Slides
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First Quarter 2025 Financial Results April 29, 2025
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2 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. 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 statements related to global economic conditions, geopolitical issues, increasing price and product competition by our competitors, fluctuations in cost and availability of raw materials, energy, labor and logistics, the ability to achieve selling price increases, the ability to recover margins, customer inventory production levels, our ability to maintain favorable supplier relationships and arrangements, the timing of and the realization of anticipated cost savings from restructuring and other initiatives, the ability to identify additional cost savings opportunities, the timing and expected benefits of our acquisitions, difficulties in integrating acquired businesses and achieving expected synergies therefrom, economic and political conditions in the markets we serve, the imposition and magnitude of tariffs, 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, global human health issues, the unpredictability of existing and possible future litigation, including asbestos litigation and governmental investigations. 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 2024 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 2024 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. All of this information speaks only as of April 29, 2025, and any distribution of this presentation after that date is not intended and will not be construed as updating or confirming such information. PPG undertakes no obligation to update any forward-looking statement, except as otherwise required by applicable law.
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First Quarter 2025 Highlights Note: Data reflects reclassification for discontinued operations. All changes versus same quarter last year. Organic sales defined as net sales excluding the impact of currency, acquisitions and divestitures. See Appendix for reconciliation of Adjusted EPS and Segment EBITDA Margin.3 Adjusted EPS Net Sales Segment EBITDA Margin Share Repurchases $3.7B $1.72 19.4% ~$400MM +1% Organic SalesSolid sales growth in China, India, Brazil and Vietnam Sluggish demand in architectural coatings and soft automotive OEM production Strong organic sales growth in aerospace, refinish, protective and marine, and traffic solutions Industrial coatings volume growth in all regions Positive sales volume and momentum for sustainable growth
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PPG’s Enterprise Growth Strategy Driving superior performance through high-margin business growth and strong cash flow 4 0 ✓ Portfolio pruning – completed 2024 ✓ Re-segment portfolio to provide increased accountability / transparency – completed 2024 ✓ Disciplined, opportunistic and accretive M&A Portfolio Actions Taken to Deliver Customer Success and Shareholder Value Aggressive 2025 Execution 0 ✓ Delivery of world-class margins – 2024 / ongoing ✓ Decisive self-help actions – 2024 / ongoing ✓ Building / executing organic growth competencies ✓ Deliver customer innovation including digital and AI 0 ✓ Reward shareholders – 2024 / ongoing ✓ Growth-focused capital spending ✓ Free cash deployment to drive shareholder value Growth & Margin Leadership Capital Allocation Capitalizing on structural resilience Accelerating self-help Driving growth momentum Leveraging a strong balance sheet
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-3% -2% $3,849 0% 1% $3,684 1Q'24 Price Volume Currency Divestitures 1Q'25 5 First Quarter Net Sales Selling prices: Slightly positive with targeted increases offset by carry over of index-based pricing in certain customer contracts Volumes: Growth in Performance Coatings partially offset by Global Architectural Coatings and Industrial Coatings Divestitures: Includes silicas in 4Q’24 Net Sales ($ in millions) . Organic sales up 1% driven by strength in Performance Coatings segment Note: Data reflects reclassification for discontinued operations.
