Reportable Segment Information

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

REPORTABLE SEGMENT INFORMATION

REPORTABLE SEGMENT INFORMATION

The Company reports segment information in the same way that management internally organizes its business for assessing performance and making decisions regarding allocation of resources in accordance with the Segment Disclosures Topic of the ASC. The Company has determined that it has four reportable operating segments: Paint Stores Group, Consumer Group, Global Finishes Group and Latin America Coatings Group (individually, a "Reportable Segment" and collectively, the “Reportable Segments”).

(Thousands of dollars)	Three Months Ended June 30, 2013
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings Group		Administrative			Consolidated Totals
Net external sales	$	1,606,509	$	393,660		$	513,524	$	198,991	$	1,205		$	2,713,889
Intersegment transfers			658,202			3,740		9,691		(671,633		)
Total net sales and intersegment transfers	$	1,606,509	$	1,051,862		$	517,264	$	208,682	$	(670,428	)	$	2,713,889
Segment profit	$	332,972	$	79,042	(1)	$	54,462	$	856				$	467,332
Interest expense										$	(15,069	)	(15,069		)
Administrative expenses and other										(71,379		)	(71,379		)
Income before income taxes	$	332,972	$	79,042		$	54,462	$	856	$	(86,448	)	$	380,884

	Three Months Ended June 30, 2012
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings Group		Administrative			Consolidated Totals
Net external sales	$	1,488,109	$	397,749		$	498,693	$	187,281	$	1,190		$	2,573,022
Intersegment transfers			655,276			1,935		11,649		(668,860		)
Total net sales and intersegment transfers	$	1,488,109	$	1,053,025		$	500,628	$	198,930	$	(667,670	)	$	2,573,022
Segment profit	$	266,982	$	80,757	(1)	$	48,032	$	9,281				$	405,052
Interest expense										$	(10,230	)	(10,230		)
Administrative expenses and other										(67,019		)	(67,019		)
Income before income taxes	$	266,982	$	80,757		$	48,032	$	9,281	$	(77,249	)	$	327,803

⁽¹⁾ Segment profit includes $8,108 and $7,968 of mark-up on intersegment transfers realized as a result of external sales by the Paint Stores Group during the second quarter of 2013 and 2012, respectively.

	Six Months Ended June 30, 2013
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings  Group		Administrative			Consolidated Totals
Net external sales	$	2,774,446	$	702,240		$	1,000,342	$	401,627	$	2,402		$	4,881,057
Intersegment transfers			1,165,906			5,031		19,912		(1,190,849		)
Total net sales and intersegment transfers	$	2,774,446	$	1,868,146		$	1,005,373	$	421,539	$	(1,188,447	)	$	4,881,057
Segment profit	$	462,685	$	133,014	(2)	$	88,393	$	21,695				$	705,787
Interest expense										$	(30,380	)	(30,380		)
Administrative expenses and other										(126,139		)	(126,139		)
Income before income taxes	$	462,685	$	133,014		$	88,393	$	21,695	$	(156,519	)	$	549,268

	Six Months Ended June 30, 2012
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings  Group		Administrative			Consolidated Totals
Net external sales	$	2,611,187	$	718,122		$	981,768	$	395,874	$	2,415		$	4,709,366
Intersegment transfers			1,158,776			4,265		22,624		(1,185,665		)
Total net sales and intersegment transfers	$	2,611,187	$	1,876,898		$	986,033	$	418,498	$	(1,183,250	)	$	4,709,366
Segment profit	$	379,694	$	136,063	(2)	$	76,669	$	29,168				$	621,594
Interest expense										$	(20,567	)	(20,567		)
Administrative expenses and other										(130,909		)	(130,909		)
Income before income taxes	$	379,694	$	136,063		$	76,669	$	29,168	$	(151,476	)	$	470,118

⁽²⁾ Segment profit includes $14,278 and $14,644 of mark-up on intersegment transfers realized as a result of external sales by the Paint Stores Group during the first six months of 2013 and 2012, respectively.

In the reportable segment financial information, Segment profit was total net sales and intersegment transfers less operating costs and expenses. Domestic intersegment transfers were accounted for at the approximate fully absorbed manufactured cost, based on normal capacity volumes, plus customary distribution costs. International intersegment transfers were accounted for at values comparable to normal unaffiliated customer sales. The Administrative segment includes the administrative expenses of the Company’s corporate headquarters site. Also included in the Administrative segment was interest expense, interest and investment income, certain expenses related to closed facilities and environmental-related matters, and other expenses which were not directly associated with the Reportable Segments. The Administrative segment did not include any significant foreign operations. Also included in the Administrative segment was a real estate management unit that is responsible for the ownership, management and leasing of non-retail properties held primarily for use by the Company, including the Company’s headquarters site, and disposal of idle facilities. Sales of this segment represented external leasing revenue of excess headquarters space or leasing of facilities no longer used by the Company in its primary businesses. Gains and losses from the sale of property were not a significant operating factor in determining the performance of the Administrative segment.

Net external sales and segment profit of all consolidated foreign subsidiaries were $531.6 million and $5.6 million, respectively, for the second quarter of 2013, and $491.9 million and $32.5 million, respectively, for the second quarter of 2012. Net external sales and segment profit of these subsidiaries were $1.048 billion and $31.2 million, respectively, for the first six months of 2013, and $993.8 million and $67.3 million, respectively, for the first six months of 2012. Long-lived assets of these subsidiaries totaled $765.9 million and $637.7 million at June 30, 2013 and June 30, 2012, respectively. Domestic operations accounted for the remaining net external sales, segment profits and long-lived assets. No single geographic area outside the United States was significant relative to consolidated net external sales, income before taxes, or consolidated long-lived assets.

Export sales and sales to any individual customer were each less than 10 percent of consolidated sales to unaffiliated customers during all periods presented.