Thanks to its diversified product offerings, you won't catch PPG Industries painting itself into a corner. Coatings -- such as paints (Pittsburgh Paints, Lucite, and Monarch), stains (Olympic), and sealants -- account for most of its sales; the remainder comes from glass, chemicals, and specialty materials. PPG's glass offerings include flat glass for buildings, fabricated glass, and continuous-strand fiberglass used in aircraft and buildings. Its chemicals segment makes chlor-alkali chemicals, and the specialty materials unit provides silica products. The company also makes optical products like Transitions-brand lenses.
PPG operates more than 120 manufacturing facilities worldwide and owns 450 retail centers in the US, Africa, China, and Australia.
Driven by stronger global industrial production activity, PPG's revenues were up 11% in 2011, with increased sales across almost all of its product lines. The increase was led by its Commodity Chemicals segment with a 21% jump in sales boosted by higher pricing and the impact of the acquisition of a US-based chlorine producer. The Industrial Coatings and Architectural segments both had 12% sales increases. Sales of Performance Coatings, its largest segment, went up a more modest 8%, while other segments grew between 5% and 8%.
Higher sales volumes combined with a global reduction in PPG's cost structure boosted the company's net income by more than 42% over 2010.
PPG generates almost 60% of its revenues outside the US, and the company is focusing on acquiring additional businesses and entering into additional joint ventures to grow its global business portfolio.
In 2012 PPG agreed to spin off its commodity chemicals business and merge it with Georgia Gulf in a cash and stock deal valued at $2.1 billion. The transaction will earn PPG a majority interest of about 50.5% in the combined company which will be the third-largest chlor-alkali and the second-largest vinyl chloride monomer (VCM) producer in North America.
It made two foreign acquisitions to expand its international operations in 2011. First it bought the business assets of Ducol Coatings South Africa Ltd., which had served as an importer and distributor of PPG's automotive refinish products in South Africa since 2003. PPG also expanded its joint venture with India-based Asian Paints (India's largest coatings company) and created a second 50-50 JV in 2012. The deals boosts PPG's position in the Chinese and Asian packaging coatings industry, part of its global strategy to expand into emerging regions.
As part of its push to expand in emerging markets, in 2011 PPG formed a joint venture with an India-based company, Harsha Exito Engineering Private, to produce fiber glass reinforcement products.
In the US, that year PPG also acquired Equa-Chlor, a producer of chlorine, caustic soda, and muriatic acid, for $27 million. In 2012 the company also agreed to buy Akzo Nobel's North American Decorative Paints business for $1.05 billion. – less