Sales were $2.13 billion.
The settlement, announced May 14, would cover all current and future personal injury claims against PPG and Pittsburgh Corning for asbestos products manufactured, distributed or sold by the companies. The settlement would become effective after Pittsburgh Corning's bankruptcy plan of reorganization, incorporating the settlement, is approved by a court order that is no longer subject to appeal.
In the second quarter last year, net income was $155 million, or 92 cents a share, on sales of $2.16 billion. For the first six months of 2002, PPG recorded a net loss of $311 million, or a loss per share of $1.83, including one-time, aftertax charges in the first quarter of $55 million, or 33 cents a share, for restructuring and $9 million, or 5 cents a share, for the cumulative effect of a required accounting change, and the second-quarter charge for the asbestos settlement. Excluding these charges, net income was $248 million, or $1.47 a share. Sales were $4.0 billion.
First-half 2001 net income was $211 million or $1.25 a share, including an aftertax restructuring charge of $71 million. Excluding the charge, net income was $282 million, or $1.67 a share. Sales were $4.3 billion. "The settlement announced two months ago will enable us to put all of our asbestos product claims exposure behind us," said Raymond W. LeBoeuf, chairman and chief executive officer. "Excluding the charge, our strong results in the quarter, particularly record earnings in coatings, reflect a series of actions we took to reduce costs and generate cash beginning in late 2000 in anticipation of the North American recession. As a result, excluding the charge, we have successfully lowered our debt-to-total-capital ratio to 42 percent, which is 6 percentage points lower than a year ago and the lowest it has been in three years "We remain cautious about the second half because of the fragile North American economy resulting from slow job growth, high household debt levels and the potential impact of continued weak stock markets on consumer confidence," LeBoeuf said. "Nevertheless, our focus on generating cash and managing costs will continue to serve us well during this uncertain economic period." Second quarter 2002 earnings included approximately 11 cents a share of higher pension and retiree medical benefits costs, which were partially offset by the required accounting change eliminating goodwill amortization of 5 cents a share.
The coatings segment generated record operating earnings because of lower costs and increased margins. Sales grew 2 percent from the year-ago quarter with contributions from volume gains, currency translation and modest price increases.
Glass sales were down as lower volumes and prices were only partially offset by manufacturing efficiencies and overhead reductions throughout the segment. Chemical sales were flat and earnings declined despite significant growth in specialty chemicals, particularly optical products. Falling commodity chemical prices were only partially offset by volume gains and manufacturing efficiencies in all businesses.