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AkzoNobel Hits 2015 Targets

Thursday, February 11, 2016

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AkzoNobel has reported record performance for 2015, hitting the year's financial targets and posting significant increases in its operating income.

The Amsterdam-based company posted a 79 percent gain in net income attributable to shareholders, reaching €979 million (about US$1.09 billion), AkzoNobel announced Wednesday (Feb. 10) in its fourth quarter and full-year earnings report.

"We successfully achieved our 2015 financial targets in what was a record year for AkzoNobel in a number of areas, including return on sales, return on investment and sustainability,” said AkzoNobel CEO Ton Büchner.

research
Images: AkzoNobel

AkzoNobel CEO Ton Büchner reported that 2015 was a successful year for the company in a number of areas, including return on sales, return on investment and sustainability. The company opened a $10 million research facility in Ohio in December.

“The proposed increase of the total dividend [up 7 percent at €1.55 (US$1.73)] is also a clear sign that we are more confident about our cashflow generation,” he added.

Operating income for 2015 increased 59 percent to €1,573 million (US$1,758 million), driven by optimization, lower costs, reduced restructuring expenses, favorable currency development and incidental items, the company said.

FY2015 revenue grew 4 percent to €14,859 million (about US$16,608 million) as a result of 6 percent favorable currency effects, partly offset by divestments and lower volumes.

Additionally, the company saw a 10.6 percent return on sales and a 15 percent return of investment for the year.

The year-end report also highlighted the company’s recognition as a leader in the field of sustainability by the Dow Jones Sustainability Index (the Materials industry group) for the fourth year in a row.

AkzoNobel

Among its 2015 achievements, AkzoNobel was pleased to have been ranked number one on the Dow Jones Sustainability Index in the Materials industry group.

Segment results were reported as follows.

Decorative Paints

The company’s Decorative Paints division recorded a 39 percent gain in full-year operating income as a result of the new operating model, lower costs, reduced restructuring expenses and currency developments.

Revenue growth of 3 percent was attributed to favorable currencies offsetting adverse price/mix and volumes.

Volumes were down 1 percent overall for the full-year, with positive developments in Asia offset by Latin America and Europe, the company said.

Performance Coatings

AkzoNobel reported a 45 percent increase in the full-year operating income in the Performance Coatings division. Performance improvement initiatives, management delayering, lower costs, reduced restructuring expenses and currencies were credited for the growth.

AkzoNobel

The company reported significating increases in operatin gincome across all three divisions for FY2015.

Segment revenue was up 7 percent, as a result of favorable price/mix and currencies offsetting lower volumes, according to the company.

Volumes dipped 2 percent across the segment, attributable to a result of lower demand in Brazil and continued spending declines in the global oil and gas industry, it said.

Specialty Chemicals

The company’s Specialty Chemicals segment saw a 20 percent gain its full-year operating income. This growth was attributed to continuous improvement programs, favorable currency effects, lower costs and incidental items.

A 2 percent increase in revenue for the segment was achieved as a result of favorable currency effects, partly offset by the divestment of the Paper Chemicals business and adverse price effects.

Overall volumes in this segment were flat.

Outlook for 2016

Büchner said the company expects 2016 to be a challenging year and expects limited support from the markets in which it operates. It foresees a continuation of difficult market conditions Brazil, China and Russia and does not anticipate improvement in Europe, particularly in the Buildings and Infrastructure segment.

Deflationary pressures continue and currency tailwinds are moderating, he added.

   

Tagged categories: AkzoNobel; Coatings manufacturers; Decorative coatings; Earnings reports; Finance; Industry News

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