<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
[ X ] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the Period Ended June 30, 1996
-------------
or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the transition period from ___________________
to ______________________
Commission file number 1-4851
--------
THE SHERWIN-WILLIAMS COMPANY
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
OHIO 34-0526850
- --------------------------------- -------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
101 Prospect Avenue, N.W., Cleveland, Ohio 44115-1075
- ------------------------------------------- -------------------------
(Address of principal executive offices) (Zip Code)
(216) 566-2000
- --------------------------------------------------------------------------------
(Registrant's telephone number including area code)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practical date.
Common Stock, $1.00 Par Value -- 85,791,603 shares as of July 31, 1996.
<PAGE> 2
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED)
Thousands of dollars, except per share data
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
-----------------------------------------------------------
1996 1995 1996 1995
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Net sales $ 1,145,254 $ 904,729 $ 2,003,025 $ 1,621,525
Costs and expenses:
Cost of goods sold 675,273 516,782 1,195,551 941,019
Selling, general and administrative expenses 330,453 271,035 630,112 535,660
Interest expense 7,014 562 12,450 1,209
Interest and net investment income (1,701) (2,042) (3,298) (4,626)
Other 2,116 2,191 4,509 2,326
- --------------------------------------------------------------------------------------------------------------
1,013,155 788,528 1,839,324 1,475,588
- --------------------------------------------------------------------------------------------------------------
Income before income taxes 132,099 116,201 163,701 145,937
Income taxes 50,197 42,994 62,206 53,997
- --------------------------------------------------------------------------------------------------------------
Net income $ 81,902 $ 73,207 $ 101,495 $ 91,940
==============================================================================================================
Net income per share $ 0.95 $ 0.85 $ 1.18 $ 1.07
==============================================================================================================
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 3
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
Thousands of dollars
<TABLE>
<CAPTION>
JUNE 30, Dec. 31, June 30,
1996 1995 1995
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 12,666 $ 249,484 $ 148,438
Short-term investments 0 20,000 0
Accounts receivable, less allowance 602,200 334,304 437,084
Inventories:
Finished goods 481,607 395,817 442,362
Work in process and raw materials 101,665 67,270 74,868
- ---------------------------------------------------------------------------------------
583,272 463,087 517,230
Other current assets 258,355 172,023 176,988
- ---------------------------------------------------------------------------------------
Total current assets 1,456,493 1,238,898 1,279,740
Deferred pension assets 241,424 233,574 229,465
Other assets 712,724 212,224 148,429
Property, plant and equipment 1,112,658 987,434 935,126
Less allowances for depreciation and
amortization 573,465 531,077 508,481
- ---------------------------------------------------------------------------------------
539,193 456,357 426,645
- ---------------------------------------------------------------------------------------
Total assets $ 2,949,834 $ 2,141,053 $ 2,084,279
=======================================================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings $ 323,335 $ 0 $ 0
Accounts payable 390,847 276,863 300,061
Compensation and taxes withheld 81,519 78,148 62,452
Other accruals 325,234 232,035 227,850
Accrued taxes 88,790 31,891 57,029
- ---------------------------------------------------------------------------------------
Total current liabilities 1,209,725 618,937 647,392
Long-term debt 134,638 24,018 20,732
Postretirement benefits other than pensions 182,080 175,766 174,214
Other long-term liabilities 129,630 110,206 118,974
Shareholders' equity
Common stock - $1.00 par value:
85,773,837, 85,454,813 and 85,237,391
shares outstanding at June 30, 1996,
December 31, 1995 and June 30, 1995,
respectively 101,432 101,110 100,863
Other capital 190,640 182,311 166,736
Retained earnings 1,313,691 1,242,167 1,160,762
Cumulative foreign currency translation
adjustment (19,139) (20,657) (19,926)
Treasury stock, at cost (292,863) (292,805) (285,468)
- ---------------------------------------------------------------------------------------
Total shareholders' equity 1,293,761 1,212,126 1,122,967
- ---------------------------------------------------------------------------------------
Total liabilities and shareholders' equity $ 2,949,834 $ 2,141,053 $ 2,084,279
=======================================================================================
