Pennsylvania
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|
25-0730780
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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|
|
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One PPG Place, Pittsburgh, Pennsylvania
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15272
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(Address of principal executive offices)
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(Zip Code)
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Large accelerated filer
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ý
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Accelerated filer
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o
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Non-accelerated filer
|
o
(Do not check if a smaller reporting company)
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Smaller reporting company
|
o
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PAGE
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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||
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Item 1.
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Item 1A.
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Item 2.
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Item 6.
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||
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Three Months Ended
March 31 |
||||||
|
2016
|
|
2015
|
||||
Net sales
|
$
|
3,672
|
|
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$
|
3,662
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|
Cost of sales, exclusive of depreciation and amortization
|
2,013
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2,065
|
|
||
Selling, general and administrative
|
919
|
|
|
914
|
|
||
Depreciation
|
91
|
|
|
87
|
|
||
Amortization
|
30
|
|
|
33
|
|
||
Research and development, net
|
118
|
|
|
119
|
|
||
Interest expense
|
31
|
|
|
29
|
|
||
Interest income
|
(7
|
)
|
|
(11
|
)
|
||
Asbestos settlement, net
|
3
|
|
|
3
|
|
||
Other charges
|
21
|
|
|
24
|
|
||
Other income
|
(18
|
)
|
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(31
|
)
|
||
Income from continuing operations before income taxes
|
471
|
|
|
430
|
|
||
Income tax expense
|
117
|
|
|
104
|
|
||
Income from continuing operations
|
354
|
|
|
326
|
|
||
Income from discontinued operations, net of tax
|
—
|
|
|
1
|
|
||
Net income attributable to the controlling and noncontrolling interests
|
354
|
|
|
327
|
|
||
Less: Net income attributable to noncontrolling interests
|
(7
|
)
|
|
(5
|
)
|
||
Net income (attributable to PPG)
|
$
|
347
|
|
|
$
|
322
|
|
Amounts attributable to PPG:
|
|
|
|
||||
Income from continuing operations, net of tax
|
$
|
347
|
|
|
$
|
321
|
|
Income from discontinued operations, net of tax
|
—
|
|
|
1
|
|
||
Net income (attributable to PPG)
|
$
|
347
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|
|
$
|
322
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|
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|
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|
||||
Earnings per common share:
|
|
|
|
||||
Income from continuing operations, net of tax
|
$
|
1.30
|
|
|
$
|
1.17
|
|
Income from discontinued operations, net of tax
|
—
|
|
|
0.01
|
|
||
Net income (attributable to PPG)
|
$
|
1.30
|
|
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$
|
1.18
|
|
Earnings per common share – assuming dilution:
|
|
|
|
||||
Income from continuing operations, net of tax
|
$
|
1.29
|
|
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$
|
1.16
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|
Income from discontinued operations, net of tax
|
—
|
|
|
0.01
|
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||
Net income (attributable to PPG)
|
$
|
1.29
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|
|
$
|
1.17
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|
|
|
|
|
||||
Dividends per common share
|
$
|
0.36
|
|
|
$
|
0.33
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|
|
Three Months Ended
March 31 |
||||||
|
2016
|
|
2015
|
||||
Net income attributable to the controlling and noncontrolling interests
|
$
|
354
|
|
|
$
|
327
|
|
Other comprehensive income, net of tax:
|
|
|
|
||||
Defined benefit pension and other postretirement benefits
|
19
|
|
|
68
|
|
||
Unrealized foreign currency translation adjustments
|
45
|
|
|
(272
|
)
|
||
Derivative financial instruments, net
|
(8
|
)
|
|
6
|
|
||
Other comprehensive income (loss), net of tax
|
56
|
|
|
(198
|
)
|
||
Total comprehensive income
|
$
|
410
|
|
|
$
|
129
|
|
Less: amounts attributable to noncontrolling interests:
|
|
|
|
||||
Net income
|
(7
|
)
|
|
(5
|
)
|
||
Unrealized foreign currency translation adjustments
|
3
|
|
|
5
|
|
||
Comprehensive income attributable to PPG
|
$
|
406
|
|
|
$
|
129
|
|
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March 31, 2016
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December 31, 2015
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
909
|
|
|
$
|
1,311
|
|
Short-term investments
|
121
|
|
|
144
|
|
||
Receivables (less allowance for doubtful accounts of
$53 and $51)
|
3,106
|
|
|
2,788
|
|
||
Inventories
|
1,863
|
|
|
1,705
|
|
||
Other
|
719
|
|
|
606
|
|
||
Total current assets
|
6,718
|
|
|
6,554
|
|
||
Property, plant and equipment (net of accumulated depreciation of $4,557 and $4,434)
|
3,038
|
|
|
3,017
|
|
||
Goodwill
|
3,743
|
|
|
3,669
|
|
||
Identifiable intangible assets, net
|
2,170
|
|
|
2,178
|
|
||
Deferred income taxes
|
648
|
|
|
672
|
|
||
Investments
|
370
|
|
|
367
|
|
||
Other assets
|
628
|
|
|
619
|
|
||
Total
|
$
|
17,315
|
|
|
$
|
17,076
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued liabilities
