Akzo Nobel N.V. (AKZA; AKZOY) publishes results for first quarter 2021 

Highlights Q1 2021

- Revenue up 10% and 16% higher in constant currencies¹ with strong growth in Asia

- ROS² increased to 13.6% (Q1 2020: 10.4%)

- €300 million share buyback completed on April 16, 2021; €1 billion share buyback starts April 27, 2021

- Acquisition of Titan Paints in Spain completed in March 2021

Q1 2021 (compared with Q1 2020)

- Revenue up 10% and 16% higher in constant currencies, with volumes up 16% and price up 2%, mainly due to strong end market demand. Compared with Q1 2019*, revenue was up 10% in constant currencies

- Operating income up 62% at €303 million (2020: €187 million); OPI margin improved to 13.4% (2020: 9.1%)

- Adjusted operating income³ up 43% at €307 million (2020: €214 million) and excludes €4 million negative impact from identified items, mainly related to transformation initiatives (2020: €27 million negative identified items related to transformation initiatives)

- Net cash from operating activities improved by €129 million to an outflow of €31 million (2020: outflow of €160 million)

- Net income from total operations up 90% at €217 million (2020: €114 million) 

- EPS from total operations up 95% at €1.15 (2020: €0.59); adjusted EPS⁴ from continuing operations up 66% at €1.18 (2020: €0.71)

^{*Q1 2019 comparatives are included to allow for proper comparison in light of the COVID-19 impact in 2020.}

AkzoNobel CEO, Thierry Vanlancker, commented:

“We delivered very strong results for the quarter, including 16% growth and higher profitability. It’s encouraging how we’ve pivoted from our successful 15 by 20 ambition with a powerful start to our new Grow & Deliver strategy, which is already having a positive impact on our results.

“Ongoing challenges related to raw materials are an industry-wide issue and require our continued attention. I’m very proud of how our teams continue to serve our customers, while dealing with the significant disruption. Going forward, we’ll remain focused on offsetting higher raw material costs with pricing initiatives and cost discipline, to ride out the wave and build on our strong foundation for growth.”

Recent highlights

Polar Pod partnership to push boundaries of scientific exploration

A pioneering expedition which will send a manned oceanographic platform drifting around Antarctica has brought AkzoNobel on board as exclusive paints and coatings partner. The Polar Pod will enable scientists and researchers to study the Antarctic Circumpolar Current, which has a major influence on the Earth’s climate. AkzoNobel will support the 1,000-ton platform for the next five years, from project construction through to the completion of its three-year mission, which is expected to start in December 2023.

Paint the Future leads to investment in application technology from Qlayers 

We’ve invested in pioneering coatings application technology from Qlayers – one of the winners in our 2019 Paint the Future startup challenge. Their innovative industrial system offers a fully automated solution that is safer, more consistent and faster than the manual coating processes currently being used. By eliminating overspray, it’s a sustainable solution that also saves costs.

DIY made simple thanks to new Dulux range

With the UK firmly bitten by the DIY bug, we recently launched our new Dulux Simply Refresh range, which refreshes walls in a single coat. It’s available in two carefully curated color collections – One Coat and Feature Wall – for both neutral and bold palettes. As well as removing the hassle from decorating, the new products will also help to save valuable time.

Leading the charge for e-mobility powder coatings

As global demand for electric vehicles – and e-mobility in general – continues to accelerate, our Powder Coatings business has switched on to the growing needs of its customers by developing advanced technologies to help power the industry into the future. We now offer a dedicated powder coatings portfolio for manufacturers of electric vehicles and components, who are increasingly looking for world class solutions to help protect motors, battery systems and electrical storage units. 

Acquisition of Titan Paints in Spain completed

We completed the acquisition of 100% of the shares of Industrias Titan S.A.U. (Titan Paints) – strengthening our paints business and footprint in Spain to become one of the market references in the region. The transaction includes three production facilities and seven logistics and service centers for decorative paints, including one of the most modern manufacturing plants for water-based paints in Europe, located near Barcelona. The business generated revenue of around €80 million. Titan Paints – which also has a relevant presence in Portugal – is one of Spain’s best-known brands. The business shares AkzoNobel’s commitment to sustainable product innovation, with much of its portfolio having received recognition for environmental performance.

Outlook:

AkzoNobel targets to grow at least in line with its relevant markets. Trends differ per region and segment with raw material disruption and inflation expected, especially in Q2 and Q3. Margin management and cost discipline programs are in place to deliver 50 basis points increase in return on sales. The company targets a leverage ratio of 1-2 times net debt/EBITDA and commits to retain a strong investment grade credit rating.

The report for the first quarter 2021 can be viewed and downloaded at https://akzo.no/Q12021-Report

1 Constant currencies calculations exclude the impact of changes in foreign exchange rates 

2 ROS is adjusted operating income as percentage of revenue; ROS excluding unallocated cost was reported in relation to the Winning together: 15 by 20 strategy and is no longer reported

3 Adjusted operating income = operating income excluding identified items

4 Adjusted earnings per share are the basic earnings per share from operations, excluding identified items and taxes thereon

This media release covers the highlights for the quarter. We recommend reading the media release in combination with the full AkzoNobel Q1 2021 Report. 

The Q1 2021 Report provides additional information, including the IAS34 condensed consolidated financial statements.

ROS, Adjusted OPI and Adjusted EPS are Alternative performance measures (APM’s). AkzoNobel uses APM adjustments to the IFRS measures to provide supplementary information on the reporting of the underlying developments of the business. A reconciliation of the alternative performance measures to the most directly comparable IFRS measures can be found in the AkzoNobel Q1 2021 Report.

This is a public announcement by Akzo Nobel N.V. pursuant to section 17 paragraph 1 of the European Market Abuse Regulation (596/2014).

About AkzoNobel

We’ve been pioneering a world of possibilities to bring surfaces to life for well over 200 years. As experts in making coatings, there’s a good chance you’re only ever a few meters away from one of our products. Our world class portfolio of brands – including Dulux, International, Sikkens and Interpon – is trusted by customers around the globe. We’re active in more than 150 countries and have set our sights on becoming the global industry leader. It’s what you’d expect from the most sustainable paints company, which has been inventing the future for more than two centuries.