PPG Industries Inc. (PPG Quick QuotePPG - Free Report) has a diversified business and a leading position in several paints and coatings end markets. The company is gaining from healthy momentum across automotive OEM, automotive refinish and aerospace markets.

PPG Industries also has been actively focused on growing its business inorganically, manifested by major buyouts (including Comex) and its aggressive cost cutting and restructuring actions. It should also gain from its restructuring actions that include right-sizing headcount and production capacity. However, PPG Industries is exposed to currency headwinds and macroeconomic challenges.

Let’s have a quick look at this Pittsburgh-based coating giant’s second-quarter 2016 release.

Estimate Trend & Surprise History

Investors should note that the earnings estimate for PPG Industries for the second quarter has seen a downtrend over the last month. PPG Industries has beaten the Zacks Consensus Estimate in 2 out of the 4 trailing quarters with an average beat of 0.97%.

Earnings

PPG Industries logged adjusted earnings of $1.85 per share for the quarter, up 10.8% year over year. It beat the Zacks Consensus Estimate of $1.84 by a penny. The results benefited from successful commercialization of new innovative products, aggressive cost management and earnings accretive cash deployment.

Revenues

PPG Industries posted second-quarter revenues of $4,064 million, essentially flat year over year. It trailed the Zacks Consensus Estimate of $4,155 million. Unfavorable currency impacted net sales by 2%. In local currencies, net sales rose by over 1%. Acquisitions contributed over 1% to sales.

PPG INDS INC Price and EPS Surprise

PPG INDS INC Price and EPS Surprise | PPG INDS INC Quote

Key Stats/Developments to Note

PPG Industries remains committed to deliver higher organic growth, including continued commercialization of its innovative, industry-leading coatings technologies. The quarter saw increased growth in Europe, Asia and Latin America and expects the trend to continue. Demand in U.S. and Canada was negatively impacted due to lower architectural coatings volumes.

In the second quarter, PPG Industries announced the sale of its European fiber glass business as well as completed the sale of its minority ownership interest in Pittsburg Glass Works and acquisition of MetoKote. The company spent $800 million to fund its portion of the Pittsburgh Corning Asbestos Settlement Trust. No shares were repurchased in the quarter to benefit from a 5.5% per annum prepayment discount on all future trust-funding requirements.

Zacks Rank

PPG Industries currently has a Zacks Rank #3 (Hold), but that could change following the company’s earnings report which was just released.

Market Reaction

PPG Industries’ shares were inactive in pre-market trading. It would be interesting to see how the market reacts to the results during the trading session today.

Check back later for our full write up on PPG Industries’ earnings report!

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