PaintSquare.com
Follow us on Twitter Follow us on LinkedIn Like us on Facebook Follow us on Instagram Visit the TPC Store
Search the site

 

Advertisement

PaintSquare


Coatings Industry News

Main News Page


Sales Up, Volumes Largely Flat for PPG in Q1

Friday, April 20, 2018

More items for Program/Project Management
More items from North America

Comment | More

Pittsburgh-based coatings firm PPG released its first-quarter financial report for 2018 on Thursday (April 19), indicating a 9 percent increase in net sales over the prior year, totaling $3.8 billion, while the company noted that an audit is ongoing to investigate possibly faulty accounting that may have underreported expenses for the quarter.

First Quarter Financials

The net income for PPG’s first quarter from continuing operations totaled $347 million, or $1.38 per diluted share, with adjusted net income totaling $350 million, an over 4 percent increase comapred to the first quarter of 2017.

“In the first quarter, selling price initiatives continued to gain momentum with increases across all regions that totaled nearly 2 percent. This is our most significant sequential improvement since raw material inflation began approximately one year ago and includes an almost 200 basis points of sequential improvement in the Industrial Coatings segment,” said Michael H. McGarry, PPG chairman and chief executive officer.

© iStock.com / JoeCollver

Pittsburgh-based coatings firm PPG released its first-quarter financial report for 2018 on Thursday (April 19), indicating a 9 percent increase in net sales over the prior year, totaling $3.8 billion, and a marginal increase in overall sales volume.

“During the quarter, we experienced further raw material inflation and higher logistics costs across all of our businesses. We are continuing to prioritize working with our customers to further offset the impact of inflation. These efforts, along with our continued focus on operational excellence are expected to aid our margin recovery efforts.”

McGarry also noted that in the Performance Coatings segment, “sales volumes were flat year-over-year as above-market growth in aerospace coatings was offset by lower European architectural coatings demand.” In Industrial Coatings, sales volumes increased by 1.5 percent thanks to solid growth in both the general industrial and packaging coatings sectors.

Activity by Segment

First quarter net sales for the Performance Coatings segment were roughly $2.2 billion, up $148 million, or 7 percent, compared with 2017’s first quarter. Sales volumes were flat, partially due to fewer shipping days, which negatively impacted distribution businesses.

Aerospace coatings sales volumes also increased by a high-single-digit percentage due to increased demand in the U.S. and Asia-Pacific. Organic sales for architectural coatings in the same areas advanced a low-single-digit percentage year-over-year. Protective and marine coatings sales volumes were also slightly higher year-over-year for the third straight quarter.

First-quarter segment income totaled $285 million, mirroring the first quarter of 2017.

PPG

The net income for PPG’s first quarter from continuing operations totaled $347 million, or $1.38 per diluted share, with adjusted net income totaling $350 million, an over 4 percent increase comapred to the first quarter of 2017.

The Industrial Coatings segment reported net sales of $1.6 billion for the first quarter, up nearly $152 million, or more than 10 percent, from 2017’s Q1. Year-over-year sales volumes also increased by 1.5 percent. Sales volume growth took a hit from businesses executing selling price initiatives, which resulted in certain business "being turned away."

Automotive OEM coatings sales volumes were in line with 2017. Sales volumes for general industrial coatings and specialty coatings and materials outpaced global industrial production growth rates for the ninth consecutive quarter.

First-quarter segment income was $240 million, down $36 million, or 13 percent.

Restructuring measures to be taken in both segments are slated to provide cost savings between $50 million and $55 million in 2018.

Report Error

As the report was being finalized, PPG received a notice that there had been potential violations of the company’s “accounting policies and procedures regarding the failure to accrue certain specified expenses in the first quarter.” After a preliminary review, PPG pinpointed $1.4 million of expenses that should have been accrued in the first quarter. Earnings reported today reflect that accrual.

“The report also alleges that there may have been other unspecified expenses, potentially up to $5 million in the aggregate, that were improperly not accrued in the first quarter,” PPG noted. “The Audit Committee of the company’s Board of Directors is overseeing an investigation of the matters set forth in the report, with the assistance of outside counsel. The company is currently unable to predict the timing or outcome of the investigation and will move with diligence.”

   

Tagged categories: Business matters; Business operations; Earnings reports; Finance; PPG

Comment Join the Conversation:

Sign in to our community to add your comments.

Advertisements
 
SAFE Systems, Inc.
 
SAFE Systems'
Blast Lights &
Deadman Switches
 
Halogen or LED blast lights available with our NEW urethane bumper. Switches available in many colors for color coding your hoses.
 

 
SABRE Autonomous Solutions
 
Productivity
 
Personnel are free to do other tasks while the ALPHA1 does the “dirty work”.
 

 
Novatek Corporation
 
Dustless Coatings Removal
 
Novatek Corporation, Dustless Coatings Removal Strip, clean and profile all dust free! Comply with new lead standards. Contact today: (866) 563-7800 www.Novatekco.com
 

 
Industrial Vacuum Equipment Corp.
 
Hurricane Vacuums
& Dust Collectors
 
Vacuum and dust collector hose, filters and related accessories.
IndustrialVacuum.com
 

 
Fischer Technology Inc.
 
TSA Coatings on Stainless Steel
 
Fischer’s Phascope PMP10 and ESD20TSA probe are incredibly accurate and easy to use.
 

 
ARC / A.W. Chesterton Company
 
Superior Impact & Wear Resistant Lining
 
100% solids, impact resistant, ceramic reinforced, epoxy/urethane hybrid lining for severe abrasive wear and impact resistance.
 

 
Bullard
 
Bullard Made in the USA
 
 

 
Modern Safety Techniques
 
Modern Safety Techniques
 
With our unique LTCat, we can help to provide clean, safe breathing air to your workers. Take a look at our Breathing Air Systems, we supply at least twice as much charcoal as our competitors! Modern
 

 
Sika-Us
 
Sika® Industrial Floor Coatings
 
Click to learn about floor and wall systems relied upon for performance, durability, easy maintenance and aesthetics across the every industry and environment.
 

 
Jotun Paints Inc.
 
Jotun Jotachar 1709
 
Mesh-free passive fire protection epoxy designed to protect against hydrocarbon pool fire scenarios for up to four hours as defined in the ANSI/UL1709 standard.
 

 
 
 

Technology Publishing Co., 1501 Reedsdale Street, Suite 2008, Pittsburgh, PA 15233

TEL 1-412-431-8300  • FAX  1-412-431-5428  •  EMAIL webmaster@paintsquare.com


The Technology Publishing Network

Durability + Design PaintSquare the Journal of Protective Coatings & Linings Paint BidTracker

 
EXPLORE:      JPCL   |   PaintSquare News   |   Interact   |   Buying Guides   |   Webinars   |   Resources   |   Classifieds
REGISTER AND SUBSCRIBE:      Free PaintSquare Registration   |   Subscribe to JPCL   |   Subscribe to PaintSquare News
MORE:      About PaintSquare.com   |   Privacy Policy (Updated 5/24/2018)   |   Terms & Conditions   |   Support   |   Site Map   |   Search   |   Contact Us