PPG Industries (PPG) 19 Apr 242024 Q1 Earnings call transcript

Good morning. My name is Angela, and I will be your conference operator today. At this time, I would like to welcome everyone to the first quarter PPG earnings conference call. [Operator Instructions] Thank you. I would now like to turn the conference over to Jonathan Edwards, Director of Investor Relations. Please go ahead, sir.

good and Angela, you, morning, everyone. Thank Jonathan is Edwards. This PPG We financial to you continued results in appreciate interest and our call. welcome your conference first quarter XXXX

Joining Vice President Tim Chief Financial PPG Executive call and and me and Officer; Senior Chairman Chief are Morales, Vince Officer. on the Knavish, from

information to equity after markets XXXX. closed comments relate released XX, Our on the financial U.S. Thursday, April

on slides Center commentary webcast available We presentation Investor Tim comments website, accompanying this detailed for to and the shortly. the and additional of have are ppg.com. call The posted on slides our will support make also opening site provide the

perspective management's on will we results Q&A to a session. Following for the quarter, the company's move

current commentary this and forward-looking forward-looking under Both events cause may no obligation and PPG's the their The these potential during provide discussion to effect updates may which is and uncertainties and actual statements prepared involve of results to These statements. view differ. subsequent financial on risks, performance. future the call company's operating contain statements to reflecting company

most non-GAAP financial contains measures presentation our The in provided website, has available the financial of which appendix non-GAAP measures. of reconciliations these The company the presentation the on GAAP measures. to materials, certain directly also comparable are financial

information, refer the For with additional please to SEC. filings PPG's

me Chairman now and PPG introduce And let CEO, Tim Knavish.

on a highlights first earnings call. then outlook. XXXX few quarter I'd and move first Jonathan, you, our financial to start everyone. good our and by to to Thank I'll quarter performance, providing Welcome morning, like XXXX our

despite earnings that share macro in the increases. COVID the EPS and year-over-year a sales first consecutive segment $X.XX culminated of house $X.X margin in challenging QX surge achieved range during paint sales. is of history, provided we The $X.XX This the our quarter quarter also a environment, best early sixth billion, in sales record delivered the adjusted just short we which diluted PPG performance of solid January. of adjusted $X.XX, second per is midpoint company's team delivered This our of above the falling very in

first and with moderating Our volumes and manufacturing up adjusted input benefit higher sales performance again costs improving by wage once mitigated lower costs. was quarter and year-over-year, EPS

in effect a last Walmart, million this holiday from $XX We're and year. had March, large stemming lower indicated impacted by in year January, of we prior of significant also days year-over-year selling As portion we win Easter was fewer in demand including year, by customer the a early volumes Europe, lower this driven an load-in.

ongoing industrial experienced global tepid production. also We

nearly year-over-year for comparison underlying volumes X Adjusting quarters. last volume items, over were these positive flat, trajectory continuing the the

portfolio fully our during outlook, businesses us in As the discuss economy, I the despite A in a organic delivered QX. strong where, of growth, sales expect country. challenging double-digit in I'll reflecting our general benefit quarter sales volumes our China was mix for positive well-established

digits For the PPG, by also grew India quarter. double in

aerospace, drove materials addition, commercial and well marine businesses. and In teams and coatings solid protective coatings sales organic our and our growth in global specialty executed

pricing positive offsetting in segment. in Industrial the the with lower Our flat Performance selling prices were segment pricing

lower region the include comparisons lower energy from experienced this energy indices quarter impact We place of period of to a in XXXX. First quarter costs a pricing pricing. offset in index-based were extremely that transitory European put energy-related prices pricing during that input quarter the in unfavorable high first in

our in prices several company have positive of been XXXX to segment. We Performance price implemented selling offsetting overall targeted expect the total some index-based in Industrial businesses, contracts segment selling structural pricing slightly as in increases be

and and customer supply as chains experienced improvement upstream downstream we Our operations have benefited patterns. from order further stable

we moderating input are supply sufficient just excess continue the noteworthy as or perspective, have capacity seasonality industry. due overall peak to This vast as of suppliers we the our to paint a the entering buying experience period From is of the majority costs.

will later initiatives our We supporting volume deliver increased gains investments, this year forward. growth-related also that and going

Building in This margins segment year improvement XXXX, priority will off margin a improved year from in further progresses, input by productivity XXXX. and basis sales highs. of manufacturing total as remains XXX in point be the stronger improvement cost full driven the moderating volumes historical

more growth. cadence Specifically on improved our operating additional volume we manufacturing peak seasonal during our productivity, deliver be will financially as quarters impactful

