Core Points - PPG has received the highest "AAA" rating for the second consecutive year from the MSCI ESG ratings assessment, indicating its status as a leader in sustainability [1] - The company emphasizes that sustainability is a key part of its business strategy and serves as a catalyst for ongoing improvement across all areas of its operations [1]

Core Insights - PPG's SIGMA COATINGS brand has launched the Sigma EcoCollect initiative in partnership with FIRE-OFF and Dijkstra Plastics to promote recycling of plastic and metal packaging [1] - The initiative allows professional painters in the Netherlands to return packaging from both Sigma Coatings and competitor products for recycling [1] - This initiative aligns with PPG's goal of increasing sustainability and reducing environmental impact [1]

Core Insights - PPG Industries, Inc. is a leading global supplier of paints, coatings, and specialty materials, operating in over 70 countries and serving diverse markets [1][2] - The company reported a modest 1% year-over-year increase in net sales for Q3 fiscal 2025, reaching $4.08 billion, surpassing analyst estimates [5] - PPG's adjusted EPS grew by 5% annually to $2.13, exceeding expectations, with a projected adjusted EPS guidance range of $7.60 to $7.70 for the full year 2025 [6] Financial Performance - PPG's stock has declined by 23.9% over the past 52 weeks and 12.4% over the past six months, underperforming the S&P 500 Index, which gained 14.1% and 21% in the same periods [3][4] - The architectural coatings segment showed improvement, with net sales rising by 1% year-over-year to $1.01 billion [5] - For fiscal year 2025, analysts expect PPG's EPS to decline by 2.7% year-over-year to $7.66, but anticipate a 6.1% increase to $8.13 in fiscal 2026 [7] Market Comparison - PPG's stock is classified as a basic materials stock, and it has underperformed compared to the Materials Select Sector SPDR Fund (XLB), which dropped 6.9% over the past 52 weeks but rose 3.5% over the past six months [4] - The company has a mixed history of surpassing consensus estimates, achieving this in two of the last four quarters [8]

Core Insights - PPG achieved a GUINNESS WORLD RECORDS title for the largest simultaneous paint stirring challenge at the 2025 SEMA Show in Las Vegas [1] - Over 275 participants took part in the event to emphasize the manual effort involved in collision repair [1] - The event also served as a platform for PPG to introduce its new SEM MIX'N'SHAKE automated stirring solution, which can produce a fully homogenized car paint mix in less than 60 seconds [1]

Core Insights - PPG Industries, Inc. reported third-quarter earnings with revenue of $4.08 billion and EPS of $2.13, surpassing analyst expectations, but full-year EPS guidance was below estimates [1] - Jim Cramer expressed confusion over PPG's performance, noting that while peers like Dow and Sherwin-Williams reported strong numbers, PPG has struggled to deliver consistent results [2] Financial Performance - PPG Industries achieved a revenue of $4.08 billion in the third quarter [1] - The EPS for the quarter was reported at $2.13, which exceeded analyst estimates [1] - However, the company's full-year EPS guidance did not meet market expectations [1] Market Context - Cramer highlighted that while PPG is facing challenges, other companies in the chemicals sector, such as Dow and Sherwin-Williams, are performing well, indicating a potential disconnect in PPG's performance [2] - The aerospace sector is noted to be strong, with positive order trends, which raises questions about PPG's struggles despite favorable market conditions [2]

