PPG Industries Inc (PPG) 2023 Q3 法說會逐字稿

Good morning. My name is Emily, and I'll be your conference operator today. At this time, I would like to welcome everyone to the third quarter PPG Earnings Conference Call. (Operator Instructions) Thank you.

早安.我叫艾米麗，今天我將擔任你們的會議操作員。現在，我歡迎大家參加 PPG 第三季財報電話會議。 （操作員說明）謝謝。

I would now like to turn the conference over to John Bruno, Vice President of Investor Relations. Please go ahead, sir.

現在我想將會議交給投資者關係副總裁約翰布魯諾 (John Bruno)。請繼續，先生。

Thank you, Emily, and good morning, everyone. We appreciate your interest in PPG, and welcome you to our third quarter 2023 financial results conference call. Joining me on the call from PPG are Tim Knavish, Chairman and Chief Executive Officer; and Vince Morales, Senior Vice President and Chief Financial Officer.

謝謝你，艾米麗，大家早安。我們感謝您對 PPG 的興趣，並歡迎您參加我們的 2023 年第三季財務業績電話會議。與我一起參加 PPG 電話會議的還有董事長兼執行長 Tim Knavish；以及高級副總裁兼財務長文斯莫拉萊斯 (Vince Morales)。

Our comments relate to the financial information released after U.S. equity markets closed on Wednesday, October 18, 2023. We have posted detailed commentary and accompanying presentation slides on the Investor Center of our website, ppg.com. The slides are also available on the webcast site for this call and provide additional support to the opening comments Tim will make shortly. Following management's perspective on the company's results for the quarter, we will move to a Q&A session.

我們的評論涉及 2023 年 10 月 18 日星期三美國股市收盤後發布的財務資訊。我們已在我們網站 ppg.com 的投資者中心發布了詳細評論和隨附的演示幻燈片。這些幻燈片也可在本次電話會議的網路廣播網站上獲取，並為蒂姆很快將發表的開場評論提供額外支持。在管理層對公司本季業績的看法之後，我們將進入問答環節。

Both the prepared commentary and the discussion during this call may contain forward-looking statements, reflecting the company's current view of the future events and their potential effect on PPG's operating and financial performance. These statements involve uncertainties and risks, which may cause actual results to differ. The company is under no obligation to provide subsequent updates to these forward-looking statements.

本次電話會議期間準備的評論和討論都可能包含前瞻性陳述，反映了公司當前對未來事件及其對 PPG 營運和財務表現的潛在影響的看法。這些陳述涉及不確定性和風險，可能導致實際結果有所不同。該公司沒有義務提供這些前瞻性陳述的後續更新。

The presentation also contains certain non-GAAP financial measures. The company has provided in the appendix of the presentation materials, which are available on our website, reconciliations of these non-GAAP financial measures to the most directly comparable GAAP financial measures. For additional information, please refer to PPG's filings with the SEC.

此簡報也包含某些非公認會計準則財務指標。該公司在我們網站上提供的簡報資料附錄中提供了這些非公認會計原則財務指標與最直接可比較的公認會計原則財務指標的調節表。如需了解更多信息，請參閱 PPG 向 SEC 提交的文件。

Now let me introduce PPG Chairman and CEO, Tim Knavish.

現在讓我介紹 PPG 董事長兼執行長 Tim Knavish。

Thank you, John, and good morning, everyone. Welcome to our third quarter 2023 earnings call. I'd like to start by providing a few highlights on our third quarter record financial performance, and then I'll move to our outlook.

謝謝約翰，大家早安。歡迎參加我們的 2023 年第三季財報電話會議。首先，我想介紹一下我們第三季創紀錄的財務業績的一些亮點，然後我將談談我們的展望。

In the third quarter, the PPG team continued to deliver strong financial results, including sales of $4.6 billion and adjusted earnings per diluted share of $2.07, both records for our third quarter. Our year-to-date cash generation is over $1.5 billion, which is also a record on a year-to-date basis. Our adjusted EPS of $2.07 was 25% higher year-over-year. We benefited from several nonrecurring favorable discrete income tax items, which added $0.10 on versus our beginning of quarter guidance. Excluding this favorable tax benefit this year, our EPS was still about 20% higher than the third quarter of 2022. We're on pace to finish 2023 with all-time record adjusted earnings per share. As we communicated at the beginning of the year, we had a high degree of conviction that our global business portfolio mix would prove resilient this year and as we had anticipated a challenging economic environment. That has clearly played out through the first 9 months of the year.

第三季度，PPG 團隊繼續取得強勁的財務業績，包括 46 億美元的銷售額和 2.07 美元的調整後每股攤薄收益，這兩項記錄均創下了第三季度的記錄。我們今年迄今的現金產生量超過 15 億美元，這也是今年迄今的記錄。調整後每股收益為 2.07 美元，年增 25%。我們受益於多項非經常性優惠離散所得稅項目，與我們季度初的指導相比增加了 0.10 美元。排除今年這項有利的稅收優惠，我們的每股盈餘仍比 2022 年第三季高出約 20%。我們預計在 2023 年結束時實現創紀錄的調整後每股收益。正如我們在年初所傳達的那樣，我們堅信我們的全球業務組合今年將表現出彈性，而且我們已經預料到了充滿挑戰的經濟環境。今年前 9 個月明顯體現了這一點。

Our results were supported by good growth trends and strong execution in several of our leading and technology advantaged businesses, which resulted in record third quarter sales in the aerospace, automotive OEM, automotive refinish and PPG Comex Coatings businesses. Our third quarter sales volumes were impacted by soft global industrial production, which worsened in many countries during the quarter and also by cautious consumer buying patterns in Europe, China and other parts of the world.

我們的業績得益於多項領先和技術優勢業務的良好成長趨勢和強勁執行力，導致航空航太、汽車 OEM、汽車修補漆和 PPG Comex 塗料業務第三季銷售額創下歷史新高。我們第三季的銷售量受到全球工業生產疲軟的影響，許多國家的工業生產在本季惡化，同時也受到歐洲、中國和世界其他地區謹慎的消費者購買模式的影響。

The selling price increases we implemented earlier this year, primarily in the Performance Coatings segment drove a solid 3% increase for the quarter. We expect selling prices to remain positive in the fourth quarter of 2023, albeit a little lower sequentially as we continue to see prior price increases reach their anniversaries.

我們今年稍早實施的銷售價格上漲（主要是在高性能塗料領域）推動了本季 3% 的穩定成長。我們預計 2023 年第四季的銷售價格將保持正值，儘管環比略有下降，因為我們繼續看到之前的價格上漲已達到週年紀念日。

Throughout 2023, a key priority for our team has been restoring our margin profile. The third quarter marked the fourth consecutive quarter of year-over-year operating segment margin improvement with aggregate segment margins up 260 basis points. This led to both of our operating segments delivering at least 25% earnings growth in the third quarter with the Industrial Coatings segment also delivering higher sequential margins.

2023 年全年，我們團隊的首要任務是恢復利潤狀況。第三季是營運部門利潤率連續第四個季度同比改善，部門總利潤率成長了 260 個基點。這導致我們的兩個營運部門在第三季度實現了至少 25% 的獲利成長，其中工業塗料部門也實現了更高的連續利潤率。

Another key focus remains strong cash generation. Throughout the first 3 quarters of the year, the $1.5 billion operating cash generation that we delivered is up more than $1.1 billion over a year -- on a year-over-year basis. In addition to our strong earnings performance, we significantly reduced working capital in total by about $300 million, mainly driven by lower inventories, contributing to the robust operating cash flow generation.

另一個重點仍然是強勁的現金產生。今年前 3 季度，我們實現了 15 億美元的營運現金生成，年增超過 11 億美元。除了強勁的獲利表現外，我們還大幅減少了總營運資本約 3 億美元，這主要是由於庫存減少，從而促進了強勁的營運現金流產生。

We use part of this cash to reduce our higher variable cost debt during the quarter and despite significant increases in market interest rates, our net interest expense declined year-over-year. As we look to continue our momentum into the fourth quarter, we are laser-focused on achieving top line sales and earnings growth in 2024 and beyond. I'd like to highlight a few items that we expect will support growth in 2024.

我們使用部分現金來減少本季較高的變動成本債務，儘管市場利率大幅上升，但我們的淨利息支出較去年同期下降。當我們希望在第四季度繼續保持這一勢頭時，我們將專注於在 2024 年及以後實現營收和獲利成長。我想強調一些我們預計將支持 2024 年成長的項目。

First, as I communicated at our CEO investor briefing in May, we are working on a number of commercial growth opportunities and several of these initiatives have been launched and are now gaining momentum. For example, we are pleased with the progress being made supporting our customers' rapid growth of electric vehicles in China with PPG technology advantage products and services. We are well positioned with the leading electric vehicle producers and continue to gain share as the production rate increases each quarter, including strong EV export activity out of China.

