Akzo Nobel NV: AkzoNobel Q3 results 2013

                   Akzo Nobel NV: AkzoNobel Q3 results 2013

October 21, 2013

  oRevenue down 5 percent, mainly due to adverse currency effects and
  oOperating income at €303 million (2012: €248 million), mainly driven by
    lower restructuring costs and higher volumes
  oNet income attributable to shareholders €155 million (2012: €110 million)
  oAdjusted EPS stable at €0.74
  oInterim dividend of €0.33 declared
  oAkzoNobel ranked first in Dow Jones Sustainability Index in the Materials
    industry group
  oDivestment of Building Adhesives completed on October 1
  oPerformance improvement program on track with estimated €160 million
    restructuring charges in Q4
  oExpected higher restructuring charges and continued weak markets mean that
    full-year operating income before incidental items is unlikely to exceed
    €908 million

Q3 2013 in € million

                                        Q3 2012 Q3 2013 D%
Revenue                                   3,966   3,778 (5)
Operating income                            248     303  22
Return on Sales (ROS) %                     6.3     8.0
EBITDA                                      428     456   7
Net income attributable to shareholders     110     155  41

Year-to-date January - September 2013 in € million

                                        YTD 2012 YTD 2013 D %
Revenue                                   11,717   11,108 (5)
Operating income                             872      842 (3)
Return on Sales (ROS) %                      7.4      7.6
EBITDA                                     1,392    1,305 (6)
Net income attributable to shareholders      413      673  63

Akzo Nobel N.V. (AkzoNobel) today reported third quarter revenues of €3,778
million, 5 percent lower compared with the same period last year. The decrease
was a consequence of adverse currency effects and divestments. Lower
restructuring costs and higher volumes helped push Q3 operating income up 22
percent to €303 million.

The third quarter saw AkzoNobel divest its Building Adhesives business
(completed October 1) and announce plans to drive further efficiency and
performance improvements within Functional Chemicals and in Germany, as well
as plans to streamline the management structure in Decorative Paints to
improve competitiveness. The company also published details of investments
totaling more than €50 million in two new manufacturing facilities to meet
growing demand in western China. AkzoNobel furthermore maintained its number
one ranking in the Dow Jones Sustainability Index, heading the Materials
industry group.

Decorative Paints revenues of €1,136 million in the third quarter were stable
versus the previous year, with higher volumes offset by adverse currency
effects. Although conditions in Europe remained challenging in general, global
volumes were up on the same quarter last year. Lower costs and lower
restructuring charges contributed to increased operating income for Q3 2013 of
€107 million, more than double the previous year's figure.

Quarterly revenue at Performance Coatings declined 4 percent to €1,415 million
compared with last year, with the decline attributable to adverse currency
effects. Whilst overall volumes were up 2 percent, weak demand in Europe
continued to impact all businesses. Q3 restructuring costs were lower in 2013
than a year earlier, as a result of which operating income showed an
improvement, up 23 percent at €160 million.

Revenue in Specialty Chemicals was 10 percent lower at €1,252 million,
primarily as a result of the divestment of Chemicals Pakistan and negative
currency effects. Overall volumes were flat compared with a year earlier.
Operating income was down 20 percent at €107 million, mainly as a consequence
of one-off restructuring costs incurred as part of the performance improvement
program in the Functional Chemicals Business Unit.

CFO Keith Nichols

"The trading environment behind these results has not changed in that demand
remains soft and on a comparative basis Q3 last year was particularly weak.
Nevertheless, the actions we have taken to address the challenges our
businesses are facing are starting to have a positive effect; the return on
sales before restructuring charges has improved in all three Business Areas
due largely to our performance improvement actions." 

Performance improvement program

The performance improvement program announced in October 2011 is on track to
deliver the full €500 million in EBITDA at the end of this year, a year early.
Further efficiency and cost reduction measures have also been identified as
restructuring activities are stepped up, the benefits of which will be
realised in 2014 and beyond. As previously indicated, the majority of the
restructuring charges for the second half of 2013 will be taken in the fourth
quarter. Year-to-date AkzoNobel has charged €144 million of an expected
full-year total of around €300 million restructuring costs, of which €75
million in Q3.

AkzoNobel will continue to implement new initiatives to optimize performance
as it moves to a culture of continuous improvement and embedded operational


The economic environment remains challenging and AkzoNobel does not expect an
early improvement in the trends faced in its end-user market segments. The
acceleration of the performance improvement program and the strategic
priorities announced in February are the right focus to have in these markets.
AkzoNobel expects restructuring charges in the fourth quarter of around €160
million. This means that full-year operating income before incidental items is
unlikely to exceed €908 million.

Business area highlights

                   Decorative Paints
Q3 2012 Q3 2013 D%                 YTD 2012 YTD 2013   D%
  1,141   1,136 -    Revenue          3,302    3,240  (2)
     48     107 123  Operating Income   185      252   36
    4.2     9.4      ROS %              5.6      7.8
     97     146 51   EBITDA             320      375   17
                   Performance Coatings
Q3 2012 Q3 2013 D%                 YTD 2012 YTD 2013   D%
  1,467   1,415 (4)  Revenue          4,308    4,204  (2)
    130     160 23   Operating Income   428      452    6
    8.9    11.3      ROS %              9.9     10.8
    163     193 18   EBITDA             526      553    5
                   Specialty Chemicals
Q3 2012 Q3 2013 D%                 YTD 2012 YTD 2013   D%
  1,393   1,252 (10) Revenue          4,223    3,749 (11)
    133     107 (20) Operating Income   427      327 (23)
    9.5     8.5      ROS %             10.1      8.7
    208     185 (11) EBITDA             678      557 (18)

The 2012 figures stated in this press release exclude last year's €2.1 billion
impairment at Decorative Paints enabling a like-for-like comparison.

The 2013 Q3 report 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 todelivering leading products and technologies
to meet the growing demands of our fast-changing world.

Not for publication - for more information
Corporate Media Relations, tel. +31 20 502 7833Corporate Investor
Relations, tel. +31 20 502 7854
Contacts: Stephen Hufton, Marc MichelsenContacts: Jonathan Atack,
Sheryl Stokes

AkzoNobel Q3 2013 Report
AkzoNobel Q3 2013 Press Release


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