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Reportable Segment Information | 12 Months Ended
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Dec. 31, 2021
Segment Reporting [Abstract] |
REPORTABLE SEGMENT INFORMATION | 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 three reportable operating segments: The Americas Group, Consumer Brands Group and Performance Coatings Group (individually, a Reportable Segment and collectively, the Reportable Segments). Factors considered in determining the three Reportable Segments of the Company include the nature of business activities, the management structure directly accountable to the Company’s chief operating decision maker (CODM) for operating and administrative activities, availability of discrete financial information and information presented to the Board of Directors. The Company reports all other business activities and immaterial operating segments that are not reportable in the Administrative segment. The Company’s CODM has been identified as the Chief Executive Officer because he has final authority over performance assessment and resource allocation decisions. Because of the diverse operations of the Company, the CODM regularly receives discrete financial information about each Reportable Segment as well as a significant amount of additional financial information about certain divisions, business units or subsidiaries of the Company. The CODM uses all such financial information for performance assessment and resource allocation decisions. The CODM evaluates the performance of and allocates resources to the Reportable Segments based on segment profit or loss and cash generated from operations. The accounting policies of the Reportable Segments are the same as those described in Note 1 of this report. The Americas Group consisted of 4,859 company-operated specialty paint stores in the United States, Canada, Latin America and the Caribbean region at December 31, 2021. Each store in this segment is engaged in servicing the needs of architectural and industrial paint contractors and do-it-yourself homeowners. These stores market and sell Sherwin-Williams® and other controlled brand architectural paint and coatings, protective and marine products, OEM product finishes and related products. The majority of these products are produced by manufacturing facilities in the Consumer Brands Group. In addition, each store sells select purchased associated products. The Americas Group sells a variety of architectural paints, coatings and related products through dedicated dealers, home centers, distributors, hardware stores and other retailers throughout Latin America. The Americas Group meets regional customer demands through developing, licensing, manufacturing, distributing and selling a variety of architectural paints, coatings and related products in North and South America. The loss of any single customer would not have a material adverse effect on the business of this segment. At December 31, 2021, The Americas Group consisted of operations from subsidiaries in 10 foreign countries. During 2021, this segment opened 85 net new stores, consisting of 92 new stores opened (76 in the United States, 3 in Canada, 10 in Mexico and 3 in South America) and 7 stores closed (6 in the United States and 1 in South America). In 2020 and 2019, this segment opened 16 and 62 net new stores, respectively. The CODM uses discrete financial information about The Americas Group, supplemented with information by geographic region, product type and customer type, to assess performance of and allocate resources to The Americas Group as a whole. In accordance with ASC 280-10-50-9, The Americas Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment. The Consumer Brands Group supplies a broad portfolio of branded and private-label architectural paint, stains, varnishes, industrial products, wood finishes products, wood preservatives, applicators, corrosion inhibitors, aerosols, caulks and adhesives to retailers and distributors throughout North America, as well as in China and Europe. The Consumer Brands Group also supports the Company’s other businesses around the world with new product research and development, manufacturing, distribution and logistics. Approximately 62% of the total sales of the Consumer Brands Group in 2021 were intersegment transfers of products primarily sold through The Americas Group. At December 31, 2021, the Consumer Brands Group consisted of operations in the United States and subsidiaries in 5 foreign countries. Sales and marketing of certain controlled brand and private-label products is performed by