首先，正如我在 5 月的執行長投資者簡報會上所傳達的那樣，我們正在研究許多商業成長機會，其中一些舉措已經啟動，目前正在獲得動力。例如，我們很高興透過PPG技術優勢產品和服務支援客戶在中國電動車的快速成長所取得的進展。我們在領先的電動車生產商中處於有利地位，隨著每季生產力的提高，包括中國電動車出口活動的強勁，我們將繼續獲得份額。

In the past few years, we've invested to enhance our manufacturing and technology capabilities around powder coatings products with prudent capacity additions. This year, we're realizing the benefit of these investments as our powder coating related sales have increased about 15% compared to last year. We're winning new business every quarter and supporting our customers' sustainability and productivity objectives, and we expect powder to outgrow the market for a number of years to come.

在過去的幾年中，我們投資加強了粉末塗料產品的製造和技術能力，並審慎地增加了產能。今年，我們意識到這些投資的好處，因為我們的粉末塗料相關銷售額比去年增長了約 15%。我們每季都會贏得新業務，並支持客戶的永續發展和生產力目標，我們預計粉末的成長將在未來幾年超過市場。

Another commercial growth initiatives supporting our growth in 2024 and beyond involves expanding the breadth of products being sold through the PPG Comex distribution network. Our world-class network of over 5,100 concessionaire locations in Mexico has consistently outgrown the regional architectural market and provides customers with their preferred paint brand and products in Mexico. We are very excited about the opportunity to now leverage this distribution network to support customer needs for protective, refinish, traffic and light industrial products.

支持我們在 2024 年及以後發展的另一項商業成長計劃包括擴大透過 PPG Comex 分銷網絡銷售的產品範圍。我們在墨西哥擁有超過 5,100 個特​​許經營點的世界級網絡，其規模不斷擴大，超出了區域建築市場的範圍，並為墨西哥客戶提供了他們首選的塗料品牌和產品。我們非常高興現在有機會利用這個分銷網絡來滿足客戶對防護、修補、交通和輕工業產品的需求。

So these focus areas are part of a larger basket of commercial initiatives that will support our previously communicated organic sales growth targets. I will provide periodic updates on these initiatives in subsequent quarters.

因此，這些重點領域是更大的商業計劃的一部分，這些計劃將支持我們先前傳達的有機銷售成長目標。我將在接下來的幾個季度定期提供這些舉措的最新情況。

A legacy of PPG and another [canvass] for earnings growth going forward is strong cash generation and value-creating capital deployment. I plan to continue to abide by our hallmark of prudent balance sheet management and financial flexibility, supported by strong free cash flow of our business portfolio. Year-to-date, we have delivered record cash flow from operations, and we have utilized this to deliver on our prior commitment to repay some variable rate debt, driving down our interest expense. In the fourth quarter, we will likely incorporate some additional debt repayment, but will also likely complete some share repurchases, reflecting our strong cash position and seasonality of our cash flows.

PPG 的遺產和未來獲利成長的另一個[畫布]是強大的現金產生和創造價值的資本部署。我計劃繼續遵守我們審慎的資產負債表管理和財務靈活性的標誌，並得到我們業務組合強大的自由現金流的支持。今年迄今為止，我們的營運現金流量創歷史新高，我們利用這一點兌現了我們先前承諾的償還部分可變利率債務的承諾，從而降低了我們的利息支出。在第四季度，我們可能會進行一些額外的債務償還，但也可能完成一些股票回購，這反映了我們強勁的現金狀況和現金流的季節性。

In addition to the sales and earnings growth initiatives, one other strategic initiative that we've been actioning relates to some selective pruning of our business portfolio. As a reminder, we've recently divested a number of smaller assets, including most of our coatings businesses in Africa, a noncore business that we acquired with the Ennis-Flint acquisition and have exited certain product categories in some businesses.

除了銷售和獲利成長計劃之外，我們一直在採取的另一項策略計劃涉及對我們的業務組合進行一些選擇性修剪。提醒一下，我們最近剝離了一些較小的資產，包括我們在非洲的大部分塗料業務，這是我們透過收購 Ennis-Flint 獲得的非核心業務，並退出了一些業務的某些產品類別。

In addition, this week, we announced the divestiture of certain international operations in our Traffic Solutions business. These actions allow us to channel our growth bandwidth in areas that are meaningful and where we have winning advantages, including technology, brands and customer relationships. We will continue to actively assess each of our businesses and product lines to ensure they're consistent with our growth objectives and that they meet our financial objectives, and they earn the right to remain in the portfolio.

此外，本週，我們也宣布剝離交通解決方案業務中的某些國際業務。這些行動使我們能夠將成長頻寬引導到有意義且具有致勝優勢的領域，包括技術、品牌和客戶關係。我們將繼續積極評估我們的每項業務和產品線，以確保它們符合我們的成長目標，滿足我們的財務目標，並贏得留在投資組合中的權利。

Now I'll comment on our fourth quarter outlook. We expect several of the businesses in our Performance Coatings segment to deliver organic growth, including continued solid growth in our PPG Comex and aerospace businesses, we do expect slowing in U.S. architectural coatings demand stemming from multi-decade highs in interest rates and lowering housing turnover. While we expect our automotive OEM business to grow in the fourth quarter in most regions, other portions of our Industrial Coatings segment will be challenged due to sluggish overall global industrial production.

現在我將評論我們第四季的前景。我們預計高性能塗料部門的多項業務將實現有機成長，包括 PPG Comex 和航空航天業務的持續穩健增長，我們確實預計美國建築塗料需求將因數十年來的高利率和住房週轉率下降而放緩。雖然我們預計大多數地區的汽車 OEM 業務將在第四季度實現成長，但由於全球工業生產整體低迷，我們的工業塗料業務的其他部分將面臨挑戰。

While there are many variables in uncertain timing, we have prudently included an estimated financial impact of the UAW strike of a few cents of EPS in our fourth quarter financial guidance. As we have communicated in the past, our regional sales to the OEMs impacted by the strike are low single-digit percentage of our total company sales. Also, we sell to other OEM customers in the region not impacted by the strikes. And given the historically low dealer inventory levels, we expect any lost volume will be made up in subsequent quarters. Certain other sales volume headwinds are beginning to abate as we expect China is at or approaching trough levels. Also, we do not expect destocking to be a significant issue in our packaging coatings end-use market in 2024.

儘管時間不確定性存在許多變數，但我們在第四季度財務指引中謹慎地納入了 UAW 罷工對每股收益幾美分的估計財務影響。正如我們過去所傳達的那樣，我們對受罷工影響的原始設備製造商的區域銷售占公司總銷售額的百分比很低。此外，我們也向該地區未受罷工影響的其他 OEM 客戶銷售產品。鑑於經銷商庫存水準處於歷史低位，我們預計任何銷售損失都將在接下來的幾季得到彌補。由於我們預期中國正處於或接近低谷水平，某些其他銷售阻力正開始減弱。此外，我們預計 2024 年去庫存不會成為我們包裝塗料最終用途市場的重大問題。

With regard to commodity raw materials, supply has normalized to pre-pandemic levels, and we expect to continue to realize benefits from moderating input costs. We will maintain emphasis on diligently managing our costs and expect to make more progress on our previously announced restructuring initiatives.

就大宗商品原料而言，供應已恢復至疫情前水平，我們預計將繼續從投入成本下降中獲益。我們將繼續重視努力管理成本，並期望在先前宣布的重組計劃上取得更多進展。

In addition, we are beginning to deliver manufacturing productivity gains, which are supported by a more stable supply chain and customer order pattern. Despite the challenging environment, we've raised full year earnings guidance and expect fourth quarter aggregate segment margins will be higher on a year-over-year basis for the fifth consecutive quarter.

此外，我們開始實現製造生產力的提高，這得到了更穩定的供應鏈和客戶訂單模式的支持。儘管環境充滿挑戰，我們還是上調了全年盈利指引，並預計第四季度的總細分利潤率將連續第五個季度同比上升。

Lastly, I'd like to thank our team members around the world who live our purpose every day to protect and beautify the world. Thanks to their hard work and dedication, we're able to support our customers and help them solve their biggest challenges. I remain confident in our team's ability to make it happen.

最後，我要感謝我們世界各地的團隊成員，他們每天都在實踐我們的目標，保護和美化世界。由於他們的辛勤工作和奉獻精神，我們能夠為客戶提供支援並幫助他們解決最大的挑戰。我對我們團隊實現這一目標的能力仍然充滿信心。

Thank you for your continued confidence in PPG. This concludes our prepared remarks. And now would you please open the line for questions.

感謝您對 PPG 的持續信任。我們準備好的演講到此結束。現在請您開通提問專線。

(Operator Instructions) Your first question today comes from the line of John McNulty with BMO.

（操作員說明）您今天的第一個問題來自 BMO 的 John McNulty。

Congrats on a solid set of results. I wanted to ask on the raw material environment. We've seen a decent jump up in oil recently. I guess, can you speak to how we should be thinking about raws moving from 3Q to 4Q, and if you expect those to be down? And how much on a sequential basis, do you expect them to be down? And then, I guess, how should we be thinking about that as it rolls through into 2024?