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 4
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED)
Thousands of dollars
<TABLE>
<CAPTION>
Six months ended June 30,
-------------------------
1996 1995
- -----------------------------------------------------------------------
<S> <C> <C>
OPERATIONS
Net income $ 101,495 $ 91,940
Non-cash adjustments:
Depreciation 36,761 30,205
Amortization of intangible assets 13,163 6,743
Increase in deferred pension assets (7,850) (3,503)
Other 4,905 9,392
Change in current assets and liabilities-net (89,357) (140,900)
Other (10,928) (7,338)
- -----------------------------------------------------------------------
Net operating cash 48,189 (13,461)
INVESTING
Capital expenditures (69,281) (49,309)
Decrease in short-term investments 20,000
Acquisitions of assets (586,613) (9,635)
Decrease in other investments 20,561
Other 20,689 (7,094)
- -----------------------------------------------------------------------
Net investing cash (594,644) (66,038)
FINANCING
Increase in short-term borrowings 922,985
Payments of short-term borrowings (629,025)
Increase in long-term debt 113,071
Payments of long-term debt (74,385) (765)
Payments of cash dividends (29,971) (27,245)
Treasury stock acquired (30) (2,820)
Proceeds from stock options exercised 7,177 6,584
Other (185) 768
- -----------------------------------------------------------------------
Net financing cash 309,637 (23,478)
- -----------------------------------------------------------------------
Net decrease in cash and cash equivalents (236,818) (102,977)
Cash and cash equivalents at beginning of year 249,484 251,415
- -----------------------------------------------------------------------
Cash and cash equivalents at end of period $ 12,666 $ 148,438
=======================================================================
Taxes paid on income $ 12,267 $ 37,827
Interest paid on debt 11,248 1,264
</TABLE>
SEE NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 5
THE SHERWIN-WILLIAMS COMPANY AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
(Thousands of dollars, except per share data, unless otherwise indicated)
Periods ended June 30, 1996 and 1995
NOTE A--BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q. Accordingly, they
do not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's Form 10-K for the fiscal year ended December
31, 1995. In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. The consolidated results for the three months and six months ended
June 30, 1996 are not necessarily indicative of the results to be expected for
the fiscal year ending December 31, 1996.
NOTE B--DIVIDENDS
Dividends paid on common stock during each of the first two quarters of 1996 and
1995 were $.175 per share and $.16 per share, respectively.
NOTE C--INVESTMENT IN LIFE INSURANCE
The Company invests in broad-based corporate owned life insurance. The cash
surrender value of the policies, net of policy loans, are included in Other
Assets. The net expense associated with such investment is included in Other
Costs and Expenses.
NOTE D--OTHER COSTS AND EXPENSES
Significant items included in other costs and expenses are as follows:
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
--------------------------- ------------------------
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Dividend and royalty income $ 1,617 $ 1,269 $ 2,778 $ 7,816
Provisions for environmental
remediation (3,000)
Provisions for disposition and
termination of operations (1,500)
Net expense of financing and
investing activities (3,953) (2,724) (7,613) (4,428)
</TABLE>
The net expense of financing and investing activities represents the realized
gains or losses associated with disposing of fixed assets, the net gain or loss
associated with the investment of certain long-term asset funds and the net
pre-tax expense associated with the Company's investment in broad-based
corporate owned life insurance.
<PAGE> 6
NOTE E--ACQUISITION AND MERGER
Effective January 10, 1996, the Company, through its wholly-owned subsidiary,
SWACQ, Inc., acquired all outstanding stock and completed its merger with Pratt
& Lambert United, Inc. (Pratt & Lambert) for a total cash purchase price of
approximately $400,000. The excess purchase price over the fair value of the net
assets acquired is being amortized over 40 years using the straight-line method.
For financial statement purposes, the acquisition is being accounted for under
the purchase method of accounting. Accordingly, the results of operations of
Pratt & Lambert since the date of acquisition are included in the Company's
statements of consolidated income. The following unaudited pro forma combined
condensed statement of consolidated income for the three months and six months
ended June 30, 1995 was prepared in accordance with Accounting Principles Board
Opinion No. 16 and assumes the merger had occurred on January 1, 1995. The
following pro forma data reflects adjustments for interest expense, net
investment income, depreciation expense and amortization of intangible assets.
