Financial News

AkzoNobel reports strong fourth quarter results

March 11, 2011

AkzoNobel reported a revenue increase of 12 percent for the year 2010 to €14.6 billion. EBITDA increased 16 percent to €1,964 million, with EBITDA margins up at 13.4 percent. Total 2010 net income increased 165 percent to €754 million. Revenue growth was driven by a six percent volume increase across its three business areas as demand recovered, particularly in high growth markets. For the fourth quarter, volumes were up three percent, pricing improved four percent and EBITDA rose three percent to €377 million. The total net income amounted to €162 million. Raw material prices increased in 2010, particularly in the second half of the year. The company expects 2011 prices to increase further. Pricing and cost reduction actions are ongoing. Net debt decreased from €1,744 million at year-end 2009 to €936 million at year-end 2010, mainly due to the National Starch divestment generating €1 billion of cash. Net cash from operating activities was €519 million (2009: €1,220 million) reflecting investment in working capital facilitating growth and higher restructuring payments in 2010. In September 2010, the company announced a simplified dividend policy, stating that it intends to pay a stable to rising dividend. In line with this policy, AkzoNobel is proposing a final dividend of €1.08, which would make a total 2010 dividend of €1.40, up four percent from €1.35 in 2009. “Our 2010 performance marks the first year of delivery of our new strategy. All business areas have reported strong revenue growth, increased profitability, improved sustainability performance and higher returns on invested capital,” said CEO Hans Wijers. “AkzoNobel’s revenue in high growth markets, currently representing around 40 percent of our total, grew more than 20 percent, outperforming the market in 2010. In our mature markets, revenue increased close to ten percent, further evidence that our medium-term growth plans are on track. Broad demand improvement in both mature and high growth markets for specialty chemicals led to a full-year EBITDA increase of 27 percent. Performance coatings delivered a solid performance, supported by volume growth and selective acquisitions, although EBITDA margins were impacted by higher raw material costs. Double-digit revenue growth for decorative paints was achieved in Asia and Latin America, with lower volumes in mature markets.”