Industrial by by first and the lower basis the on pricing higher as improvement and XXX input points volumes and versus our segment up Coatings quarter, wage In by the improving points about Performance businesses costs margin prior commitment we basis year, XX inflation. were favorable moderating also delivered with margins mitigated margins were

year From balance a our sheet year-over-year. perspective, legacy our value. cash and strong, inventories including excellent to expect to shareholder follow of continue remains sheet another balance our utilizing We'll strong flow and we flow, cash cash create of lower

reflecting first $XXX use million shareholder to value. create our the commitment we approximately excess to stock, In quarter, cash of PPG repurchased

Additionally, yesterday, bringing share our buyback billion, authorization approximately billion. by total repurchase an $X.X $X.X Directors additional our of authorization to Board share increased our

our of with concessionaire in we've Mexico growth fastest-growing distribution coatings non-architectural to space -- from continued of We the our selling our into the drive the locations world-class on progress strong economies. one from pleased into and made our world's innovative mobility additional executed I'm initiatives. X,XXX enterprise further products to products growth utilize

refinish, sold date, increased, wins. of machines, and productivity. services which MOONWALK mixing customer LINQ subscriptions. mixing on of include automotive shop net MOONWALK LINQ best-in-class X,XXX tools In yielding our are additional These body X,XXX industry-leading and approximately focused machines body digital we've over both shop and our To nearly adoption tools are XXX improving digital

of Canada higher-margin We in the of the driving business product and quarter. goal we to silica announced a with portfolio transforming business a the are global U.S. reviews strategic higher-growth, architectural company. and first optimization Strategically, this

basis architectural points forward path assessments segment the years. XXX excluding of to higher and target these U.S. on margins the appropriate several third no As would of communicate Performance determination of the strategic than later in coatings an average when an last quarter. than with our example, a business XXX the Canada, be the We'll Coatings

on comment second outlook. quarter I'll our Now

QX adjusted share, per record would deliver at EPS previous be EPS. our to expect $X.XX XX% and midpoint between $X.XX which quarterly higher is than We

While demand global to by gains packaging and by positive levels low protective percentage, to be production low to our organic single-digit our coatings. we and by anticipate be volumes remain we and share second in uneven at sales absolute in expect geography, growth marine industrial aerospace, overall quarter a aided

will our project strong OEM China, our our OEM further business in third-largest led for growth We positioning drive our solid sales. from sales, continuing electric vehicle by producers automotive where businesses country with

further second-largest our across sales, world-class for deliver our to expect growth well sales network. leveraging many we as Mexico, in distribution our Additionally, businesses as country position strong

geographic PPG's profile in sales Europe and the growing that improvements strong India, with confident move in and Mexico volume support as U.S., are positions the PPG's and in and China, along consistent with continued growth We modest growth unique will eventually forward. stabilization we

prices Coatings but overall flat anticipate impact first in some in positive as company benefits from energy in There's Performance cost price energy it's our We slightly year be surcharges, quarter still impact segment quarter. in prior by the the be European unfavorable to input selling pricing of selling than increases offset will second to contracts segment. less our Industrial index-based offsetting the

to benefits realize supply we will commodity from to costs. materials, continue ample, raw and remains input regard moderating With

oil second and in recent impact material realization decreases we the raw that We're percentage price although expect will watching will absorbed percentage mid-single-digit high deflation in any expect following volatility, and single-digit We be the accordingly, price upstream. we quarter QX. of oil feedstock manage increases

execute auto we deliver in our remain than at Looking XXXX, $XXX also positive our XXXX, order will various China remaining driving in in the India. solutions. that parts, our driving more in initiatives and remainder our well-positioned of across further growth each million growth expanded backlog electric We'll volumes benefits growing sales aerospace, powder confident we coatings and in and in including key Mexico digital on quarter and of growth businesses vehicle,

our capabilities. other by our capitalize our volumes on to previously costs leverage manage and productivity drive initiatives aided chain years against following improvement operating initiatives diligently volume to to approved and drive And restructuring and enterprise further of actions. sales continue focused will our higher of growth and sales disruptions. supply remains service our margins, We'll and drive fully execute growth on manufacturing technical PPG several we

customers strong to Lastly, specialty of including a XXXX we for best-in-class our balance every provides enter to employees solutions. who by which providing productivity-enhancing with mutual day materials, us more coatings, world drive and the our further with sustainable you with flexibility sheet, XX,XXX Thank around second the quarter paints, value partner creation. success than shareholder

please and open confidence you PPG. in Thank prepared would your for This continued now lines questions? the you remarks, concludes for our

Ghansham of line Instructions] first question Baird. the from comes [Operator from Your Panjabi

by Tim, quite business improvement you portfolio of back on I geography, guidance a but during across the earnings a half embeds your an a have on also year know the by bit basis. the going year-over-year lot of and

input So higher? out, guess some play lay especially dynamic the can with for underlay just just as that, I such the specifics trending that to out you energy costs on your confidence of that upstream

full Yes, year you sure, tell here. about guide Ghansham. Thanks for I'll how I'm feeling the question. the

growth planet. to EPS and bold year confident a and a that. we've reasons challenging on off last strong got year believe have target We strong a of we're XX% in record But very