|
$
|
3,616
|
|
|
$
|
3,490
|
|
Asbestos settlement
|
831
|
|
|
796
|
|
||
Restructuring reserves
|
71
|
|
|
87
|
|
||
Short-term debt and current portion of long-term debt
|
38
|
|
|
283
|
|
||
Total current liabilities
|
4,556
|
|
|
4,656
|
|
||
Long-term debt
|
4,226
|
|
|
4,042
|
|
||
Accrued pensions
|
682
|
|
|
712
|
|
||
Other postretirement benefits
|
1,017
|
|
|
1,021
|
|
||
Asbestos settlement
|
255
|
|
|
252
|
|
||
Deferred income taxes
|
479
|
|
|
460
|
|
||
Other liabilities
|
852
|
|
|
864
|
|
||
Total liabilities
|
12,067
|
|
|
12,007
|
|
||
Commitments and contingent liabilities (Note 15)
|
|
|
|
||||
Shareholders’ equity:
|
|
|
|
||||
Common stock
|
969
|
|
|
969
|
|
||
Additional paid-in capital
|
648
|
|
|
635
|
|
||
Retained earnings
|
15,770
|
|
|
15,521
|
|
||
Treasury stock, at cost
|
(9,583
|
)
|
|
(9,440
|
)
|
||
Accumulated other comprehensive loss
|
(2,643
|
)
|
|
(2,702
|
)
|
||
Total PPG shareholders’ equity
|
5,161
|
|
|
4,983
|
|
||
Noncontrolling interests
|
87
|
|
|
86
|
|
||
Total shareholders’ equity
|
5,248
|
|
|
5,069
|
|
||
Total
|
$
|
17,315
|
|
|
$
|
17,076
|
|
|
Three Months Ended
March 31 |
||||||
|
2016
|
|
2015
|
||||
Operating activities:
|
|
|
|
||||
Net income attributable to controlling and noncontrolling interests
|
$
|
354
|
|
|
$
|
327
|
|
Less: Income from discontinued operations
|
—
|
|
|
(1
|
)
|
||
Income from continuing operations
|
354
|
|
|
326
|
|
||
Adjustments to reconcile net income to cash from operations:
|
|
|
|
||||
Depreciation and amortization
|
121
|
|
|
120
|
|
||
Pension expense
|
19
|
|
|
24
|
|
||
Stock-based compensation expense
|
10
|
|
|
15
|
|
||
Equity affiliate earnings, net of distributions received
|
(3
|
)
|
|
(6
|
)
|
||
Deferred income tax (benefit) expense
|
(4
|
)
|
|
12
|
|
||
Gain on derivative instruments
|
—
|
|
|
(55
|
)
|
||
Cash contributions to pension plans
|
(6
|
)
|
|
(276
|
)
|
||
Restructuring cash spend
|
(18
|
)
|
|
(13
|
)
|
||
Change in certain asset and liability accounts:
|
|
|
|
||||
Receivables
|
(269
|
)
|
|
(327
|
)
|
||
Inventories
|
(120
|
)
|
|
(136
|
)
|
||
Other current assets
|
(83
|
)
|
|
(66
|
)
|
||
Accounts payable and accrued liabilities
|
90
|
|
|
(63
|
)
|
||
Taxes and interest payable
|
(57
|
)
|
|
67
|
|
||
Noncurrent assets and liabilities, net
|
(4
|
)
|
|
(33
|
)
|
||
Other
|
29
|
|
|
(18
|
)
|
||
Cash from / (used for) operating activities
|
59
|
|
|
(429
|
)
|
||
Investing activities:
|
|
|
|
||||
Capital expenditures
|
(77
|
)
|
|
(72
|
)
|
||
Business acquisitions, net of cash balances acquired
|
(6
|
)
|
|
(9
|
)
|
||
Proceeds from the disposition of PPG's interest in the Transitions Optical joint venture and sunlens business
|
—
|
|
|
47
|
|
||
Proceeds from maturity of short-term investments
|
31
|
|
|
51
|
|
||
Payments for the settlement of cross currency swap contracts
|
(36
|
)
|
|
(34
|
)
|
||
Proceeds from the settlement of cross currency swap
|
19
|
|
|
19
|
|
||
Proceeds from the settlement of net investment hedges
|
—
|
|
|
19
|
|
||
Other
|
6
|
|
|
14
|
|
||
Cash (used for) / from investing activities
|
(63
|
)
|
|
35
|
|
||
Financing activities:
|
|
|
|
||||
Net change in borrowing with maturities of three months or less
|
2
|
|
|
(20
|
)
|
||
Net proceeds (payments) on commercial paper and short-term debt
|
86
|
|
|
(497
|
)
|
||
Proceeds from the issuance of debt
|
—
|
|
|
1,242
|
|
||
Repayment of long-term debt
|
(251
|
)
|
|
(1
|
)
|
||
Purchase of treasury stock
|
(150
|
)
|
|
(200
|
)
|
||
Issuance of treasury stock
|
14
|
|
|
44
|
|
||
Dividends paid
|
(96
|
)
|
|
(91
|
)
|
||
Other
|
(14
|
)
|
|
(19
|
)
|
||
Cash (used for) / from financing activities
|
(409
|
)
|
|
458
|
|
||
Effect of currency exchange rate changes on cash and cash equivalents
|
11
|
|
|
(15
|
)
|
||
Net (decrease) / increase in cash and cash equivalents
|
(402
|
)
|
|
49
|
|
||
Cash and cash equivalents, beginning of period
|
1,311
|
|
|
686
|
|
||
Cash and cash equivalents, end of period
|
$
|
909
|
|
|
$
|
735
|
|
|
|
|
|
||||
Supplemental disclosures of cash flow information:
|
|
|
|
||||
Interest paid, net of amount capitalized
|
$
|
33
|
|
|
$
|
17
|
|
Taxes paid, net of refunds
|
$
|
108
|
|
|
$
|
83
|
|
1
.
|
Basis of Presentation
|
2
.
|
New Accounting Standards
|
3
.
|
Dispositions
|
4
.
|
Inventories
|
($ in millions)
|
March 31, 2016
|
|
December 31, 2015
|
||||
Finished products
|
$
|
1,187
|
|
|
$
|
1,082
|
|
Work in process
|
179
|
|
|
160
|
|
||
Raw materials
|
446
|
|
|
413
|
|
||
Supplies
|
51
|
|
|
50
|
|
||
Total Inventories
|
$
|
1,863
|
|
|
$
|
1,705
|
|
5
.
|
Goodwill and Other Identifiable Intangible Assets
|
($ in millions)
|
Performance
Coatings
|
|
Industrial
Coatings
|
|
Glass
|
|
Total
|
||||||||
Balance, December 31, 2015
|
$
|
3,073
|
|
|
$
|
552
|
|
|
$
|
44
|
|
|
$
|
3,669
|
|
Acquisitions
|
4
|
|
|
1
|
|
|
—
|
|
|
5
|
|
||||
Currency
|
52
|
|
|
16
|
|
|
1
|
|
|
69
|
|
||||
Balance, March 31, 2016
|
$
|
3,129
|
|
|
$
|
569
|
|
|
$
|
45
|
|
|
$
|
3,743
|
|
|
March 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||
($ in millions)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Net
|
||||||||||||
Acquired technology
|
$
|
576
|
|
|
$
|
(432
|
)
|
|
$
|
144
|
|
|
$
|
572
|
|
|
$
|
(421
|
)
|
|
$
|
151
|
|
Customer-related intangibles
|
1,300
|
|
|
(611
|
)
|
|
689
|
|
|
1,267
|
|
|
(574
|
)
|
|
693
|
|
||||||
Trade names
|
137
|
|
|
(67
|
)
|
|
70
|
|
|
132
|
|
|
(61
|
)
|
|
71
|
|
||||||
Other
|
40
|
|
|
(28
|
)
|
|
12
|
|
|
39
|
|
|
(26
|
)
|
|
13
|
|
||||||
Balance
|
$
|
2,053
|
|
|
$
|
(1,138
|
)
|
|
$
|
915
|
|
|
$
|
2,010
|
|
|
$
|
(1,082
|
)
|
|
$
|
928
|
|
($ in millions)
|
Future Amortization Expense
|
||
Remaining nine months of 2016
|
$
|
95
|
|
2017
|
125
|
|
|
2018
|
120
|
|
|
2019
|
110
|
|
|
2020
|
95
|
|
|
2021
|
95
|
|
|
Thereafter
|
275
|
|
6
.
