Net sales were up 4% year over year.
PPG (NYSE:PPG) today reported net sales of $4.644 billion for the third quarter 2023, up 4% from $4.468 billion last year. Net income was $426 million, up 29% from $329 million in the third quarter of 2022.
Tim Knavish, PPG chairman and chief executive officer, commented on the quarter saying, “I am proud of the PPG team for delivering outstanding results in a challenging global demand environment, including a slower-than-expected recovery in China. We achieved record third quarter net sales and adjusted earnings per share aided by the breadth and resiliency of our business portfolio. This included strong operating performance with both of our operating segments delivering at least 25% earnings growth, led by our aerospace, automotive original equipment manufacturer (OEM), automotive refinish coatings and PPG Comex businesses, all of which also produced record sales for a third quarter.”
“Looking ahead, while demand in Europe and China are at or nearing trough levels and will likely present growth opportunities in 2024, we anticipate soft global macroeconomic conditions will persist in the fourth quarter. Overall, we remain confident that our technology-advantaged products and strong brands will drive our outperformance versus the markets we supply, including continued growth in our aerospace and PPG Comex businesses. In addition, supply conditions have returned to historical norms and raw material availability remains ample,” Knavish continued.
“Finally, we remain focused on executing our enterprise growth strategy, including managing our business to meet our organic growth objectives through purposeful investments in innovation, assets and our people. We continue the unwavering support to our customers by providing superior services and products that enhance their productivity and sustainability. Driven by the contributions of our more than 50,000 global employees, we aim to maintain our strong momentum and accelerate growth and value creation for the benefit of all stakeholders,” Knavish concluded.
According to prepared remarks for its quarterly results call with financial analysts, financial performance was aided by record sales for a third quarter in the aerospace, automotive original equipment manufacturer (OEM) and automotive refinish coatings businesses and a quarterly record for PPG Comex.
Automotive Refinish Coatings
The company reported that organic sales for automotive refinish coatings were slightly higher year over year. Price gains in all regions and sales volume growth in Europe and Asia Pacific were partially offset by lower sales volumes in the U.S. primarily due to shifting order patterns from certain distribution customers.
According to the company, U.S. body shop activity remained robust, with backlogs beginning to normalize closer to historical levels as supply chain conditions improved. In Europe, sales volumes were solidly above third quarter 2022 levels, as orders from distributors rebounded. In China, demand for PPG refinish products is slowly recovering and expected to continue to improve in the coming quarters.
In the third quarter, the company continued to win new body shops, driven by the company’s ability to provide up to a 15% productivity improvement compared to competitors over the full repair process cycle time. The company continues to enhance its digital capabilities and grow its LINQ services subscription model. Additionally, more than 400 year-to- date Moonwalk installations are further supporting customer wins. The company expects fourth quarter global net sales to be up a low single-digit percentage compared to the fourth quarter 2022.