I'm We're minus the us We've can margin momentum minus without we've -- essentially is. flat believe X%, one-timers. rest volume We satisfied quarters and proven that strong minus volumes We expecting from went will do optionality. we That the X%, where all, with First of pricing year. several over cash. now gives of the last X%, the positive what on our continue.

indexing but Performance. We in We've that. continue Industrial, price get I'm offsets in confident in some got to

on we're number the of our Mexico, leverage aerospace, PMC, momentum. countries portfolio. strength in in China, India, from initiatives We're of starting the automotive. volume starting well a We've to got incremental manufacturing businesses, And and as some deliver a as productivity position

some some launched and got optionality again in of process being across share initiatives, we gains have with strategy do We've growth refinish, got capital We've coatings. packaging, enterprise industrial our the deployment.

second about QX we and So good year, between QX the the the feel of Ghansham. ramp half to

this Vince. Ghansham, And Yes. is

Just year further in strong point. talked, this we don't as guide, we full in sheet any our a at deployment cash balance baked have

not press on year additional this in deployment real-time purchase we $XXX did does a to assume point of the first our cash release, decisions the at but We'll quarter, in remainder full make year. in guide of we basis. As shares alluded those about our the million

with comes The the McNulty John next line from question of BMO.

see side, the indexing, maybe if I And you we material on dynamic, then XQ? to So to speak the basket to versus you expect raw XQ your the pricing down out on from price whether Because raws forward? take portion guess, a do kind does of you've be as pushing of to number should business neutral, sound expect pricing like really to further net a which real you initiatives price. what it got of see push we're your can

you us So those things? think can to help about

just Vince, do the is Yes, let John. This me math.

Again, Europe Let last That the the QX a million year-over-year energy do had basis, math about on gas high the natural cost in pricing. we on year-over-year surcharge of -- a me is reflecting $XX basis. on really European year. was in

you exact As our pass-through offset, alluded sold. in an completely cost John, that to, was of goods

myopically the looking about $XX you're line, carryover in that at if of we million, about that's have price and QX. half But

$X million, in have still impact. an surcharge $X million QX, energy So we

that pricing. as structural exclude be what would I that, our would Excluding

going question. is to Tim And raws the answer

for Yes. John, question. the thanks

forecast digits which that say believe, was As year digits, full confident now as high the for we in we're digits. mid-single QX, better 'XX. raws QX, digits. year of did down being QX, to progression we mid-single down guide QX digits And enough on low-single they full mid-single down issue to far single our to from than were

So price/raws we've into the we visibility rest got better believe the what year. like that look for now of will

question the The Fargo. Michael from Wells of Sison next with comes line

year. Nice the start to

you're quarter being much end your in about from the help seeing give volume really just bit and areas growth growth talked maybe much of your You you comes execution and need market XQ. growth Maybe little in turning us in just how confident on that a how markets. of color some in macro or

take a One factors. overall been load-in of Yes, the for you it's of of we've Walmart the that, Mike, based when the when particularly on you adjust ramping. to trend for And company, adjust number got out. -- first all, is you

of it. that's one part So

industrial, across we wins are number businesses launch the and some last in seeing to we've is in Second And primarily. our from starting QX gain of a year share refinish of far in seeing in here. what in also the shipments -- we're XX the whatever days only on just the comfortable with we're X/X that's or quarter, into we're And and month quarter. orders thus of packaging while

saying volume So QX. we're we'll positive that comfortable in be for

with question Goldman line of the Fischer comes Duffy Sachs. The from next

Two annual just number. you're to guide, in rolling annual per there's not into clarify, quarter the that you're want questions the Vince, even buyback. so that million saying $XXX more that I off buybacks One, no the through guidance

rate And we years then million going if should think look we run Tim, that take the to models? eat available, got that for our through forward? should X maybe buyback that now would into ramping the put $XXX you you over about how What program level at you've

this is Vince. Duffy,

be You $XXX properly. to stated purchased the million first will it quarter. financials. impactful We obviously obviously the in That

further nothing guide year have assumed in of year. full for We balance the our the

number We high-cost balance sit on the yesterday about what the of really said that our to grow obviously, in way we're that our in what need the we're we years to our done absence we and down we're did it And dividend. our in CapEx with the got said last of to value-creating We quarters. last sheet. going cash businesses And we've acquisitions, that, over QX. consistently debt QX, not to going paid from Board Obviously, consistent said that we thinking did is going do the let with year. to we've authorization pay The organically. I'm additional do of shareholder all we our that and

see factors, way acquisition versus with things actual in kind of mantra. So going our depend we dividend pipeline that done we're organic sitting of all on our think really about after those at will magnitude forward sticking and what leverage we've CapEx. The to of those what's

from The the comes from question David Bank. next line Begleiter of Deutsche

since outcome and late most review think, do February? in assets? Tim what's, interest process? announcement this and disruption any level you Vince, U.S. likely the in of in you architectural, What's your have And seen of these the

after of detailed we've went thoughtful plan release have very very talk continued -- seen very engaging employees. our David, we and got out And really communications but it's We're plans a Tim. that the minimal, customers. that We we've executed if and on any, engaging shortly you XX had our announcement ahead making owners, chatter, February execute. to key know. We're our key We're obviously, as engaging disruption. There's out our there. good press

minimal a the disruption very So to business.

