Good morning. Thank you for joining the Sherwin-Williams Company's Review of Q2 2024 Results and our Outlook for Q3 and Full-Year of 2024. With us on today's call are Heidi Petz, President and CEO; Allen Mistysyn, Chief Financial Officer; Jane Cronin, Senior Vice President, Enterprise Finance; and Jim Jaye, Senior Vice President, Investor Relations and Communications. This conference call is being webcast simultaneously in listen-only mode. An archived replay of this webcast will be available. This conference call will include certain forward-looking statements as defined under U.S. federal securities laws with respect to sales, earnings, and other matters. Any forward-looking statement speaks only as of the date on which such statement is made, and the company undertakes no obligation to update or revise. After the company's prepared remarks, we will open up this session to questions. I will now turn the call over to Jim Jaye.

Thank you, and good morning. Sherwin-Williams delivered a strong quarter, driven by continued execution of our strategy with little help from what continues to be an uneven global macroeconomic environment. Led by Paint Stores Group, consolidated sales were within our guided range, gross margin expanded, and diluted earnings per share and EBITDA grew by double-digit percentages. Margin improved sequentially and year-over-year in all three reportable segments. We continue to make progress on our enterprise priorities and we are clearly seeing returns from the heightened investments made in the back half of last year and which have now annualized. We also maintained our disciplined capital allocation approach during the quarter, returning $613 million to our shareholders through dividends and share repurchases, an increase of 57% year-over-year. Our second quarter performance ends our first half on a strong note and coupled with our current visibility into the back half of the year, we are increasing our full-year earnings outlook. We remain highly focused on executing our strategy, demonstrating our value proposition to win new accounts and increased share of wallet, and taking advantage of disruptions in the market. We are well positioned to deliver in the current environment and highly confident that our actions and investments will result in even stronger performance when end market demand eventually becomes more robust. Let me now turn it over to Heidi, who will comment on our second quarter results by segment before moving on to our outlook and your questions.

