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PPG Investor Overview
September 2019
2
Notes
Forward looking statements
3
The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on
behalf of the Company. 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 global economic conditions, increasing price and product competition by foreign and domestic competitors,
fluctuations in cost and availability of raw materials, the ability to achieve selling price increases, the ability to recover
margins, customer inventory levels, the ability to maintain favorable supplier relationships and arrangements, the timing of
realization of anticipated cost savings from restructuring initiatives, the ability to identify additional cost savings opportunities,
difficulties in integrating acquired businesses and achieving expected synergies therefrom, economic and political conditions
in international markets, 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. Such factors also include risks related to the impact of the
restatement disclosed in our amended 2017 Annual Report on Form 10-K/A, including the impact on PPG’s reputation and
commercial contracts. 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 2018 Form 10-K is 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 2018
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.
4
A global maker of paints, coatings and
specialty materials, with full-year net
sales of $15.4 billion in 2018
Corporate Social Responsibility Awards
• Ranked #31 on the U.S. 500 Newsweek Green Rankings
• Forbes Best Employers for Diversity in 2019
Product and Process Awards
Earned R&D 100 Awards for two technologies in the mechanical devices / materials category in 2018
Customer Awards
Named Supplier of the Year by Home Depot in 2018
• Recipient of Uni-Select’s 2018 Diamond Award
How We Rank
Our employees protect and beautify the world
Ranked among the “World’s Most Admired Companies” in its industry by
Fortune Magazine in 2018
Who We Are
A leader in all our markets: construction,
consumer products, industrial and
transportation markets and aftermarkets
Headquartered in Pittsburgh,
Pennsylvania, with operations in more
than 70 countries
Founded in 1883
Fortune 500: Ranked 191
PPG background and recent accolades
2018 key achievements
Strategic Portfolio Actions•Announced 6 acquisitions with annual revenue of about $500 million
• Acquisitions expanded technological capabilities and global footprint
Strong Financial & Operational Performance
•Grew adjusted EPS* vs. prior year despite significant raw material inflation
•Delivered approximately $80 million in cost savings from restructuring actions
Cash and Cash Deployment
•About $1.5 billion of cash generated from operations
•Quarterly dividend increase – 47th consecutive year (7% annual increase)
•Returned approximately $2.2 billion of cash to shareholders
• $1.7 billion for share repurchases
• $0.5 billion for dividends
5
* See appendix for reconciliation of PPG reported to adjusted EPS
6
Business portfolio optimization
~$10.2B (2005) ~$15.4B (2018)
Percentage of Sales (as originally reported)
In 2017, finalized a multi-year strategic portfolio transformation with
the sale of U.S. fiber glass business
100%
0%
20%
40%
60%
80%
100%
2005 2010 2016 Current
Coatings Optical Commodity Chemicals Glass
PPG is a focused coatings and paint company
Other
Global paint and coatings industry (~$140B)
Competitive Landscape
PPG has completed 20 strategic acquisitions since the beginning of 20157
Source: IPPIC, Company Annual Reports, PPG estimates
Strong fundamentals
• Stable earnings/cash
• Growth potential
• Low capital intensity
• Technology & service
• Consolidating industry
U.S & Canada
42%
EMEA31%
Asia/Pacific17%
Latin America
10%
Coatings geographic mix
Source: IPPIC
Coatings Industry
Geographic Sales Mix
PPG Coatings
Geographic Net Sales Mix
PPG - Opportunities to expand in Asia and globally
U.S. & Canada
18%
EMEA30%
Asia Pacific45%
Latin
America
7%
8
EMEA includes Europe, Middle East, and Africa
Coatings end-usesIndustry End Use Demand
(~$140B Sales Value)
Source: IPPIC, Company Annual Reports, PPG estimates
PPG Coatings End-Use Net
Sales Mix
PPG is in line with the global coatings industry end-use mix
9
Automotive OEM,
Parts
& Aftermarket, 30%
Construction - New &
Maintenance, 35%
General
Industrial, 20%
Aerospace and
Marine, 15% (New & Aftermarket)
Architectural
General Industrial
Automotive OEM & Aftermarket
