Вы находитесь на странице: 1из 23

PPG Capital Markets Day December 5, 2011

Business Updates
Aerospace, Refinish and Protective & Marine Coatings Pierre-Marie De Leener, Executive Vice President

Information current as of December 5, 2011

Performance Coatings Segment


Performance Coatings Business Units Geographic Sales Mix
Latin America, 5%

Protective and Marine Coatings Aerospace Automotive Refinish Architectural Coatings Americas & Asia/Pacific (Overview by Rich Alexander)

OEM / New, ~20% Asia/Pacific,

25%

Aftermarket, ~80%

U.S. & Canada, 49%

Europe, 21%

Emerging Regions = ~30%

Global businesses with heavy focus on technology, distribution and customer service
2

Performance Coatings Segment


3Q YTD Segment Financial Results
$4,000

Performance Coatings Sales Mix


20%

$3,750

15.4%

15.3%

15%
$3,500
EBIT Margin Sales

OEM / /New, OEM New, ~20% ~20%

$3,250

10%

$3,000

5%
$2,750

Aftermarket, ~80%

$2,500 3Q08 3Q09 3Q10 3Q11

0%

Sales Millions of USD

Margin

Excellent financial performance continues, driven by large aftermarket presence


3

Protective & Marine Coatings Industry


Protective & Marine Coatings Industry ($B)
$9.0 $8.0 $7.0 $6.0 $5.0 $4.0 $3.0 $2.0 $1.0 $0.0
Source: Company Estimates

Industry Geographic Mix


Latin America

Other Rail Offshore Power Oil & Gas Infrastructure Marine Aftermarket Marine OEM

U.S. & Canada

Asia Pacific

Western Europe

Eastern Europe & Mid-East

Varied industry end-use markets; Strong Asian profile (ship building)


4

PPG Protective & Marine Coatings


PPG Protective & Marine Coatings Sales Mix
100%

Technology-driven End-use Markets Fire Protection Premium and Standard Antifoulants

Marine OEM
75%

25%

Marine Aftermarket
50%

25%

Tank Linings
25%

Ultra Durable Topcoats

Protective Coatings

50%

0%

PPG equally split between protective and marine markets, strong technology requirements
5

Protective & Marine Coatings Industry Statistics


Global Infrastructure Spending
2,500 CAGR: U.S./W. Europe = 4% Emerging Regions = 8%

Container Ship Deliveries


Twenty-Foot Equivalent Units (TEUm)

1.60

12%

2,000 1.20

10%

Order Backlog - % of Fleet

1,500
Deliveries

8%

0.80

6%

1,000

4%

500

0.40
2%

0 2010
Billions of USD
Source: IHS Global Insights

0.00 2011 2012 2013 Emerging 2014 2015 2007 2008 2009 2010 2011E 2012P Deliveries Order Backlog Developed

0%

Sources: Clarkson Research Services, ABG Sundal Collier, Company Estimates

Protective market growing; Marine OEM activity declining after strong build cycle
6

PPG Aerospace
Business Success Factors PPG Aerospace Sales Mix

Leading technologies Coatings Sealants Transparencies (aircraft windows) Services Global distribution Service

Aftermarket

45% 55%

OEM

Global technology and service business; Equally split between OEM and aftermarket
7

PPG Aerospace Leading Technologies


Non Chrome Exterior Primer Basecoat Clearcoat System

Aerocron Electrocoat Non Chrome Flexible Primer

Solar Reflective System

Sanding Surfacers Single Stage Topcoat Non Chrome Structural Primer

Legend:

Coatings

Extensive aerospace technology content


8

PPG Aerospace Leading Technologies


Non Chrome Exterior Primer Complex Glass & Plastic Forming Basecoat Clearcoat System Alteos Interactive Window Systems

Aerocron Electrocoat Next Generation Surface Seal

Intelligent Windows

Non Chrome Flexible Primer

Solar Reflective System Improved P-Static Coating

Sanding Surfacers

Opticor Advanced Transparency Material Single Stage Topcoat Non Chrome Structural Primer

Legend:

Coatings Transparencies

Extensive aerospace technology content


9

PPG Aerospace Leading Technologies


Non Chrome Exterior Primer Basecoat Clearcoat System Customized Sealant Solutions Alteos Interactive Window Systems Complex Glass & Plastic Forming Aerocron Electrocoat Next Generation Surface Seal Lightweight Sealants Intelligent Windows

Non Chrome Flexible Primer

Spray Seal Solar Reflective System Improved P-Static Coating Sanding Surfacers Opticor Advanced Transparency Material Single Stage Topcoat Cure on Demand Sealant

Non Chrome Corrosion Inhibitive Sealant Lightweight Conductive Sealant Non Chrome Structural Primer Legend: Coatings Transparencies Sealants

Extensive aerospace technology content


10

PPG Aerospace Distribution & Service


PPG Application Support Center (ASC) Network

ASCs provide high degree of customer service in close proximity to customer locations
11

Aerospace Industry
Boeing/Airbus Jet Deliveries
1,250

Global Airplane Fleet


(Aerospace Aftermarket) 2011 2012 CAGR: U.S./W. Europe = 4% Emerging Regions = 6%

+14% +6%

14,000 12,000 10,000

1,000

750

8,000
500

6,000 4,000

250

2,000 0
2007 2008 2009 2010 2011E 2012P
# of Aircraft

0
# of Aircraft

2008

2009

2010

2011E 2012P

Source: Boeing / Airbus & UBS Estimates

U.S. / W. Europe

Emerging Regions

Aerospace industry expected to continue strong growth trends in both OEM and aftermarket
12

