PPG posts third-quarter gains

Natural disasters affected PPG’s third quarter performance, both emotionally and operationally, says CEO Michael McGarry. Still, the company saw gains in third-quarter sales and income from continuing operations.

The company reported net sales of $3.8 billion, up 3.2% from the same quarter last year. Third quarter net income from continuing operations was $392 million, swinging from a loss of $211 million in the third quarter of 2016.

“While the third quarter was challenging emotionally and operationally due to the natural disasters, we achieved solid overall financial results and, more importantly, made some progress in our initial operating margin recovery efforts,” said McGarry. “Additionally, we were tracking toward volume growth of about 1.5 percent prior to the disasters, which was an improvement versus our sales volume growth for the first half of the year.

Architectural coatings – Americas and Asia Pacific sales volumes were flat year-over-year with differences by channel and region. U.S. and Canada company-owned architectural stores grew sales volumes by a mid-single-digit percentage year-over year including the unfavorable impact from the hurricanes. This increase in sales was more than offset by lower sales volumes in national retail (DIY) accounts and independent dealer networks as both of these distribution channels continue to experience soft demand.

The company sold its glass business in the third quarter a “transformational milestone for the company, he said.

“Looking ahead to the fourth quarter, we expect moderate global economic growth to continue. Given the after-effects from the natural disasters, we no longer expect any notable decline in the level of raw material cost inflation for the remainder of this year,” McGarry said.

Year-to-date, PPG has completed business acquisitions totaling more than $300 million, including The Crown Group which was finalized on Oct. 2.