|
Business Restructuring
|
($ in millions, except for employees impacted)
|
Severance
and Other
Costs
|
|
Asset
Write-offs
|
|
Total
Reserve
|
|
Employees
Impacted
|
|||||||
Performance Coatings
|
$
|
71
|
|
|
$
|
6
|
|
|
$
|
77
|
|
|
1,259
|
|
Industrial Coatings
|
42
|
|
|
13
|
|
|
55
|
|
|
534
|
|
|||
Glass
|
4
|
|
|
—
|
|
|
4
|
|
|
33
|
|
|||
Corporate
|
4
|
|
|
—
|
|
|
4
|
|
|
27
|
|
|||
Total second quarter 2015 restructuring charge
|
$
|
121
|
|
|
$
|
19
|
|
|
$
|
140
|
|
|
1,853
|
|
2015 Activity
|
(32
|
)
|
|
(19
|
)
|
|
(51
|
)
|
|
(1,047
|
)
|
|||
Foreign currency impact
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|||
Balance as of December 31, 2015
|
$
|
87
|
|
|
$
|
—
|
|
|
$
|
87
|
|
|
806
|
|
2016 Activity
|
(18
|
)
|
|
—
|
|
|
(18
|
)
|
|
(123
|
)
|
|||
Foreign currency impact
|
2
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|||
Balance as of March 31, 2016
|
$
|
71
|
|
|
$
|
—
|
|
|
$
|
71
|
|
|
683
|
|
7
.
|
Borrowings
|
8
.
|
Earnings Per Share
|
|
Three Months Ended
March 31 |
||||
(number of shares in millions)
|
2016
|
|
2015
|
||
Weighted average common shares outstanding
|
267.6
|
|
|
273.2
|
|
Effect of dilutive securities:
|
|
|
|
||
Stock options
|
0.9
|
|
|
1.2
|
|
Other stock compensation plans
|
0.9
|
|
|
1.2
|
|
Potentially dilutive common shares
|
1.8
|
|
|
2.4
|
|
Adjusted weighted average common shares outstanding
|
269.4
|
|
|
275.6
|
|
9
.
|
Income Taxes
|
|
Three Months Ended
March 31 |
||||
|
2016
|
|
2015
|
||
Effective tax rate on pre-tax income from continuing operations
|
24.8
|
%
|
|
24.2
|
%
|
10
.
|
Pensions and Other Postretirement Benefits
|
|
Pensions
|
|
Other Postretirement
|
||||||||||||
|
Three Months Ended
March 31 |
|
Three Months Ended
March 31 |
||||||||||||
($ in millions)
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Service cost
|
$
|
14
|
|
|
$
|
15
|
|
|
$
|
4
|
|
|
$
|
5
|
|
Interest cost
|
43
|
|
|
50
|
|
|
10
|
|
|
12
|
|
||||
Expected return on plan assets
|
(69
|
)
|
|
(70
|
)
|
|
—
|
|
|
—
|
|
||||
Amortization of actuarial losses
|
31
|
|
|
30
|
|
|
4
|
|
|
8
|
|
||||
Amortization of prior service credit
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|
(3
|
)
|
||||
Net periodic benefit cost
|
$
|
19
|
|
|
$
|
24
|
|
|
$
|
16
|
|
|
$
|
22
|
|
|
Three Months Ended
March 31 |
||||||
($ in millions)
|
2016
|
|
2015
|
||||
U.S. defined benefit pension voluntary contributions
|
$
|
—
|
|
|
$
|
250
|
|
Non-U.S. defined benefit pension plan contributions
|
$
|
6
|
|
|
$
|
26
|
|
11
.
|
Shareholders' Equity
|
($ in millions)
|
Total PPG
Shareholders’
Equity
|
|
Non-
controlling
Interests
|
|
Total
|
||||||
Balance, January 1, 2016
|
$
|
4,983
|
|
|
$
|
86
|
|
|
$
|
5,069
|
|
Net income
|
347
|
|
|
7
|
|
|
354
|
|
|||
Other comprehensive income, net of tax
|
59
|
|
|
(3
|
)
|
|
56
|
|
|||
Cash dividends
|
(96
|
)
|
|
—
|
|
|
(96
|
)
|
|||
Issuance of treasury stock
|
34
|
|
|
—
|
|
|
34
|
|
|||
Stock repurchase program
|
(150
|
)
|
|
—
|
|
|
(150
|
)
|
|||
Stock-based compensation activity
|
(16
|
)
|
|
—
|
|
|
(16
|
)
|
|||
Other
|
—
|
|
|
(3
|
)
|
|
(3
|
)
|
|||
Balance, March 31, 2016
|
$
|
5,161
|
|
|
$
|
87
|
|
|
$
|
5,248
|
|
($ in millions)
|
Total PPG
Shareholders’
Equity
|
|
Non-
controlling
Interests
|
|
Total
|
||||||
Balance, January 1, 2015
|
$
|
5,180
|
|
|
$
|
85
|
|
|
$
|
5,265
|
|
Net income
|
322
|
|
|
5
|
|
|
327
|
|
|||
Other comprehensive income, net of tax
|
(193
|
)
|
|
(5
|
)
|
|
(198
|
)
|
|||
Cash dividends
|
(91
|
)
|
|
—
|
|
|
(91
|
)
|
|||
Issuance of treasury stock
|
58
|
|
|
—
|
|
|
58
|
|
|||
Stock repurchase program
|
(200
|
)
|
|
—
|
|
|
(200
|
)
|
|||
Stock-based compensation activity
|
2
|
|
|
—
|
|
|
2
|
|
|||
Other
|
—
|
|
|
(5
|
)
|
|
(5
|
)
|
|||
Balance, March 31, 2015
|
$
|
5,078
|
|
|
$
|
80
|
|
|
$
|
5,158
|
|
12
.