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-3% -7% -2% $966 1% $857 1Q'24 Price Volume Currency Divestitures 1Q'25 Note: EBITDA margin change for quarter versus the same prior year period. MSD/LSD = Mid/Low Single Digit. See appendix for EBITDA margin reconciliation.6 Results impacted by soft but moderating European demand and paused Mexico investment Global Architectural Coatings Organic Sales 1Q’25 Results Architectural EMEA Architectural Latin America & AP LSD MSDHighlights • Architectural EMEA organic sales flat with positive price offset by lower sales volume • Architectural coatings sales in Mexico impacted by a pause in project-related spending • 1Q margin impacted by lower volume and inflation due to currency, offset by cost control actions • 2Q’25 organic sales growth expected; currency translation expected to remain unfavorable Net Sales ($ in millions) Global Architectural Coatings Segment Flat 1Q’25 Segment EBITDA Margin 16.8% -310 bps
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-1% -1%$1,184 3% 6% $1,265 1Q'24 Price Volume Currency Divestitures and Other 1Q'25 Note: EBITDA margin change for quarter versus the same prior year period. DD = Double Digit. HSD/LSD = High/Low Single Digit. See appendix for EBITDA margin reconciliation.7 First quarter sales and earnings record with strong growth in all four businesses Performance Coatings Organic Sales 1Q’25 Results Aerospace Refinish Protective & Marine Traffic Solutions HSD DD LSD DD HSD Highlights • Record quarterly aerospace net sales with double-digit percentage organic sales growth • Automotive refinish share gains more than offset lower industry collision claims in the U.S. • Strong, above-market protective and marine coatings growth driven by new technologies • Traffic solutions benefitted from share gains in North America • 2Q’25 organic sales growth expected in aerospace, traffic solutions and protective & marine Net Sales ($ in millions) Performance Coatings Segment 1Q’25 Segment EBITDA Margin 24.3% +20 bps
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Highlights • Lower auto OEM demand in mature regions and growth in Asia Pacific and Latin America • Positive momentum in industrial coatings sales volume with growth in all regions • Packaging coatings sales volume growth driven by share gains • 2Q’25 organic sales declining with lower auto production partially offset by higher industrial demand -1% -1% -2% -4% $1,699 $1,562 1Q'24 Price Volume Currency Divestitures 1Q'25 Note:.EBITDA margin change for quarter versus the same prior year period. MSD/LSD = Mid/Low Single Digit. See appendix for EBITDA margin reconciliation. 8 Industrial Coatings Industrial and packaging growth offset by soft automotive markets Organic Sales 1Q’25 Results Auto OEM Industrial Packaging LSD MSD Flat LSD Net Sales ($ in millions) 1Q’25 Segment EBITDA Margin Industrial Coatings Segment 16.8% -90 bps
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Strong Balance Sheet and Cash Note: Cash balance includes cash equivalents and short-term investments. See appendix for EBITDA reconciliation. 9 Net Debt March 31, 2025 $5.4B Cash Balance March 31, 2025 $1.9B 1Q’25 Activity Dividends and Share Repurchases $550MM Increased cash return to shareholders $0 $100 $200 $300 $400 $500 $600 2Q'23 3Q'23 4Q'23 1Q'24 2Q'24 3Q'24 4Q'24 1Q'25 Dividends Share Repurchases Cash Deployed to Shareholders ($ in millions) Issued long-term debt of €900 million due in 2032 Debt maturities of €900 million due in 2025 Net Debt / Adjusted EBITDA LTM 1.9x
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Note: The company is not able to provide a reconciliation of full-year 2025 expected adjusted earnings per diluted share to the most directly comparable GAAP financial measure because certain items that impact such measure are uncertain or cannot be reasonably predicted at this time. 10 Tariff Impact and Mitigation Impacts Excess chemical supply Lower oil price Share gain momentum >$100MM annualized 2% Lower auto industry production PPG impact <1% of company net sales Reduced China exports to U.S. PPG impact <1% of company net sales PPG Differentiators Accelerating self-help $75MM in 2025 Diverse portfolio Regionally balanced Leading positions in all verticals Mexico project delays PPG impact <1% of company net sales European demand improvement China stimulus Offsets No Change to Guidance Full-Year EPS $7.85 - $8.05 Raw Material Cost LSD% Inflation PPG well positioned to mitigate impact of tariffs LSD% increase in raw material cost >95% of materials locally sourced / no-tariff Improved foreign exchange Infrastructure spending Localization of production Localization of supply
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Segment organic sales (YOY %): Global Architectural Coatings Performance Coatings Industrial Coatings Flat to +LSD Flat to +LSD +LSD to +MSD -MSD to -LSD Segment margin (YOY) -80 to -100 bps Raw material and enacted tariff costs (YOY) LSD inflation Corporate expense (net of TSA) $85MM - $95MM Net interest expense $17MM - $21MM Effective tax rate 24% - 25% 11 Second Quarter Financial Projections Note: All forecasts are approximate. MSD/LSD = Mid/Low Single Digit.