Protective & Marine, Packaging, Aerospace
#1 End-Use Position #2 End-Use Position #3 End-Use Position Meaningful presence No Current Meaningful Presence
PPG global end use positions
Source: IPPIC; company annual reports, PPG estimates
Position by Coatings Vertical
PPG growth opportunity: To be #1 or #2 in every country/vertical
Source: Orr and Boss; Company Annual Reports; PPG estimates
---------- Participation in all end-use markets -----------
Global
Position
ArchGeneral
Industrial
Protective
& MarineAuto OEM
Refinish /
CollisionPackaging
Aerospace
PPG #2 #2 #3 ~#3 #1 #2 #2 #1
Sherwin
Williams#1
AkzoNobel #3
Nippon #4
RPM #5
Axalta #6
BASF #7
10
PPG growth levers
Innovation
Growth
Economic
Growth
Acquisition
Growth
• Technology-led organic growth
• Leverage expertise across coatings end-uses
• Proven track record of successful integrations
• Active pipeline of global acquisition targets
• European volumes ~15% below 2008 levels
• Strong incremental margins due to cost management
Growth opportunities in many areas 11
12
Recognized industry leading innovation
2016
R&D 100 Winner
R&D 100 Winner
ENVIRO-PRIME® EPIC
R&D 100 Winner
AEROCRON® 2100, first e-coat primer
for the aerospace industry
LIQUID NAILS®
Fuze*It®
R&D 100 Finalist
ENVIROCRON® Extreme
Protection Powder Coating
R&D 100 FinalistR&D 100 Winner R&D 100 FinalistR&D 100 Winner
AEROTM Light & EasyOLYMPIC ® SMARTGUARD,
Multisurface WaterprooferAmbient Reactive Extrusion
Additive ManufacturingLow Temperature Cure
Coating System for Ferrari
2017
2018
R&D 100 Finalist
AUDIOGUARDTM for
Aluminum
R&D 100 Winner
Premium Compact
Process Primer
R&D 100 Finalist
DESOTHANE Solar Heat
Management Coatings
PPG is regularly honored as an R&D 100 Finalist or Winner
Acquisitions contribute to sales growth
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Acquisition Sales Growth Over Prior Year Notable acquisitions:
2008 – SigmaKalon
2013 – AkzoNobel NA
2014/5 – Comex (partial years)
+3% average sales
growth from
acquisitions
(USD MM)
Acquisitions supplement organic growth
13
14
PPG reporting segments drive our business
Performance Coatings
• Aerospace
• Architectural Coatings
- Americas & Asia Pacific
- Europe, Middle East, Africa
• Automotive Refinish Coatings
• Protective & Marine Coatings
40%
Industrial Coatings
• Automotive OEM Coatings
• Industrial Coatings
• Packaging Coatings
• Specialty Coatings & Materials
~ ~
• Automotive Refinish
• Architectural Americas & Asia Pacific
• Architectural EMEA
• Aerospace
• Protective & Marine
15
$8.7 $8.8$8.6
$8.7
$9.1
13.9%
14.9%15.4%
15.0%14.3%
'14 '15 '16 '17 '18
US & Canada
45%
EMEA32%
Asia12%
Latin America11%
Net Sales with ROS* 2018 Net Sales by Geography
5-Year CAGR* ~ 3%
EMEA: Europe,
Middle East, and
Africa
• Distribution focus
• After market and maintenance component
• Consistent cash generation
• Stable industries
Strategic Business Units Segment Traits
$B
Performance Coatings segment
*includes acquisition and currency impact
'16 '17 '18
US & Canada
EMEA
Asia Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~1%
16
• Color complexity
• Emerging regions growth
• Technology shift to waterborne
• Value added programs and training
• Growth of advanced driver-
assistance systems
PPG Global Waterborne Paint ShopsKey Industry Trends
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
3-Year CAGR ~ 5%000s
Automotive Refinish
50%
50%
30%
70%
US & Canada
EMEA Asia
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~ 6%
17
• Single aisle aircraft driving growth
• Industry consolidation and OEM
vertical integration intensify
• Stable to moderate fuel prices
• Shift to robotic applications and
automation
Net Sales MixKey Industry Trends
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Aerospace
Aftermarket
OEM Military
Commercial
US & CanadaEMEA
Asia
Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~ 2%
18
• Infrastructure ($4.4B)
• Energy ($3.8B)
• Marine Aftermarket ($2.3B)
• Industrial Maintenance ($1.9B)
• Marine OEM ($1.3B)
PPG Net Sales MixKey Industry End Uses
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Protective & Marine Coatings (PMC)
Marine After Market
Marine New Build
0%
25%
50%
75%
100%
Protective
Coatings
Marine New Build
Marine After
Market
Protective
Coatings
20182009
US & Canada
AsiaLatin
America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~7%
19
*includes acquisition and currency impact
Architectural Coatings (Americas & Asia)
Maintenance / Repaint
Non-ResidentialResidential
