Reconciliation of Revenue and Operating Income from Segments to Consolidated |
Reportable segment net
sales and segment income for the three and six months ended
June 30, 2012 and 2011 were as follows:
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Three Months Ended
June 30 |
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Six Months Ended
June 30 |
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2012 |
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2011 |
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2012 |
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2011 |
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(Millions) |
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Net sales:
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Performance
Coatings
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$ |
1,241 |
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$ |
1,230 |
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$ |
2,391 |
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$ |
2,282 |
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Industrial
Coatings
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1,099 |
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1,075 |
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2,175 |
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2,100 |
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Architectural Coatings -
EMEA
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601 |
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611 |
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1,118 |
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1,082 |
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Optical and Specialty
Materials
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314 |
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326 |
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648 |
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634 |
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Commodity
Chemicals
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427 |
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470 |
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846 |
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889 |
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Glass
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273 |
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274 |
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529 |
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532 |
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Total (a)
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$ |
3,955 |
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$ |
3,986 |
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$ |
7,707 |
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$ |
7,519 |
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Segment income:
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Performance
Coatings
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$ |
204 |
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$ |
204 |
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$ |
364 |
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$ |
343 |
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Industrial
Coatings
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143 |
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115 |
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293 |
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231 |
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Architectural Coatings -
EMEA
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64 |
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50 |
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80 |
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62 |
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Optical and Specialty
Materials
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95 |
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90 |
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204 |
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180 |
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Commodity
Chemicals
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106 |
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106 |
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206 |
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203 |
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Glass
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23 |
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29 |
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31 |
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55 |
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Total
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635 |
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594 |
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1,178 |
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1,074 |
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Legacy items (b)
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(15 |
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(11 |
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(190 |
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(37 |
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Business restructuring
(c)
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— |
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— |
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(208 |
) |
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— |
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Acquisition-related (costs)
gain, net (d)
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— |
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9 |
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(6 |
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9 |
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Costs related to the
separation and merger transaction (e)
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(4 |
) |
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— |
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(4 |
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— |
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Interest expense, net of
interest income
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(41 |
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(44 |
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(82 |
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(87 |
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Other unallocated corporate
expense – net
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(48 |
) |
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(48 |
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(110 |
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(108 |
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Income before income
taxes
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$ |
527 |
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$ |
500 |
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$ |
578 |
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$ |
851 |
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(a) |
Intersegment net sales for
the three and six months ended June 30, 2012 and 2011 were not
material. |
(b) |
Legacy items include
current costs related to former operations of the Company,
including pension and other postretirement benefit costs, certain
charges for legal matters and environmental remediation costs, and
certain charges which are considered to be unusual or non-recurring
including the earnings impact of the proposed asbestos settlement.
Legacy items also include equity earnings from PPG’s
approximate 40 percent investment in the former automotive glass
and services business. The expense for the six months ended
June 30, 2012 includes a pretax charge of $159 million. The
charge relates to continued environmental remediation activities at
legacy chemicals sites, primarily at PPG’s former Jersey
City, N.J. chromium manufacturing plant and associated
sites. |
(c) |
The charge for business
restructuring costs in the six months ended June 30, 2012,
includes charges of $65 million related to the Performance Coatings
segment, $46 million related to the Industrial Coatings segment,
$63 million related to the Architectural Coatings - EMEA segment,
$32 million related to the Optical and Specialty Materials segment
$1 million related to the Commodity Chemicals segment and $1
million related to Corporate. These costs are considered to be
unusual and non-recurring and do not reduce the segment earnings
used to evaluate the performance of the operating
segments. |
(d) |
For the six months ended
June 30, 2012, the expense represents the flow-through cost of
sales of the step up to fair value of inventory acquired from Dyrup
and Colpisa. These costs are considered to be unusual and
non-recurring and do not reduce the segment earnings used to
evaluate the performance of the operating segments. For the three
and six months ended June 30, 2011, represents a net benefit
stemming primarily from a bargain purchase gain reflecting the
excess of the fair value of the net assets acquired over the price
paid for the business, net of the flow-through cost of sales of the
step up to fair value of acquired inventory. |
(e) |
Represents costs incurred
in connection with the announced separation and merger of the
commodity chemicals business. |
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