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PPG: A Compelling Long-Term Investment Leading positions in all coatings verticals Organic and inorganic growth opportunities Diversified Global Portfolio Strong Brands, Technologies and Services Cash deployment focused on shareholder value creation Strong Balance Sheet & Consistent Cash Generation Accelerating margin expansionAsset-Light, Highly Flexible Cost Structure
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Appendix
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2023 2024 2025 Global Architectural Coatings Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Segment Margin, As Reported 16.4% 17.4% 18.9% 13.9% 16.7% 17.2% 19.7% 18.2% 13.4% 17.3% 13.8% Net Sales $975 $1,066 $1,037 $943 $4,021 $966 $1,070 $1,004 $881 $3,921 $857 Segment Income 160 186 196 131 673 166 211 183 118 678 118 Depreciation and Amortization 25 25 26 25 101 26 26 26 26 104 26 Adjusted EBITDA 185 211 222 156 774 192 237 209 144 782 144 Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) margin 19.0% 19.8% 21.4% 16.5% 19.2% 19.9% 22.1% 20.8% 16.3% 19.9% 16.8% Performance Coatings Segment Margin, As Reported 19.9% 23.1% 18.3% 17.7% 19.9% 21.2% 23.0% 22.3% 20.5% 21.8% 21.7% Net Sales $1,153 $1,424 $1,322 $1,233 $5,132 $1,184 $1,418 $1,373 $1,262 $5,237 $1,265 Segment Income 230 329 242 218 1,019 251 326 306 259 1,142 274 Depreciation and Amortization 35 34 35 35 139 34 34 31 33 132 33 Adjusted EBITDA 265 363 277 253 1,158 285 360 337 292 1,274 307 Adjusted EBITDA margin 23.0% 25.5% 21.0% 20.5% 22.6% 24.1% 25.4% 24.5% 23.1% 24.3% 24.3% Industrial Coatings Segment Margin, As Reported 13.7% 13.6% 13.9% 13.3% 13.7% 14.7% 14.8% 12.1% 11.7% 13.4% 13.8% Net Sales $1,753 $1,833 $1,767 $1,736 $7,089 $1,699 $1,747 $1,655 $1,586 $6,687 $1,562 Segment Income 241 250 246 231 968 249 259 200 185 893 215 Depreciation and Amortization 53 53 53 54 213 52 53 52 49 206 48 Adjusted EBITDA 294 303 299 285 1,181 301 312 252 234 1,099 263 Adjusted EBITDA margin 16.8% 16.5% 16.9% 16.4% 16.7% 17.7% 17.9% 15.2% 14.8% 16.4% 16.8% Total Segments Segment Margin, As Reported 16.3% 17.7% 16.6% 14.8% 16.4% 17.3% 18.8% 17.1% 15.1% 17.1% 16.5% Net Sales $3,881 $4,323 $4,126 $3,912 $16,242 $3,849 $4,235 $4,032 $3,729 $15,845 $3,684 Segment Income 631 765 684 580 2,660 666 796 689 562 2,713 607 Depreciation and Amortization 113 112 114 114 453 112 113 109 108 442 107 Adjusted EBITDA 744 877 798 694 3,113 778 909 798 670 3155 714 Adjusted EBITDA margin 19.2% 20.3% 19.3% 17.7% 19.2% 20.2% 21.5% 19.8% 18.0% 19.9% 19.4% Segment Margin Reconciliation 14 $ in millions, except margin % Note: Figures in the table may not recalculate due to rounding. Individual segment margin defined as segment income as a percentage of segment net sales and segment margin for the total segments defined as total segment income as a percentage of net sales.