25%
70% 30%
New
Construction
75%National
Retailers
(DIY)
35%Company
Stores
50%
Independent
Dealers 15%
USCA Net Sales MixUS Net Sales Mix
Region Stores
USCA ~900
LA ~4,600
AP ~50
20
Architectural Coatings (Latin America)
Operating Model
• Open New Stores
• Develop Low Share Territories
• Penetrate Key Segments
• Purchase Experience
• Develop Categories & Brand/Channel
• Founded in 1952
• ~4,600 independently owned/operated concessionaire locations in Mexico
• Opening 1 new store approximately every other day
• Targeted growth rate 2 times Mexican GDP growth rate
• Over 650 points-of-sale across Central America (incl. Glidden)
• Leading architectural coatings position in Mexico; well-recognized regional brands
Mexico Concessionaire NetworkCentral America Architectural Network
Over 650 Regional Points-of-SaleConcessionaire goal: 1 store per 20k people
Current density: 1 store per 30k people
Guatemala
Glidden
StoresHome
Center
Belize8
Honduras25
Nicaragua14
Panama18
361
Costa Rica
El Salvador
90
37
120
Represents Points-
of-Sale
Consistent Growth
UK
Portugal Spain
France
Germany Poland
Romania
Denmark
Norway
Finland
Estonia
Latvia
Belarus
Greece
'14 '15 '16 '17 '18
Net Sales* (MM €) Position by Geography
5-Year CAGR* ~1%
21
Architectural Coatings (EMEA)
PPG top 3 position
Ireland
*includes acquisition and currency impact
Maintenance
New Construction
End-Use Demand
More
Stability
in End-
Uses
Net Sales Mix
80%
20%
Region Stores
EMEA ~700
Home
Centers
20%
Company
Stores
48% Independent
Trade/Dealers
/Other
32%
• Automotive OEM
• Industrial
• Packaging
• Specialty Coatings & Materials
22
$5.6 $5.5 $5.7$6.0
$6.3
17.1% 18.0% 18.6%16.3%
13.0%
'14 '15 '16 '17 '18
US & Canada38%
EMEA28%
Asia25%
Latin America9%
Net Sales with ROS* 2018 Net Sales by Geography5-Year CAGR* ~ 4%
EMEA: Europe,
Middle East, and
Africa
• Technology advantaged products
• Mix of global and local customers
• High quality product performance
• Global customer footprint
Strategic Business Units Segment Traits
$B
Industrial Coatings segment
US & Canada
EMEA
Asia
Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~ 2%
23
Global Auto OEM Production
Customer MixKey Industry Trends
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Automotive OEM
50
60
70
80
90
100
'14 '15 '16 '17 2018
5-Year CAGR ~ 2%
2019 estimated to be +1% growth
All Remaining
Customers
U.S.
Based
Non-U.S.
Based
Top 7 PPG
Automotive
Customers
300
450
600
750
'14 '15 '16 '17 '18
US & Canada
EMEA
Asia
Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~7%
24
Asia Net Sales*Key Industry End Uses
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Industrial Coatings
• Heavy-duty Equipment
• Appliances
• Electronic Materials
• Coil
• Automotive Accessories
• Transportation
• Office Furniture
5-Year CAGR excl. FX ~ 4%
*stated at constant currency and includes acquisition impact
US & Canada
EMEA
Asia
Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~0%
25
Industry Container UseKey Industry Trends
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Packaging Coatings
• Growth in metal packaging industry
due to sustainability, performance
and safety
• Conversion to BPA-NI technology
continues globally
• Can makers drive toward complexity
reduction in coatings portfolio
Interior
ExteriorEnds
OtherBeverage
Food
Other
US & Canada
EMEA
Asia
Latin America
'14 '15 '16 '17 '18
Net Sales* 2018 Net Sales by Geography
5-Year CAGR* ~4%
26
Net Sales MixKey Industry Trends
*includes acquisition and currency impact
EMEA: Europe,
Middle East, and
Africa
Specialty Coatings & Materials
• Mobile device transition to OLED
technology
• Growth in large diameter and tires
containing premium silica productsBeverage
Silica
Teslin
Optical Monomers and Dyes
OLED materials
Coatings cost comparison
Sold in 2,000
Liter Totes
Sold in 1
Gallon
Paint
Cans
And 5
Gallon
Buckets
Average Architectural Coatings
Industry estimates – figures vary greatly by end-use and application
Source: PPG Estimates
Average Industrial Coatings
Raw material basket and manufacturing/distribution costs are different
Resins and Latex
Titanium Dioxide
Solvents and Pigments
Additives
Manufacturing
Packaging
Distribution - intermediate
Distribution - final
Resins and Latex
Titanium Dioxide
Solvents and Pigments
Additives
Manufacturing
Packaging
Distribution - final
27
Adjusted EBITDA from continuing operations as percent of sales as reported in company reports (excluding unusual items);
See Appendix for reconciliations.
