AkzoNobel successfully delivers on 2015 targets

AkzoNobel has reported Q4 and full-year results including the successful delivery on 2015 financial targets. Full-year operating income increased 59% to €1573M (excluding incidentals up 36% at €1462M), as a result of process optimisation, lower costs, reduced restructuring expenses, favourable currency developments and incidental items. The company was recognised as a leader in the field of sustainability by the Dow Jones Sustainability Index (the Materials industry group) for the fourth year in a row.

CEO Ton Büchner commented: ‘We successfully achieved our 2015 financial targets in what was a record year for AkzoNobel in a number of areas including return on sales, return on investment and sustainability. The proposed increase of the total dividend is also a clear sign that we are more confident about our cashflow generation.

"Looking ahead, we expect 2016 to be a challenging year and anticipate limited support from the markets in which we operate. We will continue to build on our foundation of operational excellence, adding organic growth and innovation to the next phase of our strategy, creating everyday essentials to make lives more liveable and inspiring.”

Decorative Paints: Full-year operating income increased by 39% as a result of the new operating model, lower costs, reduced restructuring expenses and currency developments. Revenue was up 3% due to favourable currencies offsetting adverse price/mix and volumes. Volumes were down 1% overall for the full-year, with positive developments in Asia offset by Latin America and Europe.

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

The company expects 2016 to be a challenging year. Difficult market conditions continue in Brazil, China and Russia. No significant improvement is anticipated in Europe, particularly in the Buildings and Infrastructure segment. Deflationary pressures continue and currency tailwinds are moderating.