Reportable Segment Information

3 Months Ended

Mar. 31, 2020

Segment Reporting [Abstract]

Reportable Segment Information

Reportable Business Segment Information

PPG is a multinational manufacturer with 9 operating segments (which the Company refers to as “strategic business units”) that are organized based on the Company’s major products lines. The Company’s reportable business segments include the following two segments: Performance Coatings and Industrial Coatings. The operating segments have been aggregated based on economic similarities, the nature of their products, production processes, end-use markets and methods of distribution.

The Performance Coatings reportable business segment is comprised of the automotive refinish coatings, aerospace coatings, architectural coatings – Americas and Asia Pacific, architectural coatings - EMEA, and protective and marine coatings operating segments. This reportable business segment primarily supplies a variety of protective and decorative coatings, sealants and finishes along with paint strippers, stains and related chemicals, as well as transparencies and transparent armor.

The Industrial Coatings reportable business segment is comprised of the automotive OEM coatings, industrial coatings, packaging coatings, and the specialty coatings and materials operating segments. This reportable business segment primarily supplies a variety of protective and decorative coatings and finishes along with adhesives, sealants, metal pretreatment products, optical monomers and coatings, precipitated silicas, and other specialty materials.

Reportable business segment net sales and segment income for the three months ended March 31, 2020 and 2019 were as follows: 

	Three Months Ended March 31
($ in millions)	2020	2019
Net sales:
Performance Coatings	$2,008	$2,108
Industrial Coatings	1,369	1,516
Total	$3,377	$3,624
Segment income:
Performance Coatings	$272	$297
Industrial Coatings	181	218
Total	$453	$515
Corporate	(60)	(47)
Interest expense, net of interest income	(23)	(25)
Increase in allowance for doubtful accounts related to COVID-19	(30)	—
Business restructuring-related costs, net (a)	(13)	(3)
Environmental remediation charges	(8)	(10)
Acquisition-related costs (b)	—	(7)
Litigation matters	—	(4)
Income before income taxes	$319	$419

(a)Included in business restructuring-related costs, net are business restructuring charges, accelerated depreciation of certain assets and other related costs, offset by releases related to previously approved programs.

(b)Acquisition-related costs include advisory, legal, accounting, valuation, and other professional or consulting fees incurred to effect acquisitions. These costs are included in Selling, general and administrative expense in the condensed consolidated statement of income. Acquisition-related costs also include the impact for the step up to fair value of inventory acquired in certain acquisitions which are included in Cost of Sales, exclusive of depreciation and amortization in the condensed consolidated statement of income.