Masco lifts full-year profit forecast on higher pricing, easing costs
Oct 26 (Reuters) - Masco posted a better-than-expected quarterly profit and raised its full-year earnings forecast on Thursday as the home-building products manufacturer benefits from higher prices and easing raw material expenses.
The costs of some commodities cooled from last year's highs, while freight costs also tempered in the quarter. That, along with Masco raising its prices, has helped it bolster its margins and weather a drop in sales.
The company's adjusted profit of $1 per share in the third quarter beat market expectations of 91 cents per share, according to LSEG data.
Its sales slid 10% to $1.98 billion, but topped analysts' average estimate of $1.97 billion.
The lower costs and higher prices pushed Masco's adjusted gross margin up to 35.8% in the quarter, from 31.5% a year ago.
Masco expects a low single-digit deflation in some paint raw material costs in the current quarter, it said in a post-earnings call.
It raised its full-year adjusted earnings per share forecast to $3.65 to $3.75, from its previous view of $3.50 to $3.65.
Masco, which partners with home improvement retailer Home Depot for paints and painting services from its BEHR brand, has banked on new product launches to attract demand.
In August, Home Depot noted that Americans were gradually beginning to increase spending on small-scale projects to prop up their homes. (Reporting by Juveria Tabassum; Editing by Savio D'Souza)
