The full impact of the COVID-19 pandemic on the coatings industry is still not clear. This year’s annual reports were compiled before the virus brought the industry to a halt. Reading through Q1 2020 financial statements the news is not good. The paint and coatings industry will need to reassess their business plans and financial expectations for 2020 and beyond.

PPG reported first quarter 2020 net sales of about $3.4 billion, down approximately 7 percent versus the prior year.

“Our first quarter results reflect a sudden and wide-ranging deterioration in global demand during the month of March and the impacts of the economic shutdown in China during February. As the COVID-19 pandemic spread, we prioritized and remained focused on protecting our people, customers and all of our stakeholders,” said Michael H. McGarry, PPG chairman and chief executive officer. “I could not be more proud of our employees around the world who have worked tirelessly to help keep each other safe and healthy throughout this unprecedented time in the history of our company… We have taken immediate and broad steps to adapt to the current business climate, including decisive cost actions and an increased focus on cash generation and liquidity. These include announced salary reductions for senior leaders, shutdowns of some manufacturing and distribution operations, temporary employee furloughs at the most severely demand-impacted businesses, reduced spending across all businesses and functions, and deferred capital expenditures. In addition, we continued to execute our previously announced restructuring programs, achieving about $20 million of savings in the first quarter. We are accelerating other initiatives and now expect to achieve higher restructuring savings of $80 to $90 million for the full year. We are continuing to assess and manage through the crisis, and will determine if further cost or restructuring actions are warranted.”

AkzoNobel CEO, Thierry Vanlancker released the following statement regarding the complex nature of the situation: “We’re weathering the COVID-19 storm, taking care of our employees while protecting our business. Thank you to everyone at AkzoNobel for working hard to continue serving our customers and provide many essential products for critical industries, while following all necessary health and safety measures.

“Although the pandemic situation forced us to pause key parts of our transformation, our teams have focused on minimizing all discretionary costs, as well as carefully managing cash and working capital. The actions we’ve taken, together with our strong balance sheet, provide a solid platform for AkzoNobel to perform as an industry frontrunner.”