PPG says sees no relief from inflationary cost pressures in Q3
"In the quarter, raw material and logistics costs continued to increase, including the impacts of higher oil prices and the availability of transportation. We are working diligently to offset these cost pressures by collaborating with our customers on selling price initiatives, with our pricing in the quarter increasing more than 2 percent year-over-year. In addition, we initiated a new restructuring program in response to a previously announced customer assortment change in our U.S. architectural coatings business and to further offset cost inflation. We expect that this new restructuring program will deliver annualized savings of approximately $85 million upon full implementation. These savings are in addition to the benefits we are realizing from the restructuring program announced in December 2016. Based on these actions, along with our continued focus on operational excellence, we expect the pace of our margin recovery to accelerate in the second half of 2018. As we look ahead, we currently do not anticipate any relief from inflationary cost pressures in the third quarter. We expect aggregate global economic growth to remain positive with end-use market activity comparable to the second quarter, adjusted for traditionally lower seasonal demand. However, uncertainties exist regarding global trade policies, which may create uneven demand by region and in certain industries. Specific to PPG, we expect that the previously announced architectural customer assortment change will lower our third quarter year-over-year sales volume growth rate by between 120 and 150 basis points. We remain confident that our leading-edge technologies and products, which are bringing value to our customers, will facilitate our growth going forward."