Thank you, Jim. First, I want to thank all 65,000 of our employees around the world for their efforts in the quarter and for their ongoing passion for our company and our customers. I continue to be humbled and inspired by all that you do. I believe our second quarter results demonstrate three things: One, we have the right strategy. Two, our team continues to execute and adapt. And three, we continue to see returns from our ongoing investments in the business. At the same time, we're not content with where we are by any means and our team understands that we must continue to operate with determination and urgency. We're delivering strong results in a choppy demand environment while executing on initiatives that will put our customers and our company in position for even greater sustained success. As far as specifics on the second quarter, I'll begin with the Paint Stores Group where sales increased by mid-single digits against a double-digit comparison. Volume and price were both up low-single digits. As we expected, price realization improved as the quarter progressed. Segment margin increased to 25.1%, driven by higher sales and moderating raw material costs. Pro sales were led by residential repaint, which was up by a mid-single digit percentage. Strong evidence that we are continuing to take share in a down market. We're clearly seeing a return here from the investments in dedicated sales reps we made in the back half of last year. New residential returned to growth in the quarter as we are seeing improving single family starts turn to completion. Commercial grew by low-single digits against a double-digit comparison. Property management was down less than 1% with continued delays in CapEx projects. Protective and marine was up mid-single digits against a low-20s comparison. And while we acknowledge that there have been project delays, we feel very good about the pipeline. DIY increased low-single digits compared to a high-teens comparison. From a product perspective, interior paint sales grew faster than exterior paint sales. We have opened 26 net new stores year-to-date and expect to open 80 to 100 for the full year. Moving on to our Consumer Brands Group, sales underperformed our expectations in a market that was softer than we anticipated. Lower volume, the impact of the China architectural divestiture, and unfavorable currency translation were partially offset by selling price increases primarily in Latin America. Sales in North America decreased by a high-single digit percentage where weakness in existing home sales remains a headwind. Inflation, depleted savings, and household debt also continue to pressure consumers who currently appear to be spending their modest available discretionary dollars elsewhere. We understand where we are in this cycle and eventually expect to see an upturn in DIY demand. We're confident that we are well positioned with our growing partnerships over the long term. Outside of North America, sales decreased by a high-single digit percentage in Latin America and a double-digit percentage in Europe. Adjusted segment margin expanded to 26.1%. This was primarily driven by improvements in manufacturing and distribution fixed cost absorption within the segment and moderating raw material costs, partially offset by net sales that were below expectations and higher employee-related costs. In the Performance Coatings Group, modest sales growth was driven by an acquisition, which was partially offset by unfavorable currency translation. Adjusted segment margin improved to 19.4%. This continued strong margin performance reflects our ability to drive our customer success in end markets that value differentiation. It also reflects the ongoing hard work of our team to optimize this business. We continue to see choppy demand by division and region. Industrial wood led the growth including the impact of an acquisition. Coil also delivered solid growth driven by share gains. Auto refinish was up low-single digits in North America and down less than 1% overall. Share gains are offsetting softness in our core business where consumer reluctance to pay deductibles is resulting in lower insurance claims. Packaging was down less than expected and we have a good line of sight to improvement in the back half of the year. General industrial demand was lower in all regions. Heavy equipment and transportation were down more significantly, while energy infrastructure was a bright spot. Regionally, sales in the group were down low-single digits in North America, but positive in other regions. Moving on to our guidance for the third quarter and full year, it's clear that the macroeconomic environment has been softer for longer than many economists anticipated at the start of the year. We don't expect to get material help from the market in our back half. We are unwilling to simply accept these conditions and you can count on us to continue being very aggressive in our pursuit of new business and share of wallet gains. Sherwin-Williams is incredibly well-positioned in each of our targeted end markets. Comparisons ease in our second half, competitive dynamics are a tailwind, and we are confident share gains will become more apparent over time as market conditions improve. As for our specific outlook, the slide deck issued with this morning's press release includes our expectations for consolidated and segment sales for the third quarter of 2024. For the full year 2024, consolidated sales are expected to be up a low-single digit percentage compared to our previous guidance of up low to mid-single digits. Full year sales guidance for the Paint Stores Group and the Performance Coatings Group remain unchanged. We have reduced our Consumer Brands Group guidance meaningfully following the softer than expected first half and continued weak demand in the North American DIY market. We are increasing our full-year earnings guidance given our better-than-expected results in the second quarter. The midpoint of our previous guidance now becomes the low end of our revised guidance. On an adjusted basis, we are now guiding diluted EPS in the range of $11.10 to $11.40 a share, an increase of 8.7% at the midpoint over the prior year. As we have often said, should our sales prove to be better than we are currently anticipating, we would expect EPS to be better. Our slide deck also provides guidance on our expectations for raw material costs and other items helpful for modeling purposes. As we enter our second half, we know that we are not immune from choppy market conditions. This leads us to focus even more intensely on our strategy. In periods of uncertainty and competitive disarray, customers are looking to Sherwin-Williams for consistency, reliability, dependability, and differentiated solutions that will drive their productivity and profitability. We have a deep and experienced team that knows how to do just that. We believe in success by design and we do expect to win.

Heidi, could you talk to us a little bit about the quarter in paint stores? It seems like Q2, not unlike Q1, had at least a month where there were some challenging weather conditions that probably pushed some volume out. So could you talk a little bit about whether the quarter progressed, you started to make up a little bit of Q1 and then maybe May hit and got a little challenging? And what are your customers saying in terms of where their backlogs are as a result of this? And what are you baking in, in terms of being able to make up some of this push out in the back half of the year?

