mas-20240930

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2024

☐ 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: 1-5794

Masco Corporation

(Exact name of Registrant as Specified in its Charter)

Delaware

38-1794485

(State or Other Jurisdiction of
Incorporation or Organization)

(I.R.S. Employer Identification No.)

17450 College Parkway,

Livonia,

Michigan

48152

(Address of Principal Executive Offices)

(Zip Code)

(313) 274-7400

(Registrant's telephone number, including area code)

Securities Registered Pursuant to Section 12(b) of the Act:

Title of Each Class

Trading Symbol

Name of Each Exchange
On Which Registered

Common Stock, $1.00 par value

MAS

New York Stock Exchange

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 þ No o

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☑

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No þ

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date.


Class						Shares Outstanding at September 30, 2024
Common stock, par value $1.00 per share						215,748,893

MASCO CORPORATION

INDEX

Page

PART I. FINANCIAL INFORMATION

Item 1.

Financial Statements (Unaudited):

Condensed Consolidated Balance Sheets as of September 30, 2024 and December 31, 2023

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2024 and 2023

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2024 and 2023

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2024 and 2023

Condensed Consolidated Statements of Shareholders' Equity for the Three and Nine Months Ended September 30, 2024 and 2023

Notes to Condensed Consolidated Financial Statements

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 4.

Controls and Procedures

PART II. OTHER INFORMATION

Unregistered Sales of Equity Securities and Use of Proceeds

MASCO CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)

September 30, 2024 and December 31, 2023

(In Millions, Except Share Data)


	September 30, 2024		December 31, 2023
ASSETS
Current assets:
Cash and cash investments	$	646	$	634

Receivables	1,152		1,090
Inventories	1,013		1,022
Prepaid expenses and other	153		110

Total current assets	2,965		2,856
Property and equipment, net	1,125		1,121
Goodwill	610		604
Other intangible assets, net	230		377
Operating lease right-of-use assets	238		268
Other assets	128		139

Total assets	$	5,296	$	5,363

LIABILITIES
Current liabilities:
Accounts payable	$	874	$	840
Notes payable	3		3
Accrued liabilities	742		852

Total current liabilities	1,618		1,695
Long-term debt	2,945		2,945
Noncurrent operating lease liabilities	230		258
Other liabilities	360		349

Total liabilities	$	5,154	$	5,247

Commitments and contingencies (Note M)
Redeemable noncontrolling interest	—		18

EQUITY
Masco Corporation's shareholders' equity:
Common shares, par value $1 per share Authorized shares: 1,400,000,000; Issued and outstanding: 2024 – 215,700,000; 2023 – 220,600,000	216		221
Preferred shares authorized: 1,000,000; Issued and outstanding: 2024 and 2023 – None	—		—
Paid-in capital	—		—
Retained deficit	(551)		(596)
Accumulated other comprehensive income	247		249
Total Masco Corporation's shareholders' deficit	(88)		(126)
Noncontrolling interest	230		224
Total equity	142		98
Total liabilities and equity	$	5,296	$	5,363

See notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

MASCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)

For the Three and Nine Months Ended September 30, 2024 and 2023

(In Millions, Except Per Common Share Data)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net sales	$	1,983	$	1,979	$	6,000	$	6,085
Cost of sales	1,258		1,235		3,805		3,903
Gross profit	725		744		2,195		2,182
Selling, general and administrative expenses	368		361		1,123		1,081


Operating profit	357		383		1,073		1,101
Other income (expense), net:
Interest expense	(25)		(26)		(75)		(82)
Other, net	(85)		(11)		(95)		(14)
	(109)		(37)		(170)		(96)
Income before income taxes	248		346		903		1,005
Income tax expense	68		86		222		246
Net income	180		260		681		759


Less: Net income attributable to noncontrolling interest	13		11		41		42
Net income attributable to Masco Corporation	$	167	$	249	$	640	$	717

Income per common share attributable to Masco Corporation:
Basic:


Net income	$	0.77	$	1.11	$	2.92	$	3.19
Diluted:


Net income	$	0.77	$	1.10	$	2.91	$	3.17

See notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

MASCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) (Unaudited)

For the Three and Nine Months Ended September 30, 2024 and 2023

(In Millions)


	Three Months Ended September 30,				Nine Months Ended September 30,
	2024		2023		2024		2023
Net income	$	180	$	260	$	681	$	759
Less: Net income attributable to noncontrolling interest	13		11		41		42
Net income attributable to Masco Corporation	$	167	$	249	$	640	$	717
Other comprehensive income (loss), net of tax:
Cumulative translation adjustment	$	33	$	(25)	$	(1)	$	(10)

