Key Results

• Sales increased 11 percent to $2,204 million
• Operating profit was $385 million and operating margin was 17.5 percent
• Earnings per share from continuing operations was $0.89 per share; adjusted earnings per share from continuing operations was $0.99 per share
• Returned $186 million to shareholders in the form of dividends and share repurchases
• Updating 2021 expected earnings per share to be in the range of $1.67 - $1.73, and on an adjusted earnings per share basis, in the range of $3.67 - $3.73, narrowed from the previous range of $3.65 - $3.75

Masco Corporation (NYSE: MAS), one of the world’s leading manufacturers of branded home improvement and building products, reported its third quarter results.

“Masco delivered its fifth consecutive quarter of double-digit sales growth, demonstrating the resourcefulness and strength of our organization in the face of ongoing headwinds,” said Masco President and CEO, Keith Allman. “Our team effectively navigated supply chain challenges to deliver for our customers while successfully implementing pricing and cost productivity actions to offset persistent inflation. We also advanced our capital deployment strategy by returning approximately $186 million to shareholders in the form of dividends and share repurchases, bringing our year-to-date total dividends and share repurchases to $1.0 billion."

2021 Third Quarter Commentary

• On a reported basis, compared to third quarter 2020:
  • Net sales increased 11 percent to $2,204 million; in local currency and excluding acquisitions and divestitures, net sales increased nine percent
  • In local currency, North American sales increased nine percent and international sales increased 15 percent
  • Gross margins decreased 370 basis points to 34.2 percent from 37.9 percent
  • Operating profit decreased nine percent to $385 million
  • Operating margins decreased 390 basis points to 17.5 percent from 21.4 percent
  • Income from continuing operations was $0.89 per share, compared to $1.05 per share
• Compared to third quarter 2020, results for key financial measures, as adjusted for certain items (see Exhibit A) and with a normalized tax rate of 25 percent, were as follows:
  • Gross margins decreased 380 basis points to 34.2 percent compared to 38.0 percent
  • Operating profit decreased nine percent to $385 million from $425 million
  • Operating margins decreased 390 basis points to 17.5 percent compared to 21.4 percent
  • Income from continuing operations decreased to $0.99 per share, compared to $1.06 per share
• Liquidity as of September 30, 2021 was $1,854 million (including availability under our revolving credit facility)
• Plumbing Products’ net sales increased 16 percent; in local currency and excluding acquisitions and divestitures, sales increased 13 percent
• Decorative Architectural Products’ net sales increased four percent; excluding acquisitions, sales increased three percent

Allman continued, “Demand for our products remains strong across categories and channels, and we are continuing to enhance our operational efficiency and capitalize on opportunities while navigating supply chain constraints and inflation. Based on the strength of our year-to-date performance, we expect to deliver full year adjusted earnings per share in the range of $3.67 to $3.73 per share, representing approximately 19 percent growth at the midpoint compared to 2020. While we will provide further guidance on our fourth quarter earnings call, based on our current view of our business, we expect to achieve margin expansion and double-digit adjusted earnings per share growth in 2022, consistent with the long-term growth outlook we provided earlier this year.”

Dividend Declaration

Masco’s Board of Directors declared a quarterly dividend of $0.235 per common share, payable on November 29, 2021, to shareholders of record on November 12, 2021.

About Masco

Headquartered in Livonia, Michigan, Masco Corporation is a global leader in the design, manufacture and distribution of branded home improvement and building products. Our portfolio of industry-leading brands includes Behr® paint; Delta® and Hansgrohe® faucets, bath and shower fixtures; Kichler® decorative and outdoor lighting; and HotSpring® spas. We leverage our powerful brands across product categories, sales channels and geographies to create value for our customers and shareholders. For more information about Masco Corporation, visit www.masco.com.

The third quarter 2021 supplemental material, including a presentation in PDF format, is available on Masco’s website at www.masco.com.

Conference Call Detail

A conference call regarding items contained in this release is scheduled for Wednesday, October 27, 2021 at 8:00 a.m. ET. Participants in the call are asked to register five to ten minutes prior to the scheduled start time by dialing (844) 549-7577 and from outside the U.S. at (442) 275-1712. Please use the conference identification number 9989065. The conference call will be webcast simultaneously and in its entirety through Masco’s website. Shareholders, media representatives and others interested in Masco may participate in the webcast by registering through the Investor Relations section on Masco’s website.

A replay of the call will be available on Masco’s website or by phone by dialing (855) 859-2056 and from outside the U.S. at (404) 537-3406. Please use the conference identification number 9989065. The telephone replay will be available approximately two hours after the end of the call and continue through November 27, 2021.

Safe Harbor Statement

This press release contains statements that reflect our views about our future performance and constitute “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “outlook,” “believe,” “anticipate,” “appear,” “may,” “will,” “should,” “intend,” “plan,” “estimate,” “expect,” “assume,” “seek,” “forecast,” and similar references to future periods. Our views about future performance involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. We caution you against relying on any of these forward-looking statements.

Our future performance may be affected by the levels of residential repair and remodel activity, and to a lesser extent, new home construction, our ability to maintain our strong brands and reputation and to develop innovative products, our ability to maintain our competitive position in our industries, our reliance on key customers, the length and severity of the ongoing COVID-19 pandemic, including its impact on domestic and international economic activity, consumer confidence, our production capabilities, our employees and our supply chain; the cost and availability of materials and the imposition of tariffs, our dependence on third-party suppliers, risks associated with our international operations and global strategies, our ability to achieve the anticipated benefits of our strategic initiatives, our ability to successfully execute our acquisition strategy and integrate businesses that we have and may acquire, our ability to attract, develop and retain talented and diverse personnel, risks associated with our reliance on information systems and technology, and our ability to achieve the anticipated benefits from our investments in new technology. These and other factors are discussed in detail in Item 1A “Risk Factors” in our most recent Annual Report on Form 10-K, as well as in our Quarterly Reports on Form 10-Q and in other filings we make with the Securities and Exchange Commission. Any forward-looking statement made by us speaks only as of the date on which it was made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible for us to predict all of them. Unless required by law, we undertake no obligation to update publicly any forward-looking statements as a result of new information, future events or otherwise.

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