|
Accumulated Other Comprehensive Loss
|
($ in millions)
|
Unrealized Foreign
Currency
Translation Adjustments
|
|
Pension and Other Postretirement Benefit Adjustments, net of tax
|
|
Unrealized Gain (Loss) on Derivatives, net of tax
|
|
Accumulated
Other Comprehensive
(Loss) Income
|
||||||||||||||||||||
Balance, January 1, 2016
|
|
|
$
|
(1,332
|
)
|
|
|
|
$
|
(1,379
|
)
|
|
|
|
$
|
9
|
|
|
|
|
$
|
(2,702
|
)
|
||||
Current year deferrals to AOCI
|
49
|
|
(a)
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
49
|
|
|
|
||||||||
Current year deferrals to AOCI, tax effected
|
(1
|
)
|
(b)
|
|
|
6
|
|
(c)
|
|
|
2
|
|
(d)
|
|
|
7
|
|
|
|
||||||||
Reclassifications from AOCI to net income
|
—
|
|
|
|
|
13
|
|
|
|
|
(10
|
)
|
|
|
|
3
|
|
|
|
||||||||
Net change
|
|
|
$
|
48
|
|
|
|
|
$
|
19
|
|
|
|
|
$
|
(8
|
)
|
|
|
|
$
|
59
|
|
||||
Balance, March 31, 2016
|
|
|
$
|
(1,284
|
)
|
|
|
|
$
|
(1,360
|
)
|
|
|
|
$
|
1
|
|
|
|
|
$
|
(2,643
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, January 1, 2015
|
|
|
$
|
(628
|
)
|
|
|
|
$
|
(1,492
|
)
|
|
|
|
$
|
4
|
|
|
|
|
$
|
(2,116
|
)
|
||||
Current year deferrals to AOCI
|
(429
|
)
|
(a)
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
(429
|
)
|
|
|
||||||||
Current year deferrals to AOCI, tax effected
|
162
|
|
(b)
|
|
|
45
|
|
(c)
|
|
|
(33
|
)
|
(d)
|
|
|
174
|
|
|
|
||||||||
Reclassifications from AOCI to net income
|
—
|
|
|
|
|
23
|
|
|
|
|
39
|
|
|
|
|
62
|
|
|
|
||||||||
Net change
|
|
|
$
|
(267
|
)
|
|
|
|
$
|
68
|
|
|
|
|
$
|
6
|
|
|
|
|
$
|
(193
|
)
|
||||
Balance, March 31, 2015
|
|
|
$
|
(895
|
)
|
|
|
|
$
|
(1,424
|
)
|
|
|
|
$
|
10
|
|
|
|
|
$
|
(2,309
|
)
|
13
.
|
Financial Instruments, Hedging Activities and Fair Value Measurements
|
($ in millions)
|
March 31, 2016
|
||||||||
Hedge Type
|
Loss
Deferred in
OCI
|
|
Gain (Loss) Recognized
|
||||||
Amount
|
|
Caption
|
|||||||
Fair Value
|
|
|
|
|
|
||||
Equity forward arrangements
|
Not applicable
|
|
36
|
|
|
Asbestos settlement - net
|
|||
Total Fair Value
|
|
|
$
|
36
|
|
|
|
||
Cash Flow
|
|
|
|
|
|
||||
Foreign currency forward contracts
(a)
|
$
|
(15
|
)
|
|
$
|
(3
|
)
|
|
Other charges
|
Total Cash Flow
|
$
|
(15
|
)
|
|
$
|
(3
|
)
|
|
|
Net Investment
|
|
|
|
|
|
||||
Cross currency swaps
|
$
|
(22
|
)
|
|
|
|
|
|
|
Foreign denominated debt
|
(95
|
)
|
|
|
|
|
|||
Total Net Investment
|
$
|
(117
|
)
|
|
|
|
|
|
($ in millions)
|
March 31, 2015
|
||||||||
Hedge Type
|
Gain
Deferred in OCI
|
|
Gain (Loss) Recognized
|
||||||
Amount
|
|
Caption
|
|||||||
Fair Value
|
|
|
|
|
|
||||
Equity forward arrangements
|
Not applicable
|
|
(7
|
)
|
|
Asbestos settlement - net
|
|||
Total Fair Value
|
|
|
$
|
(7
|
)
|
|
|
||
Cash Flow
|
|
|
|
|
|
||||
Foreign currency forward contracts
(a)
|
57
|
|
|
49
|
|
|
Other charges
|
||
Total Cash Flow
|
$
|
57
|
|
|
$
|
49
|
|
|
|
Net Investment
|
|
|
|
|
|
||||
Cross currency swaps
|
$
|
82
|
|
|
|
|
|
|
|
Foreign currency forward contracts
|
18
|
|
|
|
|
|
|||
Foreign denominated debt
|
113
|
|
|
|
|
|
|||
Total Net Investment
|
$
|
213
|
|
|
|
|
|
|
|
March 31, 2016
|
||||||||||
($ in millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Assets:
|
|
|
|
|
|
||||||
Other current assets:
|
|
|
|
|
|
||||||
Marketable equity securities
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
—
|
|
|
38
|
|
|
—
|
|
|||
Equity forward arrangement
|
—
|
|
|
259
|
|
|
—
|
|
|||
Investments:
|
|
|
|
|
|
||||||
Marketable equity securities
|
77
|
|
|
—
|
|
|
—
|
|
|||
Other Assets:
|
|
|
|
|
|
||||||
Cross currency swaps
|
—
|
|
|
36
|
|
|
—
|
|
|||
Liabilities:
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities:
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
—
|
|
|
9
|
|
|
—
|
|
|||
|
|
||||||||||
|
December 31, 2015
|
||||||||||
($ in millions)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Assets:
|
|
|
|
|
|
||||||
Other current assets:
|
|
|
|
|
|
||||||
Marketable equity securities
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Foreign currency forward contracts
|
—
|
|
|
47
|
|
|
—
|
|
|||
Equity forward arrangement
|
—
|
|
|
223
|
|
|
—
|
|
|||
Investments:
|
|
|
|
|
|
||||||
Marketable equity securities
|
77
|
|
|
—
|
|
|
—
|
|
|||
Other assets:
|
|
|
|
|
|
||||||
Cross currency swaps
|
—
|
|
|
41
|
|
|
—
|
|
|||
Liabilities:
|
|
|
|
|
|
||||||
Accounts payable and accrued liabilities:
|
|
|
|
|
|
||||||
Foreign currency forward contracts
|
—
|
|
|
4
|
|
|
—
|
|
($ in millions)
|
March 31, 2016
(a)
|
|
December 31, 2015
(b)
|
||||
Long-term debt - carrying value
|
$
|
4,200
|
|
|
$
|
4,265
|
|
Long-term debt - fair value
|
$
|
4,423
|
|
|
$
|
4,367
|
|
14
.
