Ppg Industries, Inc. · NYSE:PPG
Ppg Industries — Q3 2023 Earnings Presentation
15 slides from Ppg Industries's earnings presentation, Oct 19, 2023
Slide 1: Third Quarter 2023 Financial Results
Third Quarter 2023 Financial Results October 18, 2023 Tim Knavish, Chairman and Chief Executive Officer Vince Morales, Senior Vice President and Chief Financial Officer John Bruno, Vice President Finance
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: Third Quarter 2023 Financial Highlights
Third Quarter 2023 Operating Financial Highlights Cash Flow ~$900 MM Record quarterly sales and adjusted EPS + $380 MM Adjusted EPS Strong organic growth in aerospace coatings, auto OEM coatings and PPG Comex $2.07 Global industrial production muted, +25% including slow recovery in China Net Segment
Slide 4: Third Quarter Record Net Sales
Third Quarter Record Net Sales Organic sales up 1% year-over-year Net Sales ($ in millions) 1% $4,644 3% 2% Selling prices: Includes incremental 2023 actions $4,468 -2% Volumes: Strong aerospace coatings and PPG Comex more than offset by soft industrial production and slow recovery in China Currency
Slide 5: Current Operating Environment Similar to 2Q 2023
Current Operating Environment Similar to 2Q 2023 Positives • Aerospace recovery and order backlog 0 • Economic growth in Mexico • Price – cost recovery momentum • Raw material availability Watching • Europe demand stabilizing • China recovery (excluding auto) • U.S. consumer spending • U.S. labor cl
Slide 6: Performance Coatings
Performance Coatings Segment Margin 0 15.7% 6% net sales increase driven by aerospace and PPG Comex +230 bps YOY Net Sales ($ in millions) Organic Sales 3Q’23 4Q’23 3% $2,880 Results Outlook 3% $2,705 0% Aerospace DD DD Refinish LSD LSD Architectural LSD FLAT 3Q'22 Price Volume Currency 3Q'23 EMEA A
Slide 7: Industrial Coatings
Industrial Coatings Segment Margin 0 13.9% Strong YOY margin improvement +300 bps YOY Net Sales ($ in millions) Organic Sales 3Q’23 4Q’23 2% Results Outlook $1,763 1% 1% $1,764 Auto OEM LSD LSD -4% Industrial MSD MSD 3Q'22 Price Volume Currency Acquistions 3Q'23 and Packaging HSD LSD Divestitures Hi
Slide 8: Record Operating Cash Flow
3Q’23 Activity Record Operating Cash Flow Operating cash flow ($ in millions) $1,513 ~$900 MM $1.3 B Operating cash flow Cash balance September 30, 2023 $380 MM YOY $376 $4.9 B Net debt September 30, 2023 3Q'22 YTD 3Q'23 YTD Paid down $500 MM of term loan debt Significantly reduced net interest expe
Slide 9: Examples of PPG Organic Growth Drivers
Examples of PPG Organic Growth Drivers Powder Coatings Electric Vehicles PPG: #1 paint company in Mexico One of the fastest growing A leading EV coatings supplier coating technologies in the in China providing conventional World class distribution world, delivering protection on coatings and new inn
Slide 10: Sustainability: Examples of Recent Progress
Sustainability: Examples of Recent Progress Recent Accomplishments Priorities Launched the PPG Initiate execution of SUSTAINABILITY CO₂NCEPT™ PPG’s Scope 1 & 2 system, a suite of tools designed decarbonization to help automotive repair shops roadmap reduce energy, waste and Introduced PPG LINQ™ gree
Slide 11: Full Year and Fourth Quarter 2023 Financial Projections
Full Year and Fourth Quarter 2023 Financial Projections Category Fourth Quarter 2023 Full-Year Total organic sales (YOY) +/- LSD Adjusted EPS $1.44 - $1.50 per share $7.58 – $7.64 per share Raw material costs (YOY) - HSD Favorable foreign currency impact (YOY) ~$60 MM net sales Based on current rate
Slide 12: Appendix
Appendix
Slide 13: Reconciliation: Segment Margin and Adjusted EPS Excluding Amortization
Reconciliation: Segment Margin and Adjusted EPS Excluding Amortization $ in millions, except margin % 2021 2022 2023 2023 2023 Performance Segment Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Segment Margin, As Reported 16.6% 16.5% 14.8% 9.7% 14.4% 12.4% 15.2% 13.4% 10.9% 13.1% 15.0% 17.7% 15.7% Net Sales
Slide 14: Reconciliation: Adjusted EPS
Reconciliation: Adjusted EPS $ in millions, except EPS Total PPG Third Quarter 2023 Net Income EPS(a) Net Income from Continuing Operations, As Reported $ 426 $ 1.79 Acquisition-related amortization expense 30 0.13 Business restructuring-related costs, net(b) 10 0.04 Transaction-related costs(c) 27
Slide 15: 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 We protect and beautify the world® email: silvey@ppg.com 15