In management's opinion, the pro forma financial information is not indicative
of the results of operations which would have occurred had the acquisition of
Pratt & Lambert taken place on January 1, 1995 or of future results of
operations of the combined companies under the ownership and operation of the
Company.
UNAUDITED PRO FORMA COMBINED
CONDENSED STATEMENT OF CONSOLIDATED INCOME
------------------------------------------
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, 1995 June 30, 1995
------------------ ----------------
<S> <C> <C>
Net sales $ 1,021,567 $ 1,826,787
=========== ===========
Net income 72,849 86,793
=========== ===========
Net income per share 0.85 1.01
=========== ===========
</TABLE>
NOTE F--RECLASSIFICATION
Certain amounts in the 1995 financial statements have been reclassified to
conform with the 1996 presentation.
<PAGE> 7
NOTE G--COMPUTATION OF NET INCOME PER SHARE
<TABLE>
<CAPTION>
Three months ended Six months ended
June 30, June 30,
------------------------- -------------------------
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Fully Diluted
Average shares outstanding 85,720,518 85,203,138 85,643,541 85,130,534
Options - treasury stock method 731,950 588,297 719,031 574,199
Assumed conversion of 6.25% Convertible
Subordinated Debentures 7,942
----------- ----------- ----------- -----------
Average fully diluted shares 86,452,468 85,791,435 86,362,572 85,712,675
=========== =========== =========== ===========
Net income $ 81,901 $ 73,207 $ 101,495 $ 91,940
=========== =========== =========== ===========
Net income per share $ 0.95 $ 0.85 $ 1.18 $ 1.07
=========== =========== =========== ===========
Primary
Average shares outstanding 85,720,518 85,203,138 85,643,541 85,130,534
Options - treasury stock method 685,206 571,504 658,122 549,715
----------- ----------- ----------- -----------
Average shares and equivalents 86,405,724 85,774,642 86,301,663 85,680,249
=========== =========== =========== ===========
Net income $ 81,901 $ 73,207 $ 101,495 $ 91,940
=========== =========== =========== ===========
Net income per share $ 0.95 $ 0.85 $ 1.18 $ 1.07
=========== =========== =========== ===========
</TABLE>
All 6.25% Convertible Subordinated Debentures outstanding at December 31, 1994
were converted to common stock during the first quarter of 1995 without
incurring further interest.
<PAGE> 8
NOTE H--BUSINESS SEGMENTS
Net External Sales/Operating Profit
- -----------------------------------
<TABLE>
<CAPTION>
Three months ended June 30, Six months ended June 30,
------------------------------------------------ ------------------------------------------------
1996 1995 1996 1995
---------------------- ---------------------- ---------------------- ----------------------
NET Net NET Net
EXTERNAL OPERATING External Operating EXTERNAL OPERATING External Operating
SALES PROFIT Sales Profit SALES PROFIT Sales Profit
---------- --------- ---------- --------- ---------- --------- ---------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Paint Stores $ 659,318 $ 58,684 $ 579,064 $ 52,381 $1,134,015 $ 64,192 $1,023,095 $ 53,106
Coatings 482,667 92,664 322,282 73,038 862,446 136,040 591,620 110,951
Other 3,269 3,276 3,383 3,119 6,564 6,615 6,810 5,903
---------- --------- ---------- --------- ---------- --------- ---------- ---------
Segment totals $1,145,254 154,624 $ 904,729 128,538 $2,003,025 206,847 $1,621,525 169,960
========== ========== ========== ==========
Corporate expenses-net (22,525) (12,337) (43,146) (24,023)
--------- --------- --------- ---------
Income before income taxes $ 132,099 $ 116,201 $ 163,701 $ 145,937
========= ========= ========= =========
==================================================================================================================================
Intersegment Transfers
- ----------------------
<CAPTION>
Three months ended June 30, Six months ended June 30,
----------------------------------- -----------------------------------
1996 1995 1996 1995
--------- --------- --------- ---------
<S> <C> <C> <C> <C>
Coatings $ 261,762 $ 221,002 $ 440,415 $ 385,149
Other 5,280 4,682 10,452 9,148
--------- --------- --------- ---------
Segment totals $ 267,042 $ 225,684 $ 450,867 $ 394,297
========= ========= ========= =========
==================================================================================================================================
</TABLE>
Operating profit is total revenue, including realized profit on intersegment
transfers, less operating costs and expenses.
