PPG’s Refinish Sales Rise as Industrial Coatings Margins Tighten
Image courtesy of PPG.
PPG reported improving automotive refinish sales alongside continued Industrial Coatings margin pressure in its third-quarter results released Oct. 27. Higher selling prices and volumes supported growth, but cost inflation continued to affect industrial profitability.
Refinish Returns to Growth
Automotive refinish organic sales increased by a mid-single-digit percentage compared with the third quarter of 2025. During the company’s Oct. 28 earnings call, Chairman and CEO Tim Knavish said U.S. collision claims remained down 4% year over year, compared with a 6% decline in the second quarter.
The improvement follows a difficult second quarter, when PPG reported a double-digit percentage decline in refinish organic sales. The company attributed that earlier decline to lower volumes, comparisons with customer ordering patterns in 2025 and a slower recovery in underlying demand. PPG had anticipated second-half improvement partly because of those order comparisons.
Across the broader Performance Coatings segment, which includes refinish, EBITDA increased 21% to $372 million. Segment EBITDA margin rose to 23.9% from 21.7%.
Industrial Growth Meets Cost Pressure
Industrial Coatings segment sales increased 5% to $1.744 billion. However, segment EBITDA declined 11% to $251 million, and EBITDA margin contracted by 260 basis points, or 2.6 percentage points.
Organic sales increased 4%, with equal contributions from prices and volumes. Within that segment, the individual industrial coatings business delivered high-single-digit organic growth, supported by heavy-duty equipment, general finishes and electrical infrastructure for data centers. Packaging coatings achieved double-digit organic growth, while automotive OEM coatings organic sales declined by a low-single-digit percentage.
Knavish said cost inflation continued to outpace the timing of index-based pricing. Higher prices and volumes partially offset the pressure, and the company was beginning to realize benefits from those pricing adjustments.
Earnings Outlook Improves
Companywide, sales increased 7% to $4.353 billion. Reported earnings per diluted share from continuing operations were $2.12, while adjusted EPS increased 6% to $2.25. PPG narrowed its full-year adjusted EPS guidance to $7.90–$8.10.
The previous range was $7.70–$8.10. Adjusted EPS is a non-GAAP measure; the company provides reconciliations in its earnings materials.
Sources: PPG Investors, Earnings Whispers
Why it matters to PCI: PPG’s results show improving refinish sales without a full recovery in collision claims, while industrial demand gains remain subject to pricing and cost pressures. Follow PCI’s refinishing coverage for related market and technology developments.
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