine months of 2026.

Previous wording

The Company’s financial condition and liquidity remained strong at June 30, 2026. The Company generated $1.487 billion in Net operating cash and returned cash of $2.232 billion to its shareholders in the form of dividends and share repurchases during the first six months of 2026. Net income increased 9.5% to $1.378 billion and EBITDA increased 11.7% to $2.433 billion for the first six months of 2026. Refer to the Non-GAAP Financial Measures section below for the definition and calculation of EBITDA.

Current wording

The Company’s financial condition and liquidity remained strong at September 30, 2026. The Company generated $2.591 billion in Net operating cash and returned cash of $2.981 billion to its shareholders in the form of dividends and share repurchases during the first nine months of 2026. Net income increased 5.1% to $2.199 billion and EBITDA increased 8.5% to $3.823 billion for the first nine months of 2026. Refer to the Non-GAAP Financial Measures section below for the definition and calculation of EBITDA.

Previous wording

At June 30, 2026, the Company had Cash and cash equivalents of $293.5 million and total debt outstanding of $12.072 billion. Total debt, net of Cash and cash equivalents, was $11.779 billion. The Company continues to maintain sufficient short-term borrowing capacity at reasonable rates, and has sufficient cash on hand and total available borrowing capacity to fund its current operating requirements.

Current wording

At September 30, 2026, the Company had Cash and cash equivalents of $264.2 million and total debt outstanding of $11.795 billion. Total debt, net of Cash and cash equivalents, was $11.531 billion. The Company continues to maintain sufficient short-term borrowing capacity at reasonable rates, and has sufficient cash on hand and total available borrowing capacity to fund its current operating requirements.

Previous wording

Net working capital, defined as Total current assets less Total current liabilities, decreased $856.7 million to a deficit of $2.628 billion at June 30, 2026 compared to a deficit of $1.771 billion at June 30, 2025. The net working capital decrease is due to an increase of $1.431 billion in Total current liabilities partially offset by an increase in Total current assets of $573.9 million.

Current wording

Net working capital, defined as Total current assets less Total current liabilities, decreased $1,494.1 million to a deficit of $2.822 billion at September 30, 2026 compared to a deficit of $1.327 billion at September 30, 2025. The net working capital decrease is due to an increase of $2.375 billion in Total current liabilities partially offset by an increase in Total current assets of $881.3 million.

Previous wording

Current asset balances increased $573.9 million at June 30, 2026 compared to June 30, 2025 due to an increase in Accounts receivable, net of $459.3 million, an increase in Other current assets of $45.8 million, primarily related to recoverable income taxes and prepaid expenses, an increase in Inventories of $45.1 million and an increase in Cash and cash equivalents of $23.7 million.

Current wording

Current asset balances increased $881.3 million at September 30, 2026 compared to September 30, 2025 due to an increase in Accounts receivable, net of $475.8 million, an increase in Inventories of $270.7 million, an increase in Other current assets of $112.1 million, primarily related to miscellaneous prepaid expenses and other receivables, and an increase in Cash and cash equivalents of $22.7 million.

Previous wording

Current liability balances increased $1.431 billion at June 30, 2026 compared to June 30, 2025 due to an increase in Short-term borrowings of $539.7 million, an increase in the Current portion of long-term debt of $347.7 million, an increase in Accounts payable of $256.4 million, an increase in Accrued taxes of $149.6 million, an increase in Compensation and taxes withheld of $79.5 million, an increase in Other accruals of $51.9 million primarily related to increases in customer considerations and non-traded investments, partially offset by a decrease in accrued severance, and an increase in the Current portion of operating lease liabilities of $5.8 million. The Company’s current ratio was 0.73, 0.87 and 0.78 at June 30, 2026, December 31, 2025 and June 30, 2025, respectively.

Current wording

Current liability balances increased $2.375 billion at September 30, 2026 compared to September 30, 2025 due to an increase in the Current portion of long-term debt of $1.148 billion, an increase in Short-term borrowings of $506.7 million, an increase in Accounts payable of $453.7 million, an increase in Compensation and taxes withheld of $108.0 million, an increase in Other accruals of $105.1 million, primarily related to increases in customer considerations, non-traded investments and derivative liabilities, an increase in Accrued taxes of $45.8 million, and an increase in the Current portion of operating lease liabilities of $7.8 million. The Company’s current ratio was 0.71, 0.87 and 0.82 at September 30, 2026, December 31, 2025 and September 30, 2025, respectively.

Previous wording

Net property, plant and equipment increased $82.0 million in the first six months of 2026 and $413.5 million in the twelve months since June 30, 2025. The increase in the first six months was due to capital expenditures of $230.1 million and assets acquired through business combinations of $55.5 million, primarily related to the Suvinil acquisition, partially offset by depreciation expense of $196.8 million, sales or dispositions of fixed assets of $3.4 million, and foreign currency translation and other adjustments of $3.4 million. Since June 30, 2025, the increase was due to capital expenditures of $613.0 million and assets acquired through business combinations of $197.0 million, partially offset by depreciation expense of $377.9 million and foreign currency translation and other adjustments of 18.6 million.

Current wording

Net property, plant and equipment increased $88.2 million in the first nine months of 2026 and $312.4 million in the twelve months since September 30, 2025. The increase in the first nine months was due to capital expenditures of $337.6 million and assets acquired through business combinations of $61.8 million, primarily related to the Suvinil acquisition, partially offset by depreciation expense of $296.0 million, foreign currency translation and other adjustments of $9.3 million, and sales or dispositions of fixed assets of $5.9 million. Since September 30, 2025, the increase was due to capital expenditures of $532.8 million and assets acquired through business combinations of $203.2 million, partially offset by depreciation expense of $394.3 million and foreign currency translation and other adjustments of $29.3 million.

Previous wording

Also included in 2026 capital expenditures were expenditures related to manufacturing capacity expansion, operational efficiencies and maintenance projects in the Consumer Brands and Performance Coatings Groups and the opening of new stores and renovation and improvements in existing stores in the Paint Stores Group.

Current wording

Included in 2026 capital expenditures were expenditures related to manufacturing capacity expansion, operational efficiencies and maintenance projects in the Consumer Brands and Performance Coatings Groups and the opening of new stores and renovation and improvements in existing stores in the Paint Stores Group.