AkzoNobel posts strong revenue growth

AkzoNobel posts strong revenue growth

4:57 PM, 8th June 2011
AkzoNobel posts strong revenue growth
Hans Wijers, CEO, AkzoNobel.

  • Stronger volumes and pricing drive revenue growth of 16 percent to € 3.8 billion
  • EBITDA increased 10 per cent to € 437 million
  • Total net income increased to € 128 million from € 81 million in Q1 2010
  • Outlook reiterated: aiming for more than 5 per cent revenue and EBITDA growth in 2011 – in line with strategic ambitions

 

AMSTERDAM, THE NETHERLANDS: Akzo Nobel N V reported a 16 per cent gain in Q1 revenue compared with the same period in 2010. Group revenue of € 3,762 million (Q1 2010: € 3,246 million) reflects a 7 per cent increase in volumes and 4 per cent positive price effect.

 

Double-digit revenue growth was achieved in all three business areas, driven by strength in high growth markets and demand recovery in mature economies. Raw material price inflation has been significant and AkzoNobel is confident that it will mitigate the costs by pricing and cost reduction actions.

 

During the quarter, EBITDA improved by 10 per cent to € 437 million, although overall EBITDA margins declined slightly compared with Q1 2010, reflecting the lag effect of pricing and margin management actions to compensate raw material price increases. Sequentially, from Q4 2010, the EBITDA margin increased from 10.4 per cent to 11.6 per cent as mitigating actions took effect. The company has a seasonal pattern in that revenue and profitability are lowest in the fourth and first quarters of the year.

 

“Strong volume and pricing behind our 16 per cent revenue growth gives me confidence that we have been able to maintain or improve market share across the portfolio. Our revenue growth in high growth markets continued to be impressive. Raw material prices have continued to rise, as we indicated last quarter. Pricing and cost reduction actions are on-going to mitigate the impact of these higher prices and we remain confident that we will be able to compensate for these increases,” said Hans Wijers, CEO, AkzoNobel.

 

“Specialty chemicals continues to experience strong demand and both revenue and EBITDA grew strongly. Performance coatings achieved considerable growth in high growth markets. The successful roll-out of decorative paints products to 3,500 Walmart stores in the US, together with continued strong growth in Asia and Latin America, underpinned the decorative paints performance,” added Wijers. Further, the company has announced several significant investments in the first quarter of 2011.

(C) WOC News

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