UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

For the fiscal year ended December 31, 20202022

Commission File Number 1-1687

Securities Registered Pursuant to Section 12(g) of the Act: None

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):

Part I

Item 1. Business

PPG Industries, Inc. manufactures and distributes a broad range of paints, coatings and specialty materials. PPG was incorporated in Pennsylvania in 1883. PPG’s vision is to be the world’s leading coatings company by consistently delivering high-quality, innovative and sustainable solutions that customers trust to protect and beautify their products and surroundings. 

PPG has a proud heritage andwith a demonstrated commitment to innovation, sustainability, community engagement and developingdevelopment of leading-edge paint, coatings and specialty materials technologies. Through dedication and industry-leading expertise, we solve our customers’ biggest challenges, collaborating closely to find the right path forward. PPG is a global leader serving customers in construction, consumer products, industrial and transportation markets and aftermarkets with manufacturing facilities and equity affiliates in more than 70 countries.

PPG supplies paints, coatings and specialty materials to customers inserving a wide array of end-uses, including industrial equipment and components; packaging material; aircraft and marine equipment; automotive original equipment; automotive refinish; pavement marking products; as well as coatings for other industrial and consumer products. PPG also serves commercial and residential new build and maintenance customers by supplying coatings to painting and maintenance contractors and directly to consumers for decoration and maintenance.

The coatings industry is highly competitive and consists of several large firms with global presence and many firms supplying local or regional markets. PPG competes in its primary markets with the world’s largest coatings companies, most of which have global operations, and with many regional coatings companies.

PPG’s business is comprised of two reportable business segments: Performance Coatings and Industrial Coatings as described below:

PERFORMANCE COATINGS

INDUSTRIAL COATINGS

(a) Original equipment manufacturer (OEM)

Technology innovation has been a hallmark of PPG’s success throughout its history. The Company seeks to optimize its investment in research and development to create new products to drive profitable growth. We align our product development with the macro trends in the markets we serve, including a focus on sustainability, and leverage core technology platforms to develop products forto address unmet market needs. Additionally, we operate laboratories in close geographic proximity to our customers and we customize our products for our customers' end-use applications. Our history of successful technology introductions is based on a commitment to an efficient and effective innovation process and disciplined portfolio management. We have obtained government funding for a small portion of the Company’s research efforts, and we will continue to pursue government funding, where appropriate.

We own and operate several facilities to conduct research and development for new and improved products and processes. In addition to the Company’s centralized principal research and development centers (See(see Item 2. “Properties” of this Form 10-K), operating segments manage their development through centers of excellence. As part of our ongoing efforts to manage our formulations and raw material costs effectively, we operate global competitive sourcing laboratories. Because of our broad array of products and customers, we are not materially dependent upon any single technology platform.

The effective management of raw materials, energy and logistics is important to PPG’s continued success as PPG uses a wide variety of complex raw materials that serve as the building blocks of our manufactured products. The Company’s most significant raw materials areinclude resins, reactants, solvents, titanium dioxide, epoxy and other resins, titanium dioxide and other pigments, and solvents in the coatings businesses and sand and soda ash in the specialty coatings and materials business.emulsions. Raw materials include both organic, primarily petroleum-derived, materials and inorganic materials, including titanium dioxide. These rawmaterials. Raw materials represent PPG’s single largest production cost component.

Most of the raw materials and energy used in production are purchased from outside sources, and the Company has made, and plans to continuecontinues to make, supply arrangements to meet our planned operating requirements for the future. Supply of critical raw materials and energy is managed by establishing contracts with multiple sources and identifying alternative materials or technology whenever possible. OurIn support of our decarbonization efforts, we are increasing the amount of renewable energy secured for our operating facilities and increasingly evaluating alternative raw materials includethat offer sustainable benefits and support the circular economy, including recycled, bio-based, materials as partbio-circular feedstocks and biomass balance products. Prices for certain of a product renewal strategy. While prices for certainour raw materials typically fluctuate with energy prices and global supply and demand changes, such fluctuations arechanges; however, pricing may be impacted by the fact that the manufacture of our raw materials is several steps downstream from crude oil, natural gas, and other key feedstocks.

We are continuing our aggressive sourcing initiatives to broaden our supplyThrough effective management of high quality raw materials, improve our overallenergy and logistics, the Company aims to maintain a competitive cost position and ensure ongoing security of supply. TheseSecurity of a sufficient supply of high-quality raw materials is important to PPG’s continued success as it allows the Company to increase production as necessary to keep pace with customer demand. In 2022, we continued to experience shortages of certain raw materials, which negatively impacted our ability to fully meet some of our customers’ demand. We continue to focus on improving our competitive cost position and expanding our supply of high-quality raw materials, including strategic initiatives include qualifyingto qualify multiple sources of supply, both local and international, including suppliers from Asia and other lower cost regions of the world, adding on-site resin production at certain manufacturing locations and reducing the amount of titanium dioxide used in our product formulations.

We typically experience fluctuating prices for energy and raw materials driven by various factors, including changes in supplier feedstock costs and inventories, global industry activity levels, foreign currency exchange rates, government regulation, and global supply and demand factors. For 20202022 versus 2019,2021, we experienced deflationary movementsincreases in the majorityour operating costs of ourmore than $1 billion, including significant raw material and energy cost inflation. The increases in raw material costs were primarily driven by higher supplier feedstock costs, higher energy prices, labor availability challenges, transportation shortages and higher ocean freight costs. Also in 2022, we experienced increases in other logistics costs, driven by a general slowdown in industrial demand due to the pandemic, affecting the global supply chain disruptions, logistical challenges, labor shortages and demand balances. This was in addition to pricemanufacturing interruptions at both our factories and cost decreases in mostthose of our key feedstocks through the first half of 2020.suppliers and customers.

Given the uncertainty of the global economic recovery from the pandemic, coupledassociated with the continuing volatility in certain feedstock costs, particularly the volatility in oil and oil-based derivatives, and foreign currencies,various factors that drive raw material prices, we are not able to predict with certainty the 20212023 full-year impact of changes in raw material pricingcosts versus 2020.2022; however, we expect the negative impact of raw material inflation to lessen as 2023 progresses.

Further, givenWe are subject to existing and evolving standards relating to the distribution natureregulation and registration of manychemicals which could potentially impact the availability and viability of some of the raw materials we use in our production processes. Our ongoing, global product stewardship efforts are directed at maintaining our compliance with these standards. We anticipate that the number of chemical registration regulations will continue to increase globally, and we have implemented programs to track and comply with these regulations.

Our commitment to sustainability extends to our suppliers as an extension of our businesses, logistics and distribution costs are sizable, as are wage and benefit changes. For 2020 versus 2019,internal focus on sustainability. The PPG experienced a modest increase in logistics costs as a percentageGlobal Supplier Code of sales. This is due to inefficienciesConduct clarifies our global expectations in the globalareas of business integrity, labor practices, associate health and safety, and environmental management. Our Supplier Sustainability Policy builds upon our Global Supplier Code of Conduct by establishing expectations for sustainability within our supply networkchain. This policy reinforces our expectations that our suppliers, as well as their subcontractors, will comply fully with applicable laws and lower transportation agility dueadhere to restrictions associated withinternationally recognized environmental, social and corporate-governance standards.

In both 2022 and 2021, PPG earned a Gold rating from EcoVadis™, a trusted business sustainability ratings platform. EcoVadis experts evaluate company performance on 21 factors related to environment, labor and human rights, ethics, and sustainable procurement. The rating methodology is based on international sustainability standards and initiatives, such as the global pandemic. Entering into 2021, transportation remains challenged with multiple supplyGlobal Reporting Initiative (GRI) Standards, United Nations Global Compact and international trade factors, after the United Kingdom’s exitISO 26000 standard (social responsibility). Maintaining a Gold rating from the European Union ledEcoVadis underscores PPG’s ongoing commitment to equipment shortages, impacting availability. Through the year we see these factors waning as supply networks become stabilized with new global demand patternscorporate social responsibility and the reduced impact of COVID-19 through vaccination. As a result of these factors, offset by improved operating efficiencies, PPG expects low level increases in logistics costs as a percentage of sales in 2021.our efforts to manage our economic, social and environmental impact.

PPG has a significant investment in non-U.S. operations. This broad geographic footprint serves to lessen the significance to us of economic impacts occurring in any one region on our total Net sales and Income before income taxes inof the consolidated statement of income.world. As a result of our global footprint, we are subject to certain inherent risks, including economic and political conditions in international markets, trade protection measures and fluctuations in foreign currency exchange rates. During 2020,2022, unfavorable foreign currency translation decreased Net sales by approximately $150$775 million and Income before income taxes by approximately $25$85 million.

Refer to Note 22,20, “Revenue Recognition” in Item 8 of this Form 10-K for additional geographic information pertaining to sales and Note 21, “Reportable Business Segment Information” underin Item 8 of this Form 10-K for geographic information related to PPG’s property, plant and equipment, and for additional geographic information pertaining to sales.equipment.