祝賀取得了一系列可靠的結果。我想問一下原料環境。最近我們看到石油價格大幅上漲。我想，您能否談談我們應該如何考慮原始數據從第三季度轉移到第四季度，以及您是否預計原始數據會下降？您預計它們會連續下降多少？然後，我想，隨著 2024 年的到來，我們該如何思考這個問題？

John, thanks for the question. So let me talk about oil first. Obviously, oil is going to produce some impact on solvents for us. But really, our raw material basket is much more dependent upon supply demand. Where several steps removed from oil with the exception of solvents. So that's a much bigger impact for us. And then the total impact for Q4, we saw high single-digit deflation in Q3. We expect high single digits in Q4, and we expect further deflation as we move into 2024 on a broader basis.

約翰，謝謝你的提問。那我先談談石油。顯然，石油將對我們的溶劑產生一些影響。但實際上，我們的原料籃子更取決於供應需求。除溶劑外，經過幾個步驟從油中去除。所以這對我們來說影響更大。然後是對第四季度的整體影響，我們在第三季度看到了高個位數的通貨緊縮。我們預計第四季度將出現高個位數數字，隨著進入 2024 年，我們預計通縮將在更廣泛的基礎上進一步出現。

So John, this is Vince. Let me just add a little bit to what Tim was saying. So the supply-demand environment, as we pointed out, I think, in our prepared remarks and the press release, we have seen sufficient -- more than sufficient supply. That's typically a bigger driver of our input costs than just the feedstocks. And right now and heading into a seasonally lower fourth quarter, we expect that to continue. So I would expect the increase in -- rise in oil to have no impact other than solvents on our fourth quarter. And as we head into next year, start negotiating with our suppliers in Q4 -- late Q4, and the tone from our suppliers has been more volume-driven as opposed to price-driven.

約翰，這是文斯。讓我對蒂姆所說的內容補充一點。因此，正如我們在準備好的演講和新聞稿中所指出的那樣，我認為供需環境是充足的——不僅僅是充足的供應。這通常是我們投入成本的一個更大的驅動因素，而不僅僅是原料。目前，進入季節性較低的第四季度，我們預計這種情況將持續下去。因此，我預計石油價格的上漲除了溶劑之外不會對我們第四季產生任何影響。當我們進入明年時，在第四季末開始與我們的供應商進行談判，我們供應商的基調更多是數量驅動，而不是價格驅動。

Your next question comes from the line of Duffy Fischer with Goldman Sachs.

您的下一個問題來自高盛的達菲費雪 (Duffy Fischer)。

Just a question around the delta between Industrial and Performance. So Industrial margins were up 300 bps year-over-year and Performance was up a little under 2.5%. But Industrial trailed on volumes by 4% and trailed on dollar pricing by 3%. So it doesn't look like there were any leverage from price and volume on the margin spread. So what's underlying that gap? And why was industrial able to do better than performance even though it didn't on price or volume?

只是一個關於工業和性能之間增量的問題。因此，工業利潤率年增了 300 個基點，業績成長略低於 2.5%。但工業品銷售落後 4%，美元定價落後 3%。因此，價格和交易量對保證金利差似乎沒有任何槓桿作用。那麼這種差距的根本原因是什麼呢？為什麼工業能夠做得比性能更好，儘管它在價格或數量上沒有做到這一點？

Yes. Duffy, this is Vince. Let me start on it and Tim add some color, obviously. But if you look at Q3 alone, the improvement year-over-year in Industrial is larger but the Performance segment improved quicker. So we got pricing, we typically have pricing in Performance quicker. So we had price injected into our businesses quicker in Performance. We lagged that with Industrial, and we were still getting price in Industrial and certainly in 2022 in the back half. So on a year-over-year delta, you're correct, the Industrial segment looks better, but Performance just recovered earlier. Tim, do you want to add?

是的。達菲，這是文斯。讓我開始吧，蒂姆顯然會添加一些顏色。但如果單獨看第三季度，工業領域的年比改善更大，但績效領域的改善更快。所以我們得到了定價，我們通常會更快地對性能進行定價。因此，我們將價格更快地註入到我們的業務績效中。我們在工業方面落後了，而且我們仍在獲得工業方面的價格，當然在 2022 年下半年。因此，就同比增量而言，你是對的，工業部門看起來更好，但業績剛剛恢復得更早。提姆，你想補充一下嗎？

Yes. I think it's spot on, and I think both segments will see continued year-over-year margin improvement, depending upon the addition of manufacturing -- productivity improvements that I mentioned in my opening comments. And of course, as we get into seasonality, more volume will help that step change in margins as well.

是的。我認為這是正確的，而且我認為這兩個細分市場的利潤率都將持續同比改善，這取決於我在開場評論中提到的製造業的增加——生產力的提高。當然，隨著我們進入季節性，更多的銷售也將有助於利潤率的逐步變化。

Your next question comes from the line of Ghansham Panjabi with Baird.

你的下一個問題來自 Ghansham Panjabi 和 Baird 的對話。

As we kind of think about 2023, two of your higher-margin verticals, including aerospace and Comex had delivered on outsized growth and obviously, margin conversion as well. How should we think about the sustainability of these growth verticals into 2024? And just more broadly, what is your base case for volumes for each of the two operating segments next year?

當我們思考 2023 年時，包括航空航太和 Comex 在內的兩個利潤率較高的垂直行業都實現了大幅增長，顯然也實現了利潤率轉換。我們應該如何考慮這些垂直成長到 2024 年的可持續性？更廣泛地說，明年兩個營運部門各自銷售的基本情況是什麼？

Yes, Ghansham. Thanks for the question. Aerospace, you should expect that to continue not only for '24, but multiple years going forward. We have just such a unique technology advantaged position in that industry across commercial new build, commercial aftermarket, general aviation, military. And all of those are strong and projected to be strong for the foreseeable future. We've got a tremendous backlog. Everything we make, we can sell. So that you should feel very good about we do for coming quarters and years.

是的，甘沙姆。謝謝你的提問。在航空航太領域，您應該預期這種情況不僅會持續到 24 年，而且還會持續很多年。我們在商業新建、商業售後市場、通用航空、軍事等產業中擁有如此獨特的技術優勢地位。所有這些都很強大，並且預計在可預見的未來也會很強大。我們有大量的積壓。我們生產的所有東西都可以出售。因此，您應該對我們未來幾季和幾年的工作感到非常滿意。

Likewise, with PPG Comex. I think this was the 13th quarter in a row of record performance. There's nothing to say we won't have 14th, 15th and beyond. In my opening comments, I mentioned and back in May at the CEO briefing, I mentioned that while we will continue to gain share in the conventional architectural business. We're now focused on kind of our next chapter of accelerated growth in PPG Comex and that's using our world-class distribution network to sell refinish coatings, traffic, industrial protective and those are all up and running. So you should feel really good about those two businesses continuing record-breaking performance, and we certainly do.

PPG Comex 也是如此。我認為這是連續第 13 個季度創紀錄的業績。沒有什麼好說的，我們不會有第 14 名、第 15 名以及更高的成績。在我的開場白中，我提到過，並在 5 月的執行長簡報會上提到，雖然我們將繼續在傳統建築業務中獲得份額。我們現在專注於 PPG Comex 加速成長的下一個篇章，即利用我們世界一流的分銷網絡來銷售修補塗料、交通、工業防護，而這些都已啟動並運行。因此，您應該對這兩家企業持續創紀錄的業績感到非常滿意，我們當然也這樣做。

On an overall volume basis, I'm confident that we're going to swing to overall positive volume in 2024. And based on a number of green shoots that we're seeing throughout our portfolio.

就整體銷售而言，我相信我們將在 2024 年實現整體正銷量。並且基於我們在整個投資組合中看到的一些萌芽。

And Ghansham, if I could add just to those green shoots. So we are seeing Europe, in our opinion, is troughing especially for our business mix. We were essentially flat in Q3 in European volume across our portfolio. We do expect growth to resume in China, albeit at a lower level. Those are two pieces of our -- two big pieces of our portfolio geographically. And as Tim mentioned, Mexico, we expect to have outsized growth relative to other regions. And then the other business, as Tim mentioned, I would agree with, but I would also add that we do -- we are picking up share in our refinish business based on some of the technologies that we talked about in May.

還有甘沙姆（Ghansham），如果我能補充一下這些新芽的話。因此，我們認為歐洲正在經歷低谷，尤其是我們的業務組合。第三季度，我們整個投資組合的歐洲交易量基本上持平。我們確實預計中國將恢復成長，儘管水準較低。從地理上看，這是我們投資組合中的兩大塊。正如蒂姆所提到的，我們預計墨西哥相對於其他地區會有大幅成長。然後，正如蒂姆所提到的，我同意其他業務，但我還要補充一點，我們確實這樣做 - 我們正在根據我們五月份討論的一些技術來提高修補漆業務的份額。

Your next question comes from the line of Christopher Parkinson with Mizuho.

你的下一個問題來自克里斯多福·帕金森和瑞穗的對話。

Tim, you've spoken a lot about kind of refocusing on R&D and just further positioning PPG to outgrow some of its respect to end markets. New products, new technologies has been literally just mentioned one. Once we're through this macro [may hammer] however you want to characterize it, what's your level in degree of confidence that you will, in fact, be able to outgrow certain markets? And where are you ultimately the most enthusiastic?