I'm going to start here and then hand it over to Al to give a little bit of commentary as well, but I think you characterized it well. If you look across segments here, certainly there were some challenges. We don't hide behind weather. We're also obviously not immune to having to make sure that we've got the right paint and application conditions for our contractors, which ultimately benefits our customers and our shareholders in the long run. But let me be really clear about the controllables and where we are laser focused here. If you look by segment, starting with residential repaint, we mentioned this in the prepared remarks, but very confident that we're going to continue to take market share as you've seen over the last few quarters, especially to your point in Q2 where we're posting up mid-single digits in a down market. I would expect to continue to see us doing that. I think it's also a clear signal that we're getting a return on the investments that you'll remember we laid in last year. So by design, we often talk about success by design as a great example of how that's playing out in stores. And it's worth repeating this segment, there's incredible upside as it relates to market share opportunity. My time out in the field with our team and our customers gives me a lot of confidence that what we're doing is working and we're getting a lot of positive feedback from even our new customers, ultimately helping them make more money. That is the reason we're in this. If I then take you over to new residential, again, Q1 to Q2, I'm going to let Al kind of come in and give a little bit of color commentary. But we are encouraged by the growth that we're seeing here. Single family starts are turning to completions. I have been personally spending a lot of time with our builders and the team here and they're ultimately after optimizing cycle time and profitability. So our opportunity, not only do we see momentum here in the back half, we look at that as some solid tailwind, but I'm very confident that we are, I would say, best positioned in our industry, specifically within this segment as the market recovers.

And so the only thing I would add is just to take a quick look at the second quarter, up 3.5% compared to a strong low-double digit comparison last year. Volume was up low-single digits. Price was up low-single digits, and I would say it was probably slightly below where our expectations were as we were coming into the second quarter, but we exited the second quarter at our targeted run rate, which leads to the second half guidance to be similar up low to mid-single digits and that'd be really just broken out between price up low-single digits and volume up low-single digits with a reminder that we talked about Res Repaint being up at the high end of that range in our second quarter.

When we take a step back and think about your longer-term gross margin opportunity, there's still a lot of moving parts and perhaps some things in the housing market which are out of your control. But when we break down volume, price, raw materials versus labor, and just kind of all the other things that could affect that outlook, how should the investment community be thinking about that, not even for the second half of '24, but ‘25, ‘26 onwards based on all the initiatives including investments you've already been doing?

Yes, Chris, this is Al again. I appreciate the question, but we're not going to discuss that long-term target today. I believe FCP in the next 30 days will provide a good opportunity to talk about the financial metrics and longer-term targets. Today, we want to focus on the strong second quarter we delivered in a challenging market environment and also on our full-year adjusted EPS beat and raise.

Congrats on the strong results. Maybe if I could just get your thoughts on how to frame the share gain opportunity as you look into '25 and ‘26. Obviously, there's a couple of competitors who are going through some of their own changes, and maybe that could benefit you guys. I think there's a perception that, that's on the several hundred million dollars of potential gains for PCG. Is that correct? And when you do onboard those customers, you talked about new customers earlier, what's the margin profile look like? I know that there's been traditionally, kind of get them up and get them going and get them further up the mix line mentality. Does that still prevail? Maybe you can just kind of frame some of those thoughts for us.

Let me start with your last question, in terms of new customers coming in. Yes, this is certainly positive mix for us. So new customers, existing customers in this segment tend to value more of the premium product premium experience that we provide. So I would say that that's a fair characterization across the segment. Obviously, we won't get into any ‘25 certainly not any ‘26 outlook, but what I would tell you is the confidence in the momentum that we have here relative to the run up we're already experiencing in a few segments. And again, I'll go back to this idea of success by design, the luxury of a very tenured management team that is very astute when it comes to reading market indicators and signals. So, the timing in which we're laying these investments in, at the right point in the cycle, so that we are best positioned for the run up. Res paint is a great example. I point to automotive refinish as another really good example where you can see, I know you asked specifically about stores, but that same discipline holds across the portfolio. So we're seeing some positive signals from a market share standpoint. I'm very proud of that team and that organization is as you well know that automotive refinish model very similar to our stores model and our ability to have direct relationships with these customers and end users puts us in a really unique position.

I believe there are certain trends in the market that we've previously discussed. Kelly-Moore presents a more immediate opportunity primarily due to the customer base they were serving at Res Repaint, which is no longer operational. We've mentioned our aim to capture a significant share of this market, particularly evident in our districts on the West Coast in California. Regarding PCG, we'll need to wait and see, but there may be mid-term to long-term opportunities there. This reflects the consistent investment strategy we've outlined, and we remain confident in our approach. The investments we are making are yielding results, as evidenced by Res Repaint showing mid-single-digit growth in each of the last three quarters despite a challenging market.