PPG’s Income before income taxes has typically been greater in the second and third quarters and Cash from operating activities has been greatest in the fourth quarter due to end-use market seasonality, primarily in our architectural coatings and traffic solutions businesses. Demand for our architectural coatings and traffic solutions products is typically the strongest in the second and third quarters due to higher home improvement, maintenance and construction activity during the spring and summer months in the U.S., Canada and Europe. The Latin AmericaAmerican paint season is the strongest in the fourth quarter. These cyclical activity levels result in the collection of outstanding receivables and lower inventory on hand in the fourth quarter generating higher Cash from operating activities.

The average number of people employed worldwide by PPG during 20202022 was approximately 46,900.52,000, of which approximately 15,600 were in the United States and approximately 36,400 were elsewhere in the world. The Company has numerous collective bargaining agreements throughout the world. We observe local customs, laws and practices in labor relations when negotiating collective bargaining agreements. There were no significant work stoppages in 2020.2022. While we have experienced occasional work stoppages as a result of the collective bargaining process and may experience some work stoppages in the future, we believe that we will be able to negotiate all labor agreements on satisfactory terms. To date, these work stoppages have not had a significant impact on our results of operations. Overall, we believe we have good relationships with our employees.

Our peoplehuman capital management strategies provide the foundation for our teams to thrive and deliver exceptional performance. These strategies in the areas of culture and purpose, employee engagement, development and pay equity are overseen by the Human Capital Management and Compensation Committee of our Board of Directors. We are committed to ensuring our employees are safe, healthy, enabled, engaged and valued for the diverse talents they bring to PPG. We believe that having quality dialogue with our people, recognizing the value they bring and championing an authentic culture generates engaged employees and a company that is more innovative, productive and competitive. Our focus on and investment in learning and development are crucial to ensuring we keep our people engaged, productive and successful at every stage of their careers. We are committed to promoting from within wherever possible while also bringing in new ideas, thoughts and insights.

One of PPG’s greatest strengths is the diversity of our people, who represent wide-ranging nationalities, cultures, languages, religions, ethnicities, lifestyles, and professional and educational backgrounds. Their unique perspectives enable us to meet challenges quickly, creatively and effectively, providing a significant competitive advantage in today’s global economy. To ensure our people feel valued and respected, we are committed to providing a workplace that embraces a culture of diversity and inclusion and is free from harassment and bullying. In connection with our focus on diversity, equity and inclusion, PPG operates eight Employee Resource Networks (“ERNs”). These ERNs are open to all employees and are intended to provide an opportunity for in-depth discussion, focus and recommendations on how PPG can deliver higher growth and performance by creating a more diverse, equitable and inclusive organization.

More information about PPG’s peoplehuman capital management strategies and our workforce can be found in the Proxy Statement for our 20212023 Annual Meeting of Shareholders and in our SustainabilityESG Report and on our sustainability websitelocated at http://sustainability.ppg.com.

PPG is committed to operating in a sustainable manner and to helping our customers meet their sustainability goals. Our sustainability efforts are ledgoverned by the TechnologySustainability and EnvironmentInnovation Committee of our Board of DirectorsDirectors. At the management level, day-to-day implementation of our environmental, social and governance (“ESG”) initiatives is led by our Vice President, Global Sustainability, who is responsible for coordinating PPG’s ESG and sustainability programs and for communicating our ESG progress with our customers, shareholders and other stakeholders. The Vice President, Global Sustainability works with PPG’s Sustainability Committee, which is compriseda committee of membersmanagement consisting of PPG’s senior management team. The Sustainability Committee establishescorporate executives, to establish and monitor our sustainability goals, policies, programs and procedures and goals to addressthat incorporate sustainability ininto our business practices, including resource management, climate change impacts, innovation, community engagement, communications, purchasing,procurement, manufacturing and employee wellness.

Our dedication to innovation is intertwined with sustainability. Once again, we increased the percent of our sales from sustainable products to 35% in 2020 from 33% in 2019. We are marketing an ever-growing variety of products and services that protect the environment and provide environmental, safety and other benefits to our customers. Our products contribute to lighter, more fuel-efficient vehicles, airplanes and ships, and they help our customers reduce their energy consumption, conserve water and reduce waste. These products include a compact automotive paint processprocesses and low cure capabilities that savessave energy and reducesreduce water usage;usage at customer manufacturing sites; sustainable, waterborne coatings formulations; sustainable powder coatings; lightweight sealants and coatings for aircraft; coatings that cool surfaces; coatings for recyclable metal packaging; antimicrobial products; coatings that contain reduced materials of concern; architectural coatings that contain lower carbon content raw materials; silica products for tires that improve vehicle fuel economy; and solutions for autonomous and battery-powered vehicles. Sales from sustainable products represented 39% of the Company’s total Net sales for the year ended December 31, 2022.

The Company’s commitmentPPG is committed to using resources efficiently and driving sustainability continues to yield tangible results. In 2020, we again made significant progressthroughout our entire value chain, including continued focus on reducing our energy intensity, greenhouse gas emissions, intensitywater withdrawal and waste intensity.total energy use. More information about PPG’s sustainability values, efforts, goals and data and our community and employee engagement programs can be found in our SustainabilityESG Report and on our sustainability websitelocated at http://sustainability.ppg.com and on the CDP’s website at www.cdp.net.

We are subject to existing and evolving standards relating to the protection of the environment. In management’s opinion, the Company operates in an environmentally sound manner and is well positioned, relative to environmental matters, within the industries in which it operates. PPG is negotiating with various government agencies concerning current and former manufacturing sites and offsite waste disposal locations, including certain sites on the National Priority List. While PPG is not generally a major contributor of wastes to these offsite waste disposal locations, each potentially responsible party may face governmental agency assertions of joint and several liability. Generally, however, a final allocation of costs is made based on relative contributions of wastes to the site. There is a wide range of cost estimates for cleanup of these sites, due largely to uncertainties as to the nature and extent of their condition and the methods that may have to be employed for their remediation. The Company has established reserves for onsite and offsite remediation of those sites where it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.

Our experience to date regarding environmental matters leads us to believe that we will have continuing expenditures for compliance with provisions regulating the protection of the environment and for present and future remediation efforts at waste and plant sites. Management anticipates that such expenditures will occur over an extended period of time.

In addition to the $300$217 million currently reserved for environmental remediation efforts, we may be subject to loss contingencies related to environmental matters estimated to be approximately $100 million to $200 million. These reasonably possible unreserved losses relate to environmental matters at a number of sites, none of which are individually

significant. The loss contingencies related to these sites include significant unresolved issues such as the nature and extent of contamination at these sites and the methods that may have to be employed to remediate them.

It is expected that capital expenditures for such projects in 20212023 will be in the range of $15$25 million to $25$35 million. AlthoughActual future capital expenditures are difficultmay differ from expectations due to estimate accurately becausethe inherent uncertainties involved in estimating future environmental remediation compliance costs, including possible technological, regulatory and enforcement developments, the results of constantly changing regulatory standardsenvironmental studies and policies, it can be anticipated that environmental control standards will become increasingly stringent and the cost of compliance will increase.other factors.

Management believes that the outcome of these environmental contingencies will not have a material adverse effect on PPG’s financial position or liquidity; however, any such outcome may be material to the results of operations of any particular period in which costs, if any, are recognized. SeeRefer to Note 15, “Commitments and Contingent Liabilities” underin Item 8 of this Form 10-K for additional information related to environmental matters and our accrued liability for estimated environmental remediation costs.

Item 1A. Risk Factors

As a global manufacturer of paints, coatings and specialty materials, we operate in a business environment that includes risks. These risks are not unlike the risks we have faced in the recent past nor are they unlike risks faced by our competitors. Each of the risks described in this section could adversely affect our results of operations, financial position and liquidity. While the factors listed here are considered to be the more significant factors, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles which may adversely affect our businesses and our results of operations, financial position and liquidity.

The effects of the public health crisis caused by the COVID-19 pandemic have interfered with the ability of PPG, our suppliers, customers, and others to conduct business and have negatively affected consumer confidence and the global economy. Public health officials have recommended or mandated certain precautions to mitigate the spread of COVID-19, including prohibitions on congregating in groups, shelter-in-place orders, vaccination requirements or similar measures. Preventative and protective actions that public health officials, governments or PPG have taken with respect to COVID-19 have and will continue to adversely impact our business, suppliers, distribution channels, and customers, including business shutdowns or

Our financial results are significantly affected by the cost of raw materials. Raw materials include both organic, primarily petroleum-derived, materials and inorganic materials, including titanium dioxide. These raw materials represent PPG’s single largest production cost component.

