February 6, 2014
* Q4 volume development positive in all three Business Areas and ROS excluding
restructuring costs and incidentals increased, continuing the trend from Q3
* Revenue for both Q4 and full year down 5 percent, due to adverse currency
effects and divestments
* 2013 operating income at €958 million (excluding €61 million incidentals:
€897 million; 2012: €908 million excluding impairment)
* Net income attributable to shareholders €724 million (2012: €386 million
excluding impairment) and adjusted EPS at €2.62 (2012: €2.55)
* Net debt down €769 million at €1,529 million (2012: €2,298 million)
* Total dividend for 2013 proposed at €1.45 (2012: €1.45)
* Performance improvement program completed one year ahead of schedule; target
exceeded with €545 million total savings achieved
* On track to deliver 2015 targets despite expected continued fragile economic
environment and volatile foreign currencies in 2014
 Q4 2013 in € million*
 Q4 2012 Q4 2013 D%
Revenue 3,673 3,482 (5)
Operating income 36 116
Return on Sales (ROS) % 1.0 3.3
EBITDA 205 208 1
Net income attributable to shareholders (27) 51
Full-year 2013 in € million*
 FY 2012 FY 2013 D%
Revenue 15,390 14,590 (5)
Operating income 908 958 6
 - excluding 2013 incidentals  897 (1)
Return on Sales (ROS) % 5.9 6.6
EBITDA 1,597 1,513 (5)
Net income attributable to shareholders 386 724 88
Akzo Nobel N.V. (AkzoNobel) today announced its Q4 and full-year 2013 results.
Revenue for the year totaled €14,590 million, down 5 percent on 2012 as a
consequence of adverse currency effects and divestments. 2013 operating income
excluding incidentals came in at €897 million (2012: €908 million excluding
impairment). Net income attributable to shareholders reached €724 million, up
from €386 million in 2012. Net debt came down by a third to €1,529 million at
the end of 2013. The company has successfully completed its multi-year
performance improvement program a year ahead of schedule, exceeding its targets
in doing so. In 2014, AkzoNobel will continue to significantly restructure to
reduce costs further and anticipates related restructuring charges of at least
€250 million.
CEO Ton Büchner
"We indicated at the start of 2013 that trading conditions would continue to be
challenging and that has proven to be the case. In response we accelerated our
company-wide improvement actions and have brought our performance improvement
program to a successful conclusion a year ahead of schedule and above target.
While the first half of 2013 was impacted by weaker trading conditions and
specific one-off events in Specialty Chemicals, the second half has shown early
signs of stabilization in several end markets. In combination with our
restructuring actions this positive effect has been evident in our improving
return on sales in the third and fourth quarters, despite foreign currency
headwinds. In 2014, we will continue to improve our ability to leverage our
strong brands and leading market positions. We will further restructure our
business, reduce our costs and drive organic growth. I am confident that we are
on track to deliver on our 2015 strategic goals."
Business performance
Decorative Paints full-year revenue was down 3 percent as a result of adverse
currency effects and divestments. Global volumes for the year were up 3 percent,
with increases in all regions except Europe, which remained flat in a reflection
of difficult trading conditions. The pick-up in overall volumes was particularly
noticeable in the second half of the year; Q3 and Q4 volumes were each up 5
percent compared with the prior year. Margins improved as a result of strong
margin management and lower raw material prices. Performance improvement and
restructuring measures led to a lower cost base, which, combined with lower
restructuring charges, drove operating income above the previous year, before
the divestment gain on Building Adhesives.
Full-year revenue at Performance Coatings declined 2 percent on flat volumes as
adverse currency effects outweighed a positive price/mix development. Volumes
gradually improved throughout the year to be flat overall, and up 2 percent in
Q4. Margins were maintained despite higher restructuring costs. Operating income
for the year as a whole was down 3 percent, with underlying improvements offset
by higher restructuring charges as well as adverse currencies. Restructuring
activities were accelerated in the fourth quarter, with the intended closure of
seven sites world-wide being communicated.
Specialty Chemicals annual revenues not only reflected a year of continued soft
demand, but also included a significant divestment effect from the sale in 2012
of Chemicals Pakistan. Full-year revenues were down 11 percent, with 6 percent
attributable to divestments and 2 percent a consequence of adverse currency
effects. Lower volumes accounted for a further 2 percent revenue decline,
although they did stabilize in the second half of the year and volumes in Q4
were up 3 percent versus Q4 2012. Full-year operating income was impacted by
increased restructuring costs versus the previous year, with a comprehensive
performance improvement program implemented at Functional Chemicals in the
second half of the year. The divestments of both the Primary Amides and Purate
businesses were completed in Q4.
Performance improvement program
The performance improvement program (PIP) announced in October 2011 has exceeded
the anticipated cumulative amount of €500 million in EBITDA for the period
through 2013. The program has delivered a total of €545 million in benefits a
year earlier than originally planned and has now been completed. Further
efficiency and cost reduction measures have been identified as part of
continuous improvement initiatives which are integrated in the regular business
activities. Total restructuring costs for 2013 amounted to €348 million (2012:
€292 million), of which €204 million in Q4. AkzoNobel anticipates 2014
restructuring charges of at least €250 million.
