PPG Industries (PPG) reported sales for the second quarter 2011 of $4.0
billion, an increase of 15 percent versus the prior year's second quarter.
Each major region and reporting segment achieved volume and price gains.
"Our coatings segments delivered excellent
results," said Charles E. Bunch,
PPG chairman and CEO. "The Performance Coatings
segment established a new
all-time earnings record, and the Industrial
Coatings segment earnings
matched the previous record. This was done
despite operating margins for
these segments that dropped modestly versus last
year as a result of the
weakened April volumes and an architectural
customer bankruptcy charge." He
stated that coatings margins in May and June
were consistent with the prior
year, as volume growth resumed and prices were
increased in all eight
coatings businesses to counter inflationary
pressures.
Bunch noted that April was the weakest month in
the quarter, with negative
year-over-year company volumes due to several
issues including the full
brunt of automotive OEM industry production
curtailments due to supplier
disruptions related to the March earthquake and
tsunami in Japan, poor
weather-related architectural painting
conditions in the United States, and
production downtime in the Commodity Chemicals
segment. "Our sales volumes
rebounded soundly after April, with most
segments realizing mid-single-digit
percentage volume gains in May and June versus
last year," he said.
"We anticipate the global economic recovery will
continue, although at its
current uneven pace," Bunch said. "The
resumption of automotive OEM
production and our position in high-growth
businesses and regions, such as
aerospace and Asia/Pacific, will supplement
PPG¹s growth in the remainder of
the year." He noted that although inflation has
moderated somewhat, PPG
intends to secure additional pricing in
businesses where it has been unable
to fully offset inflation despite aggressive
cost management and further
pricing actions this past quarter. These factors
are expected to be coupled
with continued positive price trends in the
Commodity Chemicals segment, he
said.
Performance Coatings segment sales for the
quarter were $1.2 billion, up
$119 million, or 11 percent, versus last year's
second quarter. Each
business delivered higher selling prices, and
foreign currency translation
aided segment sales. Overall segment volumes
were flat with improved volumes
in aerospace and automotive refinish offsetting
lower architectural coatings
volumes, due principally to the impact of poor
weather conditions in April.
Segment earnings grew $14 million to an all-time
quarterly record of $204
million, reflecting the benefit from the higher
sales, as higher selling
prices and lower overhead costs further
countered persistent raw material
cost inflation.
