PPG Industries recently reported record second quarter net sales in 2013 of $4.1 billion, up 16% compared to the prior year. Second quarter 2013 reported net income from continuing operations was $341 million. Adjusted net income for the quarter was $356 million.
Performance Coatings segment sales for the quarter were $1.7 billion, up 36%, or $447 million, vs. the prior year due principally to sales from acquired businesses. Segment volumes declined 5%, 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.
Industrial Coatings segment sales for the quarter were $1.2 billion, an increase of 13%, or $142 million, compared to the prior year, due to higher volumes combined with acquisition-related gains. Automotive OEM coatings volumes grew 12% 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%, reportedly 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.
Architectural Coatings – EMEA (Europe, Middle East and Africa) segment sales for the quarter were $571 million, a drop of 5%, or $30 million, vs. the prior year due to volume declines. Demand reportedly fell due to continued weakness in economies throughout the region. Despite the negative sales impact, segment earnings of $69 million grew by $5 million compared to the prior year, aided by aggressive discretionary cost management actions and cost improvement stemming from prior restructuring actions.
Glass segment sales were $269 million for the quarter, down $4 million year over year. Volumes declined in both fiber glass and flat glass, and were partly offset by higher flat glass pricing. Segment earnings were $8 million, a decrease of $15 million from the prior-year quarter.
“We achieved new sales and adjusted earnings records due to the continued strong performance of our coatings businesses, which in aggregate delivered 25% earnings growth in comparison to last year’s record level,” said Charles E. Bunch, chairman and CEO. “The record adjusted earnings results were driven by our strong operating focus, including ongoing aggressive cost management, and the earnings benefit from cash deployed on recent coatings acquisitions.”
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