Reportable Segment Information

3 Months Ended

Mar. 31, 2012

Reportable Segment Information [Abstract]

REPORTABLE SEGMENT INFORMATION

NOTE 13—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 segments: Paint Stores Group, Consumer Group, Global Finishes Group and Latin America Coatings Group (collectively, the “Reportable Segments”).

(Thousands of dollars)
	Three Months Ended March 31, 2012
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings Group		Administrative			Consolidated Totals
Net external sales	$	1,123,078	$	320,373		$	483,075	$	208,594	$	1,224		$	2,136,344
Intersegment transfers				503,501			2,330		10,975		(516,806	)
Total net sales and intersegment transfers	$	1,123,078	$	823,874		$	485,405	$	219,569	$	(515,582	)	$	2,136,344
Segment profit	$	112,713	$	55,306	*	$	28,636	$	19,887				$	216,542
Interest expense										$	(10,337	)		(10,337	)
Administrative expenses and other											(63,890	)		(63,890	)
Income before income taxes	$	112,713	$	55,306		$	28,636	$	19,887	$	(74,227	)	$	142,315
	Three Months Ended March 31, 2011
	Paint Stores Group		Consumer Group			Global Finishes Group		Latin America Coatings Group		Administrative			Consolidated Totals
Net external sales	$	929,267	$	294,930		$	435,317	$	194,849	$	1,223		$	1,855,586
Intersegment transfers				418,148			1,298		8,440		(427,886	)
Total net sales and intersegment transfers	$	929,267	$	713,078		$	436,615	$	203,289	$	(426,663	)	$	1,855,586
Segment profit	$	68,857	$	41,091	*	$	19,438	$	17,372				$	146,758
Interest expense										$	(10,675	)		(10,675	)
Administrative expenses and other											(41,370	)		(41,370	)
Income before income taxes	$	68,857	$	41,091		$	19,438	$	17,372	$	(52,045	)	$	94,713

* Segment profit includes $6,676 and $4,948 of mark-up on intersegment transfers realized as a result of external sales by the Paint Stores Group during the first quarter of 2012 and 2011, 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 $501.8 million and $34.8 million, respectively, for the first quarter of 2012, and $470.0 million and $27.4 million, respectively, for the first quarter of 2011. Long-lived assets of these subsidiaries totaled $662.2 million and $662.5 million at March 31, 2012 and March 31, 2011, 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.