Georgia Gulf Corporation today announced financial results for the quarter ended June 30, 2012.

The company reported net sales of $867.7 million for the second quarter of 2012, four percent higher than the net sales of $831.7 million reported for the second quarter of 2011. Georgia Gulf reported net income of$13.6 million, or $0.39 per diluted share, for the second quarter of 2012, compared to net income of $14.6 million, or $0.42 per diluted share, for the second quarter of the previous year. Net income for the second quarter of 2012 includes $6.6 million of pre-tax expense from transaction related costs, restructuring, and other expenses.

“Our operating results for the first half of 2012 improved over the first half of 2011 as the recovery in the housing and construction markets showed modest improvement,” said Paul Carrico, president and chief executive officer. “Going forward, we see low-cost natural gas in North Americaremaining globally advantaged as a source of energy. This will continue to place the Gulf Coast chlorovinyls producers in a strong position to supply domestic and export customers. Our recently announced merger with PPG’s commodity chemicals business will create a chemicals and building products leader that is very well positioned to benefit from this cost advantage and expanding global demand for our products.”

Chlorovinyls

In the Chlorovinyls segment, second quarter 2012 net sales increased to$339.9 million from $323.7 million during the second quarter of 2011. The segment posted operating income of $34.5 million, compared to operating income of $37.8 million for the same quarter in the prior year. Operating income for the second quarter of 2011 includes a $1.2 millionrestructuring gain. After adjusting for the impact of the restructuring gain, the segment experienced a decrease in operating income of $2.1 millionprimarily due to higher maintenance expense, partially offset by an increase in resin sales volumes.

Building Products

In the Building Products segment, net sales were $252.4 million for the second quarter of 2012, compared to $274.2 million recorded for the same quarter in the prior year. On a constant currency basis, sales decreased six percent. The segment's operating income was $15.4 million for the second quarter of 2012, compared to $16.9 million of operating income during the same quarter of the prior year. The second the quarter of 2012 includes a restructuring gain of $0.5 million and the second quarter of 2011 included a $0.9 million net expense from restructuring charges and inventory purchase accounting adjustments. After adjusting for these impacts, the segment experienced a decrease in operating income of $2.9 million due to lower sales and higher selling, general and administrative costs, partially offset by lower distribution costs.

Aromatics

In the Aromatics segment, net sales increased to $275.5 million for the second quarter of 2012 from $233.9 million during the second quarter of 2011. During the second quarter of 2012, the segment recorded an operating loss of $2.4 million, compared to an operating loss of $7.4 million during the same quarter in 2011. The decrease in operating loss was primarily due to higher sales volumes partially offset by higher inventory holding losses.

Liquidity

As of June 30, 2012, the company had $55.4 million of cash on hand as well as approximately $287 million of borrowing capacity available under its asset-based loan (ABL) facility.

Announced Merger with PPG’s Commodity Chemicals Business

On July 19, 2012, PPG Industries (“PPG”) and Georgia Gulf announced that the boards of directors of both companies had approved definitive agreements under which PPG will separate its commodity chemicals business and then merge it with Georgia Gulf.

The terms of the transaction call for PPG to form a new company by separating its commodity chemicals business through a spinoff or split off, and then immediately merging the business with Georgia Gulf or aGeorgia Gulf subsidiary in a Reverse Morris Trust transaction. The merger will result in PPG shareholders receiving approximately 50.5 percent of the shares of the merged company (“The Newly Merged Company”), with existing Georgia Gulf shareholders owning approximately 49.5 percent of The Newly Merged Company.

Additionally, The Newly Merged Company will assume approximately $95 million of debt, about $87 million of minority interest, and related environmental liabilities, pension assets and liabilities and other post-employment benefits (OPEB) obligations from PPG.

The transaction is subject to approval by Georgia Gulf shareholders and customary closing conditions, relevant tax authority rulings and regulatory approvals and is expected to be completed in late 2012 or early 2013.