Akzo Nobel N.V. published the results for second quarter 2020.
Highlights Q2 2020
- ROS, excluding unallocated costs, increased to 14% (2019: 13.7%) due to strong margin management and cost savings;
- Headwinds related to COVID-19 eased during the quarter, with revenue almost 30% lower in April and nearly 5% lower in June;
- Total cost savings delivered €116 million, of which €38 million structural savings related to transformation initiatives;
- Net cash from operating activities improved to €308 million (2019: €152 million); maintained a strong balance sheet
Q2 2020 (compared to Q2 2019)
- Revenue 19% lower and 17% lower in constant currencies, with positive price/mix of 2% and 18% lower volumes, mainly due to the impact of COVID-19;
- Adjusted operating income at €238 million (2019: €305 million); ROS was 12.0% (2019: 12.4%);
- Operating income at €207 million includes €31 million negative impact from identified items, related to transformation costs (2019: €308 million, including €3 million positive identified items); OPI margin was 10.4% (2019: 12.6%);
- Net income attributable to shareholders at €129 million (2019: €231 million);
- Adjusted EPS from continuing operations at €0.80 (2019: €0.96); EPS from total operations at €0.68 (2019: €1.07)
“Despite lower end-market demand, our business return on sales increased 30 basis points to 14% for the second quarter as a result of continued focus on margin management and cost-saving measures," AkzoNobel CEO Thierry Vanlancker said. "I’m extremely proud of our teams around the world, who have continued to focus on serving our customers and delivered this resilient performance while also helping many communities affected by the pandemic.
“Our rigorous cash management and strong balance sheet put us in a sound position to deal with the ongoing uncertainty from COVID-19 as we strive to deliver powerful performance as a frontrunner in our industry."
AkzoNobel's global partnership with SOS Children’s Villages was extended for another three years. Part of its “Let’s Colour” initiative, the collaboration has already benefited more than 20,000 children and young people all over the world. It will continue to focus on renewing living spaces and offer practical skills training so that young people, families at risk and children without adequate parental care can have a brighter future.
The battle to keep interior walls stain-free has escalated following the launch of Dulux EasyCare+. Reinforced with Scuff Resist technology, the paint forms a durable matt coating, providing extraordinary mechanical strength. So it prevents those familiar battle scars you often get when plastic, rubber, or wood is knocked against a wall.
Interpon powder coatings continue to make an important contribution to critical industries around the world. The company recently expanded its antimicrobial offering (which already includes products for hygiene sensitive environments such as hospitals) by enhancing the functionality of its Interpon D1000 and 2000 range of architectural powder coatings.
The inclusion of BioCote antimicrobial technology means that building interiors can now be given increased protection against microbes such as bacteria and mold – which can cause issues such as bad odors, staining, or material degradation.
AkzoNobel received nearly 200 entries for its internal Paint the Future innovation challenge. It aimed to capture some of the creative thinking which emerged over the last few months following the COVID-19 outbreak, as employees improvised and learned to adapt to new and challenging situations. A group of 500 employees from across the company was invited to rate the ideas and drew up the shortlist which was used to determine the winners.
Vanlancker signed the Declaration of Amsterdam to show AkzoNobel’s support for LGBTI+ inclusion.
During the official signing event, he said he wanted everyone working at AkzoNobel to feel at home, and that all employees deserve a workplace where they feel respected and are offered equal opportunities, regardless of sexual orientation, race, gender, or nationality. Organized by Workplace Pride, signing the declaration is a visible and very positive way for the company to show its commitment to creating an inclusive environment for everybody.