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2024 2025 Q1 Q2 Q3 Q4 FY Q1 Reported net income from continuing operations $ 405 $ 493 $444 $2 $1,344 $ 375 Interest expense, net of interest income 13 17 19 15 64 13 Income tax expense 128 149 128 70 475 122 Depreciation 95 89 89 87 360 89 Amortization 35 35 30 32 132 32 Net income attributable to noncontrolling interests 9 9 6 9 33 5 EBITDA $ 685 $ 792 $ 716 $ 215 $ 2,408 $ 636 Business restructuring-related costs, net(a) 11 4 - 362 377 9 Portfolio optimization costs(b) 6 26 10 17 59 (6) Insurance recovery(c) - - - (4) (4) (6) Legacy environmental remediation charges(d) - 20 - 4 24 - Adjusted EBITDA $ 702 $ 842 $ 726 $ 594 $ 2,864 $ 633 Net Sales z $ 3,849 $ 4,235 $ 4,032 $ 3,729 $ 15,845 $ 3,684 Net income margin 10.5% 11.6% 11.0% 0.1% 8.5% 10.2% Adjusted EBITDA margin 18.2% 19.9% 18.0% 15.9% 18.1% 17.2% Note: Figures in the table may not recalculate due to rounding. Individual segment margin defined as segment income as a percentage of segment net sales and segment margin for the total segments defined as total segment income as a percentage of net sales. 15 Adjusted EBITDA Reconciliations $ in millions, except margin % (a) Business restructuring-related costs, net include business restructuring charges, offset by releases related to previously appro ved programs, which are included in Other (income)/charges, net on the condensed consolidated statement of income, accelerated depreciation of certain assets, which is included in Depreciation on the condensed consolidated statement of inco me and other restructuring-related costs, which are included in Cost of sales, exclusive of depreciation and amortization and Selling, general and administrative on the condensed consolidated statement of income. (b) Portfolio optimization includes the gain recognized on the sale of the Company's remaining Russia business in the first quart er 2025. There was no tax expense associated with that gain. Portfolio optimization also includes advisory, legal, accounting, valuation, other professional or consulting fees, and certain internal costs directly incurred to effect acquisit ions, as well as similar fees and other costs to effect divestitures and other portfolio optimization exit actions. These costs are included in Selling, general and administrative expense on the condensed consolidated statement of income. (c) In the first quarter 2025, the Company received reimbursement under its insurance policies for damages incurred at a southern U.S. factory from a winter storm in 2021. (d) Legacy environmental remediation charges represent environmental remediation costs at certain non -operating PPG manufacturing sites. These charges are included in Other (income)/charges, net in the consolidated statement of income.
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16 Adjusted EPS Reconciliation $ in millions, except EPS Total PPG First Quarter 2025 Net Income EPS(a) Net Income from Continuing Operations, As Reported $ 375 $ 1.64 Acquisition-related amortization expense 24 0.10 Business restructuring-related costs, net(b) 7 0.03 Portfolio optimization costs(c) (6) (0.03) Insurance recovery(d) (4) (0.02) Adjusted Net Income Attributable to PPG $ 396 $ 1.72 (a) Earnings per diluted share is calculated based on unrounded numbers. Figures in the table may not recalculate due to rounding. (b) Business restructuring-related costs, net include business restructuring charges, offset by releases related to previously approved programs, which are included in Other (income)/charges, net on the condensed consolidated statement of income, accelerated depreciation of certain assets, which is included in Depreciation on the condensed consolidated statement of income and other restructuring-related costs, which are included in Cost of sales, exclusive of depreciation and amortization and Selling, general and administrative on the condensed consolidated statement of income. (c) Portfolio optimization includes a $7 million gain recognized on the sale a business in the first quarter 2025. There was no tax expense associated with that gain. Portfolio optimization also includes advisory, legal, accounting, valuation, other professional or consulting fees, and certain internal costs directly incurred to effect acquisitions, as well as similar fees and other costs to effect divestitures and other portfolio optimization exit actions. These costs are included in Selling, general and administrative expense on the condensed consolidated statement of income. (d) In the first quarter 2025, the Company received reimbursement under its insurance policies for damages incurred at a southern U.S. factory from a winter storm in 2021. Total PPG First Quarter 2024 Net Income EPS(a) Net Income from Continuing Operations, As Reported $ 405 $ 1.71 Acquisition-related amortization expense 26 0.11 Business restructuring-related costs, net(b) 8 0.03 Portfolio optimization costs(c) 4 0.02 Adjusted Net Income Attributable to PPG $ 443 $ 1.87
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17 Thank You For Your Interest In PPG Contact Information: MEDIA: Mark Silvey phone: +1.412.434.3046 email: silvey@ppg.com INVESTORS: Alex Lopez phone: +1.412.434.3466 email: alejandrolopez@ppg.com