PPG Reports Higher Glass Sales, Lower Profits
PPG Industries has reported fourth quarter net income of $113 million on sales of $2.51 billion, a record for any fourth quarter. In the fourth quarter 2004, PPG reported net income of $183 million on sales of $2.41 billion.
For all of 2005, the Pittsburgh-based glass manufacturer recorded net income of $596 million on sales of $10.2 billion, a record for any year. In 2004, the company recorded net income of $683 million and sales of $9.51 billion.
Fourth quarter glass sales increased $24 million, or 5 percent, due to higher volumes across most businesses and higher selling prices, which were partially offset by the impact of weakening foreign currencies. However, the glass businesses posted an operating loss of $1 million for the quarter, down $29 million due to the impact of inflation, including $28 million in higher energy costs, and lower other income. These decreases were partially offset by improved volumes and selling prices, as well as lower manufacturing and overhead costs.
Charles E. Bunch, PPG's chairman and chief executive officer, said, "As we look ahead to 2006, we see continued profitable growth opportunities, but also see continued pressure due to the high energy and raw material pricing environment. As a result, in addition to the annual cost reductions that we consistently deliver, we are finalizing plans to take severance and restructuring actions to further streamline our operations that would result in first-quarter charges in the range of $50 million to $70 million.
"Our focus on profitable growth, meanwhile, remains unchanged. We anticipate continued organic growth, as evidenced by the performance of many of our businesses in 2005, including optical products, architectural coatings and aerospace products. Furthermore, we want to accelerate that growth through potential acquisitions, leveraging our strong balance sheet and consistent free cash flow. This growth will position us to continue our tradition of rewarding shareholders."
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