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Akzo Nobel completes separation of specialty chemicals

Published: 24 April 2018 - Kiran Grewal

Akzo Nobel N.V. has publushed its results for the first quarter 2018, having successfully completed the dual-track process for the separation of Specialty Chemicals; AkzoNobel to sell Specialty Chemicals to The Carlyle Group and GIC for €10.1 billion.

In the paints and coatings sector, the company has reported robust pricing initiatives ramping up: price increase was successful in Q1 2018; second wave of price increases to come in 2018.

 

Selling prices are up 3% overall and for all businesses.

Revenue for Akzo is down 8%, mainly due to adverse foreign currencies (1% lower excluding currency impact) at €2,176 million).

Volumes 3% lower, mainly due to continued adverse market conditions in the marine, and oil and gas industries

Savings from continuous improvement were €30 million and creating a fit-for-purpose organization delivered €10 million.

Developments in Paints and Coatings in Q1 2018

Akzo Nobel has reinforced its commitment to customers in India, following the inauguration of a new €9 million facility in Mumbai for the production of Powder Coatings.

Consumers in Pakistan now have access to Dulux Promise. AkzoNobel has launched a decorative paints product for the mass market segment

Dulux Weathershield was relaunched in Asia featuring Smart Release Technology. This protects homes and buildings with even longer lasting protection against algae and fungus.

The most eye-catching car of the new Formula 1 season - McLaren's MCL33 - features innovative coatings supplied by AkzoNobel's Sikkens brand. This reduces the total weight of paint and decreases processing time by more than 50%

AkzoNobel is developing a new high performance antifouling, which uses ultraviolet light-emitting diodes to prevent marine growth. It features underlying technology developed by Royal Philips

Akzo Nobel N.V. CEO, Thierry Vanlancker, commented: "We delivered a key milestone in creating two focused, high performing businesses with the agreement to sell Specialty Chemicals to the Carlyle Group and GIC for €10.1 billion.

Higher raw material costs and adverse effects from foreign currencies are projected to continue in 2018, especially during the start of the year. We anticipate ongoing positive developments for Decorative Paints in all regions, particularly Asia. Trends for Performance Coatings are expected to be positive for most segments and regions, while still challenging for Marine and Protective Coatings. We continue to implement various measures to mitigate current market challenges, including increased selling prices and cost discipline. Our "Winning together: 15 by 20" strategy will create a focused Paints and Coatings company and deliver our 2020 guidance.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Paints and Coatings performance in Q1 2018

Decorative Paints revenue decreased 8% mainly due to foreign currencies (down 1% excluding currency impact). Higher selling prices were offset by adverse mix effects. Volumes were 1% lower, despite growth in Europe. Volumes were lower in China compared to an exceptionally strong first quarter last year.

 

Performance Coatings revenue was 9% lower, mainly due to adverse currencies (down 1% excluding currencies). Pricing initiatives have continued to gain traction, with 2% price increases in the first quarter and further increases expected in the following quarters. Volumes were 5% lower, mainly due to adverse conditions in the marine, and oil and gas industries. Volumes increased for Powder Coatings, as well as Automotive and Specialty Coatings.

 

Developments in Paints and Coatings in Q1 2018

AkzoNobel has reinforced its commitment to customers in India, following the inauguration of a new €9 million facility in Mumbai for the production of Powder Coatings

Consumers in Pakistan now have access to Dulux Promise. AkzoNobel has launched a decorative paints product for the mass market segment

Dulux Weathershield was relaunched in Asia featuring Smart Release Technology. This protects homes and buildings with even longer lasting protection against algae and fungus

The most eye-catching car of the new Formula 1 season - McLaren's MCL33 - features innovative coatings supplied by AkzoNobel's Sikkens brand. This reduces the total weight of paint and decreases processing time by more than 50%

AkzoNobel is developing a new high performance antifouling, which uses ultraviolet light-emitting diodes to prevent marine growth. It features underlying technology developed by Royal Philips

 

 

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