CFO Departs as RPM Wraps up Restructuring
MEDINA, OH — RPM Inc. said it has completed a restructuring and consolidation program launched in August 1999 with the reduction of positions at several operating companies and its corporate headquarters.
Included in the latest round of cutbacks was Vice President and Chief Financial Officer Michael E. Steele, whose position is being assumed by Vice Chairman James A. Karman, the company said. Karman previously held the position for more than a decade.
Since the start of the restructuring program began, RPM has eliminated approximately 800 positions, or 10% of its work force worldwide.
RPM Chairman and CEO Thomas C. Sullivan said the restructuring program has “demonstrated our commitment to across-the-board cost reductions, in which no part of RPM had immunity from these painful but necessary decisions.” He said Steele’s departure “was an economic decision made possible by the strong nucleus of three experienced officer-level financial executives who continue in their current positions at RPM.”
RPM reported a net loss of $7.0 million for its most recent quarter ended Feb. 28, while sales for the quarter were off 1.7%, to $404 million, from the prior-year period. For the nine-month period ended Feb. 28, net income rose 18.9%, to $38.7 million, from the previous year. Sales for the nine-month period increased 3%, to $1.45 billion.
Sullivan said financial results for the past two years “have been disappointing” due in part to the recent challenging economic environment, and the impact of the restructuring program, but he said the moves are expected to result in “significantly improved earnings and margins” for the company’s fiscal year ended May 31. He said the company anticipates a return to “its traditional level of earnings growth” in the current fiscal year that began June 1, “despite what we expect to be continuing slowness in the overall economy."