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OFFON

PPG INDUSTRIES, INC.

(PPG)
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PPG Industries : 1Q21 Earnings Presentation

04/15/2021 | 08:08pm EDT

First Quarter 2021 Financial Results

Michael H. McGarry, Chairman and Chief Executive Officer

Vincent J. Morales, Senior Vice President and Chief Financial Officer John Bruno, Vice President, Investor Relations

All content within is proprietary to PPG. Information current as of April 15, 2021.

Forward-Looking Statements

This presentation contains forward-looking statements that reflect the Company's current views with respect to future events and financial performance. You can identify forward-looking statements by the fact that they do not relate strictly to current or historic facts. Forward-looking statements are identified by the use of the words "aim," "believe," "expect," "anticipate," "intend," "estimate," "project," "outlook," "forecast" and other expressions that indicate future events and trends. Any forward-looking statement speaks only as of the date on which such statement is made, and the Company undertakes no obligation to update any forward looking statement, whether as a result of new information, future events or otherwise. You are advised, however, to consult any further disclosures we make on related subjects in our reports to the Securities and Exchange Commission. Also, note the following cautionary statements:

Many factors could cause actual results to differ materially from the Company's forward-looking statements. Such factors include statements related to the expected effects on our business of the COVID-19 pandemic and the pace of recovery from the pandemic, global economic conditions, increasing price and product competition by our competitors, fluctuations in cost and availability of raw materials, the ability to achieve selling price increases, the ability to recover margins, customer inventory levels, our ability to maintain favorable supplier relationships and arrangements, the timing of and the realization of anticipated cost savings from restructuring and other initiatives, the ability to identify additional cost savings opportunities, the timing and expected benefits of our acquisitions, difficulties in integrating acquired businesses and achieving expected synergies therefrom, economic and political conditions in the markets we serve, the ability to penetrate existing, developing and emerging foreign and domestic markets, foreign exchange rates and fluctuations in such rates, fluctuations in tax rates, the impact of future legislation, the impact of environmental regulations, unexpected business disruptions, the unpredictability of existing and possible future litigation, including asbestos litigation and governmental investigations. However, it is not possible to predict or identify all such factors. Consequently, while the list of factors presented here and under Item 1A of PPG's 2020 Form 10-K are considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in the results compared with those anticipated in the forward-looking statements could include, among other things, lower sales or earnings, business disruption, operational problems, financial loss, legal liability to third parties, other factors set forth in Item 1A of PPG's 2020 Form 10-K and similar risks, any of which could have a material adverse effect on the Company's consolidated financial condition, results of operations or liquidity.

All of this information speaks only as of April 15, 2021, and any distribution of this presentation after that date is not intended and will not be construed as updating or confirming such information. PPG undertakes no obligation to update any forward-looking statement, except as otherwise required by applicable law.

2

First Quarter 2021 Financial Highlights

Net sales up ~15%

  • Net sales totaled ~$3.9 billion; Y-O-Y sales volumes increased ~7%
  • Continued strong architectural coatings demand, and sales volumes in Industrial Coatings segment up ~10% Y-O-Y
  • Selling prices increased nearly 2%
  • Acquisition-relatedsales added ~$95 million: mostly Traffic Solutions (Ennis- Flint)
  • Foreign currency translation was favorable by about 3.5% Y-O-Y

Record adjusted earnings per diluted share* of $1.88

  • Adjusted EPS was higher by 44% and 27% versus 2020 and 2019 first quarter respectively
  • Strong operating earnings leverage from recovering demand
  • Commodity supply disruptions causing higher raw material inflation
  • Cost mitigation actions: ~$30 million of interim PPG savings in this quarter
  • Business restructuring actions: ~$35 million of structural cost savings

Cash deployment and liquidity

  • Cash and short-term investments totaled ~$1.9 billion on March 31, 2021
  • Fully repaid remaining $400 million balance of short-term debt (April 2021 maturity)
  • Net debt increased by about $500 million from end of fourth quarter 2020; Issued $700 million of new long term debt at attractive rate

3

Comparisons are year-over-year, unless otherwise indicated.

*Adjusted EPS (from continuing operations) - see presentation appendix for reconciliation to reported EPS.

PPG First Quarter Net Sales

($ in millions)

$4,000

+7.3%

+3.2%

+2.8%

3,881

+1.7%

$3,500

3,377

$3,000

1Q'20

Price

Volume

Currency

Acq./Div.

1Q'21

PPG Y-O-Y Net Sales Trend

Foreign Currency Rate Trends vs. U.S. Dollar

(excluding currency impacts)

(indexed to Q1'19)

11.7%

20%

1.6%

1.9%

2.2%

1.7%

0.8%

10%

-3.7%

0%

-4.7%

*0.2%

*0.6%

-10%

-20%

-21.8%

1Q '19

2Q

3Q

4Q

1Q'20

2Q

3Q

4Q

1Q '21

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

1Q

Euro

MXP

RMB

UK

'19

'20

'21

1Q'21: Volume recovery continues

In 1Q 2021 US dollar weakened (YOY) versus key currencies

4 * Including customer assortment changes.

First Quarter Sales Volumes

PPG volume performance by major coatings vertical vs. prior year and end-use market demand

U.S. and Canada

Europe / Middle East / Africa

Asia-Pacific

Latin America

Aerospace

Above Market

Above Market

Above Market

Above Market

Automotive Refinish

Above Market

Above Market

At Market

At Market

Architectural

At Market

Above Market

Australia

China

Mexico

Brazil

Above Mkt

At Market

Above Market

Above Mkt

Protective

At Market

Above Market

Above Market

At Market

Marine

At Market

At Market

At Market

N/A

Automotive OEM

At Market

Above Market

Above Market

Above Market

General Industrial

At Market

At Market

Above Market

Above Market

Packaging

At Market

At Market

At Market

Above Market

Legend:

PPG compared to expected industry end-use market demand:

Year-over-year PPG volume:

5

Above Market

At Market

Below Market

Contraction

Expansion

This is an excerpt of the original content. To continue reading it, access the original document here.

Disclaimer

PPG Industries Inc. published this content on 15 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 16 April 2021 00:07:03 UTC.


© Publicnow 2021
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Financials (USD)
Sales 2021 16 594 M - -
Net income 2021 1 753 M - -
Net Debt 2021 4 805 M - -
P/E ratio 2021 24,5x
Yield 2021 1,22%
Capitalization 42 555 M 42 555 M -
EV / Sales 2021 2,85x
EV / Sales 2022 2,64x
Nbr of Employees 46 900
Free-Float 40,5%
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Income Statement Evolution
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Mean consensus OUTPERFORM
Number of Analysts 24
Average target price 176,14 $
Last Close Price 179,49 $
Spread / Highest target 11,4%
Spread / Average Target -1,86%
Spread / Lowest Target -46,5%
EPS Revisions
Managers and Directors
NameTitle
Michael H. McGarry Chairman & Chief Executive Officer
Vincent J. Morales Chief Financial Officer & Senior Vice President
David S. Bem CTO, Vice President-Science & Technology
Bhaskar Ramachandran Chief Information Officer & Vice President
Robert King VP-Global Operations, Industrial Segment
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