a direct sales staff. The products distributed through third-party customers are intended for resale to the ultimate end-user of the product. The Consumer Brands Group had sales to certain customers that, individually, may be a significant portion of the sales and related profitability of the segment. This segment incurred most of the Company’s capital expenditures related to operational efficiencies, capacity, health and safety at sites currently in operation. The CODM uses discrete financial information about the Consumer Brands Group, supplemented with information by product type and customer type, to assess performance of and allocate resources to the Consumer Brands Group as a whole. In accordance with ASC 280-10-50-9, the Consumer Brands Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment. The Performance Coatings Group develops and sells industrial coatings for wood finishing and general industrial (metal and plastic) applications, automotive refinish, protective and marine coatings, coil coatings, packaging coatings and performance-based resins and colorants worldwide. This segment licenses certain technology and trade names worldwide. Sherwin-Williams® and other controlled brand products are distributed through The Americas Group and this segment’s 282 company-operated branches and by a direct sales staff and outside sales representatives to retailers, dealers, jobbers, licensees and other third-party distributors. The Performance Coatings Group had sales to certain customers that, individually, may be a significant portion of the sales of the segment. However, the loss of any single customer would not have a material adverse effect on the overall profitability of the segment. During 2021, this segment opened 1 new branch and closed 1 branch for no net change in the number of branches operated. At December 31, 2021, the Performance Coatings Group consisted of operations in the United States and subsidiaries in 44 foreign countries. The CODM uses discrete financial information about the Performance Coatings Group, supplemented with information about geographic divisions, business units and subsidiaries, to assess performance of and allocate resources to the Performance Coatings Group as a whole. In accordance with ASC 280-10-50-9, the Performance Coatings Group as a whole is considered the operating segment, and because it meets the criteria in ASC 280-10-50-10, it is also considered a Reportable Segment. The Administrative segment includes the administrative expenses of the Company’s corporate headquarters site and the operations of 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. 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 that were not directly associated with the Reportable Segments. In addition, the Administrative segment includes the $111.9 million pre-tax loss on the Wattyl divestiture recognized during the year ended December 31, 2021. See Notes 3 and 18 for additional information on the Wattyl divestiture. 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. The Administrative segment did not include any significant foreign operations. 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 $4.223 billion, $3.581 billion and $3.679 billion for 2021, 2020 and 2019, respectively. Long-lived assets consisted of Property, plant and equipment, Goodwill, Intangible assets, Operating lease right-of-use assets, Deferred pension assets and Other assets. The aggregate total of long-lived assets for the Company was $15.613 billion, $15.810 billion and, $15.865 billion at December 31, 2021, 2020 and 2019, respectively. Long-lived assets of consolidated foreign subsidiaries totaled $2.785 billion, $3.167 billion and $3.211 billion at December 31, 2021, 2020 and 2019, respectively. Total Assets of the Company were $20.667 billion, $20.402 billion and $20.496 billion at December 31, 2021, 2020 and 2019, respectively. Total assets of consolidated foreign subsidiaries were $4.653 billion, $4.834 billion and $4.829 billion, which represented 22.5%, 23.7% and 23.6% of the Company’s total assets at December 31, 2021, 2020 and 2019, respectively. No single geographic area outside the United States was significant relative to consolidated net external sales 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 years presented. In the reportable segment financial information that follows, Segment profit was total net sales and intersegment transfers less operating costs and expenses. Identifiable assets were those directly identified with each reportable segment. The Administrative segment assets consisted primarily of cash and cash equivalents, investments, deferred pension assets and headquarters property, plant and equipment. The margin for each reportable segment was based upon total net sales and intersegment transfers. Domestic intersegment transfers were primarily accounted for at the approximate fully absorbed manufactured cost, based on normal capacity volumes, plus customary distribution costs for paint products. Non-paint domestic and all international intersegment transfers were accounted for at values comparable to normal unaffiliated customer sales. All intersegment transfers are eliminated within the Administrative segment.
