Top Companies Report

2 AkzoNobel

July 7, 2016

Amsterdam, the Netherlands

REVENUE: $10.925 billion (2014: $11.55 billion)

• Decorative paints
• Marine and protective coatings
• Auto and specialty coatings
• Industrial and powder coatings

Ton Büchner, chairman and CEO; Maëlys Castella, CFO; Ruud Joosten, executive committee member, Decorative Paints; Conrad Keijzer, executive committee member, Performance Coatings; Werner Führmann, executive committee member, Specialty Chemicals managing directors: Oscar Wezenbeek (marine coatings); John Wolff (powder coatings); Alberto Slikta (specialty coatings); AB Ghosh (metal coatings); Mauricio Bannwart (protective coatings); Simon Parker (vehicles refinishes); Volkan Goran (wood coatings); Roger Jakeman (performance coatings); Klaas Kruithof (Performance Coatings – RD&I director); Jaap Kuiper, Decorative Paints managing director – LATAM; Lin Lianqi, Decorative Paints managing director – China and North Asia;  Amit Jain, Decorative Paints managing director – North West Europe; Jan-Piet van Kesteren, Decorative Paints managing director – Eastern Europe & Africa; Jeremy Rowe, Decorative Paints managing director – South East & South Asia, Middle East;  David Menko, Decorative Paints global marketing director; Trudy Schoolenberg, Decorative Paints global supply chain and R&D director.

AkzoNobel is active in the fields of decorative paints, performance coatings and specialty chemicals and employs approximately 45,600 people (including its Specialty Chemicals business) in more than 80 countries.  Mature Europe comprises 36 percent of the companies revenue, Asia Pacific 27 percent, North America 17 percent, Latin America 10 percent, emerging Europe 7 percent and other countries 3 percent.

“Although conditions were challenging during the year – with many markets and regions experiencing varying degrees of volatility and uncertainty – we made significant progress towards our vision of leading market positions delivering leading performance,” said Ton Büchner, CEO of AkzoNobel. “We are now a stronger, leaner, more agile company. We have new operating models in place; we’ve refined our portfolio; our factory footprint has been optimized; a continuous improvement culture is being initiated and there’s continued focus on operational excellence. In addition, our ability to successfully commercialize innovation remains strong, we continue to lead the way in terms of sustainability and our Human Cities initiative has evolved and continues to grow and thrive. All of this contributed to our performance, which saw us successfully achieve our 2015 financial targets.”

Decorative Coatings Segment: Full-year operating income increased by 39 percent as a result of the new operating model, lower costs, reduced restructuring expenses and currency developments. Revenue was up 3 percent due 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.

Protective Coatings Segment: Full-year operating income was up 45 percent, due to performance improvement initiatives, management delayering, lower costs, reduced restructuring expenses and currencies. Revenue was up 7 percent, driven by favorable price/mix and currencies offsetting lower volumes. Volumes were down 2 percent across the segments, impacted by lower demand in Brazil and ongoing spending declines in the global oil and gas industry.

AkzoNobel’s pioneering methodology for rewarding ship owners who use sustainable hull coatings has been named Environmental Leader Product of the Year for 2016. The award recognizes the introduction of the shipping industry’s first carbon credits methodology, which was developed by the company’s Marine Coatings business.

“Let’s Colour” Program 
“Let’s Colour” is an employee-led community program, which is based on AkzoNobel’s belief in the transformative power of color. The company donates paint and organize projects for community groups, charities and individuals who have the desire and determination to make a difference through color. By revamping gray and unappealing spaces into bright and colorful environments, AkzoNobel’s goal is to bring happiness to the lives of people everywhere.

As part of AkzoNobel’s Human Cities initiative, the “Let’s Colour” program highlights the important role color can play in making cities more vibrant, inspiring and human.
In August, for example, 450 volunteers took part in one of the biggest “Let’s Colour” events ever staged by the company’s Decorative Paints business. Around 20,000 liters of Coral (AkzoNobel’s paint brand in Brazil) was used to transform more than 300 buildings in Rio de Janeiro’s famous Santa Marta favela. Education is also a key component of the “Let’s Colour” program. This is achieved through paint apprenticeships, which combine the desire to bring color to communities – via schools, hospitals and other public places – with a commitment to train local people (often from disadvantaged backgrounds) in the skills of painting and decorating.

During 2015, AkzoNobel donated more than 115,000 liters of paint, worth an estimated €0.5 million. Approximately 1,000 AkzoNobel employees were involved, volunteering more than 8,000 hours of their time to various “Let’s Colour” projects across the globe. The company also trained 4,250 people in painting and estimate that they positively impacted the lives of around five million people in  2015.

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