PPG Industries, Inc. · NYSE:PPG
PPG Industries — Q2 2021 Earnings Presentation
17 slides from PPG Industries's earnings presentation, Jul 19, 2021
Slide 1: Second Quarter 2021 Financial Results
Second 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 July 19, 2021.
Slide 2: Forward-Looking Statements
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. Fo
Slide 3: Second Quarter 2021 Financial Highlights
Second Quarter 2021 Financial Highlights Net sales up ~45% Adjusted earnings per Cash deployment diluted share* of $1.94 and liquidity • Net sales totaled ~$4.4 billion; Y-O-Y • Adjusted EPS significantly higher • Cash and short-term sales volumes increased ~24% versus 2020 and similar to 2019 inves
Slide 4: PPG Second Quarter Net Sales
PPG Second Quarter Net Sales ($ in millions) $6,000 +23.8% +6.1% +11.2% 4,359 $4,000 3,015 +3.5% $2,000 $0 2Q'20 Price Volume Currency Acq./Div. 2Q'21 PPG Y-O-Y Net Sales Trend Selling Price Increase Progression (excluding currency impacts) vs Last Inflation Cycle 38.5% This Cycle Selling Price* Las
Slide 5: Second Quarter Sales Volumes
Second 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 At Market At Market Above Market Automotive Refinish Above Market Above Market At Ma
Slide 6: Performance Coatings 2nd Quarter Highlights
Performance Coatings 2nd Quarter Highlights $MM (USD) 2Q21 2Q20 Chg % • Sales impacted by raw material shortages / logistics bottlenecks; impacting most businesses Net Sales 2,749 2,069 +680 +33% • Architectural: softening DIY sales from elevated levels; Trade demand improving Income 454 362 +92 +25
Slide 7: Industrial Coatings 2nd Quarter Highlights
Industrial Coatings 2nd Quarter Highlights $MM (USD) 2Q21 2Q20 Chg % • Strong demand momentum continued for PPG technology advantaged products Net Sales 1,610 946 +664 +70% • Raw material inflation rapidly escalated; up ~20% YOY Income 190 34 +156 +458% • Results include an estimated unfavorable sal
Slide 8: Key highlights of PPG's ESG Focus and Progress
Key highlights of PPG’s ESG Focus and Progress We protect and beautify the world through our Environmental, Social, and Governance initiatives A sampling of sustainable PPG products Low-Temperature SIGMAGLIDE 1290 PR-1776MB Cure Premium Hull Coating Low Weight Fuel Basecoat / Clearcoat Solution Tank
Slide 9: Balance Sheet and Cash
Balance Sheet and Cash Second Quarter Cash and Debt Second Quarter 2021 Activity and Liquidity ($ in billions) $8 2Q 2021 approximate cash uses 7.2 $7 • Capital spending ~$60 million 6.3 • Dividends ~$130 million 5.9 $6 5.5 5.1 5.1 Liquidity $5 4.6 4.5 4.0 4.0 • ~$1.3 billion cash and short term inv
Slide 10: Five acquisitions completed since December 2020
Five acquisitions completed since December 2020 • Aggregate revenue of ~$1.7 billion • Consistent with strategy to acquire companies with leading positions and/or differentiated technologies • Expands PPG product, geographical, and sustainability capabilities • Integration focus includes leveraging
Slide 11: Third Quarter and Full Year 2021 Financial Projections
Third Quarter and Full Year 2021 Financial Projections ($ in millions unless otherwise stated) Category Projection Total company net sales (Y-O-Y) Up 21% to 23% 3Q acquisition sales ~$500 million (margins below company average) * 3Q adjusted earnings-per-diluted share $1.90- $1.95 * 2021 full-year a
Slide 12: Additional materials and appendix
Additional materials and appendix
Slide 13: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation $ in millions, except EPS Total PPG Second Quarter 2021 Net Income EPS(a) Net Income from Continuing Operations, As Reported $ 431 $ 1.80 Acquisition-related amortization expense 31 0.13 Net tax charge related to UK statutory rate change 22 0.09 Acquisition-related costs
Slide 14: Adjusted EPS Reconciliation
Adjusted EPS Reconciliation $ in millions, except EPS Total PPG Second Quarter 2020 Net Income EPS(a) Net Income from Continuing Operations, As Reported $ 99 $ 0.42 Business restructuring-related costs, net(b) 128 0.54 Acquisition-related amortization expense 23 0.10 Debt extinguishment charge 5 0.0
Slide 15: Historical ROS Segment Margin and Adjusted EPS Excluding Amortization
Historical ROS* Segment Margin and Adjusted EPS Excluding Amortization $ in millions, except ROS % 2019 2020 2021 Performance Segment Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 ROS Margin, As Reported 14.1% 17.5% 16.4% 14.1% 15.6% 13.5% 17.5% 18.9% 13.8% 16.0% 16.6% 16.5% Amortization 24 25 24 25 98 26 21
Slide 16: Historical Seasonality of New Acquisitions Compared to PPG
Historical Seasonality of New Acquisitions Compared to PPG Acquired Sales ($MM) Sales Seasonality 550 40.0% 500 35.0% 450 30.0% 400 25.0% 350 20.0% 300 15.0% 250 10.0% Q1 Q2 Q3 Q4 200 Q1 Q2 Q3 Q4 PPG Sales Curve Acquired Sales Curve Acquired $1.7B of sales with pre-synergy EBTIDA margin of ~14% 16 N
Slide 17: Thank You For Your Interest In PPG
Thank You For Your Interest In PPG Contact Information: INVESTORS: John Bruno phone: +1.412.434.3466 email: jbruno@ppg.com MEDIA: Mark Silvey phone: +1.412.434.3046 email: silvey@ppg.com 17