While not our customary practice, we also import raw materials and intermediates, particularly for use at our manufacturing facilities in the emerging regions of the world. In most cases, those imports are priced in the currency of the supplier and, therefore, if that currency strengthens against the currency of our manufacturing facility, our margins may be lower.

Most of our raw materials are purchased from outside sources, and the Company has made, and plans to continue to make, supply arrangements to meet the planned operating requirements for the future. Adequate supply of critical raw

materials is managed by establishing contracts, procuring from multiple sources, and identifying alternative materials or technology whenever possible. The Company is continuing its aggressive sourcing initiatives to effectively broaden our supply of high quality raw materials. These initiatives include qualifying multiple and local sources of supply, including suppliers fromwithin Asia and other lower cost regions of the world, diversification of our resin supply including adding on-site resin production at certain manufacturing locations, and a reduction in the amount of titanium dioxide and other raw materials used in our product formulations. OurDespite our actions undertaken to maintain supply arrangements adequate to meet planned operating requirements, raw material supply chain disruptions, including logistical and transportation challenges in many regions, have adversely impacted, and may continue to adversely impact, our ability to procure raw materials, include bio-based materials as part of a product renewal strategy.adversely impacting our financial results.

An inability to obtain certain critical raw materials wouldhas adversely impactimpacted our ability to produce products.certain products and could do so in the future. Increases in the cost of raw materials may have an adverse effect on our Income from continuing operations or Cash from operating activities in the event we are unable to offset these higher costs in a timely manner.

Demand for our products and services depends, in part, on the general economic conditions affecting the countries and markets in which we do business. Weak economic conditions in certain geographies and changing supply and demand balances in the markets we serve have negatively impacted demand for our products and services in the past and may do so in the future. Recently, global economic uncertainty has increased due to a number of factors, including the war in Ukraine, COVID-19, pandemic, slowing global growth, consumer sentiment and commodity market volatility, disruption in existingsupply chains globally, potential changes to international trade agreements, the imposition of tariffs and the threat of additional tariffs, and labor shortages in certain regions of the United Kingdom’s exit from the European Union and weaker demand in China.world. PPG provides products and services to a variety of end-use markets in many geographies. This broad end-use market exposure and expanded geographic presence lessens the significance of any individual decrease in activity levels; nonetheless, lower demand levels may result in lower sales, which would result in reduced Income from continuing operations and Cash from operating activities.

Environmental laws and regulations control, among other things, the discharge of pollutants into the air and water, the handling, use, treatment, storage and clean-up of hazardous and non-hazardous waste, and the investigation and remediation of soil and groundwater affected by hazardous substances. In addition, various laws regulate health and safety matters. The environmental laws and regulations we are subject to impose liability for the costs of, and damages resulting from, cleaning up current sites, past spills, disposals and other releases of hazardous substances. Violations of these laws and regulations can also result in fines and penalties. Future environmental laws and regulations may require substantial capital expenditures or may require or cause us to modify or curtail our operations, which may have a material adverse impact on our business, financial condition and results of operations.

PPG is involved in a number of lawsuits and claims, both actual and potential, in which substantial monetary damages are sought. Those lawsuits and claims may relate to contract, patent, environmental, product liability, asbestos exposure,

antitrust, employment, securities and other matters arising out of the conduct of PPG’s current and past business activities. Any such claims, whether with or without merit, could be time consuming and expensive to defend and could divert management’s attention and resources. We maintain insurance against some, but not all, of these potential claims, and the levels of insurance we do maintain may not be adequate to fully cover any and all losses. We believe that, in the aggregate, the outcome of all current lawsuits and claims involving PPG, including those described in Note 15, “Commitments and

We are subject to a wide variety of complex U.S. and non-U.S. laws and regulations, and legal compliance risks, including securities laws, tax laws, environmental laws, employment and pension-related laws, competition laws, U.S. and foreign export and trading laws, and laws governing improper business practices, including bribery. We are affected by new laws and regulations and changes to existing laws and regulations, as well as interpretations by courts and regulators. These laws and regulations effectively expand our compliance obligations and costs.

For example, regulations concerning the composition, use and transport of chemical products continue to evolve. Developments concerning these regulations could potentially impact the availability or viability of some of the raw materials we use in our product formulations and/or our ability to supply certain products to some customers or markets. Import/export sanctions and regulations also continue to evolve and could result in increased compliance costs, slower product movements or additional complexity in our supply chains.

Further, although we believe that we have appropriate risk management and compliance programs in place, we cannot guarantee that our internal controls and compliance systems will always protect us from improper acts committed by employees, agents, business partners or businesses that we acquire. Any non-compliance or such improper actions or allegations could damage our reputation and subject us to civil or criminal investigations and shareholder lawsuits, could lead to substantial civil and criminal, monetary and non-monetary penalties, and could cause us to incur significant legal and investigatory fees.costs.

PPG has a significant investment in global operations. This broad geographic footprint serves to lessen the significance of economic impacts occurring in any one region. Notwithstanding the benefits of geographic diversification, our ability to achieve and maintain profitable growth in international markets is subject to risks related to the differing legal, political, social and regulatory requirements and economic conditions of many countries. As a result of our operations outside the U.S., we are subject to certain inherent risks, including political and economic uncertainty, inflation rates, exchange rates, trade protection measures, local labor conditions and laws, restrictions on foreign investments and repatriation of earnings, and weak intellectual property protection. Our percentage of sales generated in 20202022 by products sold outside the U.S. was approximately 65%60%.

Unexpected events, including supply disruptions, temporary plant and/or power outages, work stoppages, natural disasters and severe weather events, including those potentially due to climate change, significant public health issues, computer system disruptions, fires, war or terrorist activities, could increase the cost of doing business or otherwise harm the operations of PPG, our customers and our suppliers. It is not possible for us to predict the occurrence or consequence of any such events. However, such events could reduce our ability to supply products, reduce demand for our products or make it difficult or impossible for us to receive raw materials from suppliers or to deliver products to customers.

PartGrowth through acquisitions is an important component of the Company’s strategy is growth through acquisitions.strategy. Over the last decade, we have successfully completed more than 50 acquisitions, and we will likely acquire additional businesses and enter into additional joint ventures in the future. Growth through acquisitions and the formation of joint ventures involve risks, including:

These risks or other problems encountered in connection with our past or future acquisitions and joint ventures could cause delays in realizing the anticipated benefits of such acquisitions or joint ventures, andor such anticipated benefits may never be realized, which could adversely affect our results of operations, Cash from operating activities or financial condition.

Our business relies on continued global demand for our brands and products. To achieve our business goals, we must develop and sell products that appeal to customers. This is dependent on a number of factors, including our ability to produce products that meet the quality, performance and price expectations of our customers and our ability to develop effective sales, advertising and marketing programs.

We believe the automotive industry will experience significant and continued change in the coming years.years, including an increase in the production of electric vehicles. Vehicle manufacturers continue to develop new safety features such as collision avoidance technology and self-driving vehicles that may reduce vehicle collisions in the future, potentially lowering demand for our automotive refinish coatings. In addition, through the introduction of new technologies, new business models or new methods of travel, such as ridesharing, the number of automotive OEM new-builds may decline, potentially reducing demand for our automotive OEM coatings and related automotive parts.

Additionally, the development of customer-facing digital platformschannels has and will continue to transform certain retail industries. An inability to develop such solutions and our customer’s pace of adoption of those solutions could negatively affect our business or the market demand for our products.

Our future growth will depend on our ability to continue to innovate our existing products and to develop and introduce new products. If we fail to keep pace with product innovation on a competitive basis or to predict market demands for our products, our businesses, financial condition and results of operations could be adversely affected.

Increased global information technology security requirements, threats and sophisticated and targeted computer crime pose a risk to the security of our systems, networks and the confidentiality, availability and integrity of our data. Despite our efforts to protect sensitive informationintellectual property and confidential and personal data, our facilities and systems may be vulnerable to security breaches. This could lead to negative publicity, theft or other financial loss, modification or destruction of

proprietary information or key information, manufacture of defective products, production downtimes and operational disruptions, which could adversely affect our reputation, competitiveness and results of operations.

None.

PPG’s corporate headquarters is located in the United States in Pittsburgh, Pa. The Company’s manufacturing facilities, sales offices, research and development centers and distribution centers are located throughout the world. SeeRefer to Item 1. “Business” of this Form 10-K for the principal manufacturing and distribution facilities by reportable business segment.

The Company’s principal research and development centers are located in Allison Park, Pa.; Tianjin, China; Zhangjiagang, China; Cleveland, Oh.; Milan, Italy; Harmer, Pa.; Monroeville, Pa.; Springdale, Pa.; Amsterdam, Netherlands;Milan, Italy; Monroeville, Pa.; Harmar, Pa.; Ingersheim, Germany; Marly, France; Oak Creek, Wi.; Sumare, Brazil; Amsterdam, Netherlands; Vantaa, Finland; Tepexpan, Mexico; Marly, France; Ingersheim, Germany; Bangplee, Thailand;Burbank, Ca.; Zhangjiagang, China; Cheonan, Republic of Korea; Sumare, BrazilWroclaw, Poland; Bangplee, Thailand; and Wroclaw, Poland.Sylmar, Ca.