Financial Performance - Net sales for the three months ended September 30, 2025, were approximately $4.1 billion, a 1% increase compared to the prior year, driven by higher selling prices and sales volumes [122]. - Income before income taxes was $556 million for the three months ended September 30, 2025, a decrease of $22 million from the prior year, primarily due to wage and cost inflation [123]. - Selling, general and administrative expenses decreased by $24 million to $824 million for the three months ended September 30, 2025, due to cost-control measures [128]. - Earnings per diluted share from continuing operations increased by 3.2% to $1.96 for the three months ended September 30, 2025, attributed to higher selling prices and cost-control actions [135]. - Segment income was $675 million, a decrease of 5% versus the prior year, primarily due to lower index-based selling prices and the unfavorable impact of the divestiture of the silicas products business [174]. Sales Performance by Segment - Global Architectural Coatings net sales for the nine months ended September 30, 2025, decreased by 5.0% to $2,887 million, with segment income down 17.5% to $462 million [145]. - Performance Coatings net sales increased by 5.4% year-over-year for the nine months ended September 30, 2025, reaching $4,191 million, while segment income rose 2.2% to $902 million [154]. - Industrial Coatings segment net sales for the nine months ended September 30, 2025, decreased by 4.3% to $4,883 million, with segment income down 4.7% to $675 million [165]. - Aerospace coatings organic sales increased by a double-digit percentage year-over-year, with customer order backlogs reaching approximately $310 million [161]. - Automotive OEM coatings organic sales increased by a mid-single-digit percentage due to higher sales volumes, particularly in Brazil and China [166]. - Packaging coatings organic sales increased by a double-digit percentage year-over-year, driven by higher sales volumes in the U.S., Canada, and Asia Pacific [170]. - Specialty products organic sales increased by a low single-digit percentage year over year, primarily due to higher sales volumes [174]. Cost and Expenses - Depreciation expense increased by 19.1% to $106 million for the three months ended September 30, 2025, primarily due to higher accelerated depreciation related to restructuring actions [129]. - Research and development expenses increased by 3.9% to $106 million for the three months ended September 30, 2025 [125]. - Other charges/(income), net increased by $24 million primarily due to net impairment and related charges in the Performance Coatings segment [130]. Cash Flow and Capital Expenditures - Cash from operating activities for the nine months ended September 30, 2025, was $1,047 million, a decrease of $9 million compared to $1,056 million in 2024 [180]. - Cash used for investing activities decreased to $417 million for the nine months ended September 30, 2025, from $501 million in 2024 [184]. - Total capital spending is expected to be approximately $725 million to $775 million in 2025 to support future organic growth opportunities [184]. Tax and Indebtedness - The effective tax rate for the three months ended September 30, 2025, was 21.2%, a decrease of 0.9% from the prior year [135]. - As of September 30, 2025, Total Indebtedness to Total Capitalization was 47%, below the 60% threshold required by credit agreements [189]. Currency and Market Risk - The U.S. dollar weakened against several currencies, resulting in an increase of consolidated net assets by $849 million compared to December 31, 2024 [193]. - A 10% weakening of the U.S. dollar against European currencies would result in unrealized translation losses of $535 million at September 30, 2025, compared to $369 million at December 31, 2024 [208]. - There were no material changes in the Company's exposure to market risk from December 31, 2024, to September 30, 2025 [210].

Financial Highlights - Net sales reached $4.1 billion, a 2% increase organically[5] - Adjusted EPS was a record $2.13, up 5%[5] - The company repurchased approximately $150 million in shares[6] Segment Performance - Global Architectural Coatings net sales were $1.012 billion, with flat organic sales growth[13] - Performance Coatings net sales were $1.414 billion, with 2% organic sales growth[16] - Industrial Coatings net sales were $1.656 billion, with 4% organic sales growth[27] Aerospace Growth - Record quarterly aerospace coatings sales and earnings were achieved[5] - The company is investing over $0.5 billion to expand aerospace capabilities[22] - Aerospace net sales are expected to have a mid-single-digit to high-single-digit CAGR from 2025-2028[20] Balance Sheet and Cash Flow - Net debt stood at $5.4 billion as of September 30, 2025[30] - The cash balance was $1.9 billion as of September 30, 2025[30] - $310 million was deployed to shareholders through dividends and share repurchases in Q3 2025[30] 2025 Financial Projections - Full year 2025 adjusted EPS is projected to be $7.60 - $7.70 per share[31] - Full year 2025 organic sales are expected to grow at a low-single-digit rate[31] - Corporate expense (net of TSA) is projected to be $340 million - $350 million for full year 2025[31]