提姆，您已經談到了很多關於重新關注研發的問題，以及進一步定位 PPG 以超越其對終端市場的一些尊重。新產品、新技術只是字面上提到的一項。一旦我們經歷了這個宏觀[可能會錘擊]，無論你想如何描述它，你對自己實際上能夠超越某些市場的信心程度是多少？您最終最熱情的地方在哪裡？

Yes. Chris, thanks for the question. I like how you described the macro. The way I'm thinking about the broader kind of sequential that you should expect to see from us. Most of '23, you heard me say many times, laser-focused on market recovery. We've made progress there. I think the next phase, I would call mostly focused on recovery growth in some of our stronger portfolio segments. But while all of that is happening, we have been shifting those focus in investment areas that you alluded to in -- I would say innovation areas, not just classic R&D because some of that innovation is inside the can and some of that innovation is outside the can.

是的。克里斯，謝謝你的提問。我喜歡你對宏的描述。我正在思考您應該從我們這裡看到的更廣泛的順序的方式。你聽我說過很多次，23 年的大部分時間都專注於市場復甦。我們在那裡取得了進展。我認為下一階段主要關注我們一些更強大的投資組合領域的復甦成長。但是，儘管所有這一切都在發生，但我們一直在將重點轉移到您提到的投資領域——我想說的是創新領域，而不僅僅是經典的研發領域，因為有些創新是在罐內，有些創新是在罐外。罐頭。

And we're starting to see progress in a number of those areas, which is some of the green shoots and confidence that I have on go forward. From a sustainability standpoint, I look at our marine M&R business. We're up 20% this year. And a lot of that is driven by sustainable products for reducing friction on the hull of ships, and we're getting tremendous pull and we expect that to grow significantly in '24 and beyond.

我們開始在其中一些領域看到進展，這是我前進的一些萌芽和信心。從永續發展的角度來看，我審視了我們的海洋 M&R 業務。今年我們上漲了 20%。其中很大一部分是由減少船體摩擦的可持續產品推動的，我們正在獲得巨大的推動力，我們預計這一推動力將在 24 年及以後顯著增長。

Vince mentioned in Chancey Hagerty's business, some of the digital innovations that we've invested in and continue to invest in are really starting to gain not only momentum with our existing customers, but share winning momentum. By the end of this year, we'll have 2,000 MOONWALKs in place. About 1/3 of those are share gain. You'll recall back in May, Chancey and his team demonstrated the broader PPG LINQ digital ecosystem to help body shops be more productive. Even though we're only 9 months in, we've got 7,000 shops lined up for PPG LINQ paying their subscriptions and starting to improve their own shops and we're still very early days. And share gain momentum on PPG LINQ is starting to pick up.

Vince 在 Chancey Hagerty 的業務中提到，我們已經投資並繼續投資的一些數位創新確實開始不僅與我們現有的客戶一起獲得動力，而且還分享了獲勝的動力。到今年年底，我們將擁有 2,000 個 MOONWALK。其中約 1/3 是股票收益。您可能還記得五月份，Chancey 和他的團隊示範了更廣泛的 PPG LINQ 數位生態系統，以幫助車身修理廠提高生產效率。儘管我們只推出了 9 個月，但我們已經有 7,000 家商店排隊等待 PPG LINQ 支付訂閱費用並開始改進自己的商店，而且我們還處於早期階段。 PPG LINQ 的份額成長動能開始增強。

EVs, 25% every car produced in China now is EV. We are winning share with the EV producers and we are growing content per vehicle on EVs. So a lot of the things we talked about are starting -- they're moving from incubation phase to implementation and execution phase. So I'm highly confident, Chris, that the things that we've picked as needle-moving investments for our future are going to do just that and move the needle in a positive direction.

電動車，目前中國生產的每輛汽車中有 25% 是電動車。我們正在贏得電動車製造商的份額，並且我們正在增加電動車每輛車的內容。因此，我們談論的很多事情正在開始——它們正在從孵化階段轉向實施和執行階段。因此，克里斯，我非常有信心，我們為未來選擇的那些對未來具有重大影響的投資將起到這一作用，並朝著積極的方向發展。

Your next question comes from the line of Michael Leithead of Barclays.

你的下一個問題來自巴克萊銀行的邁克爾·萊特黑德（Michael Leithead）。

Question for Vince on cash flow. It's been quite strong this year. You've talked a bit about 4Q deployment opportunities. But just what's the early read for the best opportunities to deploy cash in '24? And just how should we think about pick back up potentially in buyback sort of factoring into the EPS growth algorithm next year?

問文斯關於現金流的問題。今年的勢頭相當強勁。您已經談到了第四季度的部署機會。但是，關於 24 年部署現金的最佳機會的早期解讀是什麼？我們該如何考慮明年每股收益成長演算法中回購的潛在回升？

Yes, again, just to reiterate, again, record Q3 year-to-date cash flow, about $1.5 billion. If you look at our net debt, we're down $700 million to $800 million year-over-year or versus the end of the year. Tim mentioned that we have some more debt coming due in 2024. We're going to pay some of that early to get the interest rate carry into our EPS. But we have $600 million of debt coming due over the next 12 years -- 12 months, excuse me. And again, some of that's -- we have -- we can prepay it early, which we'll take advantage of.

是的，再次重申，今年第三季迄今的現金流創紀錄，約 15 億美元。如果你看看我們的淨債務，你會發現我們比去年同期或與年底相比減少了 7 億至 8 億美元。提姆提到，我們還有更多債務將於 2024 年到期。我們將提前支付其中一些債務，以便將利率計入我們的每股盈餘。但我們有 6 億美元的債務將在未來 12 年（12 個月）內到期，對不起。再說一遍，其中一些——我們有——我們可以提前預付，我們會利用這一點。

And we are going to do some level of share repo in Q4. And we're not going to itemize that in terms of size, but we'll look at our cash position and we'll look at the cash flow and typically our strongest quarter of the year. We'll give more guidance on 2024 in January. Again, we do have expect -- again continue strong cash flow in 2024. Our earnings growth, supporting that as well as we're still carrying several hundred million dollars of excess inventory as we continue to -- we made good progress on working that down in Q2 and Q3, but we still have a couple of hundred million dollars we want to work down over the next 6 months or so. So that will help our cash flow next year. But we'll give more cash and financial guidance in January.

我們將在第四季進行一定程度的股票回購。我們不會逐項列出規模，但我們會看看我們的現金狀況，我們會看看現金流，通常是我們一年中最強勁的季度。我們將在 1 月份提供有關 2024 年的更多指導。再次，我們確實預計 - 2024 年將繼續保持強勁的現金流。我們的盈利增長將支持這一點，並且我們仍然持有數億美元的過剩庫存，因為我們將繼續 - 我們在這方面取得了良好進展第二季和第三季有所下降，但我們仍然希望在未來6 個月左右的時間內減少幾億美元。這將有助於我們明年的現金流。但我們將在一月份提供更多現金和財務指導。

Your next question comes from the line of Vincent Andrews with Morgan Stanley.

你的下一個問題來自摩根士丹利的文森安德魯斯。

I believe there were some comments in the prepared remarks in U.S. refinish about some negative volume. It's a function of some customer issues. Could you just give a little more detail on those? And whether they're going to persist into the fourth quarter? Or it was just unique to the third quarter?

我相信美國修補漆準備好的評論中有一些關於一些負量的評論。這是一些客戶問題的函數。能否提供更多細節？他們是否會堅持到第四季？還是這只是第三季獨有的？

Yes. Vincent, it's Tim. Thanks for the question. So to the earlier point, we are winning share in U.S. refinish. We are winning share largely driven by our digital ecosystem technology. So -- and we're laser-focused on the body shop level because that's ultimately the end customer. That's where our products get consumed. Because of the 2-step distribution in this business, the actual sales we book are to the distributors. And they -- especially in a high interest rate environment, they fluctuate their inventories up and down. So we look at it over a multi-quarter basis. But we're confident, based on our net body shop wins that the volume and growth in this business will be a good story for us.

是的。文森特，是提姆。謝謝你的提問。因此，到目前為止，我們正在贏得美國修補漆市場的份額。我們贏得的市場份額很大程度上是由我們的數位生態系統技術推動的。因此，我們高度關注車身修理廠層面，因為這最終是最終客戶。這就是我們的產品被消費的地方。由於該業務採用兩步驟分銷，我們預訂的實際銷售額是給分銷商的。他們——尤其是在高利率環境下，他們的庫存上下波動。因此，我們會在多個季度的基礎上進行研究。但我們有信心，基於我們淨車身修理廠的勝利，這項業務的數量和增長對我們來說將是一個好故事。

Yes. And Vincent, just to -- at the market level, the body shops are still very active. They still have a backlog. They're working through that backlog. So sell-in certainly matters for us. But the ultimate judge of how the business and how the market is performing or the body shop metrics and the body shop business remains very solid as we sit here today, and we don't see that changing in the near term.

