Coming off an improved 2010 when most coatings companies began to experience recovery, 2011 continued the trend toward regaining financial ground from the economic downturn across most markets and regions. While most of the paint companies profiled in this year’s Top Companies Report (page 40) posted positive sales growth over 2010, full recovery to pre-recession levels is still likely a few years away. Still it is a very positive sign that overall profitability was restored in most companies and the industry is again growing outside the mature markets while also continuing to invest in the R&D pipeline.
Several companies are gone from this year’s report including Denmark’s Dyrup, acquired by PPG; South Africa’s Freeworld Coatings, acquired by Kansai Paint; South Korea’s SSCP, acquired by AkzoNobel; and China’s Yips Chemical, which did not meet sales revenue criteria. As high growth markets continue to redefine the dynamics of all manufacturing-based industries, domestic suppliers in these regions continue to gain prominence on the world stage. In this year’s report we say hello for the first time to several companies: Betek (Turkey); Taiho Paint (China); Kapci Coatings (Egypt); and PACHIN (Egypt).
In 2011, the global coatings market hit about $100 billion. Building decorative coatings accounted for nearly 50 percent of the total market, the most among all coatings. Vehicle coating presents the second largest application area, making up roughly 15 percent, of which, OE and refinish coatings occupying about 50 percent and 45 percent respectively. Protective and marine coating represents the third largest application field, accounting for about 12 percent. General industrial coating makes up roughly 10 percent, followed by powder coating, wood coating, coil coating, packaging coating, etc.
Geographically, China topped the world in terms of infrastructure and real estate investment, and helping make it the world’s largest coating market, worth about $18.9 billion in 2011, 54 percent of which was attributable to decorative coatings. From Jan. to Sep. 2011, domestic real estate investment increased 32 percent year-over-year. During the five-year period (2011-2015), the Chinese government plans to complete 36 million suites of affordable housing. While China is the world’s largest coating market, its domestic coating enterprises are small-scale. The number of domestic coating companies surpasses 2,500 while their revenue together only accounts for 11 percent of the Chinese coating market. Among them, Guangdong Carpoly Chemical Co., Ltd. is the largest. With 2011 revenue of $325,000 million it ranks number 43 on this year’s list.
AkzoNobel is once again at the top of this year’s diverse list of companies. It is the world’s largest coating manufacturer with the most complete product line. AkzoNobel is well-known for its Dulux paint in China which occupied the second largest share in the Chinese market and ranked No.1 in the real estate pre-decoration area. A lot of the top coating enterprises are century-old ones, and DuPont and Valspar have a history of more than 200 years. BASF, DuPont, PPG, Kansai, DAW and KCC attach a lot of importance to automotive coatings. Sherwin-Williams maintains more than 3,000 paint chain stores in the United States, while runner-up AkzoNobel only has roughly 500 chain stores. Valspar, Sika, Comex, Masco and Asian Paints focus on the building field and have their own advantages. For instance, Sika specializes in waterproof coatings for roofs. Valspar is the controlling company of Guangdong Huarun Paints, one of the largest coating manufacturers in China. Asian Paints is the largest Indian paint company. Jotun, Chugoku and Hempel are the magnates of marine coatings while Beckers is skilled in coil coating and RPM specializes in general industrial coating.
I hope you enjoy learning about these companies and many others in much more detail.