PPG remains a margin leader across coatings sector
16% 16%
11%13%
19%
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
22.0%
PPG Sherwin Williams Akzo Nobel RPM Axalta
2018 Full Year EBITDA as % of Net Sales
Coatings Peers EBITDA %
28
Adjusted EBITDA from continuing operations as percent of sales as reported in company reports (excluding unusual items); See Appendix for
reconciliations.
16%
14%
15%
13% 13%
16%
17%
16% 16%
15%
14%
19%18%
17%
15%
13%
14%
21%
17%
16%
12%
13%
19%
16% 16%
11%
13%
19%
-1.0%
1.0%
3.0%
5.0%
7.0%
9.0%
11.0%
13.0%
15.0%
17.0%
19.0%
21.0%
23.0%
PPG Sherwin Williams Valspar Akzo Nobel RPM Axalta
Full Year EBITDA as % of Net Sales
2014 2015 2016 2017 2018
N/A
Coatings Peers EBITDA %
Consistent coatings industry margins across varying economic conditions
29
2%
6%
10%
14%
0
200
400
600
2009 '10 '11 '12 '13 '14 '15 '16 '17 '18
EB
IT M
arg
in o
n S
ale
s
Ea
rnin
gs
Earnings PTPI %
0
1,000
2,000
3,000
4,000
5,000
2009 '10 '11 '12 '13 '14 '15 '16 '17 '18
Sa
les
Other PPG Businesses
Architectural Coatings EMEA
PPG Net Sales Mix (€MM) Earnings (€MM)
Modest growth continues; recent margins impacted by significant cost inflation
30
Total PPG Europe, Middle East and Africa
$1,000
$2,000
$3,000
'14 '15 '16 '17 '18
Consolidated Net Sales*
$0
$200
$400
$600
'14 '15 '16 '17 '18
Segment Income*
Recent years impacted by significant cost inflation
$MM - USD
* Recast for discontinued operations, at constant FX
PPG Asia Pacific financials
$MM - USD
31
Strong and growing Asian presence (excl. Japan)
*Many Leading Asia Markets (excl. Japan)
Performance
Industrial
Broad, full coatings business portfolio
PPG Asia Net Sales Mix (2018)*Industry Coatings Demand for Asia
*Coatings Industry in Asia remains Fragmented
Sources: PPG Internal estimates (excludes Japan includes ARCH)
PPG Market
Position
PPG ’13 - ’18
CAGR
Automotive OEM #2 2%
General Industrial #2 3%
Packaging #1 0%
Auto Refinish #1 0%
Aerospace #1 5%
Protective/Marine #4 -3%
Architectural #7 0%
Total Coatings #3 1%
Akzo9%
Nippon 8%
PPG 6%
Asian Paints 6%
Kansai 3%
S-W 3%
BASF 2%
Jotun 2%
Dulux 2%Axalta 2%
KCC 2%Hempel 1%
TOA 1%
Carpoly 1%
SKShu 1%
Others 50%
#14,200
players
32
59%14%
13%
9%5% China
India
Southeast Asia
Korea
ANZ
*PPG estimates
Robust cash generation over time while transforming the business portfolio
$1.5B
$2.4B
$1.7B
$1.2B
$1.5B
$1.9B
$1.5B
$1.0B
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
'11 '12 '13 '14 '15 '16 '17 '18
Approximate Cash & Short Term Investments
* As originally reported, not adjusted for business divestitures
Millions USD
PPG cash trends
33
$1,000
$1,250
$1,500
$1,750
$2,000
'11 '12 '13 '14 '15 '16 '17 '18
Cash From Operations*
+ Adjusted Cash from Operations; excluding cash paid to fund the Pittsburgh Corning asbestos trust
Adju
ste
d +
Cash Use Summary:
Grow Business ~45%
Return to Shareholders ~55%
20%
24%
19%
37%
Past 10 Years (~$20.0B)(2009 – 2018)
Approximate 2018 Cash Uses
$ in millions – As reported, not adjusted for business divestitures
Legacy of consistent and prudent cash deployment
Balanced cash deployment
34
$410
$380
$450
$1,720
Capital Spending
Acquisitions
Dividends
Share Repurchases
* Adjusted to exclude certain non-recurring charges, see appendix for reconciliation. All years as originally reported, not adjusted
for business divestitures.