Core Insights - PPG Industries reported a third-quarter 2025 profit of $444 million or $1.96 per share, an increase from $1.90 per share a year ago, with adjusted earnings per share at $2.13, surpassing estimates [1][8] - The company's revenues reached $4,082 million, reflecting a 1.2% year-over-year increase and exceeding the Zacks Consensus Estimate of $4,036.1 million [1] Segment Review - The Global Architectural Coatings segment experienced a 1% year-over-year sales increase to $1,012 million, driven by higher selling prices and favorable foreign currency translation, despite divestitures and reduced sales volumes [2] - The Performance Coatings segment saw a 3% year-over-year sales rise to $1,414 million, although it missed estimates. The growth was attributed to higher selling prices and favorable currency translation, with organic sales growing 2% [3] - The Industrial Coatings segment's sales remained flat at $1,656 million, missing estimates due to the divestiture of the silicas products business and lower pricing offsetting higher volumes [4] Financials - As of the end of the quarter, PPG had $1,832 million in cash and cash equivalents, with net debt increasing to $5.4 billion, up $228 million from the previous year [5] Outlook - PPG anticipates adjusted earnings per share of $7.60 to $7.70 for the full year 2025, citing ongoing share gains and benefits from cost initiatives, with stronger performance expected in aerospace and protective coatings [6] Price Performance - PPG shares have declined by 16.8% over the past year, compared to an 8.7% decline in its industry [7]

Financial Data and Key Metrics Changes - The company reported a 2% increase in organic sales growth, achieving a record high Q3 EPS of $2.13, reflecting a 5% year-over-year increase in adjusted EPS [5][6][14]. - The adjusted EPS increase was driven by solid sales improvement and aggressive cost management [6][14]. - The company completed approximately $150 million in share repurchases and paid $160 million in dividends, totaling $1.2 billion delivered to shareholders year to date [14]. Business Line Data and Key Metrics Changes - The performance coatings segment delivered double-digit organic sales growth in aerospace coatings and protective and marine coatings, while automotive refinish saw a double-digit percentage decline in organic sales [6][10][11]. - The industrial coatings segment experienced a 4% increase in sales volumes, with automotive OEM coatings growing by 8% [13][14]. - The global architectural coatings segment saw mid-single-digit organic sales growth in Mexico, but lower volumes in Europe impacted overall performance [7][8]. Market Data and Key Metrics Changes - Organic sales grew in the U.S. and Canada by a low single-digit percentage, marking the third consecutive quarter of year-over-year increases in this region [6][8]. - Sales volumes in Latin America and Asia Pacific increased, while Europe remained flat [6][8]. - The company expects stronger retail sales and modest recovery in project-related spending in Mexico for the fourth quarter [8][16]. Company Strategy and Development Direction - The company is focused on driving consistent organic sales and earnings growth, even in a challenging macroeconomic environment [15][17]. - Significant investments are being made in aerospace and protective and marine coatings to capture growth opportunities, with over $0.5 billion allocated for these initiatives [12][13]. - The company aims to maintain its competitive edge through technology-differentiated products and customer productivity solutions [17]. Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the normalization of collision claims by mid-2026, which is expected to positively impact the automotive refinish business [20][22]. - The macroeconomic environment remains challenging, with expectations of continued uncertainty in global trade affecting customer spending [27][30]. - The company anticipates a softer first half of 2026, but is optimistic about organic growth momentum and cost management efforts [30][31]. Other Important Information - The company has consistently delivered price growth in architectural coatings for nine consecutive years, demonstrating strong brand value [7][8]. - The aerospace business has grown at a mid-single-digit CAGR over the past decade and is expected to continue this trend [11][12]. - The company is actively managing its supply chain and procurement strategies to mitigate inflation impacts on raw materials [72][73]. Q&A Session Summary Question: Concerns about the refinish business decline - Management acknowledged the decline in the refinish business due to destocking and normalization of collision claims, but expressed confidence in the productivity solutions driving market share gains [19][20][21]. Question: Outlook for volume growth and market performance - Management indicated that while the macro environment remains challenging, there are signs of stabilization in several markets, and the company is focused on organic growth and cost management [26][27][30]. Question: Changes in full-year guidance - The reduction in Q4 guidance was primarily attributed to the unexpected decline in the refinish business and distributor destocking [34][35]. Question: Architectural coatings performance - Management highlighted that soft demand in key European markets is impacting architectural coatings, but aggressive cost actions are being taken to manage the situation [38][41]. Question: M&A environment and strategy - The company remains open to M&A opportunities but emphasizes organic growth as the primary focus, looking for the right assets at the right price [88][90][91].

