PPG Industries Misses Earnings and Sales Estimates in Q4

Core Viewpoint - PPG Industries reported mixed financial results for the fourth quarter of 2024, with adjusted earnings per share (EPS) slightly increasing year-over-year but missing consensus estimates, while revenues declined significantly compared to the previous year [1][2][7]. Financial Performance - Adjusted EPS for Q4 2024 was $1.61, up from $1.56 in Q4 2023, but below the Zacks Consensus Estimate of $1.65 [1] - Revenues for the quarter were $3,729 million, a decrease of approximately 5% year-over-year, missing the consensus estimate of $4,005.5 million [2] - For the full year 2024, adjusted EPS was $7.87 compared to $7.42 in 2023, while net sales decreased by 2% to $15,845 million [7] Segment Analysis - Performance Coatings segment revenues increased by 2% to $1,262 million, driven by growth in aerospace, protective and marine coatings, and traffic solutions [4] - Industrial Coatings segment revenues fell by 9% year-over-year to $1,586 million, primarily due to lower sales volumes and prices, with a significant drop in automotive OEM coatings [5] - Global Architectural Coatings segment reported revenues of $881 million, down 7% year-over-year, mainly due to unfavorable foreign currency impacts [6] Sales and Market Trends - Organic sales declined by a low single-digit percentage year-over-year, with growth in Mexico, China, and India, offsetting declines in automotive OEM and industrial coatings [3] - The aerospace order backlog grew to approximately $300 million, indicating strong demand in that sector [4] Financial Position - At the end of Q4 2024, PPG had around $1.4 billion in cash and short-term investments, with net debt at $4.5 billion, a decrease of roughly $30 million from the previous year [8] Future Outlook - PPG expects adjusted EPS for 2025 to range between $7.75 and $8.05, indicating a potential 7% increase at the midpoint, based on current economic conditions and mixed demand across regions [9] - The company anticipates that annual EPS growth will be concentrated in the second half of 2025, with plans to achieve over $100 million in annualized share gains in the Industrial Coatings segment starting in the second half of 2024 [10] Stock Performance - PPG Industries' shares have decreased by 13.2% over the past year, compared to a 15.4% decline in the industry during the same period [11]