Could you talk about your regional performance in paint stores? And once you're done with your R&D capital expenditures and some plant expansions, should your normal capital expenditures be below $500 million?

And as you know, we are very consistent in our capital allocation philosophy. After you get past the building our future projects, which as a reminder will help us attract and retain world-class talent to allow us to continue to drive above-market growth, ROI, and RONA improvements and drive strong cash flow, we will take that cash flow and we'll target CapEx below 2%. So depending on where the growth rates are, we may have years where we have to add capacity.

From a regional perspective on stores, we don't typically give too much commentary, but I would tell you that in this current quarter, our Southwest division was the leader in the clubhouse. And I'd point out too that that was an area where we've seen one of our competitors close their doors. And so you can read that a little bit as some of the share gains that we've been talking about.

So on the gross margin front, you put up this number really high despite some soft volumes. I guess, was the bulk of this price versus raws in terms of the improvement? And if not, how should we be thinking about some of the efficiency and some of the simplicity measures that you've been making? Because obviously, volumes really didn't drive this one entirely. So I guess, how should we be thinking about the big drivers there?

Yes, John, we had a couple of things driving our better gross margin performance in the quarter. Moderating raw materials certainly is part of that. The price realization that we saw in the second quarter being better than what we saw in the first quarter, along with mix. We did have some global supply chain efficiencies outside of the higher fixed cost absorption that we have talked about in the first quarter, again, was really the entire driver of the Consumer Brands improvement in the second quarter. But you also have our Paint Stores Group growing faster than the other segments. We've talked about that as that happens, that a higher gross margin will drive our mix better and continue to drive our gross margin. And really carry that momentum into the second half. And I do expect to see gross margin expansion in the second half, maybe not as much as we saw in the first half, driven by higher Paint Stores Group sales Res Repaint being at the high end of that range.

And then, John, I would add to that, you lay in additional volume when we're not in such a choppy environment and that's only going to help continue to stretch us.

I am curious about your outlook for the stores, which suggests that market demand may not improve in the second half. What do you think would happen if demand worsens? Do you see that as a possibility? Would your market share gains actually increase in that scenario? Additionally, how are the colors for the Guardian selling these days? I hope they are performing well.

Well, I'll start with the first question. You know what, I think, first and foremost, we have to be prepared for any environment, which is why we're taking a very realistic approach within a choppy environment. But I think as you look by segment is where some of those answers lie. So in terms of Res Repaint, again, we've continued to talk about this because by design, this is an area of incredible market share gain opportunity for us. And I think we've demonstrated that in a down market, we've continued to take share. So I think that's a really good litmus test of how we will operate in the down market.

Yes. Mike, the only thing I'd add to that is if you look at our second half guide for Paint Stores, it's in line with what we expected coming into the year with Res Repaint outperforming, commercial property maintenance about where we thought new res certainly improving in the second half. And then P&M with the delayed projects was maybe a little bit softer, but certainly not too far outside our guide or our expectations coming into the year.

Just curious if you can give some color on how the Pros Who Paint business performs relative to the overall segment in the quarter?

Yes, the Pros Who Paint business continues to be a really important segment for us. As you know, this is a segment that we've also continued to talk about making sure that we're investing at the right point to continue to partner with our retailer customers relative to reps and all the other things that we think are really important in this segment.

I just think that when you look at some of the leading indicators that we're following, we expect to bottom out here in the third quarter and improve in the fourth quarter.

One piece I want to add in here, and Al said this, I think, really well. But the Pros Who Paint strategy is a critical part of our strategy. We are very confident this is going to create not just a nice financial but a strategic win for our shareholders. This is a segment that we are just not set up to serve in our stores organization. It is a segment that has high growth, high-margin opportunity, and it's strategically very important that in our strategic partnerships that we also have access to this important and growing segment.

