Helped by record results in its coatings business, PPG Industries posted a 13% rise in first-quarter net income, with core figures easily topping analysts“ estimates.
The Pittsburgh-based maker of c…
Helped by record results in its coatings business, PPG Industries posted a 13% rise in first-quarter net income, with core figures easily topping analysts“ estimates. The Pittsburgh-based maker of chemicals, coatings, resins, glass and fibreglass products said net income came to US$ 139 million, or 79 cents a diluted share, compared with US$ 123 million, or 70 cents a share, a year earlier. The latest results, however, include a charge of US$ 35 million, or 20 cents a share, for the write-off of an equity investment. Excluding the charge, income came to US$ 174 million, or 99 cents a diluted share. Analysts surveyed by First Call/Thomson Financial had predicted earnings, excluding items, of 92 cents a share. The year-earlier results include a charge of 11 cents a share for restructuring the company“s packaging coatings business. Excluding the charge, year-earlier income came to US$ 143 million, or 81 cents a share. Sales rose by 16% to US$ 2.09 billion from US$ 1.80 billion. PPG Industries (PPG) said that in addition to 27% earnings growth in its coatings sector, improvements in its glass-and-chemicals segment drove earnings growth in the latest quarter. Glass-segment sales and income were up from a year earlier on higher volume in automotive OEM glass, fibreglass and flat glass. The business also benefited from recovering fibreglass prices. Chemicals segment sales and earnings also improved on better commodity prices and higher volume. The company noted that its overall results got a boost from economic recovery in Asia, as well as strong markets in Europe and North America. It said its cost-cutting effort and progress in integrating its acquisitions also paid off. Looking ahead, the company expects to report record full-year results, with “strong” sales and earnings, provided world economic conditions remain good for the period. The company acknowledged it has had “essentially flat” earnings for the past five years. Continued Asian and Latin American economic recoveries, along with improved margins in recently acquired operations and internal growth are also likely to propel a “substantially improved performance” for the year, the company said. The mean estimate of 15 analysts surveyed by First Call/Thomson Financial is for the company to post earnings of US$ 4.20 a diluted share for the year. For the year ended December 31, 1999, PPG earned US$ 647 million, or US$ 3.68 a share, excluding charges, on sales of US$ 7.8 billion.