With the sale of its commodity chemicals unit and recent acquisitions in the paint sector, PPG Industries has moved closer to realizing its long-term vision of transforming from an old-line industrial supplier to a leader in coatings and specialty products such as opticals, the company's chairman said Thursday.
In remarks to shareholders at its annual meeting held at the David L. Lawrence Convention Center, Downtown, Charles Bunch, chairman and CEO, said PPG last year made major strides toward that vision with the news that it would spin off commodity chemicals into a venture with Georgia Gulf Corp., and it would buy Dutch paint maker AkzoNobel's North American architectural paints business for about $1 billion.
Those deals and other smaller paint company purchases "further sharpen our focus on coatings and specialty products," said Mr. Bunch, noting that coatings and optical specialty materials accounted for more than 90 percent of PPG's $15.2 billion in sales last year.
Earlier Thursday, PPG said 2013 first-quarter adjusted net income from continuing operations rose 12 percent to $235 million, or $1.58 per share, beating analysts' estimates of $1.56 per share.
Sales from continuing operations were flat at $3.3 billion, below analysts' forecasts of $3.4 billion.
Including the January sale of its commodity chemicals business -- which merged with Georgia Gulf Corp. to form Axiall Corp. -- net income was $2.4 billion.
Wall Street reacted favorably to the earnings report with shares of PPG jumping by $8.25 Thursday to close at $140.65.
While demand has been generally healthy in North America and Asia, Mr. Bunch said that an ongoing weak economy in Europe has impacted sales in that region and conditions there aren't expected to improve in the near term.
Earlier this month, PPG closed on its purchase of AkzoNobel's operations, which Mr. Bunch expects will more than double the company's business in the construction and home maintenance markets.
Akzo has about 600 paint stores in the U.S. and Canada and its brands include Glidden, Sikkens, Flood and Liquid Nails.
Joyce Gannon: firstname.lastname@example.org or 412-263-1580.