AkzoNobel publishes Q3 2010 results

By: Interpon  05-Apr-2012

  • Revenue €3.9 billion (2009: €3.4 billion), up 13 percent (5 percent in constant currencies)
  • EBITDA €574 million (2009: €528 million), up 9 percent (2 percent in constant currencies)
  • Total net income up 21 percent to €238 million (2009: 197 million)
  • Sale of National Starch completed on October 1
  • Two bolt-on acquisitions in Performance Coatings
  • Interim dividend of €0.32 declared, up 7 percent from 2009
  • New medium-term ambitions announced
  • Outlook confirmed: AkzoNobel remains cautiously optimistic

Akzo Nobel N.V. (AkzoNobel), the largest global paints and coatings company and major producer of specialty chemicals, today reported a revenue increase of 13 percent for the third quarter of 2010 and an EBITDA margin of 14.8 percent.

Strong revenue gains continued to be achieved in high growth markets across all business areas, while revenue development in the mature markets remained weak. Performance Coatings and Specialty Chemicals reported the strongest revenue increases of 18 and 15 percent respectively, with Decorative Paints revenue up 8 percent.

EBITDA for the third quarter rose 9 percent to €574 million, with total net income rising 21 percent on 2009 to €238 million.

On October 1, the company completed the sale of its National Starch business for US$1.3 billion. Two acquisitions were announced during the quarter – the Lindgens Metal Decorating Coatings and Inks business, and China’s Changzhou Prime Automotive Paint Co., Ltd business, both within the Performance Coatings business area.

CEO Hans Wijers

“Our Q3 results clearly illustrate that, in line with our recently announced medium-term ambitions, our three business areas are growing revenue. Although there is reason for caution in mature markets, we are confident that we are in good shape to benefit from our geographic spread and leading positions. We are particularly optimistic about our strong revenue growth in high growth markets and our ongoing efforts to capture value. Our disciplined focus on customers, cost and cash remains strong, and we are making excellent progress in driving top line growth.

Our third quarter was also notable for two bolt-on acquisitions in Performance Coatings and, the sale of National Starch on October 1. The Sikkens healthcare concept for hospitals in the Netherlands was also launched and our Glidden brand clinched the contract to be the primary paint supplier for Walmart in the US.

Following the recent launch of our Value & Values ambitions, AkzoNobel is confidently entering a period of accelerated and sustainable growth. We will leverage our leading positions, global mega-trends and geographical spread to achieve our revenue target of €20 billion and grow our EBITDA each year while maintaining a 13 to 15 percent margin level.”

Medium- term strategic ambitions

AkzoNobel has the aspiration to be the world’s leading coatings and specialty chemicals company. On September 28, the company announced new medium-term ambitions to grow revenue to €20 billion, increase EBITDA each year while maintaining a 13 to 15 percent margin, reduce OWC percent of revenue year-on-year by 0.5 percent towards a 12 percent level, and pay a stable to rising dividend.

The sustainability ambitions are to remain in the top three on the Dow Jones Sustainability Indexes, to be top quartile in our peer group in terms of safety performance, diversity, employee engagement and development, and eco-efficiency improvement rates.

2010 outlook

Construction and housing markets, particularly in mature markets, remain soft. However, AkzoNobel’s leading positions, scale and presence in diversified markets, together with a strong balance sheet and evidence of sustained industrial demand beyond re-stocking, give reason for cautious optimism.

Business Area Highlights

Performance Coatings
   3rd Quarter   Jan - Sept   
Q3 2010 Q3 2009 ^% 2010 2009 ^%
1,239 1,051 18 Revenue 3,548 3,098 15 
166 169 (2)  EBITDA 500 440 14 
13.4 16.1 EBITDA margin (in %) 14.1 14.2
The information in this article was current at 27 Mar 2012

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