Just on your income statement, you recorded a $32 million other income net in the quarter, which is a bit large versus prior year last quarter. What is that? And is that allocated to the administrative segment or one of the businesses?

Yes. When you examine that specific line, you'll notice that the changes in foreign exchange impact it. We observed credits this quarter, including environmental foreign exchange adjustments and gains on sales. Year-over-year, this amounts to approximately a $0.12 benefit. On the downside, we experienced a higher effective tax rate, leading to a $0.07 reduction. When you combine these factors, we're still experiencing a low double-digit percentage increase.

I'm curious about your outlook for the key performance coatings verticals. Where do you see underlying markets trending in the back half? And where do you see the most upside from share gain opportunities?

Yes, Patrick, I'll start with that. Let me first start at the portfolio level. I think if you look across PCG in total, our margin performance is demonstrating the value that we're delivering. And those that are value what we do, which is helping them make more money or certainly rewarding us for some of these share gains. So if I look at kind of by division here, packaging, I'll start here. We're gaining share outside of the U.S. And per our second half guide, we do expect the progress to continue relative to the United States. If you look within packaging, we know that the technology that we bring to the market is unique. We know it's solving a lot of issues for our customers and our brand owners. We're putting some investment, as you know, into new capacity, preparing for this growth, and we're confident that we're going to continue to see a run-up here.

A two-part question for you on DIY demand. First, could you just speak in general terms about how you would expect your professional contractor sales versus DIY sales to trend in the stores moving forward? And then the second part would be, if I look at your DIY flowing through company-owned stores, it's comfortably positive year-to-date. And in the consumer segment, of course, DIY has been quite challenged well into the red. Can you talk about that disparity? And what are the, I don't know, two or three most important reasons behind that?

Yes. It's a good observation, Kevin. I think you've characterized that well. We often talk about this segment, having slightly two different segments. If you think about the DIY consumer in our stores, they're looking for that specialty paint store experience and candidly expect the service that goes along with that, a little bit less sensitive in the current macro. The DIY that prefers a home center environment tends to be more value conscious and is certainly feeling the pressure as we talked about prepared remarks early relative to inflation, depleted savings, and household debt.

Yes, the comment on DIY through our Paint Stores Group, but part of that is the price increases or the price increase that we took in our stores that is certainly impacting the DIY customer as well as the Pro.

I'd love to follow-up on two things. First, understanding volume, price, mix, and FX, both in the second quarter and what's implied from your back half guide?

Yes, if you look at our second quarter, our sales increased by 0.5%, with slight gains in both volume and price, and acquisitions were under 1%. We also faced challenges from divestitures and foreign exchange. However, the main contributor in the quarter was our Paint Stores Group, which grew by 3.5%. Both segments of that group performed as we anticipated, and we mentioned the shortfall in the consumer segment. Looking at the second half, we expect a slight increase in sales, in the low single digits, compared to low single-digit growth last year. I anticipate prices will rise by a low single-digit percentage, suggesting that volume might see a slight increase or decrease in the low single digits.

On the slide deck and also in your prepared comments, you alluded to consumer affordability impacting portions of your business such as Consumer Brands and also parts of Performance Coatings, I think you cited auto refinishing as it relates to deductibles. Switching to the Paint Stores segment, are your customers citing incremental issues as it relates to the same consumer affordability dynamic relative to the baseline of what you've already seen over the last 18 months or so?

Ghansham, I would characterize it maybe a little bit differently that there are always going to be value conscious, I would say, more so than focused on maybe the true price affordability piece. And so it's incumbent upon us that every day we are doing what we say we will do is delivering a consistent, reliable service to these more discerning and very habitual contractors that candidly just expect that from us.

Can you help me understand what led to the higher fixed cost absorption in consumer? Your volumes were down year-over-year. And Al, you mentioned improved efficiencies. What was there an operating rate improvement that despite lower volumes that led to that lower cost structure? Can you quantify that for us?

