RPM International (0A62) Risk Analysis
Risk Overview Q2, 2026
Source: the company's latest filing for the period ended May 31, 2026, filed Jul 22, 2026
Risk Change Over Time
- Accounting & Financial Operations - Risk 1The results of our annual and, as-required, interim testing of goodwill and other long-lived assets may result in additional substantial impairment charges.
As of May 31, 2026, we had approximately $2.5 billion in goodwill and other intangible assets. The Accounting Standards Codification ("ASC") section 350, "Intangibles – Goodwill and Other," requires that goodwill be tested at least on an annual basis, or more frequently as impairment indicators arise, using either a qualitative assessment or a fair-value approach at the reporting unit level. We perform our annual required impairment tests, which involve the use of estimates related to the fair market values of the reporting units with which goodwill is associated, as of the first day of our fourth fiscal quarter. The evaluation of our definite-lived, long-lived assets for impairment includes determining whether indicators of impairment exist. This is a subjective process that considers both internal and external factors. The impairment assessment evaluation requires the use of significant judgment regarding estimates and assumptions surrounding future results of operations and cash flows. For discussion of the approach for, and results of, our interim and annual impairment testing for goodwill and indefinite lived intangible assets for all periods presented, please refer to the headings entitled "Goodwill" and "Other Long-Lived Assets" within the "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Critical Accounting Policies and Estimates" sections located in "Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation" as well as Note A(6),"Summary of Significant Accounting Policies - Property, Plant & Equipment," Note A(11), "Summary of Significant Accounting Policies - Goodwill and Other Intangible Assets," and Note C, "Goodwill and Other Intangible Assets," to our Consolidated Financial Statements as presented below. If global economic conditions were to decline significantly, or if our reporting units experience significant declines in business, we may incur additional, substantial goodwill and other intangible asset impairment charges. The amount of any such impairment charge could have a material adverse effect on our results of operations.
- Corporate Activity and Growth - Risk 2Operating improvement initiatives, including digital and physical consolidation efforts, may increase our operational risks, could cause us to incur significant expenses and could impact the trading value of our common stock.
In August 2022, we approved and announced our Margin Achievement Plan 2025 ("MAP 2025"). MAP 2025 was a multi-year restructuring plan to build on the achievements of our 2020 Margin Acceleration Plan ("MAP to Growth"). On May 31, 2025, we formally concluded MAP 2025; however, certain projects identified prior to May 31, 2025, have not been completed and we expect to incur MAP 2025 restructuring costs into fiscal 2027. Our MAP 2025 operating improvement program was designed to result in significant changes in our organizational and operational structure. During fiscal 2026, we approved and announced SG&A focused optimization actions which accelerated actions planned to be included as part of our next MAP initiative. We expect to take additional actions during future periods, in furtherance of these or other operating improvement initiatives. We may incur additional expenses as a result of these actions, and we also may experience disruptions in our operations, decreased productivity and unanticipated associate turnover. Consolidation of digital systems and physical locations may increase the severity of any potential risk. Further, the objectives of our operating improvement initiatives may not be achieved. The occurrence of any of these, our failure to succeed in any future operating improvement plan, or other related events associated with our operating improvement initiatives could adversely affect our operating results and financial condition.
Risk Highlights Q2, 2026
Risk Word Cloud
Risk Factors Full Breakdown - Total Risks 27
- Regulation - Risk 1We could be adversely affected by failure to comply with federal, state and local government procurement regulations and requirements.
Some of our companies have contracts with and supply product to federal, state and local governmental entities and their contractors, and are required to comply with specific cybersecurity frameworks, procurement regulations and other requirements relating to those contracts and sales. Requirements in our contracts and those requirements flowed down to us in our capacity as a subcontractor or supplier, although customary in government contracts, may impact our performance and compliance costs. Failure to comply with these regulations and requirements or to make required disclosures under contract could result in reductions of the value of contracts, contract modifications or termination for cause, adverse past performance ratings, actions under a federal or state false claims statutes, suspension or debarment from government contracting or subcontracting for a period of time and the assessment of penalties and fines, any of which could negatively impact our results of operations and financial condition and could have a negative impact on our reputation and ability to procure other government contracts in the future.
- Regulation - Risk 2We could be adversely affected by violations of the U.S. Foreign Corrupt Practices Act and similar anti-bribery laws of other countries, as well as trade sanctions administered by the office of Foreign Assets Control and the Department of Commerce.
The U.S. Foreign Corrupt Practices Act and similar anti-bribery laws of other countries generally prohibit companies and their intermediaries from making or receiving improper payments to governmental officials or others for the purpose of obtaining or retaining business or for other unfair advantage. While our policies mandate compliance with anti-bribery laws, we operate in many parts of the world that have experienced corruption to some degree and, in certain circumstances, strict compliance with anti-bribery laws may conflict with local customs and practices. We are required to comply with U.S. regulations on trade sanctions and embargoes administered by the U.S. Department of the Treasury, Office of Foreign Assets Control, the Commerce Department and similar multi-national bodies and governmental agencies worldwide, which are complex and often changing. A violation of these regulations could subject us to regulatory enforcement actions, including a loss of export privileges and significant civil and criminal penalties and fines. Although we have internal controls and procedures designed to ensure compliance, there can be no assurance that our controls and procedures will prevent a violation of these laws. Violations, or allegations of such violations, could disrupt our business and result in a material adverse effect on our results of operations, financial condition, and cash flows.
- Regulation - Risk 3Our businesses are subject to varying domestic and foreign laws and regulations that may restrict or adversely impact our ability to conduct our business.
Our businesses are subject to varying domestic and foreign laws and regulations that may restrict or adversely impact our ability to conduct our business. These include securities, environmental, sustainability, health, safety, accounting, tax, competition and anti-trust, insurance, warranty, trade controls, data security and protection, anti-corruption, anti-money laundering, licensing, labor, wage and hour and other employment, and privacy laws and regulations. These laws and regulations change from time to time and thus may result in increased risk and costs to us related to our compliance therewith. From time-to-time regulators review our compliance with applicable laws. We have not always been, and may not always be, in full compliance with all laws and regulations applicable to our business and, thus enforcement actions, fines and private litigation claims and damages, which could be material, may occur, notwithstanding our belief that we have in place appropriate risk management and compliance programs to mitigate these risks.
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