PPG Industries, Inc. (NYSE:PPG), the largest producer and supplier of automotive coatings to major global car manufacturers, along with releasing its fourth quarter results, announced that it is in discussions with its Transitions Optical joint venture partner Essilor. This may affect the fate of the partnership. PPG Industries holds a 51% stake in the joint venture with Essilor owning the balance. The outcome of the talks with Essilor might result in modification to the JV structure or Sale of all or part of PPG’s interest to Essilor or the vice versa. Moreover the company has bounced back in recent quarter after low perfomance in the past. The Acquisitions helped company to reach sales figure of $3.6 billion for the quarter.
The company continued to aggressively manage its businesses, and hence the fourth quarter results were better as adjusted net income for the quarter, excluding the non-recurring charges, was $238 million, or $1.53 per share. The net income of company on revenue collection of $3.65 billion was $227 million or $1.46 per share compared to $216 million or $1.39 per share last year. Moreover adjusted earnings for the full year were $7.94 per share and for the fourth quarter was $1.53, 10% higher than last year. Cash at the end of the fourth quarter was close to $2.5 billion.
Area of concern
For fiscal 2012, profit fell by 14% year over year to $941 million or $6.06 per share. The coatings segment earnings marked the growth of 30% and Optical and Specialty Materials segment results were also at par in growth. In the fourth quarter of 2012, the Optical segment had sales of $272 million, which were up by $13 million over the fourth quarter of 2011. Although Optical segment accounts for handsome amount of sales and earnings for PPG, it is a matter of concern for the company as it is under discussions with its Transitions Optical joint venture partner Essilor in which PPG may lose all or part of shares of JV to Essilor and as a result of which it will have negative impact.