是的。文森特，在市場層面，車身修理廠仍然非常活躍。他們還有積壓的訂單。他們正在處理積壓的工作。因此，賣出對我們來說當然很重要。但是，當我們今天坐在這裡時，對業務和市場表現或車身修理廠指標和車身修理廠業務的最終判斷仍然非常可靠，並且我們認為這種情況在短期內不會發生變化。

Your next question comes from the line of Stephen V. Byrne with Bank of America Merrill Lynch.

您的下一個問題來自美國銀行美林銀行的 Stephen V. Byrne。

I'd like to ask you about your view on -- among all of your growth potential, where would you rank cross-selling you highlighted growth opportunities in businesses, but -- and you highlighted Comex as an opportunity to drive a few other businesses. But do you see potential to do that in other regions? And which of your businesses do you think you have the most potential to drive geographic share gain?

我想問一下您的看法——在您所有的成長潛力中，您將交叉銷售排在什麼位置？您強調了企業的成長機會，但是——您強調了紐約商品交易所是推動其他一些業務的機會。但您認為其他地區有這樣做的潛力嗎？您認為您的哪些業務最有潛力推動地域份額成長？

Yes. Steve, thanks for the question. Comex is one example. Two areas that top of mind, we talk about often as far as cross-selling, if you look at protective coatings, we are as part of our PMC business, we sell protective coatings today across the distribution networks that are kind of owned and operated by our architectural business.

是的。史蒂夫，謝謝你的提問。紐約商品交易所就是一個例子。就交叉銷售而言，我們經常談論的兩個領域，如果你看看防護塗料，我們是 PMC 業務的一部分，我們今天透過擁有和經營的分銷網絡銷售防護塗料由我們的建築業務。

We look at from a customer standpoint, the near-shoring, the construction of battery plants, for example, or the near shoring of factories into Mexico and/or Vietnam and other places, those are cross-business selling opportunities where we would be selling protective coatings, architectural coatings and light industrial coatings. So we have those cross-selling opportunities around the world, and we leverage those and see good opportunities for further growth going forward. PPG Mexico, I point out because I would argue it's the strongest distribution network in the coating space globally. But we have similar opportunities to different scales around the world.

我們從客戶的角度來看，例如電池廠的近岸建設，或墨西哥和/或越南等地的工廠近岸建設，這些都是我們將銷售的跨業務銷售機會防護塗料、建築塗料和輕工塗料。因此，我們在世界各地都有這些交叉銷售機會，我們利用這些機會並看到了未來進一步成長的良好機會。我之所以指出 PPG 墨西哥公司，是因為我認為它是全球塗料領域最強大的經銷網路。但我們在世界各地都有不同規模的類似機會。

Yes. And Steve, I just want to expand on the battery factory comment, Tim made. So if you look at the battery factory construction, we typically have multiple angles to prosecute that. We may go in first with protective coatings as they're building the infrastructure for the factory. We certainly could do architectural coatings. We then have an entree into the actual products being made in those factories, both on a light industrial or heavy industrial coatings as well as an OEM basis or so. So that I think battery factors are prime examples of where we are able to cross-pollinate with the customers.

是的。史蒂夫，我只想擴展蒂姆對電池工廠的評論。因此，如果你看看電池工廠的建設，我們通常會從多個角度來起訴。我們可能會先使用保護塗層，因為他們正在為工廠建造基礎設施。我們當然可以做建築塗料。然後我們就可以了解這些工廠生產的實際產品，包括輕工業或重工業塗料以及 OEM 等。因此，我認為電池因素是我們能夠與客戶進行交叉授粉的主要例子。

Your next question comes from the line of Jeff Zekauskas with JPMorgan.

您的下一個問題來自摩根大通的 Jeff Zekauskas。

You said that you're on FIFO and that your raw materials on that basis were down at a high single-digit rate. If you were on LIFO, how much would they be down? I know that they would be down more, but my question is by what percentage? And secondly, it seems that your volumes in your domestic architectural paint stores business increased in the third quarter, is that true? And do you think they're capable of increasing in the fourth quarter.

您說您採用先進先出原則，並且在此基礎上您的原材料以高個位數的速度下降。如果採用後進先出法，它們會下降多少？我知道他們會下跌更多，但我的問題是百分比是多少？其次，你們國內建築塗料店業務的銷售似乎在第三季增加，是真的嗎？您認為他們有能力在第四季實現成長嗎？

Jeff, this is Vince. Let me take the first question on inventory and Tim will take the architectural question. I think the best way we could describe that -- it's a complicated question, as you pointed out, but a great question. I think the best way we've been describing that is if you look on a realized basis, we're realizing mid- to high single-digit deflation in our financial -- in our P&L in Q2, Q3. We think that would be high single digit or even low double digit depending on the commodity. If we were able to move to a LIFO for the 80% of our business that's on FIFO. So that gap is probably 200 to 300 basis points of deflation capture. So hope that's understood. Tim?

傑夫，這是文斯。讓我回答關於庫存的第一個問題，蒂姆將回答架構問題。我認為我們可以描述這一點的最佳方式——正如您所指出的，這是一個複雜的問題，但這是一個很好的問題。我認為我們描述這一點的最佳方式是，如果你從實際情況來看，我們在第二季和第三季的損益表中，我們的財務狀況正在實現中高個位數的通貨緊縮。我們認為這將是高個位數甚至低兩位數，具體取決於商品。如果我們能夠將 80% 的 FIFO 業務轉向 LIFO。因此，這個差距可能是通貨緊縮捕獲的 200 到 300 個基點。所以希望大家能理解這一點。提姆？

Jeff, on your architectural U.S. question, the way we look at it with our new business model is our stores are part of our professional omnichannel, which is company-owned stores plus the Pro at Home Depot plus our independent dealers. That business, despite all the challenges macro-wise, the omnichannel delivered low single-digit growth in Q3. And we would expect that or better as we move forward. So yes, I think the omnichannel is delivering what we've expected some help from macros would make that even better.

傑夫，關於你的美國建築問題，我們用新的商業模式看待它的方式是，我們的商店是我們專業全渠道的一部分，這是公司擁有的商店加上家得寶的專業商店加上我們的獨立經銷商。儘管在宏觀方面面臨所有挑戰，但該業務的全通路在第三季實現了低個位數成長。隨著我們的前進，我們會期望這一點或更好。所以，是的，我認為全通路正在提供我們所期望的東西，宏的一些幫助將使情況變得更好。

And Jeff, this is John. Just one other point to Tim's feedback that growth was driven more by volume than price in the third quarter.

傑夫，這是約翰。蒂姆回饋的另一點是，第三季的成長更多是由數量而非價格推動的。

Our next question comes from the line of Josh Spector with UBS.

我們的下一個問題來自瑞銀集團的 Josh Spector。

So I wanted to ask on margins, and I'll ask it on industrial, but I think the same logic should apply on performance since you remove some of the seasonality. So if we look at where margins are now in industrial, you're in the high 13% range. You were there in the first quarter of this year. When you weren't getting benefits on raw materials, you're there now where you are getting benefit, sales are roughly similar. So I guess, first, is why aren't we seeing the flow through on margin? Is there something on cost or any price hitting back impacting that? And then second, when we look at next year, if volumes are, say, flattish or maybe slightly up is there anything in your control to get margins up higher than where they are today, be it cost or otherwise? Or is this the level we kind of normalize that and it's more volume growth?

所以我想問利潤率，我會問工業，但我認為同樣的邏輯應該適用於性能，因為你消除了一些季節性。因此，如果我們看看工業領域現在的利潤率，就會發現處於 13% 的高水準範圍。今年第一季你就在那裡。當你沒有從原材料上獲得利益時，你現在就在獲得利益的地方，銷售額大致相似。所以我想，首先，為什麼我們沒有看到邊際流量？成本或價格方面是否有什麼影響？其次，當我們展望明年時，如果銷量持平或略有上升，您是否可以控制任何因素來使利潤率比現在更高，無論是成本還是其他方面？或者這是我們正常化的水平，並且是更多的銷售成長？

Josh. So Industrial segment, [13.9%] as you said, that is 300 basis points up from last year in Q3. And the real driver -- it's not -- we have not seen any significant, if any, price give back, to your question, on the impact there in industrial. The big impact is volume that -- as volume recovers, moving forward, you'll see margin in Industrial Coatings improve. So within our control, the operational improvements that we've talked about, and we said in our prepared remarks that we're starting to see those impacts come through on a productivity basis. That's another big driver to Industrial segment margin continued improvement.

喬許。正如您所說，工業領域 [13.9%] 比去年第三季成長了 300 個基點。真正的驅動因素——它不是——我們沒有看到任何重大的（如果有的話）價格對你的問題的影響，對工業的影響。最大的影響是銷量——隨著銷量的恢復，繼續前進，你會看到工業塗料的利潤率有所改善。因此，在我們的控制範圍內，我們已經討論過的營運改進，並且我們在準備好的發言中表示，我們開始看到這些影響是在生產力的基礎上實現的。這是工業部門利潤率持續改善的另一個重要動力。

Your next question comes from the line of David Begleiter with Deutsche Bank.