| 2021
| The Americas Group |  | Consumer Brands Group |  | Performance Coatings Group |  | Administrative |  | Consolidated Totals
Net external sales | $ | 11,217.0 |  |  | $ | 2,721.6 |  |  | $ | 6,003.8 |  |  | $ | 2.2 |  |  | $ | 19,944.6 |
Intersegment transfers | — |  |  | 4,411.8 |  |  | 149.7 |  |  | (4,561.5) |  |  | — |
Total net sales and intersegment transfers | $ | 11,217.0 |  |  | $ | 7,133.4 |  |  | $ | 6,153.5 |  |  | $ | (4,559.3) |  |  | $ | 19,944.6 |
Segment profit | $ | 2,239.1 |  |  | $ | 358.4 |  |  | $ | 486.2 |  |  |  |  | $ | 3,083.7 |
Interest expense |  |  |  |  |  |  | $ | (334.7) |  |  | (334.7) |
Administrative expenses and other |  |  |  |  |  |  | (500.4) |  |  | (500.4) |
Income before income taxes | $ | 2,239.1 |  |  | $ | 358.4 |  |  | $ | 486.2 |  |  | $ | (835.1) |  |  | $ | 2,248.6 |
% to net external sales | 20.0 | % |  | 13.2 | % |  | 8.1 | % |  |  |  | 11.3 | %
Identifiable assets | $ | 5,627.9 |  |  | $ | 5,161.1 |  |  | $ | 8,388.6 |  |  | $ | 1,489.1 |  |  | $ | 20,666.7 |
Capital expenditures | 79.2 |  |  | 123.9 |  |  | 90.8 |  |  | 78.1 |  |  | 372.0 |
Depreciation | 73.4 |  |  | 86.7 |  |  | 66.2 |  |  | 36.8 |  |  | 263.1 |
Amortization | 3.7 |  |  | 83.7 |  |  | 218.9 |  |  | 3.2 |  |  | 309.5 |
| 2020
| The Americas Group |  | Consumer Brands Group |  | Performance Coatings Group |  | Administrative |  | Consolidated Totals
Net external sales | $ | 10,383.2 |  |  | $ | 3,053.4 |  |  | $ | 4,922.4 |  |  | $ | 2.7 |  |  | $ | 18,361.7 |
Intersegment transfers | — |  |  | 3,688.4 |  |  | 137.1 |  |  | (3,825.5) |  |  | — |
Total net sales and intersegment transfers | $ | 10,383.2 |  |  | $ | 6,741.8 |  |  | $ | 5,059.5 |  |  | $ | (3,822.8) |  |  | $ | 18,361.7 |
Segment profit | $ | 2,294.1 |  |  | $ | 579.6 |  |  | $ | 500.1 |  |  |  |  | $ | 3,373.8 |
Interest expense |  |  |  |  |  |  | $ | (340.4) |  |  | (340.4) |
Administrative expenses and other |  |  |  |  |  |  | (514.2) |  |  | (514.2) |
Income before income taxes | $ | 2,294.1 |  |  | $ | 579.6 |  |  | $ | 500.1 |  |  | $ | (854.6) |  |  | $ | 2,519.2 |
% to net external sales | 22.1 | % |  | 19.0 | % |  | 10.2 | % |  |  |  | 13.7 | %
Identifiable assets | $ | 5,386.6 |  |  | $ | 5,387.4 |  |  | $ | 8,071.1 |  |  | $ | 1,556.5 |  |  | $ | 20,401.6 |
Capital expenditures | 63.9 |  |  | 89.8 |  |  | 43.0 |  |  | 107.1 |  |  | 303.8 |
Depreciation | 73.0 |  |  | 87.6 |  |  | 69.1 |  |  | 38.3 |  |  | 268.0 |
Amortization | 4.5 |  |  | 90.0 |  |  | 213.9 |  |  | 5.0 |  |  | 313.4 |
| 2019
| The Americas Group |  | Consumer Brands Group |  | Performance Coatings Group |  | Administrative |  | Consolidated Totals
Net external sales | $ | 10,171.9 |  |  | $ | 2,676.8 |  |  | $ | 5,049.2 |  |  | $ | 2.9 |  |  | $ | 17,900.8 |
Intersegment transfers | — |  |  | 3,607.0 |  |  | 116.2 |  |  | (3,723.2) |  |  | — |
Total net sales and intersegment transfers | $ | 10,171.9 |  |  | $ | 6,283.8 |  |  | $ | 5,165.4 |  |  | $ | (3,720.3) |  |  | $ | 17,900.8 |
Segment profit | $ | 2,056.5 |  |  | $ | 373.2 |  |  | $ | 379.1 |  |  |  |  | $ | 2,808.8 |
Interest expense |  |  |  |  |  |  | $ | (349.3) |  |  | (349.3) |
Administrative expenses and other |  |  |  |  |  |  | (477.7) |  |  | (477.7) |
Income before income taxes | $ | 2,056.5 |  |  | $ | 373.2 |  |  | $ | 379.1 |  |  | $ | (827.0) |  |  | $ | 1,981.8 |
% to net external sales | 20.2 | % |  | 13.9 | % |  | 7.5 | % |  |  |  | 11.1 | %
Identifiable assets | $ | 5,399.1 |  |  | $ | 5,600.8 |  |  | $ | 8,175.6 |  |  | $ | 1,320.7 |  |  | $ | 20,496.2 |
Capital expenditures | 73.3 |  |  | 133.4 |  |  | 84.2 |  |  | 38.0 |  |  | 328.9 |
Depreciation | 72.2 |  |  | 81.1 |  |  | 70.9 |  |  | 37.9 |  |  | 262.1 |
Amortization | 4.8 |  |  | 90.3 |  |  | 212.9 |  |  | 4.8 |  |  | 312.8 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI http://asc.fasb.org/extlink&oid=123359005&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI http://asc.fasb.org/topic&trid=2134510 + Details
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