ROC growth demonstrates successful acquisition integration
PPG return on capital (adjusted)*
35
8.5%
14.0%
16.6%
18.3%
16.1% 16.0%
17.2% 16.7%16.1%
15.3%
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
20.0%
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Cap
ital ($
MM
)
Retu
rn o
n C
ap
ital
Capital Return on Capital
Industry leading 2018 adjusted return on
capital*
~15%
~13% ~12%
~8%
~5%
Measurable proof of PPG’s successful, disciplined and value creating M&A
*Adjusted ROC excluding nonrecurring items (see reconciliation at end of presentation)
36
PPG aggressively manages cost structureSG&A as % of sales
Corporate cost as % of sales Recent PPG cost savings programsDate Focus Target
Savings
Status
Q4,
2016
Reduce Europe operational footprint,
marine coatings business unit cost
structure, acquisition synergy capture
$125
million
Nearly
complete
Q2,
2018
Adjust cost structure following U.S.
architectural customer assortment changes
$85 million Underway
Q2,
2019
Continue to optimize global cost structure ~$125
million
Underway
Adjusted EBITDA margin of sales (FY18)
19%16% 16%
13%11%
Source: Annual company filings
Source: Annual company filings See detailed reconciliation on following slides
37
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
'09 '11 '13 '15 '17 ‘18
0
100
200
300
400
500
600
700
800
2019 2020 2021 2022 2023 2025 2027 2028 2029 2038 2040 2044
USD Notes
EUR Notes
47 Years of Increased DividendsDividends per share – Adjusted for
stock splits
$ in millions
Long-Term Debt Maturity
Schedule13%
7%
3% 3%3%
2% 2%3%
4%
3% 3%
0%
2%
4%
6%
8%
10%
12%
14%
1980 || 1990 || '02 '04 '06 '08 '10 '12 '14 '16 '18
Capital Spending as % of Sales (As originally reported, not adjusted for business
divestitures)
Last 5 years
Average =
~3.0%
PPG Share Repurchases
$ in millions
Average
~$770MM
Average
~$1,080MM
PPG financial hallmarks
38
$0.00
$0.20
$0.40
$0.60
$0.80
$1.00
$1.20
$1.40
$1.60
$1.80
$2.00
'78 '83 '88 '93 '98 '03 '08 '13 '18
Last 3
years =
10%
www.ppg.com
Additional Materials
and Appendix
PPG Sherwin
WilliamsAkzo Nobel RPM
Axalta
Coatings
Systems
Currency USD USD Euro USD USD
Sales 15,374 17,534 9,256 5,322 4,670
Income before taxes 1,693 1,360 573 417 268
Unusual or Infrequent
Charges189 *499 **193 ***62 ****92
Interest, net 95 367 52 84 160
Depreciation &
Amortization497 596 239 128 369
EBITDA, adjusted 2,474 2,822 1,057 691 889
% of Sales 16% 16% 11% 13% 19%
EBITDA as % of Sales (excluding specials):
2018 EBITDA Reconciliation
41
-Amounts in millions, except percentages, reflects most recent year-end. Compiled from publically available segment disclosures.
-For all years presented, PPG results from continuing operations, as disclosed in the most recent 10-K and Annual Report.
-Akzo Nobel results from continuing operations as disclosed in the Q4 2018 earnings release.
*Mainly related to integration costs, environmental expenses, California litigation expense, and pension plan settlement expense
**Mainly related to transformation cost and one-off non-cash pension costs
***Inventory-related charges, restructuring expense, charge to exit Flowcrete China, corporate governance professional fees, and ERP
consolidation plan.
****Termination benefits, debt extinguishment and refinancing related costs, and offering and transaction costs
PPGSherwin
WilliamsAkzo Nobel RPM
Axalta
Coatings
Systems
Currency USD USD Euro USD USD
Sales 14,748 14,984 9,612 4,958 4,353
Income before taxes 2,005 1,469 764 244 190
Unusual or Infrequent
Charges20 *186 -- **216 ***155
Interest, net 85 263 78 83 147
Depreciation &
Amortization460 492 276 117 348
EBITDA, adjusted 2,570 2,410 1,118 660 840
% of Sales 17% 16% 12% 13% 19%
EBITDA as % of Sales (excluding specials):
2017 EBITDA Reconciliation
42
-Amounts in millions, except percentages, reflects most recent year-end. Compiled from publically available segment disclosures.