Export sales, sales of foreign subsidiaries, and sales to any individual
customer were each less than 10% of consolidated sales to unaffiliated customers
during all periods presented.
Intersegment transfers are accounted for at values comparable to normal
unaffiliated customer sales.
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND
ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
Consolidated net sales increased 26.6 percent in the second quarter and 23.5
percent in the first six months of 1996 over the comparable 1995 periods.
Excluding the results of operations of Pratt & Lambert United, Inc. (Pratt &
Lambert) acquired during January 1996, and other smaller acquisitions acquired
since the second quarter of 1995, comparable sales increased 8.9 and 6.0 percent
for the same periods. Sales in the Paint Stores Segment increased 13.9 and 10.8
percent over last year for the second quarter and six months, respectively,
primarily due to increased paint gallons sold to wholesale customers, which
include professional painter, contractor, industrial and commercial maintenance
accounts. Year-to-date retail sales also improved over 1995. Excluding the
effects of all acquisitions, sales in the Paint Stores Segment increased 9.3
percent for the quarter and 7.6 percent for the first six months.
Comparable-store sales were up 7.9 percent in the quarter and 6.6 percent
year-to-date. The Coatings Segment's sales increased 49.8 percent in the second
quarter and 45.8 percent for the first six months primarily due to incremental
sales from acquisitions. Excluding these acquisitions, sales increased 8.2
percent in the quarter due to increased gallons sold to Coatings' national
customers as well as sales increases in the automotive branches and diversified
product lines. Year-to-date sales excluding acquisitions were up 3.3 percent
over last year. Revenue generated by real estate operations in the Other Segment
declined slightly for the quarter and six months.
Low margins on the acquired businesses caused consolidated gross profit as a
percent of sales to decline to 41.0 percent for the second quarter from 42.9
percent last year and to 40.3 percent for the first six months from 42.0 percent
last year. Excluding the effects of all acquisitions, consolidated second
quarter and year-to-date margins were higher than last year. A favorable product
mix led to second quarter and year-to-date margin improvements in the Paint
Stores Segment excluding all acquisitions. Margins in the Coatings Segment
exceeded last year for the quarter and first six months, after excluding the
effects of all acquisitions, due to stable raw material costs and increased
sales of higher-margin products.
Consolidated selling, general and administrative expenses as a percent of sales
were favorable to last year for the quarter and first six months primarily due
to lower-than-average expenses related to the acquisitions. Excluding these
acquisitions, the SG&A percentage was unfavorable to last year for both time
periods. SG&A expenses as a percent of sales in the Paint Stores Segment
remained essentially equal to last year excluding all acquisitions for both the
quarter and first six months. The Coatings Segment's SG&A percentages were
unfavorable to last year for the quarter and year-to-date excluding all
acquisitions due primarily to increased advertising and merchandising costs for
new products and customers.
The increase in long-term debt and the incurrence of short-term borrowings
during 1996 which resulted from the financing of acquisitions and working
capital led to higher second quarter and year-to-date interest expense compared
to last year. Net investment income was lower than last year for both periods
due to lower average cash and short-term investment balances offset partially by
higher average yields.
Other expenses were essentially equal to last year for the quarter but exceeded
last year for the first six months. The year-to-date increase is primarily due
to increased expenses related to the Company's investment in broad-based
corporate owned life insurance and lower net gains associated with the
investment of certain long-term asset funds.
Net income for the second quarter of 1996 increased to $81,902,000, or $.95 per
share, from $73,207,000, or $.85 per share, in 1995. Net income for the first
six months of 1996 increased to $101,495,000, or $1.18 per share, from
$91,940,000, or $1.07 per share, in 1995. Excluding the results of operations of
all acquisitions and the related financing costs, net income increased 8.2 and
10.6 percent for the quarter and six months, respectively.
<PAGE> 10
In accordance with the consensus guidance in Emerging Issues Task Force No.
