US PPG's July sales better than expected, upgrades Q3 outlook

Author: Stefan Baumgarten

2020/08/11

HOUSTON (ICIS)--PPG’s July sales were better than the company had expected, “reflecting a continuation of the solid demand recovery experienced in June”, the US-based international coatings and materials company said in an update on Tuesday.

July sales increased sequentially from June but were down 7% year on year.

Demand trends in its Chinese and European businesses were improving across a variety of coatings end-use markets, the company said. Also, global industrial production was picking up, it said.

With the stronger July performance, the company now expects Q3 sale volumes down 6-11% year on year - compared with its previous projection of a 8-15%  decline.

Also, PPG now expects Q3 “operating margin decrements” between 10-15%, “which is better than the approximate 25% experienced in the second quarter of 2020”, it added.

Higher than anticipated sales volumes, coupled with continued strong cost management, were supporting operating margins, the company said.

“Our diverse and global business portfolio is providing benefits from the demand recovery as it happens across different geographies and end-use markets,” said CEO Michael McGarry.

“We remain focused on aggressively managing our costs, including executing the previously communicated restructuring programmes, to support strong operating margin leverage as demand continues to improve,” McGarry added.

Thumbnail image shows paint. Source: imageBROKER/Shutterstock

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