PITTSBURGH — PPG Industries has reported record sales of $3.7 billion for the first quarter, surpassing the prior year’s first quarter results by 41 percent. First quarter net income was $100 million, or 61 cents per share, comprising net income from continuing operations of $87 million, or 53 cents per share, and income from discontinued operations, net of tax, of $13 million, or 8 cents per share.
Reported net income from continuing operations includes non-recurring acquisition-related costs of $89 million aftertax, or 54 cents per share, stemming from the company’s Jan. 2, 2008, acquisition of the SigmaKalon Group. Adjusted net income from continuing operations was $176 million, or $1.07 per share, as detailed below. The company’s tax rate on income from continuing operations for the quarter was 30 percent.
PPG’s sales for the first quarter 2007 were $2.6 billion. First quarter net income was $194 million, or $1.17 per share, comprising net income from continuing operations of $176 million, or $1.06 per share, and income from discontinued operations, net of tax, of $18 million, or 11 cents per share. Net income from continuing operations included an aftertax charge of $5 million, or 3 cents per share, to reflect the net increase in the value of the company’s obligation under its proposed asbestos settlement agreement, which is subject to pending court proceedings. Adjusted net income from continuing operations was $181 million, or $1.09 per share. The company’s tax rate on income from continuing operations was 23 percent.
“We are very pleased to have delivered solid organic growth despite a slowdown in the overall U.S. economy,” said Charles Bunch, PPG chairman and chief executive officer. “We achieved this growth due, in part, to our prior investments in coatings, optical products and emerging regions, which have strengthened our overall portfolio. In addition, the recent acquisition of SigmaKalon contributed to our record first quarter results. This business, which we are successfully integrating, has exceeded our expectations.”
Bunch noted that a key measure of the company’s growth is its total business segment earnings, which increased 17 percent.
“Looking ahead, while we will likely continue to experience a difficult North American economy, we remain confident in our ability to grow both sales and earnings. This is due to our leading products and technologies, and because we have significantly broadened our geographic presence. In fact, the United States and Canada now account for only about 45 percent of our total sales,” Bunch said. “We are focused on improving our already strong cash generation, and we intend to use this cash to continue to grow earnings, initially through paying down debt.”
For more information about PPG, visit www.ppg.com.