|
Stock-Based Compensation
|
|
Three Months Ended
March 31 |
||||||
($ in millions)
|
2016
|
|
2015
|
||||
Stock-based compensation
|
$
|
10
|
|
|
$
|
15
|
|
Income tax benefit recognized
|
$
|
4
|
|
|
$
|
5
|
|
|
|
Three Months Ended
March 31 |
||||||||||||
|
|
2016
|
|
2015
|
||||||||||
Grant Details
|
|
Shares
|
|
Fair Value
|
|
Shares
|
|
Fair Value
|
||||||
Stock options
|
|
775,319
|
|
|
$
|
17.89
|
|
|
583,172
|
|
|
$
|
26.98
|
|
Restricted stock units
|
|
245,038
|
|
|
$
|
90.79
|
|
|
182,150
|
|
|
$
|
114.04
|
|
Contingent shares (a)
|
|
59,645
|
|
|
$
|
95.00
|
|
|
63,308
|
|
|
$
|
118.12
|
|
15
.
|
Commitments and Contingent Liabilities
|
Remainder of 2016
|
$
|
11
|
|
2017
|
13
|
|
|
2018 – 2023
|
40
|
|
|
Total
|
$
|
64
|
|
($ in millions)
|
Three Months Ended
March 31 |
||||||
Increase (decrease) in expense
|
2016
|
|
2015
|
||||
Change in fair value:
|
|
|
|
||||
PPG stock
|
$
|
35
|
|
|
$
|
(8
|
)
|
Equity forward instrument
|
(36
|
)
|
|
7
|
|
||
Accretion of asbestos liability
|
4
|
|
|
4
|
|
||
Asbestos settlement – net expense
|
$
|
3
|
|
|
$
|
3
|
|
|
Three Months Ended
March 31 |
||||||
($ in millions)
|
2016
|
|
2015
|
||||
Environmental remediation pre-tax charges
|
$
|
5
|
|
|
$
|
4
|
|
Cash outlays for environmental remediation activities
|
$
|
14
|
|
|
$
|
36
|
|
16
.
|
Reportable Business Segment Information
|
|
Three Months Ended
March 31 |
||||||
($ in millions)
|
2016
|
|
2015
|
||||
Net sales:
|
|
|
|
||||
Performance Coatings
|
$
|
2,039
|
|
|
$
|
2,055
|
|
Industrial Coatings
|
1,372
|
|
|
1,340
|
|
||
Glass
|
261
|
|
|
267
|
|
||
Total
|
$
|
3,672
|
|
|
$
|
3,662
|
|
Segment income:
|
|
|
|
||||
Performance Coatings
|
$
|
279
|
|
|
$
|
262
|
|
Industrial Coatings
|
265
|
|
|
244
|
|
||
Glass
|
28
|
|
|
30
|
|
||
Total
|
572
|
|
|
536
|
|
||
Corporate
|
(61
|
)
|
|
(67
|
)
|
||
Interest expense, net of interest income
|
(24
|
)
|
|
(18
|
)
|
||
Legacy items
(a)
|
(10
|
)
|
|
(12
|
)
|
||
Asset write down
|
(4
|
)
|
|
—
|
|
||
Transaction-related costs
(b)
|
(2
|
)
|
|
(9
|
)
|
||
Income from continuing operations before income taxes
|
$
|
471
|
|
|
$
|
430
|
|
(a)
|
Legacy items include current costs related to former operations of the Company, including pension and other postretirement benefit costs, certain charges for legal matters and environmental remediation costs, and certain charges which are considered to be unusual or nonrecurring, including the earnings impact of the proposed asbestos settlement. Legacy items also include equity earnings from PPG’s investment in the former automotive glass and services business.
|
(b)
|
Transaction-related costs include advisory, legal, accounting, valuation and other professional or consulting fees incurred to effect significant acquisitions, as well as similar fees and other costs to effect disposals not classified as discontinued operations. These costs also include the flow-through cost of sales of the step up to fair value of inventory acquired in acquisitions. These costs also include certain nonrecurring severance costs and charges associated with the Company's business portfolio transformation.
|
•
|
Net sales were
$3.7 billion
, consistent with the prior year, primarily due to sales from acquired businesses (+3%) and higher volumes (+1%) offset by unfavorable foreign currency translation (-4%).
|
•
|
Cost of sales, exclusive of depreciation and amortization decreased 2.5% to
$2.0 billion
.
|
•
|
Selling, general and administrative expenses increased +0.5% to
$0.9 billion
, level as a percentage of sales.
|
•
|
Income before income taxes was
$471 million
.
|
•
|
The effective tax rate for the three months ended March 31, 2016 was
24.8%
.
|
•
|
Net income from continuing operations was
$347 million
and earnings per diluted share was
$1.29
.
|
•
|
Operating cash flow was
$59 million
.
|
•
|
Capital expenditures, including acquisitions (net of cash acquired), was
$83 million
.
|
•
|
During the three months ended March 31, 2016, the Company paid
$96 million
in dividends and also repurchased approximately
$150 million
of its outstanding common stock. On April 21, 2016, the Company raised the per-share dividend by 11% to $0.40 per share.
|
|
Three Months Ended
March 31 |
|
Percent Change
|
|||||||
($ in millions, except percentages)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|||||
The Americas
|
|
|
|
|
|
|||||
United States
|
$
|
1,562
|
|
|
$
|
1,526
|
|
|
2.4
|
%
|
Other Americas
|
480
|
|
|
530
|
|
|
(9.4
|
)%
|
||
Europe, Middle East and Africa (EMEA)
|
1,060
|
|
|
1,010
|
|
|
5.0
|
%
|
||
Asia Pacific
|
570
|
|
|
596
|
|
|
(4.4
|
)%
|
||
Total
|
$
|
3,672
|
|
|
$
|
3,662
|
|
|
0.3
|
%
|
2016 vs. 2015
|
Net sales increased $10 million due to the following:
|
● Net sales from acquired businesses (+3%)
|
● Higher sales volumes (+1%)
|
Partially offset by:
|
● Unfavorable foreign currency translation (-4%)
|
Foreign currency translation reduced net sales by $140 million as the U.S. dollar strengthened against most foreign currencies versus the prior year, including the Euro (-3%). Weakness in other currencies versus the U.S. dollar was more significant, including a 17% deterioration in the Mexican Peso, as well as declines in the Canadian Dollar, Chinese Yuan, and Brazilian Real.