您的下一個問題來自德意志銀行的 David Begleiter。

Tim and Vince, just on the Q4 guidance, can you give a little more color on your assumptions for the auto strike, how long it continues? And does it expand? And also, what are you seeing in terms of professional contracted backlogs heading into Q4 here.

蒂姆和文斯，就第四季度的指導而言，您能否對汽車罷工的假設進行更多說明，它會持續多久？它會擴大嗎？此外，您在進入第四季度的專業合約積壓方面看到了什麼。

David, on UAW, I said in my prepared remarks a few cents, I'll be a little more specific. We've assumed $0.03 for Q4. It was much less than that in Q3, almost negligible because just the mix of where the strikes hit from UAW, but we have made some assumptions that this will go on and will likely spread to a couple of plants. But as you know, David, we're trying to guess as much as anybody to what tactics are going to be deployed. But we've got about $0.03 built into our Q4 guide. And the second question again was...

大衛，關於 UAW，我在準備好的發言中說了幾美分，我會更具體一點。我們假設第四季為 0.03 美元。這比第三季要少得多，幾乎可以忽略不計，因為只是 UAW 罷工的綜合影響，但我們做出了一些假設，這種情況將會持續下去，並且可能會蔓延到幾家工廠。但正如你所知，大衛，我們正在嘗試與任何人一樣猜測將要部署的策略。但我們在第四季度指南中內建了大約 0.03 美元。第二個問題又是......

The backlogs in the U.S. architectural side.

美國建築方面的積壓。

Yes, thanks. Sorry, I forgot the second question. Backlogs in architectural from a DIY standpoint, of course, no backlogs down low from an overall sales and volume standpoint, but the Pro backlogs are actually holding up pretty well despite everything that's happening out there on housing. You'll recall that a lot of our Pro business is commercial and maintenance that's holding up well despite the macros. And some of it is based on a backlog of jobs still coming out of prior quarters and prior years. And some of that backlog is holding up because of skilled labor availability that our customers are seeing. So backlogs remain strong. I think the average backlog for us, and our customers is only dropped by about a week from average of 14 weeks to 13 weeks. So still pretty solid there.

對了謝謝。抱歉，我忘了第二個問題。當然，從DIY 的角度來看，建築方面的積壓情況，從整體銷售和銷售的角度來看，積壓情況並不低，但儘管住房方面發生了一切，Pro 的積壓情況實際上仍然保持得很好。您會記得，我們​​的許多專業業務都是商業和維護業務，儘管有巨集指令，但仍保持良好狀態。其中一些是基於前幾季和前幾年仍然積壓的工作。由於我們的客戶看到熟練勞動力的可用性，其中一些積壓一直存在。因此積壓依然強勁。我認為我們和我們的客戶的平均積壓僅減少了大約一周，從平均 14 週減少到 13 週。所以那裡仍然很堅固。

Your next question comes from the line of Kevin McCarthy with VRP.

您的下一個問題來自 VRP 的 Kevin McCarthy。

Portfolio question for you, Tim. You've done a fair amount of pruning, including most recently, the Australia, New Zealand portion of Traffic Solutions. Can you just put that into context, where are you in that process? How much more might there be to go? And then on the flip side of the coin, I'd appreciate any updated thoughts on potential for an increase in bolt-on acquisitions. With interest rates having increased, are you starting to see asking prices come down in the private market? And how would you characterize that versus, say, repurchases or just ongoing deleveraging for next year.

提姆，向你提出投資組合問題。您已經進行了大量的修剪，包括最近的 Traffic Solutions 的澳洲、紐西蘭部分。您能否將其放在上下文中，您在這個過程中處於什麼位置？還能走多少路？另一方面，我很感激任何關於增加補強收購潛力的最新想法。隨著利率上升，您是否開始看到私人市場的要價下降？與明年的回購或持續去槓桿化相比，您如何看待這種情況？

To your pruning question, I would say we're in early innings, frankly. What we've done so far is, I'd say some of the more obvious ones around the edge is, but businesses are on notice. My team knows that every business has to earn their right to stay in the portfolio. And that's small or medium or large even. But we did the obvious ones first, and we're working through a number of other things. It's a bit early to give any specifics, but early days there.

對於你的修剪問題，坦白說，我想說我們正處於早期階段。到目前為止，我們所做的是，我想說的是一些更明顯的邊緣問題，但企業已經注意到了。我的團隊知道每個企業都必須贏得留在投資組合中的權利。甚至是小、中、大。但我們首先做了顯而易見的事情，然後我們正在解決許多其他事情。現在給出任何具體細節還為時過早，但還處於早期階段。

And Kevin, let me just add there. I think this goes back to the May CEO briefing, the focus for us is to make sure that we're spending our energies, our bandwidth on organic growth. And if a business is not performing or too small to contribute meaningfully, then we're going to shift that bandwidth to organic growth initiatives. So that's, again, one of the critical focus is here as well as the financial returns, obviously.

凱文，讓我補充一下。我認為這可以追溯到五月份的執行長簡報，我們的重點是確保我們將我們的精力和頻寬用於有機成長。如果一家企業表現不佳或規模太小而無法做出有意義的貢獻，那麼我們將把頻寬轉移到有機成長計畫上。因此，顯然，這又是關鍵焦點之一以及財務回報。

Yes. And the word is focus. I said that many times back in May, and I'd say it's daily within the company. We're going to focus on the areas that we have the best right to win for the future and that are going to drive the best financial and growth performance for the future.

是的。這個字就是焦點。我五月就說過很多次了，我想說這是公司內部的日常。我們將重點關注那些我們最有權利贏得未來的領域，這些領域將推動未來最好的財務和成長表現。

To your second question, we are -- still a core part of our strategy is value creation, shareholder value accretive acquisitions because we still see many opportunities out there in the coatings space. But it's been a little slower than historical just given the financing costs and also performance of some companies during these macro-challenged environment. Sellers, of course, sellers want to sell at the peak EBITDA. So I think there's a little bit of a pause in closing deals, but we have a number in our pipeline. We're talking to potential sellers daily, weekly, monthly. So it's still a core part of our strategy.

對於你的第二個問題，我們策略的核心部分仍然是價值創造、股東價值增值收購，因為我們仍然在塗料領域看到許多機會。但考慮到融資成本以及一些公司在宏觀挑戰環境下的業績，這速度比歷史水準慢一些。賣家當然希望以 EBITDA 最高的價格出售。因此，我認為完成交易有一點暫停，但我們的管道中有一些數字。我們每天、每週、每月都與潛在賣家交談。所以它仍然是我們戰略的核心部分。

And frankly, because these acquisitions add long-term earnings and long-term cash generation, it's still our preferred -- one of our preferred deployment opportunities. But as you heard us in our opening remarks, if those don't happen, we will put that surplus cash to work in other ways, including repo.

坦白說，因為這些收購增加了長期收益和長期現金生成，所以它仍然是我們的首選——我們的首選部署機會之一。但正如您在開場白中聽到的那樣，如果這些沒有發生，我們會將多餘的現金以其他方式使用，包括回購。

Your next question comes from Aleksey Yefremov with KeyBanc.

您的下一個問題來自 KeyBanc 的 Aleksey Yefremov。

Did you outperform in the Pro paint market in the U.S. this year? And if so, by what magnitude? And how do you think you could do relative to the market in the segment next year.

今年您在美國專業塗料市場表現優異嗎？如果是這樣，幅度是多少？您認為明年該領域的市場表現如何？

Well, we're in -- again, in architectural, we really run three very different architectural businesses depending on where you are in the world, right? So we talk a lot about our strength in Mexico, in Europe. We're #1 in 10 countries with a very strong position with the existing business model. And that business, we're actually starting to see flat volumes despite everything that's happening in Europe. So we see that the flat volumes, we see as a positive, given what's happened over the last couple of years, with the potential that Europe has stabilized.

好吧，我們再次強調，在建築領域，我們確實經營著三種截然不同的建築業務，這取決於您在世界上的哪個地方，對吧？因此，我們經常談論我們在墨西哥和歐洲的實力。我們在 10 個國家/地區排名第一，在現有業務模式方面擁有非常強大的地位。儘管歐洲發生了一切，但我們實際上開始看到該業務的銷量持平。因此，考慮到過去幾年發生的情況，我們認為成交量持平是積極的，而且歐洲有可能趨於穩定。

In the U.S. specifically, it's a very different business model where we are actually in the mode of building a business model for the future. And so it's early days in that journey where we're building a model that's brick-and-mortar like omnichannel model across our three channels, and we're converting paint customers one by one by one. You heard me say in the past that for that model to prove success, it needs to grow high single digits, low double digits every quarter, and it will take many quarters to get significant scale there.

特別是在美國，這是一種非常不同的商業模式，我們實際上正在為未來建立商業模式。因此，在這趟旅程的早期階段，我們正在建立一個類似於實體的跨三個管道的全通路模型的模型，並且我們正在一一轉換塗料客戶。你過去曾聽我說過，要證明該模式取得成功，它需要每季實現高個位數成長和低兩位數成長，並且需要多個季度才能實現顯著規模。

Q3, you heard the earlier question, we did grow both volume and sales by low single digits, a little lower than where I'd like. But given the macros in housing, I'd say that was to expect it. How we're doing versus the market and peers. We'll see as other people release their results. But our architectural U.S. business, we are building a business model for the future. And it's a marathon, not a sprint. So we're looking at it on a long-term business model foundation.

