Segment Information

3 Months Ended

Jan. 27, 2017

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

Based on the nature of our products, technology, manufacturing processes, customers and regulatory environment, we aggregate our operating segments into two reportable segments: Coatings and Paints. We are required to report segment information in the same way that management internally organizes its business for assessing performance and making decisions regarding allocation of resources. We evaluate the performance of operating segments and allocate resources based on earnings before interest and taxes (EBIT).

The Coatings segment aggregates our industrial product lines and packaging product line. Industrial products include a broad range of decorative and protective coatings for metal, wood and plastic. Packaging products include both interior and exterior coatings used in packaging containers, principally metal food containers and beverage cans. The products of this segment are sold throughout the world.

The Paints segment aggregates our consumer paint and automotive refinish product lines. Consumer paint products include interior and exterior decorative paints, stains, primers, varnishes, high performance floor paints and specialty decorative products, such as enamels, aerosols and faux finishes primarily distributed for the do-it-yourself and professional markets in Australia, China, Europe and North America. Automotive refinish products include refinish paints and aerosol spray paints sold through automotive refinish distributors, body shops and automotive supply distributors and retailers in many countries around the world.

Our remaining activities are included in Other and Administrative. These activities include specialty polymers and colorants that are used internally and sold to other coatings manufacturers, as well as related products, furniture protection plans and furniture care and repair products. Also included within Other and Administrative are our corporate administrative expenses. The administrative expenses include expenses not directly allocated to any other reportable segment.

In the following table, sales between segments are recorded at selling prices that are below market prices, generally intended to recover internal costs. Segment EBIT includes income realized on inter-segment sales. Comparative segment data for the three months ended January 27, 2017 and January 29, 2016 are as follows:

	Three Months Ended
	January 27, 2017			January 29, 2016
Net sales
Coatings	$	565,212		$	543,563
Paints	291,275			291,097
Other and Administrative	93,065			90,525
Less Inter-segment Sales	(41,900		)	(39,429		)
Total Net sales	$	907,652		$	885,756
EBIT
Coatings	$	86,728		$	96,547
Paints	3,887			3,819
Other and Administrative	(15,348		)	(7,273		)
Total EBIT	75,267			93,093
Interest expense	22,544			22,415
Income before income taxes	$	52,723		$	70,678

It is not practicable to obtain the information needed to disclose revenues attributable to each of our identified product lines within our reportable segments.