Refinish Coatings Industry


Industry Geographic Mix
(CAGR = 2% - 4%)

Refinish Competitive Landscape

Latin America

Asia Pacific

U.S. & Canada

Local Competitors

PPG

Eastern Europe & Mid-East

Western Europe

Global Competitors #3, 4 & 5

Global Competitor #2

Emerging regions approaching 40% of industry


Source: Company Estimates

Competitive set varies by region

Refinish industry has broad geographic split; Several large global competitors
13

PPG Refinish
PPG Refinish Geographic Mix
Latin America

Business Success Factors

Asia Pacific

Distribution & service Differentiated network


U.S. & Canada

Europe

Leading technologies Water-based coatings Color Global presence

Solid growth in emerging regions with further opportunities

Global leader with broad global footprint; Distribution, technology & service key PPG attributes
14

PPG Refinish
Collision Repair

End-use Mix

Collision

Commercial & LIC

Commercial/Fleet & Light Industrial Coatings (LIC)

15

PPG Refinish Coatings Distribution Model


11 PPG manufacturing facilities

Distributors >5,500
Latin America Asia / Pacific North America

Europe

Body Shops >100,000


Latin America Asia / Pacific North America

Europe

PPG differentiated two-step distribution model provides for high customer service levels
16

PPG Refinish Color


Refinish Customer Desired Criteria
U.S. multi-brand distributor survey feedback
(5 high 1 low)

PPG Color Tools


Sprayed out Variant Chips Computerized Mixing Systems TouchMix RapidMatch Variant Selector

5.0 4.0 3.0 2.0 1.0


Top 3 Criteria Color match Quality/durability Product availability Middle 3 Criteria Ease of use TM service Brand Bottom 3 Criteria Training Discounts Net costs

PPG
Source: Independent Consultant Study

Competitor Avg.

Color critical to customers; PPG leading color tools to aid in body shop productivity
17

PPG Refinish New Technology Adoption


2005
22% CAGR 13% 30%

2010

87%

Water Solvent

70%

Key Water Advantages: Environmental considerations Ease of use / Productivity tools Color consistency / OEM alignment

Global leader in refinish water-based customer adoption; Rapid shift to new, premium technology aided by product performance
18

PPG Refinish Brand Strategy


PPG Brands:
Market Segment Brands Comments Premium products markets more prevalent in developed regions Premium

Mid-Tier / Value

Mid-Tier / Value markets more prevalent in emerging regions

Distinguished brands to address varied market segments


19

PPG Refinish
PPG Geographic Profile

Source: Company Estimates

Strong global presence; solid penetration with further opportunities in emerging regions
20

Refinish Industry
Current Industry Trends
Market Driver
Car Parc Accident Rates Miles Driven
Technology

Global Automotive Fleet


(Refinish Aftermarket) Impact 600,000 500,000 400,000 300,000 200,000 100,000 0 2009
# of Vehicles

Developed Regions

Impact

Emerging Regions

2011 2012 CAGR: U.S./W. Europe = 1% Emerging Regions = 6%

+ = =
High

+ + +
Currently Low/Mid Currently Low

Value Insurance Influence

+ +

+ -

High

2010

2011E

2012P

2013P

U.S. / W. Europe
Source: Company Estimates Source: IHS Global Insights

Emerging Regions

Emerging regions shifting toward developed model; Growth in global automotive fleet
21

Summary
Industries: Multi-national coatings competitors, with some smaller local competition Technology, distribution and service are key success factors and present entry barriers PPG: Strong global businesses (#1 or #2 in each end-use market) with heavy aftermarket mix Leading technologies and distribution/service model Consistent earnings, with capability to counter raw material inflation with cost management and price Outlook: Lower Marine OEM builds Stable end-use markets (Refinish & Protective in developed regions, Marine aftermarket) Strong Aerospace industry growth, supplemented by PPG share gains (e.g., Boeing 787) Continued emerging regions growth (Refinish, Aerospace, Protective)
22

Forward-Looking Statements
Statements contained herein relating to matters that are not historical facts are forward-looking statements reflecting PPGs current view with respect to future events and financial performance. These matters within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, involve risks and uncertainties that may affect PPGs operations, as discussed in PPGs filings with the Securities and Exchange Commission pursuant to Sections 13(a), 13(c) or 15(d) of the Exchange Act, and the rules and regulations promulgated thereunder. Accordingly, many factors could cause actual results to differ materially from the forward-looking statements contained herein. Such factors include global economic conditions, increasing price and product competition by foreign and domestic competitors, fluctuations in cost and availability of raw materials, the ability to maintain favorable supplier relationships and arrangements, difficulties in integrating acquired businesses and achieving expected synergies therefrom, economic and political conditions in international markets, the ability to penetrate existing, developing and emerging foreign and domestic markets, foreign exchange rates and fluctuations in such rates, fluctuations in tax rates, the impact of future legislation, the impact of environmental regulations, unexpected business disruptions, and the unpredictability of existing and possible future litigation, including litigation that could result if the asbestos settlement discussed in PPGs filings with the Securities and Exchange Commission does not become effective. However, it is not possible to predict or identify all such factors. Consequently, while the list of factors presented here and in PPGs Form 10-K for the year ended December 31, 2010 are considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements. Consequences of material differences in results compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on PPGs consolidated financial condition, results of operations or liquidity. All information in this presentation speaks only as of December 5, 2011, and any distribution of this presentation after that date is not intended and will not be construed as updating or confirming such information. PPG undertakes no obligation to update any forward-looking statement. 23