
PPG Reports Record Third Quarter Earnings
October 20, 2011
PPG Industries in Pittsburgh today reported net sales for the third
quarter 2011 of $3.8 billion, an increase of 11 percent versus the
prior year's third quarter. Net income for the quarter increased
to $311 million, or $1.96 per diluted share. Third quarter 2010
net sales were $3.5 billion, and net income was $262 million, or
$1.58 per diluted share.
Glass segment sales were $273 million, up $13 million, or 5 percent,
compared with the prior year as a result of improved pricing and
favorable foreign currency translation, which were offset slightly
by lower volumes due to planned fiber glass production outages.
Segment earnings were $23 million, a decrease of $9 million from
the prior-year quarter primarily due to the lower volumes and higher
maintenance costs.
"This is the fifth consecutive quarter in which we eclipsed
our prior quarterly earnings record," says Charles E. Bunch,
PPG chairman and chief executive officer. "This consistent
improvement in performance, especially in light of today's economic
backdrop, demonstrates the value of our management's aggressive
focus on operations and the continuing benefit of the structural
changes that we have made to the company the past few years, including
lowering our cost base and expanding in emerging regions. In addition,
these results reflect the continuing benefits of our disciplined
deployment of our strong cash position."
Pricing on a corporate basis increased for the sixth consecutive
quarter, Bunch says, as all 13 PPG businesses implemented higher
pricing this quarter to further counter higher input costs. "PPG's
overall volumes were flat year-over-year," he says. "Demand
in most markets in North America was up modestly and fairly consistent
with the prior quarter's growth rate. Continued volume gains in
emerging regions such as Asia/Pacific and Latin America offset lower
demand in Europe, which was driven principally by the company's
consumer-oriented businesses."
PPG's year-to-date cash from operations is up more than 10 percent
versus the prior year. "Dividends and share repurchases have
totaled more than $900 million so far in 2011, providing evidence
of our commitment to return cash to our shareholders," Bunch
says. The company reported that it repurchased 3.25 million shares
of stock in the third quarter, bringing the year-to-date total number
of shares repurchased to 7.5 million.
"Looking ahead, we expect current macro and regional economic
trends to continue, supported to date by October activity levels
in many of our businesses," Bunch says. "In general, we
anticipate normal seasonal fourth quarter patterns to occur. Raw
material inflation rates are flattening, and we are in the process
of implementing additional price increases in several businesses
to counter the inflation we have absorbed. Our cash position remains
strong, and we intend to continue to focus cash deployment on earnings
growth initiatives. Finally, we are keeping a watchful eye on the
global economy, and we are prepared to adapt to changing conditions."
PPG reported today that it ended the quarter with approximately
$1.3 billion in cash and short-term investments.
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