PPG Industries Inc.'s fourth-quarter net income rose 13% on a double-digit sales increase. The supplier of coatings, glass and fiberglass Thursday reported net income of $94 million, or 55 cents a share, compared with $83 million, or 49 cents a share, a year earlier.
The latest results included a charge of $4 million, or two cents a share, to reflect an increase in value of PPG stock related to an asbestos settlement. Excluding the charges, the company's earnings were $98 million, or 57 cents a share.
The latest results were in line with the company's lowered earnings guidance, which ranged between 55 cents and 60 cents a share. In November, PPG had warned that earnings for the quarter would be less than analysts' forecast of 76 cents a share, citing the continued slowdown in overall industrial production and slower-than-expected increases in its commodity chemical prices.
Sales, meanwhile, rose 4.4% to $1.99 billion from $1.91 billion a year earlier.
For the year, PPG swung to a net loss of $69 million, or 41 cents a share, compared with net income of $387 million, or $2.29 a share, in 2001.
Excluding items, the company's 2002 earnings increased 3.9% to $476 million, or $2.80 a share, compared with $458 million, or $2.71 a share, in 2001.
Sales slipped 1.2% to $8.07 billion from $8.17 billion a year earlier.
Later Thursday, Chief Financial Officer William Hernandez said PPG is considering making a $20 million to $30 million contribution to its pension fund, and it will also reduce its year-end equity by $800 million because of a shortfall in pension assets versus liabilities.
"While we are not required to make a contribution to our pension fund, we are considering making a voluntary contribution in the range of $20 to $30 million in 2003," said Mr. Hernandez in a taped message following the release of the company's fourth-quarter results.
The contribution would give the company more flexibility by delaying the time it could be mandated to make a contribution until at least 2006, even if the equity markets don't recover at all, Mr. Hernandez said.
PPG wants to retain that flexibility to avoid distractions from serving customers, funding businesses and continuing to increase dividend payments, he said.
Higher pension costs and retiree benefit costs reduced reported earnings for 2002 by about $120 million, he said. "We continue to estimate that the 2003 impact on reported earnings will be about the same increase, year-over-year," Mr. Hernandez said.
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