print

PPG reports 4th quarter and 2017 financial results

PPG (NYSE:PPG) reported fourth quarter 2017 net sales of approximately of $3.7 billion, up nearly 8 percent versus the prior year. Sales volumes increased by 3 percent year-over-year and selling prices improved sequentially for the third consecutive quarter, adding less than 1 percent to sales growth. Favorable foreign currency translation improved net sales by more than 3 percent, or about $115 million, and acquisitions-related sales, net of divestitures, added less than 1 percent to sales growth.

  • Fourth quarter net sales of approximately $3.7 billion, up about 8 percent versus prior year
  • Fourth quarter reported earnings per diluted share from continuing operations of $0.72 and adjusted earnings per diluted share from continuing operations of $1.19
  • Sales volume growth of 3 percent in the fourth quarter versus prior year
  • Share repurchases of $400 million in the fourth quarter and slightly more than $800 million for the year
  • Strong financial flexibility with approximately $1.5 billion of cash and short-term investments at year-end
  • Commitment to deploy at least $2.4 billion on acquisitions and share repurchases in 2018

Fourth quarter 2017 reported net income from continuing operations was $184 million, or 72 cents per diluted share, including an unfavorable impact of 5 cents per diluted share stemming from the natural disasters that occurred in the third quarter. Adjusted net income from continuing operations was $304 million, or $1.19 per diluted share.

“In the fourth quarter, we delivered solid and balanced sales growth in each major region, and  both reporting segments achieved at least 2 percent sales volume growth,” said Michael H. McGarry, PPG chairman and chief executive officer. “Additionally, our aggregate selling prices improved for the third consecutive quarter as we made continued progress on our margin recovery efforts, despite higher than anticipated raw material inflation in the quarter driven by ongoing supply-related issues, including production curtailments from additional environmental enforcement in China.

“Our Performance Coatings segment delivered its highest sales volume growth of the year, growing more than 2 percent aided by continued above-market performance in automotive refinish coatings, strengthening aerospace growth and solid mid-single-digit percentage volume growth in our U.S. company-owned architectural coatings stores. Industrial Coatings maintained a mid-single-digit percentage sales volume growth rate, once again well outpacing global industrial production, led by our general industrial and packaging coatings businesses,” McGarry said.

“Our cash flow from operations was excellent, totaling over $1.5 billion for the year, including the benefit from improved operating working capital ratios. We also continued our heritage of returning cash to shareholders, with more than $1.2 billion returned in 2017 via share repurchases and dividends. We remain proud that PPG has paid annual dividends for 118 consecutive years, and increased per-share payouts for 46 consecutive years, including a 13% per-share increase in July.” McGarry continued.

“Looking ahead, we are well positioned to benefit from broadening and more synchronized global economic growth due to our geographic reach, excellent product portfolio, and advanced customer technologies, McGarry said. We expect minimal abatement in the first half of the year to the high level of raw material inflation that the coatings industry is experiencing. We will continue to work with our customers to address the inflationary environment and expect to realize additional selling price increases in 2018. Finally, we continue to have strong financial flexibility and are committed to deploy a minimum of $2.4 billion of cash in 2018 on acquisitions and share repurchases as part of our previously communicated target to deploy $3.5 billion in 2017 and 2018 combined,” McGarry concluded.

The company reported year-end 2017 cash and short-term investments of approximately $1.5 billion. Also, PPG had $3.6 billion remaining on its current share repurchase authorizations at year-end 2017, including a $2.5 billion authorization approved by PPG’s Board of Directors in December.

Full-Year 2017 Financial Results

Full-year 2017 reported net sales from continuing operations were approximately $14.8 billion, up more than 3 percent, versus the prior year, including favorable foreign currency translation  of less than 1 percent, or approximately $55 million. Organic sales growth of 1.5 percent versus the prior year was supplemented by acquisition-related sales growth of more than 1 percent.

The company’s 2017 full-year reported net income from continuing operations was $1.4 billion, or $5.46 per diluted share. Full-year 2017 adjusted earnings per diluted share from continuing operations was $5.87 per diluted share, representing an increase of nearly 4 percent year-over-year. Adjusted net income excludes net after-tax charges totaling $105 million, or $0.41 per diluted share. These net after-tax charges include: $97 million net charge related to the new U.S. Tax Cuts and Jobs Act legislation; $38 million for pension settlement charges; $7 million for asset write-downs; and $6 million for transaction-related costs, partially offset by a $24 million gain from the sale of the Mexican Plaka wallboard business; an $11 million benefit from a legal settlement, and an $8 million gain from the sale of a non-operating asset.

In 2017, foreign currency translation unfavorably impacted pre-tax income by $7 million. The effective tax rate from continuing operations was 28.8 percent for 2017 and the adjusted effective tax rate from continuing operations was 24.4 percent for 2017.

The company’s 2016 full-year reported net income from continuing operations was $547 million, or $2.05 per diluted share. Full-year 2016 adjusted earnings per diluted share from continuing operations was $5.67 per diluted share. Adjusted net income excludes net after-tax charges totaling $959 million, or $3.62 per diluted share. These net after-tax charges include: $616 million for pension settlement charges; $151 million for a net tax charge related to asbestos settlement funding; $144 million for business restructuring; $51 million charge for increases to legacy environmental reserves; $17 million for asset write-downs; $5 million for transaction-related costs; and $5 million for a premium on the early retirement of debt, partially offset by a $30 million net gain on the disposals of ownership interests in business affiliates. The effective tax rate from continuing operations was 27.6 percent for 2016 and the adjusted effective tax rate from continuing operations was 24.6 percent for 2016.

PPG: WE PROTECT AND BEAUTIFY THE WORLD™

At PPG (NYSE:PPG), we work every day to develop and deliver the paints, coatings and materials that our customers have trusted for more than 130 years. Through dedication and creativity, we solve our customers’ biggest challenges, collaborating closely to find the right path forward. With headquarters in Pittsburgh, we operate and innovate in more than 70 countries and reported net sales of $14.8 billion in 2017. We serve customers in construction, consumer products, industrial and transportation markets and aftermarkets. To learn more, visit www.ppg.com.

Source & complete press release: http://corporate.ppg.com/Media/Newsroom/2018/01-18-2018-PPG-reports- fourth-quarter-and-full-y

Contact Information

PPG Industries, Inc.
PPG Industries, Inc.

One PPG Place
Pittsburgh, PA, 15272

tele: 412-434-3131
http://www.ppg.com/

Comments

Leave a Reply

Comment

Security Code:


Extension Media websites place cookies on your device to give you the best user experience. By using our websites, you agree to placement of these cookies and to our Privacy Policy. Please click here to accept.