our even brands and because strength higher assets we pleased The of the the of strength is expected architectural I'm second say of we interest than question, the strong to the the expected. what in U.S.-Canada business. interest

So we that's about -- we feel good right now where are.

start start in best As far can as across the which likely we a outcome, want David, definitive and value the at what's on we path early. But QX. be for shareholder to until coming it's our forward bit looking numbers long-term desk creation,

so, this So what another we'll have a like much structure might of or quarter better look in David. view

line of The Wolfe next the from question Chris comes with Parkinson Research.

the has moves and your mean, last markets you you a above-market away ago the next or at across want a to specialty or from couple you remaining end will that American the North it, in businesses year a the pretty quarters how Tim, confident you positively best-in-class growth are negatively? Just however reviews Industrial, you've X, even back X dramatic characterize I company R&D remaining your the long how some of the longer? even, confident changed and you're and been businesses over render obviously respective you innovators are those take look little at ultimately first and or say, When Performance portfolio quarters. the in year, perhaps just confidence making a are versus the let's step and in time, architectural

comfortable at have feel very of the at that higher are beginning your we that profile Chris, old I will I'm margin portfolio than ever a that more polite a and higher there. building PPG saying thanks here now for way profile. growth a

alluded ones. with you year. targets. see did I would being portfolio some year call pretty just smaller of last consistent growth not X As and year, performance this we I parts We that QX did really sizable to, strategy Obviously, our announced enterprise did pruning our of we that last our what

on today, sizable least at with you shouldn't or divestiture. very soon forward, coming out another any time tomorrow Going count us

portfolio with high the I'm level. what's So in comfortable in a at --

enterprise two, however, that to our scale. focused strategy. a And forward very business one standpoint; smaller sorry, has to We of going prune prove or growth continue, on to portfolio. every consistent our mantras will a one, -- I'm right the the to is in earn outlook but That means, stay performance with from

I add also acquirers just focused it's outlook when that to on growth Chris, continued for also both those intending very going want things the enterprise about meet our performance pruning and to basis we just we strategy. not a be and But talk that divestitures. are portfolio, forward about our

Yes. is Vince. And this Chris,

right it the regional the If a portfolio, basis remaining in businesses, basis. you be we about to a have the think the global whether win businesses, or on on

As you your alluded associated with question, in most of technology businesses them. strong have these to

the earlier margin which higher that a these profile, be pro basis. comments in we're talked We've doing about if a absent forma our on review on, would again strategic businesses

So again, to on those win, the good portfolio. pull, to we're things right focused the respect customer that with are the margins, good

from line with comes The John next of Mizuho. Roberts question the

you has American North architectural might that? you DIY comment coatings with and on separate deal versus Another Pro separately. into that firm suggested Could them

lot John, there's lot out there parties. of of a different theories from a

expected. level what of end. the this and I coming all have should As high, that we've view not do look we in parties might the the is those And very interest seen mentioned, same at than of like higher we what

a be we period. casting again option weigh that, that Everybody were little beyond hit yet. comment that numbers every shareholder only do that said net should everyone a will confident early should look and our what's no to my would confident at best value, have wide be because them and in we we go nothing So for desk be -- It's comes intentionally.

the comes Patrick question of Citigroup. from next line The Cunningham with

the CapEx base we On for should what expect the a next year, And be reasonable years? this are CapEx additional higher the for investment? you're range few growth contemplating areas to the

Vince. Yes, get the spending just have did we year. things. of last Patrick, at year this capital end this spillover into we last couple A things tail didn't of to from year, some One, is

India. Mexico So our We're at additional QX spending capital, in capital in a higher. looking little also also and growth-related

year-end But as if We call be you additional going in midterm. look capital up X% this COVID. from -- or some our over QX we're X.X% to the well, somewhere year, and this call our said on we that still to last year, we're and catching have

bit to We in So our the return us range. again, you little normal recognized But higher. we're should call. our again, expect January over a that midterm, to