87-11, "Allocation of Purchase Price to Assets to be Sold", all second quarter
and year-to-date 1996 results of operations exclude the results of operations of
certain Pratt & Lambert subsidiaries which are currently being offered for sale.
These subsidiaries include essentially all operations of Pierce & Stevens Corp.,
a manufacturer of specialty chemicals, and Miracle Adhesives Corporation, a
manufacturer of adhesives for the construction industry. The total operating
profit related to these subsidiaries, approximately $1,853,000 for the second
quarter and $2,411,000 for the first six months of 1996, has been excluded from
the respective statement of consolidated income. The Company has considered
proceeds from the sales of these subsidiaries in its allocation of purchase
price pursuant to APB Opinion No. 16, and expects ultimate sales to occur within
one year from the original acquisition date.
During the first six months of 1996, cash and cash equivalents decreased $236.8
million, long-term debt increased $110.6 million and short-term borrowings
increased $323.3 million. Short-term borrowings incurred during the year relate
to the Company's commercial paper program, which had unused borrowing
availability of $276.7 million at June 30, 1996. This program is backed by the
Company's revolving credit agreements. The increase in long-term debt is
primarily related to the Company's issuance of two $50.0 million long-term
notes. The proceeds of these borrowings and the decline in cash were used to
acquire Pratt & Lambert and other smaller acquisitions totaling $586.6 million,
payments of both Pratt & Lambert and the Company's long-term debt and short-term
borrowings totaling $703.4 million, capital expenditures of $69.3 million, cash
dividends of $30.0 million and normal operating needs for seasonally higher
accounts receivable and inventories. The Company's current ratio of 1.20 remains
favorable at June 30, 1996. The decrease in this ratio from 1.98 at the end of
last year's second quarter occurred primarily due to the increased short-term
borrowings and related decrease in cash. Other Assets increased $564.3 million
since December 31, 1995, of which approximately $529 million related to goodwill
and intangible assets acquired during the year.
Since June 30, 1995, cash and cash equivalents decreased $135.8 million,
short-term borrowings increased $323.3 million and long-term debt increased
$113.9 million. Cash generated by operations during this period of $344.4
million was offset by asset acquisitions of $651.0 million, payments of debt of
$703.4 million, capital expenditures of $128.4 million, payments of cash
dividends of $57.3 million, treasury stock acquisitions of $14.6 million and
normal working capital needs. The Company expects to remain in a borrowing
position throughout 1996.
Capital expenditures during the first six months of 1996 represented primarily
the costs of updating or installing point-of-sale terminals at the paint stores,
relocating or remodeling paint stores, and the expansion or upgrade of
distribution centers and manufacturing and research facilities. We do not
anticipate the need for any specific external financing to support our capital
programs.
During the first six months of 1996, approximately 1,500 shares of our own stock
were received in exchange from the exercise of stock options. We did not acquire
any of our own shares through open market purchases during this time period. We
acquire our own stock for general corporate purposes and, depending upon our
cash position and market conditions, we may acquire shares of our own stock in
the future.
The Company and certain other companies are defendants in lawsuits arising from
the manufacture and sale of lead pigments and lead paints. It is possible that
additional lawsuits may be filed against the Company in the future with similar
allegations. The various existing lawsuits seek damages for personal injuries
and property damage, along with costs incurred to abate the lead related paint
from buildings. The Company believes that such lawsuits are without merit and is
vigorously defending them. The Company does not believe that any potential
liability which may ultimately be determined to be attributable to the Company
arising out of such lawsuits will have a material adverse effect on the
Company's business or financial condition.
The operations of the Company, like those of other companies in our industry,
are subject to various federal, state and local environmental laws and
regulations. These laws and regulations not only govern our current operations
and
<PAGE> 11
products, but also impose potential liability on the Company for past operations
which were conducted utilizing practices and procedures that were considered
acceptable under the laws and regulations existing at that time. The Company
expects the environmental laws and regulations to impose increasingly stringent
requirements upon the Company and our industry in the future. The Company
believes it conducts its operations in compliance with applicable environmental
laws and regulations and has implemented various programs designed to protect
the environment and ensure continued compliance.
