RPM has a new profit plan. What happened to the last one?

RPM is launching another drive to improve profits, with $400 million in planned benefits from manufacturing, purchasing, overhead and commercial improvements. The coatings and building-products maker wants annual sales of $10 billion by fiscal 2030.

Research by Ticker Byline shows that RPM's original MAP 2025 targets remained out of reach in fiscal 2026, when the company had expected them to be fully reflected in its results. Adjusted profit before interest and taxes reached about $1.02 billion, against an original goal of $1.36 billion. The margin was roughly 13%, against 16%.

The goals in the earlier slides

RPM set out MAP 2025 at its October 2022 investor day. The goals were annualized targets for May 2025, with the full benefit expected in fiscal 2026. These were the plan's original long-term ambitions, built around sales growth, acquisitions and operating improvements.

Adjusted EBIT is RPM's profit before interest and taxes, with items such as restructuring and acquisition costs removed. Its fiscal 2026 result was about 25% below the original target.

That leaves a substantial gap, alongside a real improvement. The same profit measure was about 44% higher than in fiscal 2022, the earlier plan's starting year. RPM's latest presentation also points to plant and warehouse closures, purchasing changes and a smaller number of accounting systems as achievements of its improvement programs.

The new margin goal uses a different measure

MAP 2030 aims for $2 billion in adjusted EBITDA, or 20% of the targeted $10 billion in sales. That is a different measure from the earlier 16% adjusted EBIT goal.

EBITDA also adds back depreciation and amortization, expenses that spread the cost of equipment and other assets over time. Those add-backs lifted RPM's fiscal 2026 adjusted profit measure by $208.3 million, from $1.02 billion of EBIT to $1.23 billion of EBITDA. The new plan therefore starts from an adjusted EBITDA margin of 15.6%.

For the new target, RPM expects about $115 million of benefits from manufacturing, $112 million from purchasing, $125 million from overhead and commercial productivity, and $48 million from pricing and selling improvements.

Together, those benefits cover just over half the roughly $772 million increase needed to move from fiscal 2026 adjusted EBITDA to the $2 billion target. Growth has to contribute as well.

Sales growth is part of the profit plan

RPM's revenue assumptions call for roughly 2% annual growth each from higher volumes, pricing and acquisitions. Overall, reaching $10 billion from fiscal 2026 sales requires about 6.2% annual growth over four years.

The company is pursuing that growth from a business largely tied to maintaining and repairing existing assets. It estimates that repair and maintenance account for about 65% of its mix, with the rest linked to new construction and manufacturing customers.

The RPM company profile tracks the earlier goals, the results and the new targets.