Our headquarters, certain distribution centers and substantially all company-owned paint stores are located in facilities that are leased while our other facilities are generally owned. Our facilities are considered to be suitable and adequate for the purposes for which they are intended and overall have sufficient capacity to conduct business in the upcoming year.

Item 3. Legal Proceedings

PPG is involved in a number of lawsuits and claims, both actual and potential, including some that it has asserted against others, in which substantial monetary damages are sought. These lawsuits and claims may relate to contract, patent, environmental, product liability, asbestos exposure, antitrust, employment, securities and other matters arising out of the conduct of PPG’s current and past business activities. To the extent these lawsuits and claims involve personal injury, property damage and certain other claims, PPG believes it has adequate insurance; however, certain of PPG’s insurers are contesting coverage with respect to some of these claims, and other insurers may contest coverage. PPG’s lawsuits and claims against others include claims against insurers and other third parties with respect to actual and contingent losses related to environmental, asbestos and other matters.

From the late 1880’s until the early 1970’s, PPG owned property located in Cadogan and North Buffalo Townships, Pennsylvania which was used for the disposal of solid waste from PPG’s former glass manufacturing facility in Ford City, Pennsylvania. In October 2018, the Pennsylvania Department of Environmental Protection (the “DEP”) approved PPG’s cleanup plan for the Cadogan Property. In April 2019, PPG and the DEP entered into a consent order and agreement (“CO&A”) which incorporated PPG’s approved cleanup plan and a draft final permit for the collection and discharge of seeps emanating from the former disposal area. The CO&A includes a civil penalty of $1.2 million for alleged past unauthorized discharges. PPG’s former disposal area is also the subject of a citizens’ suit filed by the Sierra Club and PennEnvironment seeking remedial measures beyond the measures specified in PPG’s approved cleanup plan, a civil penalty in addition to the penalty included in the CO&A and plaintiffs’ attorneys fees. PPG and the plaintiffs settled plaintiffs’ claims for injunctive relief and PPG agreed to enhancements to the DEP approved cleanup plan and a $250,000 donation to a Pennsylvania nonprofit organization. This settlement has been memorialized by an amendment to the CO&A which was appended to a Consent Agreement between PPG and the plaintiffs which has been lodged withentered by the federal Court. The remaining claims in the case for attorneys’ fees and a civil penalty are not affected by this settlement. PPG believes that the remaining claims are without merit and intends to defend itself against these claims vigorously.

For many years, PPG has been a defendant in lawsuits involving claims alleging personal injury from exposure to asbestos. For a description of asbestos litigation affecting the Company, see Note 15, “Commitments and Contingent Liabilities” to the accompanying consolidated financial statements underin Part I, Item 8 of this Form 10-K.

In the past, the Company and others have been named as defendants in several cases in various jurisdictions claiming damages related to exposure to lead and remediation of lead-based coatings applications. PPG has been dismissed as a defendant from most of these lawsuits and has never been found liable in any of these cases. After having not been named in a new lead-related lawsuit for 15 years, PPG was named as a defendant in two Pennsylvania state court lawsuits filed by Montgomery County and Lehigh County in the respective counties on October 4, 2018 and October 12, 2018. Both suits seek declaratory relief arising out of alleged public nuisances in the counties associated with the presence of lead paint on various buildings constructed prior to 1980. The Company believes these actions are without merit and intends to defend itself vigorously.

Set forth below is information related to the Company’s executive officers as of February 18, 2021.16, 2023. 

Item 4. Mine Safety Disclosures

Not Applicable.

Item 5. Market for the Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The information required by Item 5 regarding market information, including PPG’s stock exchange listing and quarterly stock market prices, dividends, holders of common stock, and the stock performance graph is included in Exhibit 13.1 filed with this Form 10-K and is incorporated herein by reference.

No shares were repurchased in the three months ended December 31, 20202022 under the current $2.5 billion share repurchase program approved in December 2017. The maximum number of shares that may yet be purchased under this program is 10,472,5868,830,144 shares as of December 31, 2020.2022. This repurchase program has no expiration date.

The following discussion includes a comparison of our results of operations and liquidity and capital resources for the years ended December 31, 20202022 and 2019.2021. A discussion of changes in our results of operations for the year ended December 31, 20192021 as compared to the year ended December 31, 20182020 has been omitted from this Form 10-K, but may be found in “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our 20192021 Form 10-K, filed with the Securities and Exchange Commission on February 20, 2020.17, 2022.

For specific business results, see the Segment ResultsPerformance of Reportable Business Segments section within Item 7 of this Form 10-K.

Selling, general and administrative expenses decreased $215increased $62 million primarily due to:

Interest expense netincreased $46 million 2022 versus 2021 primarily due the unfavorable impact of higher interest rates on PPG’s variable rate debt obligations and slightly higher levels of debt in the current year.

Interest expense, net of Interest income increased $15$28 million in 2020 versus 2019 primarily due to the $1.5 billion 364-day term loan credit agreement entered into in April 2020. As of December 31, 2020, $400 million remains outstanding under this agreement.higher interest rates.

In 2020,the fourth quarter 2022, the Company recorded an impairment charges were recorded for the write-downcharge of certain assets and liabilities related$4 million to the planned sale of certain entities andreduce the carrying value of ancertain indefinite-lived trademark. trademarks based on the results of the annual impairment test.

Refer to Note 3, ”Acquisitions and Divestitures” and Note 7,6, “Goodwill and Other Identifiable Intangible Assets”Assets and Note 7 ”Impairment and Other Related Charges, Net” in Item 8 of this Form 10-K for additional information.

In 2021, the reserve for asbestos-related claims was reduced to reflect the Company’s current estimate of potential liability for these claims. Refer to Note 15 “Commitments and Contingent Liabilities” in Item 8 of this Form 10-K for additional information.

Pretax restructuring charges of $203$84 million related to recent acquisitions were recorded in 2020,2022, partially offset by certain changes in estimates to complete previously recorded programs of $29$51 million. Pretax restructuring charges of $194$54 million were recorded in 2019,2021, offset by certain changes in estimates to complete previously recorded programs of $18$23 million. Refer to Note 8, "Business Restructuring" in Item 8 of this Form 10-K for additional information.

Other (income)/charges, consistnet was lower in 2022 compared to the prior year primarily due to a $34 million gain on the sale of environmental remediation charges. These charges were principally for environmental remediation at a former chromiumproduction facility in 2021 in connection with the Company’s manufacturing plantfootprint consolidation plans and associated sitesrestructuring programs as well as favorable legal settlements in New Jersey.2021. Refer to Note 15, "Commitments and Contingent Liabilities"18, “Other (Income)/Charges, Net” in Item 8 of this Form 10-K for additional information.

The effective tax rate for the year-ended December 31, 20202022 was 21.4%23.5%, a decreasean increase of 2.2%2.9% from the prior year. The lower effective incomeyear primarily driven by charges associated with PPG’s operations in Russia along with a reduction in the release of reserves for uncertain tax rate included higher net benefits for changes in valuation allowance reservespositions compared to the prior year.

Earnings per diluted share and for U.S. research and development credits. The Company expects that its full year 2021 effective tax rate will be between 22% and 24%.

PPG believes investor’sinvestors’ understanding of the Company’s performance is enhanced by the disclosure of net income from continuing operations, earnings per diluted share from continuing operations, and PPG’s effective tax rate from continuing operationsand segment income adjusted for certain items. PPG’s management considers this information useful in providing insight into the Company’s ongoing performance because it excludes the impact of items that cannot reasonably be expected to recur on a quarterly basis or that are not attributable to our primary operations. Net income from continuing operations, earnings per diluted share from continuing operations, and the effective tax rate from continuing operationsand segment income adjusted for these items are not recognized financial measures determined in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) and should not be considered a substitute for net income from continuing operations, earnings per diluted share from continuing operations, the effective tax rate, segment income or other financial measures as computed in accordance with U.S. GAAP. In addition, adjusted net income, adjusted earnings per diluted share from continuing operations and the adjusted effective tax rate from continuing operations may not be comparable to similarly titled measures as reported by other companies.

In 2020,2022, all businesses within the Performance Coatings reportable business segment suffered from lower sales volumes due to the COVID-19 pandemic but achieved higher selling prices across all regions.consistent with our focus on mitigating raw material and other cost inflation. These price increases also helped to offset softer demand conditions in Europe due in part to geopolitical issues, the impact of pandemic-related restrictions in China, softening do-it-yourself (“DIY”) demand and unfavorable foreign currency translation.