|
Acquired businesses added $104 million of sales in 2016, primarily Revocoat and IVC, supplemented by several other acquisitions made in 2015.
|
Sales volume growth occurred primarily in Europe, Middle East and Africa ("EMEA") and the emerging regions, while U.S. and Canada sales volumes were flat. The first quarter 2016 was the fifth consecutive quarter of broadening European volume growth.
|
|
Three Months Ended
March 31 |
|
Percent Change
|
|||||||
($ in millions, except percentages)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|||||
Cost of sales, exclusive of depreciation and amortization
|
$
|
2,013
|
|
|
$
|
2,065
|
|
|
(2.5
|
)%
|
Cost of sales as a percentage of net sales
|
54.8
|
%
|
|
56.4
|
%
|
|
(1.6
|
)%
|
2016 vs. 2015
|
Cost of sales, exclusive of depreciation and amortization, decreased $52 million (-2.5%) due to the following:
|
● Foreign currency translation
|
● Lower manufacturing costs
|
Partially offset by:
|
● Cost of sales from acquired businesses
|
● Higher sales volumes
|
|
Three Months Ended
March 31 |
|
Percent Change
|
|||||||
($ in millions, except percentages)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|||||
Selling, general and administrative expenses
|
$
|
919
|
|
|
$
|
914
|
|
|
0.5
|
%
|
Selling, general and administrative expenses as a percentage of net sales
|
25.0
|
%
|
|
25.0
|
%
|
|
—
|
%
|
2016 vs. 2015
|
Selling, general and administrative expenses increased $5 million (+0.5%) primarily due to:
|
● Selling, general and administrative expenses from acquired businesses
|
● Overhead cost inflation
|
● Increased architectural coatings U.S. and Canada business spending of approximately $15 million on new product launches and other growth-related initiatives at major national accounts.
|
Partially offset by:
|
● Foreign currency translation
|
● Restructuring cost savings
|
|
Three Months Ended
March 31 |
|
Percent Change
|
|||||||
($ in millions, except percentages)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|||||
Interest expense, net of Interest income
|
$
|
24
|
|
|
$
|
18
|
|
|
33.3
|
%
|
Other charges
|
$
|
21
|
|
|
$
|
24
|
|
|
(12.5
|
)%
|
Other income
|
$
|
(18
|
)
|
|
$
|
(31
|
)
|
|
(41.9
|
)%
|
|
Three Months Ended
March 31 |
|
Percent Change
|
|||||||
($ in millions, except percentages)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|||||
Income tax expense
|
$
|
117
|
|
|
$
|
104
|
|
|
12.5
|
%
|
Effective tax rate
|
24.8
|
%
|
|
24.2
|
%
|
|
0.6
|
%
|
||
Adjusted effective tax rate, ongoing operations*
|
25.0
|
%
|
|
24.4
|
%
|
|
0.6
|
%
|
||
|
|
|
|
|
|
|||||
Earnings per diluted share, continuing operations
|
$
|
1.29
|
|
|
$
|
1.16
|
|
|
11.2
|
%
|
Adjusted earnings per diluted share*
|
$
|
1.31
|
|
|
$
|
1.18
|
|
|
11.0
|
%
|
*See the Regulation G Reconciliation.
|
|
Three months ended March 31, 2016
|
|||||||||||||||||
($ in millions, except percentages and per share amounts)
|
Income Before Income Taxes
|
|
Tax Expense
|
|
Effective Tax Rate
|
|
Net income from continuing operations (attributable to PPG)
|
|
Earnings per diluted share
|
|||||||||
As reported, continuing operations
|
$
|
471
|
|
|
$
|
117
|
|
|
24.8
|
%
|
|
$
|
347
|
|
|
$
|
1.29
|
|
Includes:
|
|
|
|
|
|
|
|
|
|
|||||||||
Charges related to transaction-related costs
(1)
|
2
|
|
|
1
|
|
|
37.6
|
%
|
|
1
|
|
|
0.01
|
|
||||
Charge for asset write-down
|
4
|
|
|
1
|
|
|
37.6
|
%
|
|
3
|
|
|
0.01
|
|
||||
Adjusted, continuing operations, excluding certain charges
|
$
|
477
|
|
|
$
|
119
|
|
|
25.0
|
%
|
|
$
|
351
|
|
|
$
|
1.31
|
|
|
Three months ended March 31, 2015
|
|||||||||||||||||
($ in millions, except percentages and per share amounts)
|
Income Before Income Taxes
|
|
Tax Expense
|
|
Effective Tax Rate
|
|
Net income from continuing operations (attributable to PPG)
|
|
Earnings per diluted share
|
|||||||||
As reported, continuing operations
|
$
|
430
|
|
|
$
|
104
|
|
|
24.2
|
%
|
|
$
|
321
|
|
|
$
|
1.16
|
|
Includes:
|
|
|
|
|
|
|
|
|
|
|||||||||
Charges related to transaction-related costs
(1)
|
9
|
|
|
3
|
|
|
33.3
|
%
|
|
6
|
|
|
0.02
|
|
||||
Adjusted, continuing operations, excluding certain charges
|
$
|
439
|
|
|
$
|
107
|
|
|
24.4
|
%
|
|
$
|
327
|
|
|
$
|
1.18
|
|
|
Three Months Ended
March 31 |
|
$ Change
|
|
% Change
|
|||||||||
($ in millions, except per share amounts)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|
2016 vs. 2015
|
|||||||
Net sales
|
$
|
2,039
|
|
|
$
|
2,055
|
|
|
$
|
(16
|
)
|
|
(0.8
|
)%
|
Segment income
|
$
|
279
|
|
|
$
|
262
|
|
|
$
|
17
|
|
|
6.5
|
%
|
2016 vs. 2015
|
Performance Coatings net sales decreased (-1%) due to the following:
|
● Unfavorable foreign currency translation of approximately $85 million (-4%)
|
Partially offset by:
|
● Net sales from acquisitions (+1%)
|
● Higher sales volumes (+1%)
|
● Slightly higher selling prices
|
Architectural coatings - EMEA sales volumes continued to trend favorably, with the growth rate increasing for several consecutive quarters. Sales volumes improved by a low-single-digit percentage year-over-year, led by growth in western Europe.
