PPG Industries (PPG)

The Global Coatings Footprint

PPG is the diversified global coatings company: architectural paint, coatings sold to manufacturers, and high-specification performance coatings such as aerospace and car refinish, in one portfolio. Unlike Sherwin-Williams it files a full-year price and volume split for the whole group. FY2025 organic sales (excluding currency, acquisitions and disposals) grew 2%, made of +1% volume and +1% selling prices. Reported net sales were flat at $15.88B, with divestitures taking 3% off.

Gross margin was 41.3%, after 40.4% in 2023 and 41.6% in 2024. PPG prints no gross profit line, so the figure is derived, and its cost of sales excludes depreciation and amortisation, which flatters it against peers that include plant depreciation. Segment EBITDA margin was 19.3%; adjusted EBITDA margin, which also carries corporate costs, was 17.3%, down from 18.1% in FY2024.

On 15 April 2026 PPG announced global price increases of up to 20% across paints, coatings and specialty products to offset raw-material, energy and logistics inflation. That is forward evidence of pass-through, beside the FY2025 price contribution.

How the Numbers Read

Price made up half of PPG's organic growth; at Ecolab it was two-thirds (+2% of +3%), and Sherwin-Williams files a split only for its Paint Stores Group.

The gross margin moved 30 bps in FY2025 and stayed within 1.2 points over the three years. Coatings gross margins usually move less than 100 bps a year, so this is a formulator's margin, not a commodity producer's. The pricing power guide explains why a stable gross margin beside a positive price line shows costs being passed on.

Segment margins show the mix. In FY2025 Performance Coatings earned 20.8%, Global Architectural 15.6% and Industrial 13.4%. The gap between the performance and industrial lines mirrors Sherwin-Williams' Paint Stores at 22.5% against its Performance Coatings Group at 13.9%, and the coatings economics guide sets both side by side.

Net debt at the end of FY2025 was 1.9 times trailing adjusted EBITDA ($5.1B on $2,749M), against Sherwin-Williams' 2.4x and Ecolab's 2.0x, each on its own definition.

Valuation Framework

PPG has raised prices to cover its costs and its margin has held, so a business like this is valued with a DCF on a steady margin; a multiple of normalised earnings is a check. Albemarle needs a different method, because the lithium market sets one segment's price. The premium valuation guide explains why EV/EBITDA is a steadier sector comparison than trailing P/E.

Use one EBITDA definition throughout. The adjusted margin, which carries corporate costs, is the closer match to Sherwin-Williams' adjusted 19.6%.

What to Watch in the Financials

The April 2026 increases. Check whether they show up in FY2026 price contribution and gross margin. PPG discloses no lag length, so model the timing as an assumption.

Segment mix. Performance Coatings earned 7.4 points more than Industrial in FY2025, so a shift in mix moves the group margin even if no segment changes.

Key Risks

Construction and manufacturing cycles. Global Architectural and Industrial both depend on building and factory activity. FY2025's small volume gain can reverse if those markets soften.

Portfolio reshaping. Recompute organic growth and segment margins after each divestiture.

Global exposure. A worldwide footprint adds currency swings and uneven regional demand that Sherwin-Williams' North American store model largely avoids.

Corporate costs. The two-point gap between segment and adjusted EBITDA margin in FY2025 is costs outside the segments, and shareholders bear them.