Architectural coatings - Americas and Asia Pacific– EMEA net sales, excluding the impact of currency, acquisitions, divestitures and acquisitions (organic sales)the wind down of Russia operations (“organic sales”) were flat compared to prior year as selling price increases were offset by lower sales volumes. Sales were negatively impacted by geopolitical uncertainty, including the war in Ukraine, lower demand for DIY paint products and unfavorable foreign currency translation.

Architectural coatings – Americas and Asia Pacific organic sales increased a low-single-digitmid-single-digit percentage during the year with differences by channel and region. Higher do-it yourself (“DIY”) sales volumes wereprimarily due to selling price increases that more than offset by the unfavorable impact of retail store shutdownslower sales volumes. Sales in the U.S., and Canada were unfavorably impacted by raw material availability, which improved as the year progressed, and softening DIY demand. In Mexico, and unfavorable foreign currency translation driven by the Mexican peso. PPG-ComexPPG Comex architectural coatings organic sales were higher by a mid-single-digit percentage,increased compared to the prior year as the concessionaire network sell-out of PPG products wasdemand continued to be strong throughout the year.2022 and further selling price increases were implemented.

ArchitecturalAutomotive refinish coatings – EMEA organic sales increased by a mid-single-digithigh-single-digit percentage driven by a strong volumesdue to selling price increases in all regions and volume growth in the second half of the year offsetU.S. stemming from higher miles driven, increased collision claims and more people returning to office work versus 2021. Sales were negatively impacted by lowersofter demand in Southern Europe earlierand the impact of pandemic-related restrictions in the year when various countries mandated the temporary closure of retail paint stores due to COVID-19.

Aerospace coatings organic sales increased by a high-teen-percentage due to increased selling prices and sales volumes decreased about 25% year-over-year duein all regions. Sales volumes increased in all regions compared to a sharp decline in commercial OEM, general aviation and after-market products.prior year, but still remain below pre-pandemic levels. Net sales benefited from consistentcontinued strong demand for the company’s military applications and acquisition-relatedfor PPG’s technology-advantaged products.

Organic sales from Dexmet and Texstars.

Traffic solutions organic sales increased by a low-teen-percentage as a result ofhigher selling prices and solid volume growth in the pandemicU.S. and Latin America were partially offset by lower demand for protective coatings products. Lower sales volumes in Europe and the U.S. were related to continued soft demand in the oil and gas industry. Sales volumes in Europe suffered from delayed projects due to the pandemic. In the Asia-Pacific region, sales volumes were flat versus 2019 reflecting strong demand for PPG’s technology-advantaged products and despite lower demand for marine coatings products.

Segment income decreased $50$92 million year-over-year, including unfavorable foreign currency translation impacts of approximately $20 million. Segment income was impacted byyear over year primarily due to raw material and logistics cost inflation, lower sales volumes related toand the pandemic andimpact of unfavorable foreign currency translation, partially offset by higher selling prices, execution of cost-mitigation effortssavings from previously approved restructuring actions and restructuring initiatives.acquisition-related earnings.

Looking ahead, overall segment net sales inIn the first quarter 2021,2023, demand conditions in Europe and China are expected to remain similar to the fourth quarter 2022, including potential pandemic-related disruptions. Raw material and transportation availability continue to improve, with the biggest challenges remaining in the aerospace coatings business. Aggregate sales volumes are anticipated to be generally similarlower by a mid-single-digit percentage compared to the fourth quarter. Sales volumes are expectedfirst quarter 2022 driven by the unfavorable impacts in Europe and China and continued soft architectural coatings DIY demand. The impact of divestiture-related sales and sales related to be slightly lower on a year-over-year basis. Sharp year-over-year declinesthe Russia business, which the Company is in the commercial aerospace coatings business will continue. Lastly, acquisitionsprocess of winding down, are forecastanticipated to addreduce sales by about $90 million of net sales, primarily from Ennis-Flint. First quarter sales and earnings for the Ennis-Flint business are historically low due to normal seasonality in that business. It is expected that raw material, logistics, and certain other costs will be inflationary in 2021.$40 million. The company has already announced selling price increases in most of the businesses within the Performance Coatings reportable segment andCompany will continue to executefocus on executing various existing cost-savings initiatives. Finally, foreign currency translation is expected to have a favorable impact on segment net sales and earnings

PartiallyIn 2022, all businesses within the Industrial Coatings reportable business segment achieved higher selling prices consistent with our focus on mitigating raw material and other cost inflation. These price increases also helped to offset by:

Automotive OEM coatings organic sales increased by more than 10% led by higher selling prices in all regions and higher sales volumes decreasedin the U.S. and Latin America. Sales were unfavorably impacted by approximately 15% year-over-year, drivenindustry-wide production disruptions due to semiconductor chip shortages, which continued in 2022 but improved as the year progressed. Sales volumes were also impacted by the significant curtailment in globallower automotive industry production rates due to the COVID-19 pandemic. Although sales volumes decreased year-over-year, strong sales volumesgeopolitical uncertainty in ChinaEurope and the company’s strong technology and service capabilities led PPG to outpace the global industry build rate.impact of pandemic-related disruptions in China.

For the industrial coatings business, netorganic sales decreasedincreased by about 10% compared to prior year. Acquisition-related sales from Whitford and modesta high-single-digit percentage year over year as strong selling price increases in selling prices were more than offset by lower demand stemming from reduced industrial production in mostall regions due to customer shutdowns. Global industrial production improved during the second half of the year compared to the start of the pandemic.

Packaging coatings organic sales increased by a high-single-digit percentage year over year due to higher selling prices in all regions. Sales volumes were strong in the Asia Pacific region. In the U.S. but were negatively impacted by geopolitical uncertainty in Europe and Latin America, sales volume growth was driven by strong demandpandemic-related restrictions in the canned food and beverage segment.China.

Specialty coatings and materials netorganic sales were lowerincreased by approximatelynearly 20% versus the prior year driven by lower sales volumeshigher selling prices in the U.S.all regions and Europe. Additionally,volume growth in the second half of 2020, a company facility in Louisiana was damaged by both Hurricanes Laura and Delta, causing an estimated $10 million in lost revenues due to production interruptions.Europe.

Segment income decreased $112$37 million year-over-year, includingyear over year primarily due to raw material and logistics cost inflation, lower sales volumes and the impact of unfavorable foreign currency translation, impacts of about $10 million. Segment income was impacted by lower sales volumes driven by customer shutdowns related to the pandemic, partially offset by cost-mitigation actions, restructuring cost savings, and modestly higher selling prices.prices and savings from previously approved restructuring actions.

Looking ahead,In the first quarter 2023, global industrial production is expected to remain at lower levels. In China, pandemic-related disruptions are expected to continue into the first quarter. Aggregate sales volumes forare anticipated to decline by a mid-single-digit percentage compared to the Industrial Coatings reportablefirst quarter 2022. Sales volumes are expected to be similar to the prior year quarter in the automotive OEM coatings business but lower in the industrial coatings, packaging coatings, and specialty coatings and materials businesses. Positive selling price is expected to continue, although some of the strong selling prices realized in 2022 will begin to reach their anniversary in the first quarter. Year-over-year segment margins are expected to continue to improve on a sequential basis in the first quarter 2021 are expected2023. The Company will continue to be higher than the prior-year first quarter by a mid-to-high-single-digit percentage, including the benefit of an

During 2020, the COVID-19 pandemic significantly impacted global economic conditions.The impact in the first quarter was concentrated in China and broadened to most of the rest of the world in the second quarter. Coatings end-use markets related to mobility were more negatively impacted, such as the aerospace and automotive refinish coatings businesses. Some end-use markets benefited from the government mandated restrictions, including architectural coatings DIY and the packaged food segment. PPG’s net sales, excluding foreign currency translation impact, decreasedincreased approximately 8%10% versus the prior year.year and were a record $17.7 billion. Organic sales increased by about 8% driven by higher selling prices, partially offset by lower sales volumes. Acquisition-related sales contributed 1%3% to net sales growth compared to prior year.year as the Company benefited from four strategic acquisitions that were completed in 2021. Foreign currency translation was unfavorable throughoutfor the year and impacted net sales by about 1%5%. During 2022, severe cost inflation, supply disruptions, geopolitical issues in Europe and continuing impacts from the pandemic significantly impacted net sales and earnings. There was partial recovery in the end-use markets that were impacted by mobility restrictions in 2020 and 2021, such as automotive OEM, automotive refinish coatings and aerospace coatings, but all three remained below 2019 global demand levels. Demand

was mixed by geographic region. In the U.S. and Canada and Latin America regions, demand was solid throughout the year in most businesses despite supply disruptions constraining sales more than other regions. Demand was the softest in Europe due in part to geopolitical issues, including the war in Ukraine, with the largest impact on the architectural coatings business. In Asia, demand was mixed, as activity in China was impacted by ongoing pandemic-related restrictions and associated disruptions, while demand conditions in the rest of Asia were more stable. Despite ongoing component shortages that constrained global automotive OEM manufacturers’ production, global builds increased by about 6% versus 2021 due to strong underlying demand in most regions and supply deficits that are expected to remain into 2023. Raw material costs moderated during the first halfcost inflation trended higher for most of the year, finishing the fourth quarter about 35% above fourth quarter 2019 levels. In the fourth quarter 2022, raw material inflation began to moderate and then increased sequentially throughout the second half of 2020 and are expectedis anticipated to continue to be inflationary into the first quarter of 2021.ease further in 2023. Some other key costs continued to increase in 2020 such as2022, including logistics, employee wage and benefit costs, and energy costs. The Company continued to collaborate with its customers to implement selling price increases to mitigate elevated input costs, resulting in an 11% increase in selling prices compared to 2021.