The with Fermium line next from Frank of comes Mitsch Research, question LLC. the

more the The you next in growth also LLC frame portion can those some that growth on Listen, expecting about X? forth. appreciate X and of operating terms you indicated, How the also important, et is improvement, gains. as EPS, cetera? productivity kind I you're so of interplay so X 'XX quarters do dollars of you're between think the very are tied to in volume Any I those between for that. know interplay way spending money that higher we But the rates, or initiatives millions of

investments at -- of the start will a we growth last that making, those Tim. in net-net, we're QX, XX% that that expecting making started just QX Those the QX. we're deliver we Yes. now those the investments coming to we QX, net-net midpoint, those in hit the Well, growth start number of versus P&L we're for actually year, and didn't EPS the this and here -- making to expecting in growth Mr. The that Mitsch, year. is

you to Beyond know add that, Vince, if I don't any details. want

are -- to, increase we're things to that These with these Tim respect No. consumer-facing as digital where customer tools building also digital, are liaisons. businesses, our refinish with to investments such as alluded out our respect

quarters other had in We multiple earnings. where record investments of have we're -- delivering Comex we've

has -- in Our capacity, infrastructure yet anticipation in aerospace some business. get adding where it protective hit to some backlog we a of the we in and that. business, but continues not even strong expedient work still backlog have books, that grow, that that adding spending we're to manner. we're protective at more And building some that we're We have to capacity try a to much there

examples. So those are

growth overheads spending. at the our up, look some of result up that of is growth overheads result a something of you that that's If where spending is -- a

with The Morgan next question comes Stanley. from the line of Andrews Vincent

be versus you're the a Can in terms level we to a about for you are would where in volume if declines pre-COVID and refinish? talking go-forward XQ very it trying levels. -- against year-ago of difficult bit And volumes could what set just talk just on now basis, about I'm period. us comps And helpful XQ understand I'm

of that So for normalized post-COVID? from on price the is the if be And here? the case, and what that's refinish assessment should algorithm volume we've basis terms volumetrically in go-forward a

Yes. Vincent, question. for Thanks Tim here. the

easy inside repair. the part the kill to of second but all should plus in the and improve. it's a to service the of can low-cost the repair, first, price the of value part proposition tools refinish the fairly important continues on the And the such outside an can Price, execute paint part the me because always have to Let we expect us part. way you continue

So price. we'll continue to execute on

we In loves winter, a industry to for Southwest expected. ready it was Southeast not in than claims the pretty lower lower industry The saw particular, that than March out volume, bit And U.S., we're the you really an refinish handle storm expected. the U.S. was ice where data just down came mild with in for QX if particularly south. a storm, they're ice quite the U.S., whole down an or quite and

claims mid why QX, why which affected in on March digits we're mid-single saying And frankly, we're so for carry also down QX affect down significantly. That will sales partly -- and, is were -- in QX. the and

did we strong have last year. a in other QX The is very factor QX

and spoken who last QX. to all to Chancey, return in about key saying users has our are the growth here us, That But runs the they're a same business weeks, of thing that in end second for would half expecting, I've normal we I XXXX. all spoken, the say, said, and more

So got through get we QX. just to

your standpoint claims industry. other digits mid-single a XXXX, miles set March down on than up. driven bit we're pre-COVID question because versus we To a an industry are But seeing aside digits, as unique, things it's versus March, from low-single like ticking

We to more return if call and want it are seeing downtown more you areas, to that.

year long short standpoint mentioned business. of that's share because down we a half through in and long-term confident of bit we down tools, a QX one-timers health QX, to the and a of my our and bit in if second So of for I claims it, share, gain the this in remarks. here. digital And weather the gain continuing From opening a don't confident in standpoint, are as but

Vince. Vincent, And this is Yes.

low Just current point month the of down double to, digits low Tim referred The which double clarification. claims these was a of The reading for data claims, March. down are again digits. industry are

entire set So these are industry claims that collision [ ] the industry.

to March, were they Prior Yes. single digits. down low

Lynch. comes The of Merrill the question next America Stephen line Bank of with Byrne from

because has the I'm Depot Has get barely Tim, improving? asked I I just -- it managers Or more in number my any you be not had on underlying do Home stores? model one concessionaire me you have head store around his trend that, and why benefit But like which of Moore? for this a the tell been of is it is all of average your to margins. Is the from has years. that in good architectural for like profitable need Comex to would move match partnership? there been to the trying U.S. clearly to X Depot, Ben business business there pricing been Home

Steve. Thanks,

what have as investing has little far and the Depot it's it's as in been below the but average, over done a particularly Home been been of years, company couple model. and we So downs, last ups it

it over low has But several great. at number been level last the of years? of aren't things, the macros A why the profitability

whole post-COVID this industry. across got the You've hangover

model. we and with -- factors stores. been our those mentioned, in our And need all through the As has own I fixed through high post-COVID, mentioned that's macro decreased. And have stores, investing. the the And velocity own you cost you a stores, in that velocity through