Financial Data and Key Metrics Changes - PPG Industries reported a 2% increase in organic sales growth for Q3 2025, marking the third consecutive quarter of sales volume growth [5][6] - Adjusted EPS increased by 5% year over year, reaching a record high of $2.13 for Q3 [6][14] - The company completed approximately $150 million in share repurchases and paid $160 million in dividends, totaling $1.2 billion delivered to shareholders year to date [14] Business Line Data and Key Metrics Changes - The performance coatings segment achieved double-digit organic sales growth in aerospace coatings and protective and marine coatings, while automotive refinish saw a double-digit decline in organic sales [6][10] - The industrial coatings segment experienced a 4% increase in sales volumes, outpacing industry demand, with automotive OEM business net sales increasing by 8% [13][14] - The global architectural coatings segment saw mid-single-digit organic sales growth in Mexico, but lower volumes in Europe impacted overall performance [7][8] Market Data and Key Metrics Changes - Organic sales grew in the U.S. and Canada, Latin America, and Asia Pacific, while remaining flat in Europe [6][8] - The macroeconomic environment was described as choppy, with expectations of low single-digit inflation for the year due to tariffs [15][16] - The company anticipates a year-over-year decline in organic sales in the architectural coatings segment due to distributor inventory management [15] Company Strategy and Development Direction - PPG Industries is focused on driving consistent organic sales and earnings growth, emphasizing operational excellence and innovation [17] - The company plans to increase investments in aerospace and protective and marine coatings to capitalize on growth opportunities [12][13] - M&A remains a consideration for the company, but organic growth and margin improvement are prioritized [89][90] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to recover from current challenges in the refinish business, expecting normalization of collision claims by mid-2026 [20][22] - The outlook for 2026 is cautious, with anticipated challenges in the first half due to macroeconomic conditions and normalization effects [27][30] - Management highlighted the importance of productivity solutions in maintaining market share during tough market conditions [20][78] Other Important Information - The company is channeling additional growth-related investments into the protective and marine coatings business due to strong performance and opportunities in various end markets [10][12] - PPG's aerospace business has grown at a mid-single-digit CAGR over the past 10 years and is expected to continue this trend [11][12] Q&A Session Summary Question: Concerns about the refinish business decline - Management acknowledged the decline in the refinish business due to destocking and normalization of collision claims, but expressed confidence in the long-term growth potential driven by productivity solutions [19][20] Question: Outlook for volume growth and market performance - Management indicated that while the macro environment remains challenging, there are signs of stabilization in several markets, and the company is focused on organic growth and cost management [26][27] Question: Changes in full-year guidance - The reduction in Q4 guidance was primarily attributed to the refinish business challenges and distributor inventory management [34][35] Question: Architectural coatings performance - Management noted soft demand in key European markets and emphasized ongoing efforts to control costs and maintain pricing power [38][41] Question: Chinese OEM vehicle outlook - Management expects low to mid-single-digit growth in the Chinese automotive market, despite recent challenges faced by competitors [44][45] Question: Performance coatings margins - The decline in operating income for performance coatings was attributed to mix issues related to the refinish business and increased investments in aerospace and protective coatings [48][49] Question: M&A environment - Management remains open to M&A opportunities but emphasizes that organic growth and margin improvement are the primary focus [89][90]