During 2020,In 2022, economic activity was impacted byremained robust and continued to recover from the COVID-19 pandemic with overall economic activity sharply fallinglower demand levels experienced in the first half of the year and then continuously improving in the second half of the year.2021 due to pandemic-related restrictions. For the full year, U.S. GDP fellgross domestic product (“GDP”) and industrial production increased by about 5%. Automotive OEM industry builds were down about 20% compared to 2019 with minimal production in the second quarterapproximately 2% and improving trends in the second-half of the year.4%, respectively. Demand in the residential and commercial construction markets were mixed in 2020 compared to 2019.was strong at the beginning of the year but softened as interest rates increased as the year progressed. New home starts advanced approximately 5%decreased by a mid-single-digit percentage in 20202022 versus approximately 2%a mid-teen percentage increase in 2019.2021. Residential remodeling was up 2%down by approximately 10% in 20202022 versus 2019 supported2021 as solid housing fundamentals were offset by stay-at-home mandates.the impact of higher interest rates. Commercial construction was down approximately 10% compared to 2019.2021. Market demand for architectural paint shifted significantlycontinued to shift back to do-it-for-me (“DIFM”) from the DIY channel during the year as higherlower U.S. unemployment and increased work-from-homemobility resulted in consumers choosing to spend more time renovating their homes. PPG’s architecturalhire professional paint contractors. Earnings were aided by strong selling price increases, but negatively impacted by higher levels of inflation, including historically high raw material cost inflation and higher than normal salary and wage increases due to the high level of employment in the U.S. Architectural coatings sales volumes in the U.S. and Canada were positively impacted by DIY trends and negatively impacted by lower commercialsevere raw material shortages that prevented the Company from meeting the demand trends.for its architectural products, mostly impacting the higher demand periods of spring and summer.

Automotive OEM industry builds were up nearly 10% compared to 2021 as component shortages began to moderate and underlying demand for new automobiles was solid. The aerospace coatings business was significantly impacted by the pandemic.continued what is expected to be a multi-year recovery to return to 2019 activity levels. Before the pandemic, the company’sCompany’s sales mix was approximately 70% commercial and 30% military. During the pandemic PPGand through 2022, sales volumes for military applications remained solid, in part due to specification of PPG products with advantaged technology. The commercial segment wasremains down about 50% due15%, as overall improved flying activity still remains below 2019 levels, mostly impacted by lower activity in China. With the lifting of pandemic-related restrictions in China, it is expected that global commercial aftermarket and new build demand will continue to lower passenger miles flown and fewer industry OEM builds.improve in 2023. The automotive refinish coatings business was impacted by stay-at-home mandates. These mandatesexperienced strong demand through the year as miles driven and collision claims trended closer to pre-pandemic levels. Sales were constrained due to ongoing supply disruptions, which has led to less commuting to work, less congestion and fewer miles driven leading to lower collision claims. PPG’sindustry inventory levels. The packaging coatings business was favorably impacted by new business wins at several new packaged beverage can customers and overall solid demand for the Company’s sustainable products. The traffic solutions business, which represents the Ennis-Flint acquisition completed in December 2020, made good progress realizing synergies and achieved a low-teen percentage growth in organic sales.

U.S. and Canada organic sales increased by more than 10% compared to 2021 driven by higher packaged food demand. PPG’sselling prices in all businesses. Solid year-over-year sales volume increases in the aerospace, automotive refinish, industrial, automotive OEM and packaging coatings business performance was slightly below industry demand levels due to customer mix. Higher acquisition-related salesbusinesses were partially offset by lower year-over-year sales volumes in the automotive OEMarchitectural and protective and marine coatings business. For the industrial coatings business, acquisition-relatedbusinesses. Aggregate regional sales and higher selling prices werevolumes remain more than offset by10% lower sales volumes.than the fourth quarter 2019. The U.S. and Canada remained PPG’s largest region, with sales of $7.4 billion, representing approximately 41%42% of 20202022 net sales.

European economicdemand for coatings softened in 2022, mostly impacted by geopolitical issues and high levels of inflation. Supply chain disruptions lessened during 2022 but continued to impact certain end-use markets, most notably automotive OEM. In the first quarter, activity in this region was weaknegatively impacted by mobility restrictions associated with pandemic-related disruptions. While the impact of the pandemic eased throughout the year, consumer confidence worsened as the year progressed due to elevated costs and the war in 2020. Industrial productionUkraine, which significantly impacted demand for coating products. Component shortages continued to constrain automotive OEM sales volumes. Automotive builds in 2022 were at similar levels as 2021. Architectural coatings – EMEA organic sales were flat compared to the prior year as selling price increases were offset by lower sales volumes. Net sales for architectural DIFM products improved as compared to the prior year. Integration of the June 2021 acquisition of Tikkurila continued with good progress toward realizing targeted

synergies. In addition, the integration efforts continued for the two automotive OEM acquisitions made in 2021, Wörwag and manufacturing ratesCetelon, with PPG continuing to realize acquisition-related synergies and leverage acquired product technologies to drive sales growth. Net sales were aided by partial recovery in the region were lower than 2019. The region was impacted by continuing uncertainty over the United Kingdom’s exit from the European Unionaerospace and overall contracting demand in most end-use markets that PPG supplies due to the pandemic. Regional demand continued to be mixed by country and end-use. Demand for PPG products was impacted by a decline in demand for automotive refinish automotive OEM, aerospace,coatings businesses. Demand was soft for architectural coatings, packaging coatings and general industrial coatings products. Demand for architectural and packaging coatings products was better, led by

EMEA net sales of $5.5 billion represented 31% of PPG’s 2022 net sales, modestly higher coatingsthan 2021. Organic sales for architectural DIY and the packaged food segment. PPG’s architectural coatings - EMEA business’ organic sales were higherimproved by a mid-single-digit percentage drivencompared to 2021 led by higher selling prices and higheracquisition-related sales, volumes.

The emerging regions of Asia Pacific and Latin America represented 28%27% of PPG’s 20202022 net sales in aggregate, similar to the prior year.

Net sales in Latin America in 2022 were $2.0 billion, representing a 16% increase compared to 2021. Overall, demand in Latin America declined year-over-yearthe region increased year over year driven by lower automotive industry builds and overall softerimproved economic conditionsactivity in most countries, including Mexico. In Mexico,end-use markets. Organic sales were higher by a mid-teen-percentage compared to 2021 due to higher selling prices and sales volumes. The PPG Comex business made strong contributions, which continued to outpace the PPG-Comexindustry. The business added more concessionaire locations during 2022, bringing the total to over 5,100 locations. Additionally, both reportable segments delivered sales volume growth on a net of approximately 80 new concessionaire locations. The overall region’s performance was supported by strong growthyear-over-year basis. Sales volumes in the packaging coatings business. Foreign currency translation was volatile and finished about 10% unfavorableregion increased by a low-single-digit percentage compared to 2019, principally driven by weaker currencies, including the Mexican peso and Brazilian real.2019.

Looking ahead to 2021, weWe expect solidsoftening global market growtheconomic activity in 2023 that will likely be uneven by region and end-use. WeAs 2023 progresses, we expect regional growth ratesdemand for architectural coatings products in the U.S. to be negatively impacted by higher than 2020interest rates, while we anticipate demand to gradually improve in China as it transitions away from zero-COVID policies and supply chain disruptions continue to ease. In Europe, we expect demand to remain soft due to ongoing geopolitical issues and inflation. In general, most end-use markets do not have significant excess inventories, and any demand improvement should lead to a faster ramp-up of sales volumes. Continued recovery is expected in the automotive refinish, automotive OEM and aerospace coatings businesses, which collectively accounted for about 40% of the Company’s pre-pandemic sales and where the Company has broad, global businesses supported by advantaged technologies.

Supply chain and pandemic-related disruptions experienced during the past three years are expected to ease as 2023 progresses, which should allow for ample supply of commodity-related raw materials in all regionsregions. We also expect the Company’s ability to manufacture and deliver product to improve as demand continuesthe year progresses, leading to recover from the pandemic.better manufacturing efficiencies.

