Valspar (VAL) said net sales dropped 2% to $1.06 billion in the second quarter from a year earlier, as the negative impacts from foreign currency translation more than offset boosts from acquisitions.
Net income fell 11% on a reported basis, but rose 7% excluding restructuring costs and $18 million in costs associated with the proposed merger with Sherwin-Williams (SHW) .
Adjusted earnings in the period were $1.22 a share, below analysts' estimates of $1.26.
The Minneapolis-based maker of paint and coatings said sales fell 4% to $587 million in the coatings segment, while paint segment sales edged higher by 1% to $407 million. Total volume fell 1% as volume rose 2% in the coatings segment but declined 6% in the paints segment.
"Coatings segment performance continues to show the strength of our diversified portfolio, with solid volume growth in the Coil, Wood and Packaging product lines," Valspar Chairman and CEO Gary E. Hendrickson said in a statement.
Sherwin-Williams said in March it would acquire Valspar to help strengthen its position as a premier global paints and coatings provider. The acquisition is subject to approval from shareholders as well as the Federal Trade Commission, which earlier in May made a second request for a review regarding the acquisition.
Valspar said Tuesday that it was withdrawing its guidance for the year because of the pending merger.
Valspar shares slipped 0.6% in premarket trading on Tuesday.