-For all years presented, PPG results from continuing operations, as disclosed in the most recent 10-K and Annual Report.
-Akzo Nobel results from continuing operations as disclosed in the Q4 2017 earnings release.
-Sherwin Williams results for 2017 have been adjusted for adoption of ASU 2017-01 as well as an inventory accounting change made in 2018.
*Transaction and integration related SG&A expense related to the acquisition of Valspar, in addition to inventory accounting change adjustment
**Goodwill impairment charge, charge to exit Flowcrete Middle East, and severance expense.
***Termination benefits, transition-related costs, Venezuelan foreign exchange losses and effects of deconsolidation impacts and
impairments.
PPGSherwin
WilliamsValspar Akzo Nobel RPM
Axalta
Coatings
Systems
Currency USD USD USD Euro USD USD
Sales 14,270 11,856 4,191 9,434 4,814 4,069
Income before taxes 779 1,595 434 850 483 83
Unusual or Infrequent
Charges1,234 *58 22 5 **(15) ***257
Interest, net 99 154 91 91 81 178
Depreciation &
Amortization440 198 98 282 111 322
EBITDA, adjusted 2,552 2,005 645 1,228 660 840
% of Sales 18% 17% 15% 13% 14% 21%
EBITDA as % of Sales (excluding specials):
2016 EBITDA Reconciliation
43
-Amounts in millions, except percentages, reflects most recent year-end. Compiled from publically available segment disclosures.
-For all years presented, PPG results from continuing operations, as disclosed in the most recent 10-K and Annual Report.
-Akzo Nobel results from continuing operations as disclosed in the Q4 2017 earnings release.
-Axalta results have been updated for correction of immaterial errors as noted in the 2017 10-K report.
*Transaction and integration related SG&A expense related to the acquisition of Valspar.
**Reversal of Kirker earnout.
***Termination benefits, debt extinguishment and refinancing related costs, offering and transaction costs, Venezuelan foreign exchange
losses and effects of deconsolidation impacts and impairments
PPGSherwin
WilliamsValspar Akzo Nobel RPM
Axalta
Coatings
Systems
Currency USD USD USD Euro USD USD
Sales 14,241 11,339 4,392 9,892 4,595 4,084
Income before taxes 1,745 1,549 564 992 453 158
Unusual or Infrequent
Charges198 -- (22) 80 -- 116*
Interest, net 86 62 81 91 69 197
Depreciation &
Amortization446 198 93 306 99 308
EBITDA, adjusted 2,475 1,809 716 1,469 621 779
% of Sales 17% 16% 16% 15% 14% 19%
EBITDA as % of Sales (excluding specials):
2015 EBITDA Reconciliation
44
-Amounts in millions, except percentages, reflects most recent year-end. Compiled from publically available segment disclosures.
-For all years presented, PPG results from continuing operations, as disclosed in the most recent 10-K and Annual Report.
-Akzo Nobel results from continuing operations (Paints & Coatings) with certain estimates based on 2016 recast data.
-Axalta results have been updated for correction of immaterial errors as noted in the 2017 10-K report.
*Termination benefits, transition-related costs, debt extinguishment and refinancing related costs, offering and transaction costs,
Venezuelan foreign exchange losses and effects of deconsolidation impacts and impairments
PPGSherwin
WilliamsValspar Akzo Nobel RPM
Axalta
Coatings
Systems
Currency USD USD USD Euro USD USD
Sales 14,250 11,130 4,522 9,427 4,376 4,362
Income before taxes 1,326 1,258 491 529 424 32
Unusual or Infrequent
Charges417 26 41 253 -- 126*
Interest, net 137 64 65 125 65 218
Depreciation &
Amortization422 199 101 311 90 309
EBITDA, adjusted 2,302 1,547 698 1,218 579 685
% of Sales 16% 14% 15% 13% 13% 16%
EBITDA as % of Sales (excluding specials):
2014 EBITDA Reconciliation
45
-Amounts in millions, except percentages, reflects most recent year-end. Compiled from publically available segment disclosures.
-For all years presented, PPG results from continuing operations, as disclosed in the most recent 10-K and Annual Report.
-Akzo Nobel results from continuing operations (Paints & Coatings) with certain estimates based on 2016 recast data.