We anticipate that PPG’s growth in the U.S. and Canada regional growth will be led by the aerospace coatings, automotive refinish coatings and traffic solutions businesses. Automotive OEM and general industrial coatings as industrial production levelsindustry builds in the region are expected to increase slightly compared to 2022. Architectural coatings demand is expected to moderate and may fall as the year progresses due to higher interest rates, lower single-family home construction and lower sales of existing homes. Traffic solutions and protective coatings demand should be higher than 2020.aided later in 2023 as infrastructure spending continues to gain momentum.

We expect European industry demand trends in 2023 to remain similar to those experienced in the second half of 2022. Automotive OEM builds are expected to be approximately a mid-teen percentage higher compared to 2020. We expect positive growth in housingincrease modestly from historical lows, and continued weakness in commercial construction and maintenance. Architectural DIYaerospace demand is expected to remain at elevated levels in the first half of 2021. Demand for aerospace and automotive refinish coatings is expectedcontinue to remain subdued during the first half of 2021.

customers. Raw material availability is expected to continue to improve as the year progresses. A new cost savings program was announced in the third quarter 2022, which has a higher concentration of initiatives focused on Europe. We continue to monitor the economic environment in the U.K., as its exit from the European Union progresses, andincluding monitoring the impacts on consumer sentiment, logistics, labor availability and coatings demand. Demand for aerospaceTo date, the U.K.'s exit from the European Union has not had a material impact on the Company's operations.

In the Asia Pacific region, we expect economic activity to improve in China after the first quarter as supply chain activity and automotive refinish coatingsmobility levels move closer to 2019 levels. Stimulus support is expected in the region to aid economic activity. Economic output in India is expected to remain soft.

In Latin America, we anticipate slightly bettercontinued stable economic conditions in Mexico, most of Central America and South America compared to 2020.2022. We expect continued strong demand forin the PPG-ComexPPG Comex architectural coatings business.

We made significant progress on the global restructuring programs that were announced in May 20182019, 2020 and June 2019.2021. The 2019 and 2020 programs have been substantially completed. In the third quarter 2022, the Company achievedapproved a business restructuring plan which included actions to reduce its global cost structure in response to current economic conditions. Total restructuring savings, including the impact of acquisition synergies, was approximately $70$65 million ofin 2022. Total restructuring savings in 2020 relating to these programs. The majority of these restructuring actions are expected to be completed by the end of the first quarter 2021 with the remainder of the actions expected to be completed by 2022. Aggregate restructuring savings related to the 2020, 2019 and 2018 programs was approximately $115at least $60 million in 2020.

Raw materials are aour most significant input cost to the process of manufacturing coatings.cost. PPG experiences fluctuating energy and raw material costs driven by various factors, including changes in supplier feedstock costs and inventories, global industry activity levels, foreign currency exchange rates, and global supply and demand factors. In

On an aggregate basis, average raw material costs were modestly lowersignificantly higher in 20202022 versus 2019 due to variety2021. The increases in raw material costs were primarily driven by ongoing supply constraints, including various force majeure declarations, higher energy prices, production outages at many of reasons, including softer industry demandour suppliers, energy surcharges in Europe, labor availability challenges, transportation shortages and lower crude oil prices.higher ocean freight costs. PPG currently expects overall raw material pricescosts to increasebe higher by a low-single-digit percentage

In 2020, weWe achieved selling price improvement primarilyacross all businesses in the Performance Coatings reportable business segment,2022, reflecting the Company’s efforts to offset various inflationary pressures. Further benefits from selling price actions are necessary in 2021 to recover operating margins, reflecting the value of our products. The Company will carefully monitor all costs during 20212023 and assess the need for additional selling price increases.

In 2020,2022, we experienced unfavorable foreign currency translation throughout the year. Based on mid-January 2021 exchange rates, the Company expects favorable year-over-yearyear, and we expect that foreign currency translation in 2021. The foreign currency environment continuesrates will continue to be volatile, andvolatile. However, the impact on 2021 net sales and income before income taxes could differ from this expectation. The Company generally purchases raw materials, incurs manufacturing costs and sells finished goods in the same currency, so we typically incur only modest foreign currency transaction relatedtransaction-related impacts.

The 20212023 effective tax rate from continuing operations is expected to be in the range of 22% to 24%, varying by quarter. This range represents the Company’s best estimate.

Over the past five years, the Company used over $3.9$2 billion of cash to repurchase approximately 3521 million shares of PPG stock. Nostock, including using $190 million to repurchase shares were repurchased in 2020.of PPG stock during 2022. The Company ended the year with approximately $1.5$1.1 billion remaining under its current share repurchase authorization. During 2020,2022, the Company deployed nearly $1.2 billion$114 million for acquisitions, approximately $300$518 million for capital expenditures and approximately $495$570 million for dividends. In 2022, PPG increased its per-share dividend in September 2020, markingmarked the 49th51st annual per share dividend increase and the 121st consecutive123rd successive year of annual dividend payments.

PPG ended 20202022 with approximately $1.9$1.2 billion in cash and short-term investments. The Company expects continued strong cash generation in 2021.2023.

PPG is involved in a number of lawsuits and claims, both actual and potential, including some that it has asserted against others, in which substantial monetary damages are sought. SeeRefer to Item 3. “Legal Proceedings” and Note 15, “Commitments and Contingent Liabilities” underin Item 8 of this Form 10-K for a description of certain of these lawsuits.

As discussed in Item 3 and Note 15, although the result of any future litigation of such lawsuits and claims is inherently unpredictable, management believes that, in the aggregate, the outcome of all lawsuits and claims involving PPG, including asbestos-related claims, will not have a material effect on PPG’s consolidated financial position or liquidity; however, any such outcome may be material to the results of operations of any particular period in which costs, if any, are recognized.

As also discussed in Note 15, PPG has significant reserves for environmental contingencies. Refer to the Environmental Matters section of Note 15 for details of these reserves. It is PPG’s policy to accrue expenses for contingencies when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated. Reserves for environmental contingencies are exclusive of claims against third parties and are generally not discounted. In management’s opinion, the Company operates in an environmentally sound manner and the outcome of the Company’s environmental contingencies will not have a material effect on PPG’s financial position or liquidity; however, any such outcome may be material to the results of operations of any particular period in which costs, if any, are recognized. Management anticipates that the resolution of the Company’s environmental contingencies will occur over an extended period of time.

Note 15, PPG has significant reserves for environmental contingencies. Please refer to1, “Summary of Significant Accounting Policies” in Item 8 of this Form 10-K describes the Environmental Matters section of Note 15 for details of these reserves. A significant portion of our reserves for environmental contingencies relate to ongoing remediation at PPG's former chromium manufacturing plant in Jersey City, N.J. and associated sites ("New Jersey Chrome"). There are multiple, future events yet to occur, including further remedy selection and design, remedy implementation and execution and applicable governmental agency or community organization approvals. Considerable uncertainty exists regarding the timing of these future events for the New JerseyCompany’s recently adopted accounting pronouncements.

During the past two years, PPG had sufficient financial resources to meet its operating requirements, to fund our capital spending, including acquisitions, share repurchases and pension plans, and to pay increasing dividends to shareholders.

The $45$599 million increasedecrease in Cash from operating activities - continuing operations was primarily due to favorable changesa larger increase in working capital excludingin 2022 compared to the prior year, which reflects the impact of business acquisitions.higher raw material costs on inventories and higher selling prices on trade receivables.

Operating working capital is a subset of total working capital and represents (1) receivables from customers, net of allowance for doubtful accounts, (2) inventories, and (3) trade liabilities. SeeRefer to Note 4,3, “Working Capital Detail” underin Item 8 of this Form 10-K for further information related to the components of the Company’s operating working capital. We believe operating working capital represents the key components of working capital under the operating control of our businesses.

A key metric we use to measure our working capital management is operating working capital as a percentage of sales (fourth quarter sales annualized). 

We expect cash outlays for environmental remediation activities in 20212023 to be between $80$40 million and $100$60 million.

The $438$1,943 million increasedecrease in cash used for investing activities - continuing operations, was primarily due to higher spending on business acquisitions.the Company’s prior year acquisition of Tikkurila.

CapitalDuring 2023, capital expenditures, related to modernization and productivity improvements, expansion of existing businesses and environmental control projects iswhich are expected to be approximately $450in the range of $500 million in 2021, reflecting a return to pre-pandemic levels of spending in$550 million, will support of future organic growth opportunities.

The $699$502 million decrease in cash used for financing activities - continuing operations,change was primarily due to the proceeds from the issuance of short-termlong-term debt in 2020 and lower net purchases2021 to finance the Company’s acquisition of treasury stock year-over-year.Tikkurila.

Share repurchase activity

The Company has approximately $1.5$1.1 billion remaining under the current authorization from the Board of Directors, which was approved in December 2017. The current authorized repurchase program has no expiration date.

