Standard & Poor's Ratings Services said that PPG Industries Inc.'s announcement that its fourth quarter earnings will fall below analysts' forecasts will not affect its ratings on the company.
The current earnings environment is making it difficult for the company to strengthen the key funds from operations to total debt ratio from substandard levels. Moreover, PPG must contend with long-term payments to an asbestos settlement trust once 50%-owned Pittsburgh Corning Corp.'s bankruptcy reorganization plan is approved and is no longer subject to appeal. Still, a major support for the ratings is management's commitment to continue using the company's strong discretionary cash flow to reduce debt in 2003. Any faltering of this debt reduction initiative could lead to a negative adjustment of the rating in the future.