Depot contributing. the at Now what's offset DIY those working the curve Home point, side. is that on gaining not this ramp-up is and and enough But macros, in particularly momentum initiative far certainly Pro happening positively it's to

we profitability. we're to model company the a now And momentum this stores faster -- our with is independent that to get the omnichannel this need our kind So of have make combination we in do partner this dealers. reason the and Depot, to doing but go of Home average

we're And so that's why number open scenarios a business. to of different for this

The of JPMorgan. comes Jeff from next Zekauskas with the question line

think is on things sales basis. the look March came that I all the And expected that in my your categories you quarter a in in weakened globally. division, of refinish, at, Performance first you impression aerospace, architectural, X than of them in lower

the began be your a for you would So forget it that a you is the the year? before if expectation little half is thought we bit weaker now quarter than moment, second second as

years, over $XXX goes, past average million. about as X as secondly, far think your repurchase is purchase price the then share And the I

the shares? what how taking to in trying $X.X you so Or achieve of evaluate How And and success? allocation capital? do gauge you repurchasing billion of are the will that success your you

asked, Okay. we QX you expected. weaker I'll were -- couple momentum what question. than were things take in take and But so question a one. the that that full repo kind there Vince transparency, of Jeff, mean, I thanks can for of the the

lack the Walmart expected just -- straight So load-in, a We that's Walmart right? of math.

month, we second we snapback, to We the a are expected worse bit So actually only higher okay? that first the some -- than shifting negative Easter than first halfway through that but timing the quarter, just expected. what impact. say I And be again, was we're that post-Easter seeing will would it's of was but quarter.

than things. And expected. other was of we expected. than weaker industrial production, with the our softer launching Europe of combined Two some we wins, was share

an about the there. QX, days, snapback. Easter we're to comp if seeing load-in you April. early comfortable isn't roll getting Walmart forward all of I we're what with in those So we're obviously, but Europe, and think On mentioned

it's going worse. I'm see it So have but saying a it's getting to not don't snapback, -- we

seeing And those number expecting of slower refinish industrial particularly March, executed in are finally, And second I share a bit on we the was then a side, -- for QX. that the we we second refinish. last factor launching we're expected, in half throughout half year mentioned, but just are refinish, of strong than a that the gains we

Vince. is this Jeff, Yes,

are more Again, portion -- couple several gone we're numbers terms have -- of share typically, balance obviously, been time done market a when share of where of longer consecutive There's number we've the where a series M&A. if In done large a last times for when accurate years terms you look horizon, years. your years, excess is repo, capacity. sheet we've minimal in there's over repurchases times we share of not we've M&A in and repurchases robust as excess over been active of cash a the or

an share do calculate option. an are we imperative think our When for We we you estimates, look going forward that intrinsic rate where times our stock our with the it's what price. XX% have we to repo feel is as look value at there of -- do us growth in

how the As have of our stock deployment. a dividend, prioritized we we cash on effectuate list the deployment. and keeping Tim based then at And at healthy look the with look the CapEx, that's again, and cash assessment, value of said, we intrinsic we businesses M&A

The of McCarthy with Kevin next the VRP. from line question comes

for subject you of few Tim, on a Europe. the questions

your mix year. I think EMEA of last was XX%

that And If and to divesting you number wind little China you in expected. contrast strong, India, like sounds in come bit U.S. in all of and did a which do came Canada architectural, Europe rise forward. or than some weaker very maybe moving it up will

to a, So variance role hearing is a companies understand have few driving the that a questions you that industrial? anyway. there expectation exactly; would I'm prior at be, b, chemical versus all. on is the what whether about versus of And from your rationalization your Europe provide playing more various and some were customers' capacity We curious maybe businesses color can more consumer-facing you in

the volume color more need and to bit the little to. achieve positive alluded what growth you volume glide that of on So overall there macro-wise that path region of you kind just company a for

here. one Yes. last Thanks, the off kick first Kevin. to it I'll just take

have have the their affecting in our that We of that significant capacity Europe. seen point of -- any can't, to I it's numbers any customers our think rationalized not frankly,

X in Europe, so the was we're deco. the that than Nordics. We little affected say in us us optimism forward. looking expected, in that's In the quite did where mostly strong, was I'd given businesses green the in France That and a we see was shoots QX, also slower that and one probably consumer-facing, East most

Industrial we The segment, second was business for the automotive. Automotive quarter. on weaker the expected than

recoveries do again, some we So we shipments. We order as days do see worse. we early there. we And a beginning in that do it those as talk deco see that in better off bottom. not and the to book get look the expecting better our -- forward, in East. businesses believe is gives -- bouncing do happen we're insights But April, to countries seeing we hard-hit customers that to the They're

largest not #X together, and portfolio, but places Romania them where deco add places strong like part growing, you Hungary markets, places our have individually, each again, when Czech. of maybe we like they're positions an Poland, and like the And important