Yes, Steve, as I mentioned during our first quarter call, this aligns with our previous discussions. We noted the fluctuations in production volumes we've faced over the past four to five years and the need to update our cost standards to reflect the increased costs associated with conversion. I mentioned this at SCP last year, highlighting that this has been a challenge for our Consumer Brands Group. We anticipated that we could achieve efficiencies to counterbalance these costs, so we wouldn't need to reset our standard costs as we did at the start of this year.

So I wanted to ask on Res Repaint. It's obviously been a source of strength for you this year. I mean in the event that you don't really get any improvement in housing turnover next year or maybe it ticks down. I'd be curious if you'd characterize if you want to think about either your backlog or your opportunity to win in that scenario, basically meaning have we been perhaps still over-earning from a slew of projects coming to completion with lower turnover or is that a zero or low risk in your view relative to the market?

I think it's zero. I mean, I think, Josh, it's a good question. The health of those backlogs is real. And certainly, we're making the right investments at the right time to ensure that we're well-positioned. When you talk about kind of the source of strength here, there's certainly opportunity to take share across the market. This has been an area of strength for us because we understand how to do something. I truly believe that no one can do with this segment. And I take it back to the controlled distribution model that we have. So not only are we investing and laying in reps at the right pace in the right geographies, but we're arming these reps with the world's largest database of painting contractors. We're laser focused on from day one, ensuring they have the tools and the understanding of what they need to go in and help our contractors to grow their business.

Another question on the Performance Coatings Group. You said that in the general industrial portion of that business, demand was lower across all regions. Can you kind of walk us through those regions and comment on how things are trending, your expectations for the second half? I guess, are there some signs of improvement in any regions or at least lapping some prior year weakness in general industrial?

Yes, Mike, I would say on the positive side, there is less of a slowdown in North America. To take a step back, it all starts with gaining market share in this type of environment, increasing share of wallet, and differentiation. I believe North America will be less of a challenge moving forward. As for Europe, we don't anticipate much improvement in the second half. However, we expect positive results from Latin America and Asia, particularly in Asia against a very weak comparison, while Latin America remains steady.

And Mike, I think to the team's credit, I would say our focus here, given the fundamentals of the core has been laser-focused on new account growth. And I would tell you that that's holding up better than the market. So the team is focused on the right activities here to offset some of the pressure.

If I could, just a clarification. Al, I thought you said that pricing didn't do as well in the second quarter as you had hoped. Can you just kind of walk us through of the 5% that you announced earlier this year? You kind of usually talked about 60% being realized within a year. How do we trend from where we're at now to getting to that, let's say, 3% of your 5%?

Yes, Duffy, we mentioned that the price increase effectiveness improved as the quarter went on, and we exited the quarter at our targeted effectiveness rate. So I would expect to see that kind of realization. We have built into our forecast that kind of realization, low-single-digit and then volume low-single-digit in the second half.

Heidi, can you talk to the cadence of earnings in the back half of the year? And specifically on CBG margins, Al were you implying that they would be up in Q3 versus Q2?

No, David, I didn’t mean to suggest that if that’s how it was interpreted. The operating margin situation within CBG will depend on where we stand in the sales range and the volume throughout the quarter, especially in the second half. As you know, we still expect to see a seasonal slowdown in our fourth quarter.

Al, I wanted to follow-up on your CBG comment that you made earlier that this is the margin level you can build on. So if we think about 2025 or 2026, can we think of this low 20s operating margin plus some volume levers, perhaps in the pace of recovery? So this could be a mid to high-20 margins with volume leverage? Or are there any offsets and perhaps some part of this margin story is not sustainable longer term?

No. Like we have talked in the past, our expectation for Consumer Brands, operating margin is high teens, low 20s. And certainly, we challenge our group and divisions to continue to raise that bar. Volume is the #1 driver of operating margin performance in all our segments, as you well know, and that clearly showed itself in 2020 during the pandemic when we had really strong volumes in consumer out-the-door sales, that drove the operating margins higher.

DIY is mostly interior, I think. So was it unusual for interior to outgrow exterior this quarter? Or was that the weather effect and painters switched to interior when the weather is unfavorable?