*Termination benefits, debt extinguishment and refinancing related costs, and transition-related costs
FULL YEAR 2018 2017 2016 2015 2014
Net Earnings as Reported $1,323 $1,369 $564 $1,405 $1,133
Adjustments:
Accounting investigation costs 11 - - - -
Impairment of a non-manufacturing asset 7 - - - -
Brand rationalization charge 4 - - - -
Costs related to a customer assortment change 14 - - - -
Accelerated depreciation from restructuring actions 7 - - - -
Business restructuring, net 46 - 146 106 -
Transaction-related costs 4 6 6 32 42
Environmental remediation charges and other costs 58 - 51 - 86
Pension settlement charges - 38 616 5 -
Tax rulings/law changes (13) 134 - - (24)
Gain on the sale of non-operating assets (20) (8) - - (73)
Legacy legal settlements 8 (11) - - -
Loss on divestiture of European fiber glass business - - 44 - -
Net gain on disposals of ownership interest in business affiliates - (24) (55) - -
Net tax effect of asbestos settlement funding - - 151 - -
Equity affiliate debt refinancing charge - - - 7 -
Debt refinancing charge - - - - 200
Charge related to early retirement of debt - - 5 - -
Asset write-downs - 7 20 - -
Total Net Adjustments $126 $142 $984 $150 $231
Adjusted Net Earnings $1,449 $1,511 $1,548 $1,555 $1,364
Adjusted Net Earnings
Amounts in Millions of USD – Not adjusted for business divestitures for comparative purposes 46
FULL YEAR 2013 2012 2011 2010 2009
Net Earnings as Reported $1,034 $941 $1,095 $769 $336
Adjustments:
Business restructuring charges 73 163 - - 141
Pension settlement charges 13 - - 85 -
Tax rulings/law changes (10) - - - -
Transaction-related costs 28 27 - - -
Environmental remediation charges 64 99 - - -
Total Net Adjustments $168 $289 - $85 $141
Adjusted Net Earnings $1,202 $1,230 $1,095 $854 $477
Adjusted Net Earnings
47
Amounts in Millions of USD – Not adjusted for business divestitures for comparative purposes
FULL YEAR 2018 2017 2016 2015 2014
Adjusted Net Earnings $1,449 $1,511 $1,548 $1,555 $1,364
Net Interest Expense (after-tax) 92 80 94 95 143
Adjusted Net Earnings + Net Interest
Expense
1,541 $1,591 $1,642 $1,650 $1,507
Capital (Average Debt & Average Equity)
as Reported
$9,675 $9,473 $9,334 $9,515 $9,200
Net Adjustment (see Net Earnings
Reconciliations)
126 142 984 150 231
Adjusted Average Capital** $10,048 $9,908 $9,841 $9,603 $9,383
Adjusted Return on Capital 15.3% 16.1% 16.7% 17.2% 16.0%
Adjusted Return on Capital
48
Amounts in Millions of USD, except percentages - Not adjusted for business divestitures for comparative purposes
**This table does not foot due to the rounding effect of Net Adjustments
FULL YEAR 2013 2012 2011 2010 2009
Adjusted Net Earnings $1,202 $1,230 $1,095 $854 $477
Net Interest Expense (after-tax) 149 157 158 140 135
Adjusted Net Earnings + Net Interest
Expense
$1,351 $1,387 $1,253 $994 $612
Capital (Average Debt & Average Equity)
as Reported
$8,212 $7,371 $7,526 $6,685 $7,088
Net Adjustment (see Net Earnings
Reconciliations)
168 289 - 85 141
Adjusted Average Capital** $8,395 $7,592 $7,526 $6,753 $7,237
Adjusted Return on Capital 16.1% 18.3% 16.6% 14.0% 8.5%
Adjusted Return on Capital
49
Amounts in Millions of USD, except percentages - Not adjusted for business divestitures for comparative purposes
**This table does not foot due to the rounding effect of Net Adjustments
(in millions, except percentages) PPG**Sherwin-
WilliamsAkzoNobel RPM
Axalta
Coatings
Systems
Currency USD USD Euro USD USD
Net Earnings as Reported 1,323 1,109 455 338 207
Total Net Adjustments, after-tax (see details
below)
126 379 107 47 79
Adjusted Net Earnings 1,449 1,488 562 385 286
Net Interest Expense (after-tax)* 92 279 58 79 121
Adjusted Net Earnings + Net Interest Expense 1,541 1,767 620 464 407
Capital (Average Debt & Average Equity) as
Reported
9,675 13,606 11,685 3,666 5,130
Net Adjustments (see above) 126 379 107 47 79
Adjusted Average Capital 10,048 13,985 11,792 3,713 5,209
Adjusted Return on Capital 15% 13% 5% 12% 8%
2018 Adjusted return on capital reconciliation
Sources for Summary of Net Adjustments:
PPG: Net income impact of non-recurring items as disclosed in the 2018 Form 10-K p. 31.