So green we do there. some see shoots

we've are continent, good not huge to cost the going there's deco incremental taken we're also naive say a you leverage. but that V-shape, all improvements. And if that but delivers we incremental think enough bit of expecting to expecting worse, be are to really So we about on not actions little a volume get

Automotive, different customer similar a although a of wait get end we're not story, see. it's it and very taking bit a to marginally, a worse. Also, base. expecting But we're

recovery, modest it we're watching but closely. expecting are We

structural the cost at been -- positive environment. a price And for earnings day, a what Europe, end environment to ability the standpoint But with more. even and from a a of the shown a maybe benign they positive deliver need decade, in to to do teams this has have very cash our that macro and, benign importantly, do and mix,

worse was QX than up, all expected those of in it sum couple So we businesses.

sequentially take it if need see, incremental us will further we don't expecting but And we we to are are leverage. see good which closely. cost we watching We what improvements, give will structural And actions. --

add point just Yes. this And a on Vince. is Kevin, I'll architectural.

our lower largely As Tim to mentioned, March. than expectations attributed in QX,

the so of business. our first in a on that that in bigger X months look seeing, at you we're targets. Easter performance there the feel business early least year, our Feb, again, that If Jan, was do through April snapback was We impact at a

Aleksey The Yefremov KeyCorp. comes next line with question of the from

Aleksey. on This is Ryan for

more then more discuss you in wondering you bit some about than Wondering Coatings. uptick guys to in having are oil. can other Just talk of in targeted you're just a if this the doing weeks like And following if recent wanted refinish. Performance the areas pricing some success little

Yes.

always we execute enables which than pricing, higher higher that's the And as of what's paint. offset So products, inside paint. logistics technologies we additional across and But us Performance, then own can which to we advanced question have things help but we'll proposition services deliver continue the on And all because wage our refinish, Ryan, in tin very again, a than are we tools expected; that's to we things beyond beyond customer value -- inflation, described. to far expected. I expenses, continue like in the as offset typically that what the things to of like are supply that's

refinish. we So price to get expect in

see You'll aerospace. incremental price in

sustainable they're of We customers interested solutions very that PMC for have we in some expect our it good, parts in. where really

portfolio we And see whole it so almost expect across Performance Coatings. to the of really

line from with of Leithead Barclays. The next the Michael question comes

like more guys Question on It for still inventory. have days looks where raws about you are few talk of Vince buying material raw normalized you patterns? Can extra relative you to and a just inventory. maybe

low flow of don't assumptions then down we appreciate capital full give this up should working free just expect your And year, cash I to given be broadly, full of still raws a to guidance. But you guess, the source I year? year cash mid-singles, for volume

we're Yes. to work Michael, is to because down. end our continue of I'll going assumption that, the take

inventory relative to inventory in X excess history. excess work alluded have down, probably We versus to X to our peak especially this that as carrying history. We're production days of continue Tim to to earlier. season we're going We're that

in that All materials. of raw is

at one last point at year. And were days We we've XX made progress.

in So basis QX. another that free QX, year, on take for we're hope We purchases, then on a the out working the of should basis, a capital bite our And positive that cash a continue and generate working flow. to in balance in through year-over-year capital on about sizable halfway a to our journey. year-over-year impact bite of be prudent

said our have is opening Tim as for with work I of advantage to terms at materials the the the push our market in -- concert of and most down This or peak In as purchases, us, again, is to continue that. in But opening we'll excess suppliers supply. remarks, said our is that season. intention a raw

the BNP The from next question of comes Favre line Laurent Paribas. from

I had a question China. on

about you by still growth think COVID. presumably, a impacted quarter this I QX. talked But was in

of seeing So I QX, look you was there into wondering, when on ground? the momentum what kind are you

driver. automotive Laurent, Sure, there an impact big -- was a but thanks. impact COVID, was on some

in Coatings that again expecting continue. China continue. double continue. automotive. Refinish digit, expect We we expect and that of QX We're that expect we in in kind Industrial to to grew us, from for and grew China, to growth single-digit high

maybe So is on confident than expected. quarters, several it's as last -- more been that playing we've others we for out and really actually China the

ago, the X, China. in So in going we continuous XX don't you're but think I growth overnight rates of to going back years remain growth confident to see

just And data points. a couple Yes. of other

of is in remain the Chinese set record business and The And expect again, industrial Year strong. brought set doing aerospace there there. country. products we activity of our about travel for to New businesses, well Our our

question comes Viswanathan next line from RBC. Arun the The of with

the to I volume outlook. to just back go wanted

single be full and up second the So in it looks like you're quarter as well. year guiding the digits for low organic sales to

at number, looks it digits, look some targeted that quarter second you have initiatives. price low you single if like can So

So assume should flat kind for we volumes QX? of

half. segment for the guidance it on kind I out thinking are you growth? would look of about need then But And the through thinking that the clarify similarly maybe consolidated can you given to on full you by in know mid-single kind slides. how of volumes, reading a you've volumes you're about like that evolve the just well about some year, Am should volume as digits yes, how ramp how correctly? Or year. to low back I the they

It's Thanks, Arun. Yes. Tim.

volume flat, reading up. price correctly. the adjustment, half, QX, We're up, expecting But volume second price flat. think, actually one you You're said I more

pricing bit from of of about cost European because price that of still what from year. negativity carryover we talked Some of Vince last earlier, little a that energy have

described So we'll it momentum And QX, up. of the that through think I growth rest you is volume and price volume QX year, the well, see flat, moving QX.

