06:17 AM EDT, 04/19/2024 (MT Newswires) -- PPG Industries ( PPG ) late Thursday issued a downbeat second-quarter profit outlook, after lower sales volumes in the paints and coatings maker's two main operating segments dragged revenue below market expectations in the preceding three-month period.

The company anticipates adjusted earnings to be in a range of $2.42 to $2.52 per share for the ongoing quarter, while the consensus on Capital IQ is for $2.53. Organic sales are set to grow by low single digits, according to the firm. The stock edged down 0.6% in Friday's premarket activity.

"Looking ahead, while global industrial production remains at low absolute levels, we believe that demand in China for our products will deliver solid organic growth," Chief Executive Tim Knavish said in a statement. Demand in Europe is expected to stabilize while economic conditions in several US end-use markets are projected to improve as the year progresses, according to Knavish.

For the March quarter, PPG's adjusted EPS rose 2% to $1.86, in line with the Street's view. Sales declined to $4.31 billion from $4.38 billion the year before, missing analysts' $4.43 billion estimate.

Year on year sales comparisons were lowered by about 130 basis points due to large customer load-in and pass-through energy surcharges in Europe, which occurred in the 2023 quarter, Knavish said. "During this year's first quarter, we were also impacted by lower demand in Europe, including an early Easter holiday which reduced the number of selling days in March, and ongoing tepid global demand for industrial coatings," the CEO added.

Revenue in the performance coating segment ticked down 1% to $2.61 billion, as higher selling prices and foreign-currency tailwinds were offset by lower sales volume. Sales in industrial coatings decreased to almost $1.7 billion from $1.75 billion on an annual basis, due to lower selling prices and slightly lower sales volumes, according to the company.

PPG continues to expect adjusted earnings of $8.34 to $8.59 per share for full-year 2024, while the Street is looking for normalized EPS of $8.48. It also forecasts low-single-digit organic sales growth.

"We are executing on the strategic reviews of the architectural coatings US and Canada business and global silicas products business that we announced in the first quarter," Knavish said. "Our target is to determine a path forward for each of these assessments no later than the third quarter."