REPORTABLE SEGMENT INFORMATION

The Company reports its 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 Reporting Topic of the ASC. The Company has determined that it has three reportable operating segments: The Americas Group, Consumer Brands Group and Performance Coatings Group (individually, a Reportable Segment and collectively, the Reportable Segments).



(Thousands of dollars)	Three Months Ended June 30, 2018
	The Americas Group		Consumer Brands Group		Performance Coatings Group		Administrative			Consolidated Totals
Net external sales	$	2,625,057	$	777,746	$	1,369,324	$	1,669		$	4,773,796
Intersegment transfers	219		955,270		6,570		(962,059		)
Total net sales and intersegment transfers	$	2,625,276	$	1,733,016	$	1,375,894	$	(960,390	)	$	4,773,796

Segment profit	$	569,897	$	90,903	$	144,194				$	804,994
Interest expense							$	(93,507	)	(93,507		)
Administrative expenses and other							(173,401		)	(173,401		)
Income from continuing operations before income taxes	$	569,897	$	90,903	$	144,194	$	(266,908	)	$	538,086



	Three Months Ended June 30, 2017
	The Americas Group		Consumer Brands Group		Performance Coatings Group		Administrative			Consolidated Totals
Net external sales	$	2,437,655	$	536,441	$	761,094	$	627		$	3,735,817
Intersegment transfers	2,020		864,337		7,231		(873,588		)
Total net sales and intersegment transfers	$	2,439,675	$	1,400,778	$	768,325	$	(872,961	)	$	3,735,817

Segment profit	$	532,687	$	76,064	$	62,345				$	671,096
Interest expense							$	(56,729	)	(56,729		)
Administrative expenses and other							(105,364		)	(105,364		)
Income from continuing operations before income taxes	$	532,687	$	76,064	$	62,345	$	(162,093	)	$	509,003




	Six Months Ended June 30, 2018
	The Americas Group		Consumer Brands Group		Performance Coatings Group		Administrative			Consolidated Totals
Net external sales	$	4,705,472	$	1,434,125	$	2,597,099	$	2,106		$	8,738,802
Intersegment transfers	273		1,721,333		12,414		(1,734,020		)
Total net sales and intersegment transfers	$	4,705,745	$	3,155,458	$	2,609,513	$	(1,731,914	)	$	8,738,802

Segment profit	$	907,289	$	165,131	$	234,960				$	1,307,380
Interest expense							$	(185,054	)	(185,054		)
Administrative expenses and other							(280,654		)	(280,654		)
Income from continuing operations before income taxes	$	907,289	$	165,131	$	234,960	$	(465,708	)	$	841,672




	Six Months Ended June 30, 2017
	The Americas Group		Consumer Brands Group		Performance Coatings Group		Administrative			Consolidated Totals
Net external sales	$	4,389,401	$	859,807	$	1,245,548	$	2,448		$	6,497,204
Intersegment transfers	4,361		1,560,175		11,031		(1,575,567		)
Total net sales and intersegment transfers	$	4,393,762	$	2,419,982	$	1,256,579	$	(1,573,119	)	$	6,497,204

Segment profit	$	837,911	$	131,978	$	119,457				$	1,089,346
Interest expense							$	(82,424	)	(82,424		)
Administrative expenses and other							(191,314		)	(191,314		)
Income from continuing operations before income taxes	$	837,911	$	131,978	$	119,457	$	(273,738	)	$	815,608

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 of all consolidated foreign subsidiaries were $1.018 billion and $603.3 million for the second quarter of 2018 and 2017, respectively. Net external sales of all consolidated foreign subsidiaries were $1.938 billion and $1.022 billion for the six months ended 2018 and 2017, respectively. Long-lived assets of these subsidiaries totaled $3.485 billion and $1.698 billion at June 30, 2018 and June 30, 2017, respectively. The increase in net external sales and long-lived assets is primarily due to the Acquisition. 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 during all periods presented.

For further details on the Company's Reportable Segments, see Note 18 to the Consolidated Financial Statements in the Company's Annual Report on Form 10-K for the year ended December 31, 2017.