Pension and other post-retirement benefits	—		1		1		1

Other comprehensive income (loss), net of tax	33		(24)		—		(9)
Less: Other comprehensive income (loss) attributable to noncontrolling interest	9		(6)		2		(6)
Other comprehensive income (loss) attributable to Masco Corporation	$	24	$	(18)	$	(2)	$	(3)
Total comprehensive income	$	213	$	236	$	681	$	750
Less: Total comprehensive income attributable to noncontrolling interest	22		5		43		36
Total comprehensive income attributable to Masco Corporation	$	192	$	231	$	637	$	714

See notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

MASCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)

For the Nine Months Ended September 30, 2024 and 2023

(In Millions)


	Nine Months Ended September 30,
	2024		2023
CASH FLOWS FROM (FOR) OPERATING ACTIVITIES:
Cash provided by operations	$	957	$	954
Increase in receivables	(142)		(120)
(Increase) decrease in inventories	(52)		199
Decrease in accounts payable and accrued liabilities, net	(94)		(105)
Net cash from operating activities	668		928

CASH FLOWS FROM (FOR) FINANCING ACTIVITIES:

Purchase of Company common stock	(482)		(126)
Cash dividends paid	(191)		(193)
Purchase of redeemable noncontrolling interest	(15)		—
Dividends paid to noncontrolling interest	(25)		(49)


Proceeds from short-term borrowings	—		77
Payment of short-term borrowings	—		(11)

Payment of term loan	—		(200)

Proceeds from the exercise of stock options	76		37
Employee withholding taxes paid on stock-based compensation	(34)		(29)

Decrease in debt, net	(2)		(4)


Net cash for financing activities	(673)		(498)

CASH FLOWS FROM (FOR) INVESTING ACTIVITIES:
Capital expenditures	(112)		(181)
Acquisition of business, net of cash acquired	(4)		(136)
Proceeds from disposition of business, net of cash disposed	131		—








Other, net	(3)		(4)
Net cash from (for) investing activities	12		(321)

Effect of exchange rate changes on cash and cash investments	5		(1)

CASH AND CASH INVESTMENTS:
Increase for the period	12		108
At January 1	634		452
At September 30	$	646	$	560

See notes to condensed consolidated financial statements.

Amounts may not add due to rounding.

MASCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited)

For the Three and Nine Months Ended September 30, 2024 and 2023

(In Millions, Except Per Common Share Data)


	Total		Common Shares ($1 par value)		Paid-In Capital		Retained (Deficit) Earnings		Accumulated Other Comprehensive Income (Loss)		Noncontrolling Interest
Balance, January 1, 2023	$	(262)	$	225	$	16	$	(947)	$	226	$	218
Total comprehensive income	243		—		—		205		17		21
Shares issued	6		1		5		—		—		—
Shares retired:
Repurchased	(56)		(1)		(32)		(23)		—		—
Surrendered (non-cash)	(17)		—		—		(17)		—		—
Cash dividends declared	(65)		—		—		(65)		—		—


Stock-based compensation	11		—		11		—		—		—
Balance, March 31, 2023	$	(140)	$	225	$	—	$	(847)	$	243	$	239
Total comprehensive income (loss)	270		—		—		263		(2)		9
Shares issued	11		1		10		—		—		—
Shares retired:
Repurchased	(25)		(1)		(1)		(23)		—		—

Cash dividends declared	(64)		—		—		(64)		—		—
Dividends declared to noncontrolling interest	(49)		—		—		—		—		(49)

Stock-based compensation	4		—		4		—		—		—
Balance, June 30, 2023	$	7	$	225	$	13	$	(671)	$	241	$	199
Total comprehensive income (loss)	236		—		—		249		(18)		5
Shares issued	9		—		9		—		—		—
Shares retired:
Repurchased	(45)		(1)		(23)		(21)		—		—

Cash dividends declared	(64)		—		—		(64)		—		—


Stock-based compensation	5		—		5		—		—		—
Balance, September 30, 2023	$	148	$	224	$	4	$	(507)	$	223	$	204

MASCO CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) (Concluded)

For the Three and Nine Months Ended September 30, 2024 and 2023

(In Millions, Except Per Common Share Data)

Total

Common

($1 par value)

Paid-In
Capital

Retained (Deficit) Earnings

Accumulated Other Comprehensive Income (Loss)

Noncontrolling
Interest

Balance, January 1, 2024

SEC Form 10-Q filed by Masco Corporation