PITTSBURGH – PPG Industries (NYSE:) reported first-quarter financial results, showing adjusted earnings per share of $1.86, in line with analysts’ expectations. However, the company’s revenue missed consensus estimates, coming in at $4.31 billion versus expectations of $4.43 billion. Reported revenue also marked a 2% decline from the prior year’s first quarter, which came in at $4.38 billion.
Shares of the paints and coatings giant were slightly lower, with their share price falling 0.75% following the announcement. The move came as the company lost earnings and issued weaker-than-expected guidance for the upcoming second quarter and full fiscal year. PPG Industries expects second-quarter 2024 earnings per share of $2.42 to $2.52, below analyst consensus of $2.55. Additionally, full-year earnings per share estimates are set between $8.34 and $8.59, also missing the $8.48 consensus estimate.
PPG Chairman and CEO Tim Knavish commented on the quarter, noting the company’s sixth consecutive quarter of improved profitability and year-over-year adjusted earnings per share growth despite macroeconomic headwinds. Knavish pointed to the impact of lower demand in Europe, including the early Easter holidays, as well as weak global demand for industrial coatings. He also cited strategic reviews of the company’s architectural coatings business in the U.S. and Canada and its global silica business to determine the path forward for the third quarter.
In the performance coatings segment, the company’s net sales decreased by 1%, and in the industrial coatings segment by 3%. Despite this decline, segment profitability increased, with the Performance Coatings segment up 40 basis points and the Industrial Coatings segment up 100 basis points compared to the prior year’s first quarter.
PPG Industries remains focused on growth initiatives, expecting low, single-digit percentage growth in total sales for the second quarter, led by its aerospace, defense, marine and packaging coatings businesses, as well as continued growth in Mexico, China and India.
“I want to thank our more than 50,000 employees worldwide who collaborate with our customers every day to achieve mutual success by providing best-in-class paints, coatings and specialty materials, including productivity-enhancing solutions and sustainable technologies,” added Knavish. .
Investors will now be watching closely to see how PPG navigates the current economic environment and whether it can achieve the modest growth and improved margins projected for the remainder of the year.
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