AMSTERDAM, THE NETHERLANDS--(Marketwired - Apr 18, 2013) -
* Revenue down 7 percent, due to weak demand in Europe and divestments
* Operating income at EUR217 million (2012: EUR236 million) as weaker end markets and production issues in the Specialty Chemicals value chain impacted results
* Cash from operating activities improved EUR298 million due to lower pension payments
* Net income attributable to shareholders EUR89 million (2012: EUR84 million)
* Adjusted EPS EUR0.51 (2012: EUR0.65)
* Divestment of Decorative Paints North America completed on April 1, 2013
* Strategic focus announced in February addresses the need for performance improvement in challenging market conditions
Q1 2013 in EUR million
Q1 2012 Q1 2013 D%
Revenue 3,707 3,465 (7)
Operating income 236 217 (8)
Return on sales (ROS) % 6.4 6.3
EBITDA 410 375 (9)
Net income continuing operations 110 96 (13)
Akzo Nobel N.V. (AkzoNobel) today reported a 7 percent revenue decrease in the first quarter compared with the same period last year. This was due to weak demand in European markets and divestments. Operating income for Q1 was 8 percent lower at EUR217 million. The acceleration of AkzoNobel's performance improvement program is progressing toward achieving the full EBITDA benefit of EUR500 million a year early, as announced at the strategy update in February 2013.
Revenue in Decorative Paints declined 5 percent, mainly due to lower volumes in Europe, price/mix effects and currencies. Operating income at EUR43 million was higher than in 2012, reflecting lower restructuring charges and lower costs in mature markets.
Revenue in Performance Coatings declined 3 percent compared with the previous year.The slowdown in Europe impacted all businesses. Operating income was up 2 percent and margins improved due to a combination of margin management activities and ongoing cost control.
Revenue in Specialty Chemicals was 11 percent lower due to divestments and lower volumes, mainly in construction related products and the pulp bleaching and plastics industries. The cold weather affected seasonal segments such as agriculture and the exit from the merchant fatty acids business in China also contributed to the volume decline. Profitability was impacted by the lower volumes and productions stops.
Divestments
In December 2012, AkzoNobel completed the divestment of Chemicals Pakistan, which accounts for the divestment impact in revenue.
The divestment of Decorative Paints North America was completed on April 2013 and is reported in discontinued operations. The cash inflows and the deal result will be reported in Q2.
CFO Keith Nichols
"The economic environment remains challenging and we do not expect an early improvement in the trends that we see in our businesses. The acceleration of our performance improvement program and the strategic priorities announced in February are the right focus to have in these markets."
Business area highlights
Decorative Paints
1st Quarter
2012 2013 D%
Revenue 974 925 (5)
Operating income 25 43 72
Return on sales (ROS) % 2.6 4.6
EBITDA 68 88 29
Performance Coatings
1st Quarter
2012 2013 D%
Revenue 1,369 1,331 (3)
Operating income 127 129 2
Return on sales (ROS) % 9.3 9.7
EBITDA 159 163 3
Specialty Chemicals
1st Quarter
2012 2013 D%
Revenue 1,399 1,244 (11)
Operating income 140 99 (29)
Return on sales (ROS) % 10.0 8.0
EBITDA 235 174 26)
The 2013 Q1 report can be downloaded via the AkzoNobel Report iPad app http://bit.ly/obljrf or read online at www.akzonobel.com/quarterlyresults .
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AkzoNobel is a leading global paints and coatings company and a major producer of specialty chemicals. We supply industries and consumers worldwide with innovative products and are passionate about developing sustainable answers for our customers. Our portfolio includes well-known brands such as Dulux, Sikkens, International and Eka. Headquartered in Amsterdam, the Netherlands, we are consistently ranked as one of the leaders in the area of sustainability. With operations in more than 80 countries, our 50,000 people around the world are committed to excellence and delivering Tomorrow's Answers Today™.
AkzoNobel Q1 2013 Report: http://hugin.info/130660/R/1693917/557018.pdf
Pdf file AkzoNobel Q1 2013 press release: http://hugin.info/130660/R/1693917/557015.pdf
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Source: Akzo Nobel NV via Thomson Reuters ONE
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