PPG’s Q3 2018 Adjusted EPS Meets Expectations, Stock Rises



PPG Industries reports Q3 2018 adjusted EPS

PPG Industries (PPG) announced its Q3 2018 earnings before the market opened on October 18. It reported adjusted EPS of $1.45, a decline of 4.6% over Q3 2017. Despite the increase in raw material prices, PPG managed to meet analysts’ estimate of $1.45.

PPG’s adjusted EPS was primarily driven by the following:

  • PPG’s higher revenue growth was helped by higher prices.
  • During the quarter, PPG bought back $250 million worth of shares. At the end of Q3 2018, its common outstanding shares were 243.6 million compared to 258.2 million in Q3 2017.
  • PPG’s restructuring program helped it save $20 million in the quarter. Its selling, general, and administrative expenses have declined as a percentage of sales. It reported SG&A expenses as a percentage of sales of 22.7% compared to 23.7%, a decrease of 100 basis points.

The increase in raw material prices had an adverse impact on PPG’s adjusted EPS. Its cost of goods sold as a percentage of sales was reported at 59% compared to 55.7% in Q3 2017, an increase of 330 basis points year-over-year.

Stock reaction and guidance

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