第三季度，您聽到了先前的問題，我們的銷售和銷售額確實實現了低個位數的成長，略低於我想要的水平。但考慮到房屋市場的宏觀情況，我認為這是可以預料到的。與市場和同業相比，我們的表現如何。我們將會看到其他人發布他們的結果。但我們的美國建築業務正在建立未來的商業模式。這是一場馬拉松，而不是短跑。因此，我們正在以長期的商業模式為基礎來看待它。

Your next question comes from the line of Michael Sison with Wells Fargo.

你的下一個問題來自麥可·西森與富國銀行的對話。

Nice quarter. In terms of the fourth quarter, your outlook is for plus low single-digit sales growth to minus. I guess that implies some pricing, right? So the outlook for volume would be kind of like flattish to down mid-single digits. So can you maybe talk about what drives sort of the flattish or drive sort of the down? And then given where the interest rate environment is, do you think U.S. architectural demand next year could be up, down, flat?

不錯的季度。就第四季而言，您的預期是低個位數銷售成長至負數。我想這意味著一些定價，對嗎？因此，成交量的前景可能會持平甚至下降到個位數左右。那麼您能否談談是什麼推動了平坦或推動了下降？然後考慮到利率環境，您認為明年美國的建築需求會上升、下降還是持平？

Yes. Mike, this is John. Let me start, and I'll have Tim and Vince add on here. So in terms of the fourth quarter outlook and volume, the Performance segment, we expect volume to be positive. We're still going to see good growth in aerospace and Comex as two key drivers there. The Industrial segment, we are expecting volumes to be lower, and that includes the assumption that Tim made earlier about the UAW impact. So if you -- if we didn't have a UAW impact, we must be much closer to being flat in volume in the Industrial Coatings segment.

是的。麥克，這是約翰。讓我開始吧，我會讓蒂姆和文斯補充一下。因此，就第四季度的前景和銷售量（業績部分）而言，我們預計銷量將為正值。我們仍將看到航空航太和紐約商品交易所作為兩個關鍵驅動因素的良好成長。在工業領域，我們預計銷售量將會下降，這包括提姆早些時候做出的關於全美汽車工人聯合會影響的假設。因此，如果我們沒有受到 UAW 的影響，我們工業塗料領域的銷售一定會更接近持平。

Yes. For Architectural Coatings U.S. next year, I feel good about the Pro based on two things, Mike. The continued growth an acceleration of the omnichannel that we're building plus the backlogs that our customers continue to experience. DIY, it's a big part of the business. And if it stays at the current low level, that would actually be a positive for us as opposed to declining further. If there is just a little uptick in consumer spending and consumer remodeling, and I will remind everybody that paint remodeling is the lowest-cost home remodeling project you can do. So it will be the first one to start to recover. A little bit of volume recovery there would really help the total business in aggregate. So in net-net, I'm positive on the Pro. I'm still questioning what's going to happen on DIY for next year.

是的。對於明年的美國建築塗料展，我對 Pro 的感覺很好，基於兩件事，麥克。我們正在建立的全通路的持續成長和加速，加上我們的客戶繼續經歷的積壓。 DIY，這是業務的重要組成部分。如果它保持在當前的低水平，這實際上對我們來說是積極的，而不是進一步下降。如果消費者支出和消費者改造略有增加，我會提醒大家，油漆改造是您可以做的成本最低的家庭改造專案。所以它將是第一個開始恢復的。銷量的一點點恢復確實會對整體業務有所幫助。所以在網路方面，我對Pro持樂觀態度。我仍然在想明年 DIY 會發生什麼。

And Mike, just one more thing on the DIY is we do know many of the large DIY retailers have destocked in 2023. So we certainly haven't had detailed conversations about their plans for 2024, but there was a pretty aggressive destock in 2023. So the sellout was much greater than the sell-in in 2023. And if that just normalizes on a year-over-year basis, that will assist the paint producers.

麥克，關於 DIY 的另一件事是，我們確實知道許多大型 DIY 零售商已在 2023 年去庫存。因此，我們當然還沒有詳細討論他們的 2024 年計劃，但 2023 年有相當積極的去庫存。因此，2023 年的銷售量遠高於銷售量。如果這種情況逐年恢復正常，這將對塗料生產商有所幫助。

Your next question comes from the line of Frank Mitsch with Fermium Research.

您的下一個問題來自 Fermium Research 的 Frank Mitsch。

Congrats, John, on the promotion of VP Finance, reading a lot about wage inflation and higher accruals at PPG. So I assume it's because you've been doing double duty for the last 2.5 months, so congrats on that. You commented that volumes in the fourth quarter, it seemed like we might finally get that to be positive if it wasn't for the UAW strike. I'm curious as to given the 9 quarters in a row of negative volumes, Tim, what your expectations are as you have an early read into 2024 in terms of volume growth at PPG?

恭喜 John 晉升財務副總裁，並閱讀了大量有關 PPG 薪資上漲和應計專案增加的內容。所以我認為這是因為您在過去 2.5 個月裡一直在承擔雙重職責，所以恭喜您。您評論說，第四季度的銷量，如果不是 UAW 罷工，我們最終可能會得到積極的結果。我很好奇，蒂姆，考慮到連續 9 個季度出現負銷量，您對 2024 年 PPG 銷量增長的預期是什麼？

Yes. Frank, I do appreciate you congratulating John on his promotion. Very easy decision for us, well deserved, but it didn't affect our wage inflation because John loves his job so much, he does it for free.

是的。弗蘭克，我非常感謝你祝賀約翰升職。對我們來說，這是一個非常簡單的決定，當之無愧，但這並沒有影響我們的薪資上漲，因為約翰非常熱愛他的工作，他是免費的。

But going into next year, I'm confident based on what we know today, based on what we see today, that we will swing to positive volume as a total enterprise in 2024. Q4 will be close, but again, UAW is a big unknown, what it will on how that goes and which plants and which ones we supply, customer mix wise, it's still a bit of an unknown. But I do feel positive that we will swing to positive volume in 2024.

但進入明年，根據我們今天所了解的情況，根據我們今天所看到的情況，我相信我們將在2024 年作為一個整體企業實現正銷量。第四季度即將結束，但同樣，UAW 是一個重要的因素。未知，具體情況如何，我們供應哪些工廠以及我們供應哪些工廠，客戶組合方面，這仍然是一個未知數。但我確實確信我們將在 2024 年實現正銷量。

We've got Europe and China, two of our biggest regions that sequentially, we believe China is going to recover to a slower speed than historical, to a slower speed than what we thought a couple of quarters ago, but sequentially, we will see improvement in China. Europe, as I said earlier, we're actually pleased to see flat volume across some of our larger businesses like Deco in Europe because we really believe it is bouncing off the bottom. So we've got demand stability and any incremental increases in Europe will drive really good leverage for us.

我們有歐洲和中國，我們兩個最大的地區，我們相信中國的復甦速度將低於歷史水平，低於我們幾個季度前的預期，但我們將看到中國的進步。歐洲，正如我之前所說，我們實際上很高興看到我們一些較大的業務（例如歐洲的 Deco）銷量持平，因為我們確實相信它正在從底部反彈。因此，我們的需求穩定，歐洲的任何增量成長都將為我們帶來非常好的槓桿作用。

I mentioned the aerospace backlog, the more we make, the more we sell and that will go on for many quarters. And we're focused very heavily on productivity and getting more out the door, which will drive growth for us. Automotive, I believe, will have sequential improvement, sequential build increases moving into 2024. So when exactly? Which month? We will have some macro dependency. But overall, I'm confident in the swing to positive volume in 2024.

我提到了航空航天積壓，我們生產的越多，銷售的就越多，這種情況將持續多個季度。我們非常注重生產力並獲得更多成果，這將推動我們的成長。我相信，進入 2024 年，汽車產業將會持續改進、持續生產增加。那麼具體是什麼時候呢？哪個月？我們會有一些巨集依賴。但整體而言，我對 2024 年銷量回升充滿信心。

Your next question comes from the line of Laurence Alexander with Jefferies.

你的下一個問題來自勞倫斯·亞歷山大和傑弗里斯的對話。

Congrats on the strong quarters. I just want to pin down one point. With respect to the incremental price actions and productivity, do you think you'll be able to keep that ahead of wage inflation in Q4 and next year? Or how should we think about the bridge there?

祝賀強勁的季度。我只想明確一點。關於增量價格行為和生產力，您認為您能夠在第四季度和明年的薪資通膨之前保持領先嗎？或者我們應該如何看待那裡的橋樑？

Yes. Laurence, thanks for the question. The short answer is, yes, we'll stay ahead of wage inflation with a combination of price and productivity. We do expect, if you look at, let's call it, salary inflation in the established markets a little higher than normal, let's call it, 3%, frontline workers is very country specific. So it will be higher than that in some countries. But we're also confident, given our pricing track record that through a combination of price and productivity, we'll be able to offset the wage inflation that we'll see. And I'll also point out, remember that with our mix of businesses, with the exception of company-owned stores, we have a very low people-intensity structure because most of our businesses are direct or direct to somebody else's distribution channel. So with the exception of company-owned stores, we have a pretty low human capital intensity frontline business.