|
Protective and marine coatings net sales volumes were flat year-over-year as growth in protective coatings was offset by declines in marine coatings, primarily due to decreasing new ship builds. Protective coatings sales volumes grew versus the prior year in all regions, led by the U.S., Asia and Latin America, including benefits from expanded distribution through the Comex concessionaire network.
|
Aerospace coatings sales volumes declined a low-single digit percentage versus the prior year primarily due to lower commercial demand stemming from continuing customer inventory management. Regionally, Asian sales growth was offset by declines in the U.S. and Canada, while Europe was flat.
|
Automotive refinish coatings experienced increasing organic sales growth year-over-year, led by growing market demand in the U.S. and Asia.
|
Architectural coatings - Americas and Asia Pacific organic net sales increased modestly in the first quarter versus the prior year. Sales volumes were up slightly in the U.S. and Canadian region as aggregate demand growth in company-owned stores and national accounts was offset by declines in the independent dealer network and continued market weakness in certain Canadian markets. Local currency sales growth in Mexico was approximately two times the Mexican GDP despite comparisons to robust volume growth in the first quarter of 2015.
|
Segment income increased $17 million (+6%) year-over-year despite the impact of approximately $15 million of planned incremental costs for new product launch and other growth-related initiatives in major U.S. architectural coatings national accounts. The increase in segment income was primarily due to higher sales volumes, acquisition-related income and a continuing cost focus, including additional business restructuring benefits. Unfavorable foreign currency translation reduced segment income by almost $10 million.
|
|
Three Months Ended
March 31 |
|
$ Change
|
|
% Change
|
|||||||||
($ in millions, except per share amounts)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|
2016 vs. 2015
|
|||||||
Net sales
|
$
|
1,372
|
|
|
$
|
1,340
|
|
|
$
|
32
|
|
|
2.4
|
%
|
Segment income
|
$
|
265
|
|
|
$
|
244
|
|
|
$
|
21
|
|
|
8.6
|
%
|
2016 vs. 2015
|
Industrial Coatings segment net sales increased (+2%) due to the following:
|
● Net sales from acquired businesses (+6%)
|
● Higher sales volumes (+1%), led by growth in Europe.
|
Partially offset by:
|
● Unfavorable foreign currency translation of approximately $50 million (-4%)
|
● Slightly lower selling prices
|
PPG’s global automotive OEM coatings business sales volumes were consistent with the prior year, reflecting modest global industry automotive production growth, and in comparison to strong prior year PPG-specific volume growth. PPG's sales volumes differed by region, with year-over-year growth tempered in Asia given the prior year double-digit percentage growth.
|
In aggregate, global sales volumes increased modestly in the general industrial coatings and specialty coatings and materials business units year-over-year, as growth momentum continued from the fourth quarter 2015. Sales volume performance remained uneven by end-use market and geography. Regionally, European sales volumes continued to expand, with positive growth rates in the U.S. and Canada. Sales volumes in Asia were flat and declined in South America. By end-use market, volume growth remained consistent with improved demand in automotive parts and accessories and expansion in coil and extrusion, partially offset by declines in heavy duty equipment.
|
Global packaging coatings sales volumes were up a mid-to-high single-digit percentage year-over-year, with at least mid-single digit percentage growth in all regions, driven primarily by continued strong sales growth momentum for new can coatings technologies.
|
Segment income increased $21 million (+9%) primarily due to lower manufacturing costs including business restructuring benefits, higher sales volumes and acquisition-related income, partially offset by unfavorable foreign currency translation ($5 million).
|
|
Three Months Ended
March 31 |
|
$ Change
|
|
% Change
|
|||||||||
($ in millions, except per share amounts)
|
2016
|
|
2015
|
|
2016 vs. 2015
|
|
2016 vs. 2015
|
|||||||
Net sales
|
$
|
261
|
|
|
$
|
267
|
|
|
$
|
(6
|
)
|
|
(2.2
|
)%
|
Segment income
|
$
|
28
|
|
|
$
|
30
|
|
|
$
|
(2
|
)
|
|
(6.7
|
)%
|
2016 vs. 2015
|
Glass segment net sales decreased (-2%) due to the following:
|
● Lower sales volume (-2%)
|
● Lower sales stemming from a prior year flat glass production facility divestiture (-1%)
|
● Unfavorable foreign currency translation (-1%)
|
Partially offset by:
|
● Higher selling prices (+2%)
|
Flat glass sales volumes decreased by a low-single digit percentage reflecting the impact of a scheduled facility outage at the company’s Fresno, California facility during the quarter. Sales were also lower year-over-year due to the prior year sale of remaining finished goods from a previously divested flat glass manufacturing facility. Despite the lower sales volumes, underlying flat glass end-use market demand remained solid. Selling prices improved year-over-year.
Fiber glass sales volumes declined modestly year-over-year, as higher demand for automotive and wind energy components in Europe was offset by lower demand in certain U.S. energy-related end-use markets. Selling prices were up slightly year over year.
|
Segment income decreased $2 million (-7%) due to lower sales volumes, $8 million of repair-related costs for the scheduled Fresno facility outage and lower equity earnings, driven by weaker consumer electronics demand in Asia, partially offset by disciplined cost management.
|
•
|
Capital expenditures, excluding acquisitions, of
$77 million
, or about
2%
of sales.
|
•
|
Mandatory contributions to PPG's non-U.S. pension plans of $6 million.
|
•
|
Cash dividends paid totaled
$96 million
.
|
•
|
Cash spent on share repurchases totaled
$150 million
.
|
($ in millions, except percentages)
|
March 31, 2016
|
|
December 31, 2015
|
|
March 31, 2015
|
||||||
Trade Receivables, Net
|
$
|
2,760
|
|
|
$
|
2,413
|
|
|
$
|
2,625
|
|
Inventories, FIFO
|
2,008
|
|
|
1,868
|
|
|
2,059
|
|
|||
Trade Creditors’ Liabilities
|
2,167
|
|
|
1,940
|
|
|
1,966
|
|
|||
Operating Working Capital
|
$
|
2,601
|
|
|
$
|
2,341
|
|
|
$
|
2,718
|
|
Operating Working Capital as a % of Sales
|
17.7
|
%
|
|
15.8
|
%
|
|
18.6
|
%
|
|
Three Months Ended
March 31 |
||||||
($ in millions)
|
2016
|
|
2015
|
||||
Cash outlays for environmental remediation activities
|
$
|
14
|
|
|
$
|
36
|
|
($ in millions)
|
Remainder
of 2016
|
|
Annually
2017 - 2019
|
Projected future cash outlays for environmental remediation activities
|
$20 - $35
|
|
$25 - $45
|
Month
|
Total Number
of Shares Purchased |
|
Average
Price Paid per Share |
|
Total Number
of Shares Purchased as Part of Publicly Announced Programs (1) |
|
Maximum
Number of Shares That May Yet Be Purchased Under the Programs (1) |
|||||
January 2016
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
171,866
|
|
|
$
|
92.83
|
|
|
171,866
|
|
|
9,503,413
|
|
February 2016
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
678,883
|
|
|
$
|
94.06
|
|
|
678,883
|
|
|
8,703,370
|
|
March 2016
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
664,913
|
|
|
$
|
105.73
|
|
|
664,913
|
|
|
6,905,747
|
|
Total quarter ended March 31, 2016
|
|
|
|
|
|
|
|
|||||
Repurchase program
|
1,515,662
|
|
|
$
|
99.39
|
|
|
1,515,662
|
|
|
6,905,747
|
|
(1)
|
These shares were repurchased under a $2 billion share repurchase program approved in April 2014. The remaining shares that may be repurchased under the $2 billion repurchase program have been calculated based upon PPG's closing stock price on the last business day of the respective month. This repurchase program has no expiration date.
