PPG Industries Q2 sales increase 16%

Adjusted net income for the quarter was $356 million, or a record $2.45 per diluted share, excluding nonrecurring acquisition-related charges of 10 cents per diluted share as detailed in a reconciliation below.

Second quarter 2012 reported net income and earnings per diluted share from continuing operations were $297 million and $1.92 respectively. There were no nonrecurring charges in the prior-year quarter.

Highlights:

-Second quarter 2013 sales and adjusted earnings per diluted share establish new all-time records for any quarter.

- Aggregate coatings segment earnings increase 25 percent with solid earnings growth in all major regions.

- North American architectural coatings acquisition performing ahead of expectations.

- Board of directors approves $102 million restructuring program, to be recorded in third quarter 2013 financial results, focused primarily on cost-synergy achievement for N.A. architectural coatings acquisition.

Reporting segment financial results:

Performance Coatings segment sales for the quarter were $1.7 billion, up 36 percent, or $447 million, versus the prior year due principally to sales from acquired businesses. Segment volumes declined 5 percent, primarily due to lower marine new-build industry demand in Asia impacting the protective and marine coatings business.

Aerospace and automotive refinish delivered mid- to high-single-digit percentage sales growth aided by solid global end-market trends, although results varied somewhat by region. North American architectural coatings sales, excluding acquisitions, were down low-single-digit percentages.

High-single-digit percentage growth in company-owned stores was offset by lower results due to previously disclosed changes in products sold at a national retail customer. Segment earnings improved by 25 percent to $255 million due to strong operating performance, including lower costs from previous restructuring actions and ongoing cost management, combined with the addition of earnings from the acquired businesses.

Industrial Coatings segment sales for the quarter were $1.2 billion, advancing 13 percent, or $142 million, versus the prior year due to higher volumes combined with acquisition-related gains. Automotive OEM coatings volumes grew 12 percent globally, with comparable growth rates in all major regions.

Global industrial coatings volumes improved modestly, with demand varied by region and end-use market, including strong emerging-regions growth, solid North American improvement and weaker European performance. Packaging coatings sales advanced slightly in all regions. Segment earnings for the quarter were $191 million, up 34 percent as a result of higher organic sales coupled with lower costs, including the benefits from PPG’s continued operating focus, and earnings from acquired businesses.