是的。勞倫斯，謝謝你的提問。簡短的回答是，是的，我們將透過價格和生產力的結合領先於薪資通膨。我們確實預計，如果你看一下，成熟市場的工資通膨率略高於正常水平，我們稱之為 3%，第一線工人的工資通膨率因國家而異。所以會比一些國家更高。但鑑於我們的定價記錄，我們也有信心透過價格和生產力的結合，我們將能夠抵消我們將看到的薪資通膨。我還要指出，請記住，在我們的業務組合中，除了公司自營商店之外，我們的人員密集度結構非常低，因為我們的大多數業務都是直接或直接面向其他人的分銷渠道。因此，除了公司自營商店之外，我們的第一線業務人力資本強度相當低。

Your next question comes from the line of Aron Ceccarelli with Berenberg.

您的下一個問題來自 Aron Ceccarelli 和 Berenberg 的對話。

I have one on pricing. With the heavy lift on pricing initiatives now behind us and the supply of raw materials normal to condition, how should we be thinking about pricing across the two segments for 2024? And how do you feel about the potential scenario where pricing could turn negative next year?

我有一份關於定價的資料。隨著定價措施的大力推動已經過去，原物料供應也恢復正常，我們該如何考慮 2024 年這兩個細分市場的定價？您對明年定價可能變成負數的潛在情況有何看法？

Yes. Arun, thank you for the question. Pricing, we will -- in the Performance segment, we will get incremental targeted pricing as we move into 2024 because of the structure and the value-add that we deliver relative to the total cost of production that our customers have. So in other words, the small amount of paint consumption, a small amount of price is more than offset by the total production cost that we impact and the value that we add to our customers from a productivity standpoint. So we will get more targeted price in Performance next year.

是的。阿倫，謝謝你的提問。定價方面，在性能領域，隨著我們進入 2024 年，我們將獲得增量目標定價，因為我們提供的結構和增值相對於客戶的總生產成本。換句話說，少量的油漆消耗和少量的價格足以抵消我們影響的總生產成本以及從生產力的角度為客戶增加的價值。所以明年我們會在性能方面得到更有針對性的價格。

In Industrial segment, we have not seen price give back to this point. We do have some structural contracts about 30% of our Industrial segment that is tied to some form of an index contract. So depending on what happens to that total basket of raws, there is a time lag built into where there would be some structural price changes. But again, that's less than half of our business. Beyond that, let's -- to the prior question, let's recall that there's a lot of other inflation out there. So the discussions we'll have with our customers and continue to have with our customers is that, that inflation we also need to talk about when it comes to the price of our products and services.

在工業領域，我們還沒有看到價格回落到這一點。我們確實有一些結構性合同，約佔工業部門的 30%，與某種形式的指數合約相關。因此，根據整個籃子原料的情況，會出現一些結構性價格變化，存在時間滯後。但同樣，這還不到我們業務的一半。除此之外，對於前面的問題，讓我們回想一下，還有很多其他的通貨膨脹。因此，我們將與客戶進行並繼續與客戶進行的討論是，當涉及到我們的產品和服務的價格時，我們也需要討論通貨膨脹。

Your next question comes from the line of Mike Harrison with Seaport Research Partners.

您的下一個問題來自 Seaport Research Partners 的 Mike Harrison。

I wanted to ask a question about the growth that you're seeing in powder coatings. Is this mostly share gain where you're seeing the growth? Or is there a lot of conversion happening with existing customers such that we should view it more as cannibalization. And I guess what does the margin profile look like for powder coatings compared to liquid for a similar application.

我想問一個關於粉末塗料增長的問題。您看到的成長主要是份額成長嗎？或者現有客戶是否發生了大量轉換，因此我們應該將其更多地視為蠶食。我猜想在類似的應用中，與液體塗料相比，粉末塗料的裕度分佈是什麼樣的。

Yes, Mike, great question. Thank you. What you see in powder growth for PPG is share gain, okay? Very little, if any, conversion of existing PPG customers from liquid to powder because there's two factors there. One, frankly, we're starting at a fairly low market position in powder. So we're specifically targeting share gain, and conversion of an existing customer from liquid to powder takes a capital investment by that customer in their paint shop. So it's not an overnight flip. So what you're seeing is share gain.

是的，麥克，好問題。謝謝。您在 PPG 的粉末增長中看到的是份額增長，好嗎？現有 PPG 客戶從液體轉​​向粉末的情況很少（如果有的話），因為有兩個因素。第一，坦白說，我們在粉末市場的起步階段處於相當低的地位。因此，我們專門針對份額成長，而將現有客戶從液體轉​​換為粉末需要該客戶在其塗裝車間進行資本投資。所以這不是一朝一夕的轉變。所以你看到的是份額收益。

Now from a margin standpoint, if you look at our U.S. powder business, for example, on a net margin standpoint, it's one of our more profitable segments across general industrial. And the reason is we target specifically the higher end of the powder portfolio, there's liquid-like appearance, there's metallic powders, those types of things that command a higher margin because they're more technology advanced from a formulation standpoint. So we're specifically targeting the higher end of the segment. Longer term, one of the reasons we are investing in powder for the future is it is more sustainable solution for our customers. So you've got the short-term focus that where we're driving share gain by targeting the higher-end segments of margin for powder. Longer term, you will see more and more customers converting from liquid to powder because of the sustainable solution that it provides.

現在，從利潤率的角度來看，例如，如果從淨利潤率的角度來看我們的美國粉末業務，它是我們在一般工業中利潤更高的部門之一。原因是我們專門針對高端粉末產品組合，有類似液體的外觀，有金屬粉末，這些類型的產品利潤更高，因為從配方的角度來看它們技術更先進。因此，我們專門針對該細分市場的高端市場。從長遠來看，我們為未來投資粉末的原因之一是它對我們的客戶來說是更永續的解決方案。因此，短期的重點是我們透過瞄準粉末利潤的高端領域來推動份額成長。從長遠來看，您將看到越來越多的客戶從液體轉​​向粉末，因為它提供了可持續的解決方案。

Our final question today comes from the line of Arun Viswanathan with RBC.

我們今天的最後一個問題來自 RBC 的 Arun Viswanathan。

So I just wanted to understand, it sounds like you may be looking at consolidated positive volume growth for '24? Given that scenario and the operating leverage and the incremental margins that you kind of envisioned, do you expect to get to that $9 EPS level? Or what's the path to getting back to that level that you say, you put out a couple of years ago?

所以我只是想了解，聽起來您可能正在考慮 24 年的綜合銷售量正成長？考慮到這種情況以及您所設想的營運槓桿和增量利潤，您預計每股收益會達到 9 美元的水平嗎？或者回到你所說的幾年前的水平的途徑是什麼？

Yes. Thanks, Arun, for the question. I've said many times, and I'll continue to say it, that $9 for PPG is a question of win, not if, okay? We will get there. I just fully confident in our new enterprise growth strategy and leveraging the portfolio that we've got as well as some selected pruning and some selected -- targeting certain geographies and segments being a lot more focused. So $9 is a win, not if.

是的。謝謝阿倫提出這個問題。我已經說過很多次了，我會繼續這麼說，PPG 的 9 美元是一個勝利的問題，而不是是否，好嗎？我們會到達那裡。我對我們新的企業成長策略充滿信心，並利用我們現有的投資組合以及一些選定的修剪和一些針對某些地區和細分市場的更集中的選擇。所以 9 美元是勝利，而不是如果。

What I'm confident in 2024 is that we will hit the 8% to 12% EPS growth that we stated in when we were together in May. And frankly, that 10% average EPS growth has been a target for our company for many years. And so I'm confident that as we move through 2024, combination of the swing to positive volume plus the capital deployment that we've talked about a few times here this morning, plus some of the key innovation initiatives that we're launching now and will gain momentum in 2024. I'm confident that, that combination will get us to what we've committed to.

我對 2024 年充滿信心的是，我們將實現 5 月我們在一起時所說的 8% 至 12% 的每股收益成長。坦白說，10% 的平均 EPS 成長一直是我們公司多年來的目標。因此，我相信，當我們邁入 2024 年時，銷量正向成長的轉變加上我們今天早上多次討論過的資本部署，再加上我們現在正在推出的一些關鍵創新舉措並將在2024 年獲得動力。我相信，這種結合將使我們實現我們的承諾。

Those are all the questions we have. So I'll turn the call back over to Mr. John Bruno.

這些就是我們所有的問題。所以我會把電話轉回給約翰·布魯諾先生。

Thank you, Emily. Great job. Appreciate that. We appreciate all your interest and confidence in PPG, and this concludes our third quarter earnings call.

謝謝你，艾米麗。做得好。感謝。我們感謝您對 PPG 的興趣和信心，我們的第三季財報電話會議到此結束。

This concludes today's conference call. You may now disconnect your lines.

今天的電話會議到此結束。現在您可以斷開線路。