Dividends paid to shareholders

PPG has paid uninterrupted annual dividends since 1899, and 20202022 marked the 49th consecutive51st successive year of increased annual per-share dividend payments to shareholders. The Company raised its per-share quarterly dividend by 6%more than 5% to $0.54$0.62 per share paid in September 2020.

In August 2019, PPG amended and restated its five-year credit agreement (the “Credit Agreement”) with several banks and financial institutions as further discussed in Note 10, "Borrowings and Lines of Credit" underin Item 8 of this Form 10-K. The Credit Agreement amends and restates the Company's existing five year credit agreement dated as of December 18, 2015. The Credit Agreement provides for a $2.2 billion unsecured revolving credit facility. The Credit Agreement will terminate on August 30, 2024. In March 2020, PPG borrowed $800 million under the Credit Agreement and repaid that amount in full in April 2020. There were no amounts outstanding under the credit agreement as of December 31, 20202022 and December 31, 2019.2021.

The Term Loan Credit Agreement also supports the Company’s commercial paper borrowings which are classified as long-term based on PPG’s intent and ability to refinance these borrowings on a long-term basis. As of December 31, 2020 and 2019, there were $250 million and $100 million of commercial paper borrowings outstanding, respectively.

In addition to the amounts available under lines of credit, the Company maintains access to the capital markets and may issue debt or equity securities from time to time, which may provide an additional source of liquidity. 

SeeRefer to Note 10, “Borrowings and Lines of Credit” underin Item 8 of this Form 10-K for information regarding notes entered into and repaid as well as details regarding the use and availability of committed and uncommitted lines of credit, letters of credit guarantees and debt covenants.

We continue to believe that our cash on hand and short termshort-term investments, cash from operations and the Company’s access to capital markets will continue to be sufficient to fund our operating activities, capital spending, acquisitions, dividend payments, debt service, share repurchases, contributions to pension plans, and PPG’s significant cash requirements. The Company’s significant cash requirements include the following contractual obligations.obligations and commitments.

Management has evaluated the accounting policies used in the preparation of the financial statements and related notes presented underin Item 8 of this Form 10-K and believes those policies to be reasonable and appropriate. We believe that the most critical accounting estimates made in the preparation of our financial statements are those related to accounting for contingencies, under which we accrue a loss when it is probable that a liability has been incurred and the amount can be reasonably estimated, and to accounting for pensions, other postretirement benefits, business combinations, goodwill and other identifiable intangible assets with indefinite lives because of the importance of management judgment in making the estimates necessary to apply these policies.

Contingencies, by their nature, relate to uncertainties that require management to exercise judgment both in assessing the likelihood that a liability has been incurred as well as in estimating the amount of potential loss. The most important contingencies impacting our financial statements are those related to environmental remediation, to pending, impending or overtly threatened litigation against the Company and to the resolution of matters related to open tax years. For more information on these matters, see Note 15, “Commitments and Contingent Liabilities” and Note 13, “Income Taxes” underin Item 8 of this Form 10-K.

Accounting for pensions and other postretirement benefits involves estimating the cost of benefits to be provided well into the future and attributing that cost over the time period each employee works. To accomplish this, we make extensive use

The Company tests indefinite-lived intangible assets and goodwill for impairment by either performing a qualitative evaluation or a quantitative test at least annually, or more frequently if an indication of impairment arises. The qualitative evaluation is an assessment of factors to determine whether it is more likely than not that the fair value of a reporting unit or asset is less than its carrying amount. In the quantitative test, fair values are estimated using a discounted cash flow model. Key assumptions and estimates used in the discounted cash flow model include discount rates, tax rates, future revenues, operating cash flows and capital expenditures. For more information on these matters, see Note 1, “Summary of Significant Accounting Policies” underin Item 8 of this Form 10-K.

We believe that the amounts recorded in the financial statements underin Item 8 of this Form 10-K related to these contingencies, pensions, other postretirement benefits, business combinations, goodwill and other identifiable intangible assets with indefinite lives are based on the best estimates and judgments of the appropriate PPG management, although actual outcomes could differ from our estimates.

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of the Company. Management’s Discussion and Analysis and other sections of this Annual Report contain forward-looking statements that reflect the Company’s current views with respect to future events and financial performance.

Many factors could cause actual results to differ materially from the Company’s forward-looking statements. Such factors include statements related to the expected effects on our business of the COVID-19, pandemic, global economic conditions, geopolitical issues in Europe, increasing price and product competition by our competitors, fluctuations in cost and availability of raw materials, energy, labor and logistics, the ability to achieve selling price increases, the ability to recover margins, customer inventory levels, PPG inventory levels, our ability to maintain favorable supplier relationships and arrangements, the timing of and the realization of anticipated cost savings from restructuring and other initiatives, the ability to identify additional cost savings opportunities, the timing and expected benefits of our acquisitions, difficulties in integrating acquired businesses and achieving expected synergies therefrom, the amount of future share repurchases, economic and political conditions in the markets we serve, the ability to penetrate existing, developing and emerging foreign and domestic markets, foreign exchange rates and fluctuations in such rates, fluctuations in tax rates, the impact of future legislation, the impact of environmental regulations, unexpected business disruptions, the effectiveness of our internal control over financial reporting, the results of governmental investigations and the unpredictability of existing and possible future litigation.litigation, including asbestos litigation, and government investigations. However, it is not possible to predict or identify all such factors.

Consequently, while the list of factors presented here and underin Item 1A is considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward-looking statements.

Consequences of material differences in the results compared with those anticipated in the forward-looking statements could include, among other things, lower sales or income, business disruption, operational problems, financial loss, legal liability to third parties, other factors set forth in Item 1A of this Form 10-K and similar risks, any of which could have a material adverse effect on the Company’s consolidated financial condition, results of operations or liquidity. PPG undertakes no obligation to update any forward-looking statement, except as otherwise required by applicable law.

PPG is exposed to market risks related to changes in foreign currency exchange rates and interest rates, and was exposed to changes in PPG’s stock price.rates. The Company may enter into derivative financial instrument transactions in order to manage or reduce these market risks. A detailed description of these exposures and the Company’s risk management policies are provided in Note 11, “Financial Instruments, Hedging Activities and Fair Value Measurements” underin Item 8 of this Form 10-K.

The following disclosures summarize PPG’s exposure to market risks and information regarding the use of and fair value of derivatives employed to manage its exposure to such risks. Quantitative sensitivity analyses have been provided to reflect how reasonably possible, unfavorable changes in market rates cancould impact PPG’s consolidated results of operations, cash flows and financial position.

Report of Independent Registered Public Accounting Firm

The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management Report on Establishing and Maintaining Adequate Internal Control Over Financial Reporting appearing under Item 8.Reporting. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become

inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

As described in Notes 1 and 76 to the consolidated financial statements, the Company’s consolidated goodwill balance was $5,102$6,078 million as of December 31, 2020.2022, of which a portion was subject to a quantitative goodwill impairment test. Management tests goodwill for impairment by either performing a qualitative evaluation or a quantitative test, at least annually, or more frequently if an indication of impairment exists. Management’s quantitative goodwill impairment testing, if deemed necessary, is performed during the fourth quarter of each year by comparing the estimated fair value of an associated reporting unit as of September 30 to its carrying value. Fair value is estimated using a discounted cash flow model. Key assumptions and estimates used in the discounted cash flow model relate toinclude projected future revenues, discount rates, operating cash flows, capital expenditures and tax rates.

The principal considerations for our determination that performing procedures relating to the quantitative goodwill impairment testingtest is a critical audit matter are:are (i) the significant judgment by management when developing the fair value measurementestimate of anythe reporting unitsunit where a quantitative test was performed; and (ii) thea high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating themanagement’s significant assumption used in management’s cash flow projections related to projected future revenues.

Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to management’s quantitative goodwill impairment test, including controls over the valuation of anythe reporting units for whichunit where a quantitative test was performed. These procedures also included, among others (i) testing management’s process for developing the fair value estimate. This includedestimate of the reporting unit where a quantitative test was performed; (ii) evaluating the appropriateness of the discounted cash flow model,model; (iii) testing the completeness accuracy, and relevanceaccuracy of underlying data used in the discounted cash flow model; and (iv) evaluating the reasonableness of management’s significant assumption related to projected future revenues. Evaluating management’s significant assumption related to projected future revenues involved evaluating whether the significant assumption used by management was reasonable considering (i) the current and past performance of the reporting unit,unit; (ii) the consistency with external market and industry data,data; and (iii) whether the assumption was consistent with evidence obtained in other areas of the audit.

We are responsible for establishing and maintaining adequate internal control over financial reporting as defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as amended. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

PricewaterhouseCoopers LLP, an independent registered public accounting firm, has issued their report, included on pages 31-3230-31 of this Form 10-K, regarding the Company’s internal control over financial reporting.

Consolidated Statement of Income