The Company is involved with environmental compliance and remediation activities
at some of its current and former sites. The Company, together with other
parties, has also been designated a potentially responsible party under federal
and state environmental protection laws for the remediation of hazardous waste
at a number of third-party sites, primarily Superfund sites. In general, these
laws provide that potentially responsible parties may be held jointly and
severally liable for investigation and remediation costs regardless of fault.
The Company may be similarly designated with respect to additional third-party
sites in the future.
Although the Company continuously assesses its potential liability for
remediation activities with respect to its past operations and third-party
sites, any potential liability ultimately determined to be attributable to the
Company is subject to a number of uncertainties including, among others, the
number of parties involved with respect to any given site, the volumetric
contribution which may be attributed to the Company relative to that
attributable to other parties, the nature and magnitude of the wastes involved,
and the method and extent of remediation. The Company has accrued for certain
environmental remediation activities relating to its past operations and
third-party sites, including Superfund sites, for which commitments or clean-up
plans have been developed or for which costs or minimum costs can be reasonably
estimated. These environmental-related accruals are adjusted as information
becomes available upon which more accurate costs can be reasonably estimated. In
the opinion of the Company's management, any potential liability ultimately
attributed to the Company for its environmental-related matters will not have a
material adverse effect on the Company's financial condition, liquidity or cash
flow.
<PAGE> 12
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
A. The Annual Meeting of the Shareholders of The Sherwin-Williams
Company was held on April 24, 1996.
B. The following persons were nominated to serve, and were elected, as
directors of the Company to serve until the next annual meeting and until their
successors are elected: J.M. Biggar, J.G. Breen, D.E. Collins, T.A. Commes, D.E.
Evans, R.W. Mahoney, W.G. Mitchell, A.M. Mixon, III, H.O. Petrauskas and R.K.
Smucker. The Annual Meeting's voting results for each such nominee are as
follows:
<TABLE>
<CAPTION>
Name For Withheld
- ---- --- --------
<S> <C> <C>
J.M. Biggar 77,542,475 963,349
J.G. Breen 77,520,131 985,693
D.E. Collins 77,559,692 946,132
T.A. Commes 77,528,105 977,719
D.E. Evans 77,503,365 1,002,459
R.W. Mahoney 77,557,943 947,881
W.G. Mitchell 77,554,546 951,278
A.M. Mixon, III 77,558,339 947,485
H.O. Petrauskas 77,554,812 951,012
R.K. Smucker 77,551,695 954,129
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
(11) Computation of Net Income Per Share - See Note G to
Condensed Consolidated Financial Statements
(Unaudited).
(27) Financial Data Schedule for the period ended June 30,
1996.
<PAGE> 13
(b) Reports on Form 8-K - None.
SIGNATURES
----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE SHERWIN-WILLIAMS COMPANY
August 13, 1996 By: /s/ J.L. Ault
---------------------
J.L. Ault
Vice President-
Corporate Controller
August 13, 1996 By: /s/ L.E. Stellato
---------------------
L.E. Stellato
Vice President, General
Counsel and Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FORM 10-Q
FOR THE PERIOD ENDED JUNE 30, 1996 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS
</LEGEND>
<CIK> 0000089800
<NAME> THE SHERWIN-WILLIAMS COMPANY
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 12,666
<SECURITIES> 0
<RECEIVABLES> 627,216
<ALLOWANCES> 25,016
<INVENTORY> 583,272
<CURRENT-ASSETS> 1,456,493
<PP&E> 1,112,658
<DEPRECIATION> 573,465
<TOTAL-ASSETS> 2,949,834
<CURRENT-LIABILITIES> 1,209,725
<BONDS> 134,638
<COMMON> 101,432
0
0
<OTHER-SE> 1,192,329
<TOTAL-LIABILITY-AND-EQUITY> 2,949,834
<SALES> 2,003,025
<TOTAL-REVENUES> 2,003,025
<CGS> 1,195,551
<TOTAL-COSTS> 1,195,551
<OTHER-EXPENSES> 4,509
<LOSS-PROVISION> 8,621
<INTEREST-EXPENSE> 12,450
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<INCOME-TAX> 62,206
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</TABLE>
