PPG Industries Inc., the world’s second-biggest paint maker, said it will cut an additional 2,500 jobs to trim costs because of slowing sales to auto and manufacturing markets.
A paint-making facility in Saultain, France, and other smaller operations will be closed, Pittsburgh-based PPG said today in a statement. That will save about $60 million this year and $140 million in subsequent years, while reducing first- quarter pretax profit by $190 million, or 88 cents a share, the company said. More plants may be closed, helping to reduce earnings by an additional $50 million.
Chief Executive Officer Charles E. Bunch said he is reducing production because of weak demand for coatings used on new cars and appliances. Bunch is eliminating more than 8 percent of the workforce, including the 1,357 jobs cut late last year. PPG joins rivals such as DuPont Co. and Dow Chemical Co. in slashing output amid the global economic slump.
“By implementing this program, not only will we be better able to weather today’s difficult conditions, we will also be a more efficient company coming out of the current economic downturn,” Bunch said in the statement.
Per-share profit in the first quarter will be 10 cents to 15 cents, excluding some costs to restructure company operations and settle a pending asbestos lawsuit, the company said. Profit was expected to be 31 cents a share, the average estimate of 11 analysts surveyed by Bloomberg.
PPG rose $1.43, or 4.4 percent, to $34.34 as of 4:15 p.m. in New York Stock Exchange composite trading. The shares fell 19 percent this year.
The largest maker of paints and coatings is Akzo Nobel NV.
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