Yes. John, I think that's the case. They'll work on jobs where they have the opportunity, and I will use Res Repaint six to eight weeks backlogs in advance so they can take advantage of really good weather and do exterior projects. And then again, if it's a wet rainy week, they can pivot and move to interior projects.

Nice quarter. You explained the price sensitivity of customers purchasing architectural in the CBG group, why does that not extend to residential projects in the Paint Stores Group? I know some of those projects are bigger and maybe higher end, but you seem to clearly buck that trend in the Paint Stores Group.

Yes. I think Chuck, within consumer, we've talked about a different kind of DIY customer and that's where the bulk of the volume is they are more sensitive to inflation, the amount of debt they have. You look at some of those headwinds that Heidi talked about in her opening remarks. It's less so on the DIY side in our stores. And like we talked about, there is a price impact on DIY in our stores. And I think if you look at our Pro, specifically in Res Repaint, we've mentioned this. I think the teams have done a really good job about driving new business through our stores to drive that mid-single-digit growth over the last three quarters in a down market.

I think it also points to the value of a specialty paint store model, which is certainly on the DIY side, an expectation of premium product, but it is an equally high expectation of that premium service and the willingness to pay for that service and the homeowner color selection, all of the things that go along with us being innovating in and out of the can is a great example of a consumer that values that type of solution.

I wanted to ask about raw materials. How much were raws down in 2Q and is flat in the back half of the year still a good assumption? I think that was the outlook previously.

So raws, the basket was down mid-single digits year-over-year in the second quarter. And for the full year, we're still picking or saying that the full year will be down low singles. So that tells you the back half is flattish year-over-year.

A question on revenue in two different areas, if I could. The consumer mix, just curious versus 90 days ago, what is so different that is driving the magnitude of the shortfall there? And then on the store side, I'm curious on Res Repaint, the market down and you up mid-single digit. I'm just curious to dive into both of those a little bit, if you would, in terms of the momentum of the market into the back half and then the ability to sustain the magnitude of the share gains of up five in the down market?

Let me start by addressing your question on revenue and the changes in the CBG mix over the past 90 days. To put it simply, it has remained softer for a longer period. The DIY market in North America is experiencing pressure, and the fundamentals have not rebounded at the rate we would like to see.

I have a question on Res Repaints. Maybe can you talk a little bit about the profitability of new accounts as you continue to bear market share. If I understood correctly before, you mentioned that usually new accounts came at premium, so the higher margin. I was a little bit surprised. So I would like to ask if you can maybe dig a little bit more into that? And how this should pan out as your market share gains continue?

Yes. Let me start with that, just based on my earlier comment. If you kind of picture a bell curve of a new Res Repaint contractor coming in new versus kind of a more mature Res Repaint contractor, where we've earned over time, more share of wallet. My comment is relative to kind of first and foremost, making sure that we're getting them in and getting them set up on the right products. So when we talk about making sure our customers are making more money, oftentimes there, and that is a conversation of getting them in the right premium product that's helping them get their crews on and off the job site faster, less touch up required. So when you look at the total cost of a project, they're making more money.

Just very quickly, will your raw materials in your base case? Will your raw material cost be up year-over-year in Q4?

Flattish.

Thank you, Heidi, and thank you, everybody, for joining us today. I think you heard today that while the macro is certainly very choppy, we're very confident in our strategy. We're very well positioned, and we're acting to continue outperforming the markets. The global team is aligned and we're focused on our strategy of driving that profitable growth by providing solutions for our customers. Today, you heard we've increased our full-year guidance. And as Heidi mentioned, and we've often said, if our sales do prove to be better than what we've outlined today, we would expect our bottom-line performance to be better as well. I'll close with, I just want to remind everyone, we have our financial community presentation, which is scheduled for August 29 in Boston starting at 1:30. You'll hear from Heidi, Al, and other members of our management team, along with our typical Q&A session. So you can register for that on our IR website or feel free to e-mail our Investor Relations team. They'll also be webcast, and that date again is August 29. So with that, I will thank you again for your interest in Sherwin, and have a great rest of your day.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.