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PPG Industries To Undergo Restructuring To Reduce Global Cost Structure - Quick Facts

PPG Industries, Inc. (PPG) announced Monday that it has approved significant and broad restructuring actions to reduce its global cost structure. The plan includes a voluntary separation program that was offered in the U.S. and Canada.

The company said it is taking decisive action to further adjust our cost base given the broad economic impact relating to the COVID-19 pandemic and the recovery timeline in a few end-use markets. These measures will enable the company to come out of the crisis with lower structural costs.

The company expects the planned actions to deliver $160 to $170 million in annual pre-tax cost savings when completed, with approximately $25 to $35 million of savings projected in 2020. The remainder of the annual cost savings is anticipated to be substantially realized by year-end 2021.

PPG will also record a restructuring charge of $160 to $180 million pretax, $125 to $140 million after-tax, or $0.52 to $0.58 per share, in the second quarter 2020, which is nearly all related to employee severance.

Additionally, it will incur other associated restructuring-related costs of approximately $10 million over future quarters. The total cash outlay to complete these actions is approximately $180 million, with about $110 million expected in 2020 and the remainder in 2021. The cash outlay includes capital expenditures to relocate certain operational activities.

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