Sherwin-Williams: Net income impact of non-recurring items of integration costs, environmental expenses, California litigation expense, and pension plan settlement expense
as noted in the Fourth Quarter 2018 Earnings Press Release p. 5 (assuming a tax rate of 24%). This calculation does not include the adjustment for purchase accounting
impacts.
AkzoNobel: Net income impact of non-recurring identified items mainly related to transformation cost and one-off non-cash pension costs as noted in the Q4 and full-year
2018 results presentation p. 3.
RPM: Net income impact of non-recurring items of inventory-related charges, restructuring expense, charge to exit Flowcrete China, corporate governance professional fees,
and ERP consolidation plan as noted in the Reconciliation of Non-GAAP for 4th Quarter 2018 presentation slide 8 (assuming a tax rate of 24%).
Axalta Coatings Systems: Net income impact of non-recurring items of termination benefits, debt extinguishment and refinancing related costs, and offering and transaction
costs as noted in the Fourth Quarter and Full Year 2018 Financial Results presentation, slide 15.
*Tax impact calculated using a 24% tax rate
**Does not foot due to the rounding effect of net adjustments50
2018 Quarterly Financial Results by Reportable SegmentPPG INDUSTRIES AND CONSOLIDATED SUBSIDIARIES (Continuing Operations)
BUSINESS SEGMENT INFORMATION (unaudited)
Q1 Q2 Q3 Q4 Full Year
2018 2018 2018 2018 2018
Net sales
Performance Coatings $ 2,160 $ 2,498 $ 2,289 $ 2,140 $ 9,087
Industrial Coatings 1,621 1,633 1,528 1,505 6,287
TOTAL $ 3,781 $ 4,131 $ 3,817 $ 3,645 $ 15,374
Segment income
Performance Coatings $ 280 $ 428 $ 331 $ 261 $ 1,300
Industrial Coatings 239 223 169 187 818
TOTAL 519 651 500 448 2,118
Items not allocated to segments
Corporate (43) (23) (26) (54) (146)
Interest expense, net of interest income (21) (24) (25) (25) (95)
Legacy items 4 1 - - 5
Environmental remediation charges and other costs (34) - - (43) (77)
Business restructuring, net - (83) 12 5 (66)
Accelerated depreciation related to restructuring actions - (5) (4) - (9)
Impairment of a non-manufacturing asset - (9) - - (9)
Accounting investigation costs - (9) (2) (3) (14)
Legacy legal settlements - (10) - - (10)
Costs related to customer assortment change (4) (10) (4) - (18)
Transaction-related costs - - - (6) (6)
Gain from the sale of a non-operating asset - - - 26 26
Brand rationalization charge - - - (6) (6)
INCOME BEFORE INCOME TAXES $ 421 $ 479 $ 451 $ 342 $ 1,693
Amounts in Millions of USD
51
52
Full Year
2018
Full Year
2017
Net Income EPS Net Income EPS
Reported net income from continuing operations $ 1,323 $ 5.40 $ 1,369 $ 5.31
Net tax (benefit)/charge for Tax Cuts and Jobs Act
Legislation (13) (0.05) 134 0.52
Environmental remediation charges and other costs 58 0.24 — —
Accounting investigation costs 11 0.05 — —
Impairment of a non-manufacturing asset 7 0.03 — —
Brand rationalization charge 4 0.02 — —
Transaction-related costs 4 0.02 6 0.02
Gain from the sale of a business — — (24) (0.09)
Gain on the sale of non-operating assets (20) (0.08) (8) (0.03)
Legacy legal settlements 8 0.03 (11) (0.04)
Costs related to a customer assortment change 14 0.05 — —
Business restructuring, net 46 0.18 — —
Accelerated depreciation from restructuring actions 7 0.03 — —
Pension settlement charges — — 38 0.14
Asset write-downs — — 7 0.03
Adjusted net income from continuing operations, excluding
non-recurring items
$ 1,449 $ 5.92 $ 1,511 $ 5.86
PPG Reported and Adjusted EPS
$ in millions, except EPS
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Thank you for your interest in PPG
Industries, Inc.
Contact Information:
Investors:
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(412) 434-3466
53