UBS. line The with next the Josh of Spector question comes from

talk more. wonder if just architectural a little about I you Americas could bit

versus half? the how So seems on of Pro excluding Curious the in in And like it DIY load-in perspective help U.S. your what with are in that Comex what's the the is you're impact, could from U.S., delineate going volumes seeing just of first slightly. a up and us you kind grow continuing volume much to if

actually, our from friends Mexico impact than here. of it earnings quarter was It's Josh, as more sales cash, well great had as Mexico, the really a in for Yes. standpoint impact a it holiday of it's little was important a Mexico. kind bit flip-flop Easter and another because in while up an

And market. in continuing all gained business decent we the in that last actually so DIY QX, soft, versus XXXX, versus our see into we performance confident architectural We're performance. a momentum and of good Pro that share side, the had Josh. saw but we though, we U.S. on year remains did kind and

across it private business we own we way our our doing partner, what U.S. and dealer sorry, I'm between for Home architectural on negative And recently as good negative channel, the this all the our low single that's Depot, look network, digits on The in on partners all at totality. business macros, with the Pro week we we're now as the look at many side. our despite the Pro, up the were housing, news -- Pro

Research question next Mike Harrison of comes Seaport from The Partners. line the with

what What's you I India? in are what maybe I India? But your you color position? that growth if was are of China. or of Obviously, stage little you're comments wondering in, serving in seeing And see what give inning you're that on some seeing India. in what you more markets key terms the could on some guess current the we in gave you're in a us potential

just It is for couple talk years, to just It's it India and was of got and of XX infrastructure and investment public actually happening there. lot of and been I I growth. is going noticeable. Mike, fascinating. now. always I've back Yes, a a weeks It's in there happening. improvements very ago was

big difference A If will see constructed, trains, more airports. you being there. lot regularly, go a lot you more a cranes, highways

We've growing. and trajectory those businesses going very and really good the position of about we refinish, good mostly industrial growth forward. And there, are feel got all automotive, a on

our top time X Now do infrastructure we've today. countries started that a first is, in good it we have real the reason not is very see and And one, for the growth time, long highlight industrial in to position But we production ground. the it a there. on tangible

is India. as to a seeing Mexico. of there amount significant that again, are we industrial is that robustly fostering what's economy driving Mike, as in And reshoring activity. Asia that's growing The And

Alexander The Jefferies. of the line Laurence with comes question from next

Just one. quick one

North the the that businesses you in? would higher on of your the coatings, of changed how degree volatility to about focusing have volatility I guess acquiring Or that, the and how much of M&A across margin. restructuring thinking silicas business? that I just just sort your you're are America growth, about managing forward, talked proposed or the you going And what mostly On possible exit does of the To going higher leading factor mean, forward?

would The then does those basis better. And And overall factors. adding can margin X are of our a does I cyclicality say growth the it long-term improve it for X #X are, course. our without cyclicality, seasonality, Laurence. profile? But seasonality So improve the on overall organic Thanks, first are volatility, profile the Sure. factors and we it our factors, do and if the even company?

highly first the architectural of of To is clearly, our more your businesses. one part question, seasonal U.S.-Canada

business are if So entirely say cyclicality is that part the a you we tires, would to can I but of that because does in auto do it have it OEM to Other there. production tied And the silicas and of only outcome consumer to electronics. from to parts visualize business, separators, tied some tires. separate are automotive business aftermarket portion tied Other of parts battery that business.

enough modeling its to, company I say impact, think, it I some a you not entirety in it's going your would of So might the cyclicality that affect will but how from model have standpoint.

Laurence, Vince. Yes,

at this as volume reminder, basis. terms a do said pro point basis significant time, February, impact of hundred we has forma that a you a it's in multiple if in a looking Just on sales again, But cyclicality. period improvement not for of

at this will questions to further Jonathan Edwards. turn time. no are There over I now back the call

continued in interest appreciate confidence in earnings sorry, our for as you call. PPG. -- Thank thank Okay. or concludes you first good and we operating, now quarter PPG. and This well appreciated. We so your confidence for remarks to a concludes your want prepared much This our

This conference today's everyone. you, call. Thank concludes

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