|
|
|
|
|
PPG INDUSTRIES, INC.
|
|
|
|
|
(Registrant)
|
|
|
|
|
|
Date:
|
April 21, 2016
|
By:
|
|
/s/ Frank S. Sklarsky
|
|
|
|
|
Frank S. Sklarsky
Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer and Duly Authorized Officer)
|
†10.1
|
|
Employment arrangement with Jean-Marie Greindl.
|
†12
|
|
Computation of Ratio of Earnings to Fixed Charges for the Three Months Ended March 31, 2016 and for the Five Years Ended December 31, 2015.
|
†31.1
|
|
Certification of Principal Executive Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
†31.2
|
|
Certification of Principal Financial Officer Pursuant to Rule 13a-14(a) or 15d-14(a) of the Exchange Act, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
††32.1
|
|
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
††32.2
|
|
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS*
|
|
XBRL Instance Document
|
101.SCH*
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL*
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF*
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB*
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE*
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
||
† Filed herewith.
|
||
†† Furnished herewith.
|
||
* Attached as Exhibit 101 to this report are the following documents formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Statement of Income for the three months ended March 31, 2016 and 2015, (ii) the Condensed Consolidated Balance Sheet at March 31, 2016 and December 31, 2015, (iii) the Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2016 and 2015, and (iv) Notes to Condensed Consolidated Financial Statements for the three months ended March 31, 2016.
|
Phone
|
:
|
+41
|
21
|
822
|
3000
|
Fax
|
:
|
+41
|
21
|
822
|
3100
|
4
|
Probation period
Not applicable. |
6
|
Working Schedule
40 hours per week. |
7
|
Compensation
|
•
|
While on Swiss assignment, if
employment is terminated by the company
for reason other than cause, the employee's termination indemnity applicable in their existing employment agreement immediately prior to the Swiss assignment will be paid: amount calculated at departure of Belgium € 1'604'066,- gross.
|
•
|
In the event you are terminated without cause within the first 12 months after your relocation to Switzerland, relocation expenses back to Belgium of up to CHF 20'000,-against expenses will be paid to you (these expenses would not be due if you were to be made redundant for cause)
|
•
|
Installation premium
|
•
|
Health Premium
|
•
|
Schooling
|
•
|
Moving Expenses
|
•
|
Temporary housing
|
•
|
Spouse career transition
|
•
|
Home leave:
Once each year the employee and his family may travel to their home at company expense for a period of 5 years.
|
Phone
|
:
|
+41
|
21
|
822
|
3000
|
Fax
|
:
|
+41
|
21
|
822
|
3100
|
|
Three Months Ended
March 31
|
|
Year Ended December 31
|
||||||||||||||||||||
|
2016
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||||
Earnings:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Earnings before income taxes and net earnings in equity affiliates
|
$
|
466
|
|
|
$
|
1,865
|
|
|
$
|
1,308
|
|
|
$
|
1,229
|
|
|
$
|
814
|
|
|
$
|
936
|
|
Plus:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed charges exclusive of capitalized interest
|
53
|
|
|
213
|
|
|
280
|
|
|
284
|
|
|
281
|
|
|
280
|
|
||||||
Amortization of capitalized interest
|
2
|
|
|
6
|
|
|
6
|
|
|
6
|
|
|
6
|
|
|
6
|
|
||||||
Adjustments for equity affiliates
|
1
|
|
|
77
|
|
|
5
|
|
|
9
|
|
|
12
|
|
|
19
|
|
||||||
Total
|
$
|
522
|
|
|
$
|
2,161
|
|
|
$
|
1,599
|
|
|
$
|
1,528
|
|
|
$
|
1,113
|
|
|
$
|
1,241
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed Charges:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest expense incl amortization of debt discount/premium and debt expense
|
$
|
31
|
|
|
$
|
126
|
|
|
$
|
187
|
|
|
$
|
197
|
|
|
$
|
210
|
|
|
$
|
210
|
|
Rentals - portion representative of interest
|
22
|
|
|
87
|
|
|
93
|
|
|
87
|
|
|
71
|
|
|
70
|
|
||||||
Fixed charges exclusive of capitalized interest
|
53
|
|
|
213
|
|
|
280
|
|
|
284
|
|
|
281
|
|
|
280
|
|
||||||
Capitalized interest
|
2
|
|
|
9
|
|
|
16
|
|
|
10
|
|
|
8
|
|
|
9
|
|
||||||
Total
|
$
|
55
|
|
|
$
|
222
|
|
|
$
|
296
|
|
|
$
|
294
|
|
|
$
|
289
|
|
|
$
|
289
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Ratio of earnings to fixed charges
|
9.5
|
|
|
9.7
|
|
|
5.4
|
|
|
5.2
|
|
|
3.9
|
|
|
4.3
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of PPG Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
April 21, 2016
|
/s/ Michael H. McGarry
|
|
|
Michael H. McGarry
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of PPG Industries, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
Date:
|
April 21, 2016
|
/s/ Frank S. Sklarsky
|
|
|
Frank S. Sklarsky
Executive Vice President and Chief Financial Officer (Principal Financial and Accounting Officer)
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PPG Industries, Inc.
|
/s/ Michael H. McGarry
|
Michael H. McGarry
President and Chief Executive Officer |
April 21, 2016
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of PPG Industries, Inc.
|
/s/ Frank S. Sklarsky
|
Frank S. Sklarsky
Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)
|
April 21, 2016
|