PPG Reports Rise in Third-Quarter Results
October 20, 2009
PPG Industries reported sales for the third quarter of $3.2 billion, a decline of 24 percent versus the prior year’s third quarter including a five percent decline resulting from a business divestiture in 2008.
PITTSBURGH – PPG Industries reported sales for the third quarter of $3.2 billion, a decline of 24 percent versus the prior year’s third quarter including a five percent decline resulting from a business divestiture in 2008. The company reported net income of $159 million, or 96 cents per share. Adjusted net income was $161 million, or 97 cents per share. Third-quarter 2008 sales were $4.2 billion, reported net income was $117 million, or 70 cents per share, and adjusted net income was $227 million, or $1.37 per share.
The third-quarter sales decline of $1 billion included a $229 million impact from the 2008 divestiture of a majority interest in the automotive glass and services (AG&S) business, and about a $150 million impact from negative foreign currency translation. Year-over-year sales volumes decreased by about $500 million, or 12 percent, with declines in most regions, except Asia/Pacific. Selling prices declined by about $150 million versus last year’s third quarter, primarily due to lower commodity chemicals pricing.
Performance Coatings segment sales in the third quarter 2009 decreased $154 million, or 13 percent, versus the prior year’s quarter. Sales declined as a result of lower volumes across all businesses. Industrial Coatings segment sales for the quarter decreased $198 million, or 19 percent, due primarily to lower year-over-year volumes in the automotive coatings and industrial coatings businesses, reflecting the continued severe declines in global demand. Demand in the third quarter, however, improved from the first two quarters of 2009. Architectural Coatings – Europe, Middle East and Africa (EMEA) segment sales for the quarter decreased $73 million, or 12 percent, with $50 million of the decline attributable to weaker foreign currencies. Slightly lower volumes contributed to the sales decline.
“Looking ahead to the fourth quarter, we anticipate only modest improvement in the overall economy. We expect growth in Asia to continue, and we anticipate that global automotive production will remain at least at the third-quarter levels, if not higher,” said Charles E. Bunch, PPG Chairman and Chief Executive Officer. “Currency translation, which had been a headwind for PPG all year thus far, will likely shift to a tailwind. What’s more, many of our businesses will exhibit normal, slower seasonal demand patterns.”