Raw materials
Full-year average raw material costs stabilized during the year and were down
versus 2012.
Proposed dividend
Our dividend policy is to pay a stable to rising dividend. We will propose a
2013 final dividend of €1.12 per share, which would make a total 2013 dividend
of €1.45 per share. This is stable versus the total dividend per share paid out
in 2012 of €1.45.
Sustainability and innovation
AkzoNobel's drive for operational excellence and performance improvement is
supported by its 'Planet Possible' sustainability strategy focused at creating
more value from fewer resources.
Building on its number one position in the Materials industry group on the Dow
Jones Sustainability Indices (DJSI), AkzoNobel keeps intensifying its activities
to implement the strategy which includes the following targets:
* In 2020, AkzoNobel's eco-premium products with a downstream benefit will
account for 20 percent of revenue. In 2013 this was 18%
* Carbon emissions will be reduced by 25 to 30 percent per ton of product by
2020 (base 2012).
* Improve resource efficiency across the full value chain
Outlook
Although we have seen early signs of stabilization in the second half of 2013 in
some of our businesses, the economic environment remains fragile and foreign
currencies volatile. We will continue to significantly restructure our
businesses in 2014 to reduce our cost base further to offset the expected
continued soft demand. AkzoNobel is on track to deliver on its 2015 targets of
ROS at 9.0 percent and ROI at 14.0 percent with a net debt/EBITDA ratio lower
than 2.0.
Capital Markets Day
AkzoNobel will hold a Capital Markets Day in London on March 11, 2014.
Business Area highlights*
 Decorative Paints
Q4 2012 Q4 2013 D% Â 2012 2013 D%
995 934 (6) Revenue 4,297 4,174 (3)
(91) 146 Â Operating Income 94 398
(9.1) 15.6 Â ROS % 2.2 9.5
(0.8) 6.2 Â ROS % (excluding incidentals & PIP 5.8 7.3
costs)
(36) (13) Â EBITDA 284 362 27
 Performance Coatings
Q4 2012 Q4 2013 D% Â 2012 2013 D%
1,394 1,367 Â Revenue 5,702 5,571 (2)
(2)
114 73 (36) Operating Income 542 525 (3)
8.2 5.3 Â ROS % 9.5 9.4
11.1 11.0 Â ROS % (excluding incidentals & PIP 11.1 11.2
costs)
147 110 (25) EBITDA 673 663 (1)
 Specialty Chemicals
Q4 2012 Q4 2013 D% Â 2012 2013 D%
1,320 1,200 (9) Revenue 5,543 4,949 (11)
73 (30) Â Operating Income 500 297 (41)
5.5 (2.5) Â ROS % 9.0 6.0
6.3 9.9 Â ROS % (excluding incidentals & PIP 10.2 10.0
costs)
152 169 (11) EBITDA 830 726 (13)
* The 2012 figures stated in this press release exclude the €2.1 billion
impairment at Decorative Paints enabling a like-for-like comparison.
The financial outcomes in this report are preliminary and unaudited.
The report for the full year and Q4 2013 can be downloaded via the AkzoNobel
Report iPad app http://bit.ly/obljrf or read online at
www.akzonobel.com/quarterlyresults.
- - -
AkzoNobel is a leading global paints and coatings company and a major producer
of specialty chemicals. We supply industries and consumers worldwide with
innovative products and are passionate about developing sustainable answers for
our customers. Our portfolio includes well-known brands such as Dulux, Sikkens,
International and Eka. Headquartered in Amsterdam, the Netherlands, we are
consistently ranked as one of the leaders in the area of sustainability. With
operations in more than 80 countries, our 50,000 people around the world are
committed to delivering leading products and technologies to meet the growing
demands of our fast-changing world.
Not for publication - for more information
Corporate Media Relations, tel.: Corporate Investor Relations,
+31 20 502 7833 tel.:+31 20 502 7854
Contact: Stephen Hufton Contact: Sheryl Stokes
Safe Harbor Statement
This press release contains statements which address such key issues as
AkzoNobel's growth strategy, future financial results, market positions, product
development, products in the pipeline, and product approvals. Such statements
should be carefully considered, and it should be understood that many factors
could cause forecasted and actual results to differ from these statements. These
factors include, but are not limited to, price fluctuations, currency
fluctuations, developments in raw material and personnel costs, pensions,
physical and environmental risks, legal issues, and legislative, fiscal, and
other regulatory measures. Stated competitive positions are based on management
estimates supported by information provided by specialized external agencies.
For a more comprehensive discussion of the risk factors affecting our business
please see our latest Annual Report, a copy of which can be found on the
company's corporate website www.akzonobel.com.
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AkzoNobel Q4 and full-year 2013 press release:
http://hugin.info/130660/R/1759383/595256.pdf
AkzoNobel Q4 financial report:
http://hugin.info/130660/R/1759383/595187.pdf
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Source: Akzo Nobel NV via GlobeNewswire
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