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AkzoNobel’s Q3 Results: Adjusted Operating Income Up 23%

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10.23.19

Akzo Nobel N.V. published results for third quarter 2019.

Adjusted operating income up 23% at €300 million (2018: €243 million);
Return on Sales (ROS), excluding unallocated costs, increased to 13.8% (2018: 12.3%);
Transformation on track and delivered €19 million cost savings;
Adjusted Earnings per Share (EPS) from continuing operations up 62% at €0.97 (2018: €0.60);
New share buyback announced, €500 million to be completed in the first half of 2020

Q3 2019:

Revenue up 3% and 2% higher in constant currencies, with positive price/mix of 4% and acquisitions contributing 1%, offset by 4% lower volumes;
Adjusted operating income up 23% at €300 million (2018: €243 million) driven by ongoing pricing initiatives and cost-saving programs; ROS increased to 12.5% (2018: 10.4%);
Operating income at €247 million includes €53 million negative impact from identified items, related to transformation costs and non-cash impairments; 2018 operating income of €237 million included €6 million negative identified items;
Decorative Paints ROS up at 13.8% (2018: 12.1%); Performance Coatings ROS up at 13.7% (2018: 12.2%);
Net income from total operations at €162 million, including no net income from discontinued operations (2018: €301 million, including €152 million from discontinued operations);
Adjusted EPS from continuing operations up 62% at €0.97 (2018: €0.60); EPS from total operations at €0.79 (2018: €1.18);
€2.2 billion of the €2.5 billion share buyback program completed;
Interim dividend of €0.41 per share

“We’re making good progress towards our goal for 2020, with business return on sales of 13.8%, representing a year-on-year increase for the fifth quarter in a row. Our profit improvement of 23% in the third quarter was strong, even though we had to deal with softer end-market demand," AkzoNobel CEO Thierry Vanlancker said. “The advances we made during Q3 were largely due to our ongoing pricing initiatives and cost-saving programs. Our focus on value over volume continued to deliver results.

“The results are a testament to the great work of the entire organization. We continue to focus on our plans for the future to keep the company on its improvement trajectory and remain the reference in the paints and coatings industry.”