Dutch chemicals company reports first annual loss in eight years following a €1.2bn writedown on British paint group ICI, which it acquired last year.
In its 2008 report and results for Q4, released this morning, Akzo Nobel said it had taken a non-cash impairment charge of €1.2bn after tax 'covering the value of ICI intangibles'.

The report explained: "In light of current market conditions and the continuing lack of visibility regarding future global demand, the company has assessed the fair value of its assets against lower growth rates, which it now expects."

Akzo Nobel acquired ICI, known for brands such as Dulux and Polycell, for €9bn in January last year. It added that the impairment charge is 'related to the decorative paints businesses and National Starch', which Akzo bought with ICI.

Decorative paints were down 6% in Q4, 3% for the year. Performance coatings saw a 4% drop in the fourth quarter, while speciality chemicals grew 5%.

Akzo Nobel ceo Hans Wijers expects this year to be 'very challenging' but said that that the fundamentals of the company 'remain sound'.

"Our fourth quarter results reflect the impact of the economic climate in many of our businesses. The fact that we have implemented a significant level of restructuring is a clear indicator that action is being taken across the company to mitigate the effects of the global crisis."

He added: "We have strong market positions in a number of highly attractive sectors with a wide geographical spread...The actions we are taking mean that our company is well positioned to meet the current challenges and, as a result, will be in good shape to take advantage of the recovery when it comes."

After announcing in September plans to cut 3,500 jobs by 2011 as a cost saving exercise, Akzo has already shed around 1,660 staff from its decorative paints business. It has also implemented a 2009 salary freeze for its management board, a number of executives, and for most other employees, 'where possible'.

The company also announced that it would not complete its share buyback programme, in view, it said, 'of the unprecedented uncertainties across the world'.