AkzoNobel Report for the Year 2011
-
Upload
abdelnour-abdelnour -
Category
Documents
-
view
220 -
download
0
Transcript of AkzoNobel Report for the Year 2011
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 1/24
Report or the year 2011and the ourth quarter
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 2/24
2 AkzoNobel I Report for the year 2011 and fourth quarter
•2011revenueup7percentdrivenbypricingactionstooffsetrawmaterialcostinflation
•Weakerendmarketsandcostinflationimpactedresults
•2011EBITDA9percentlowerat€1,796million(2010:€1,964million)
•Netincomefromcontinuingoperations€469million(2010:€664million)
•AdjustedEPS€2.91(2010:€3.71)•Totaldividendfor2011increaseto€1.45proposed
(2010:€1.40)•Performanceimprovementprogramontrack•Theeconomicenvironmentandcertainrawmaterialsremainour
principalsensitivitiesin2012
Our resultsataglance
(40 percent in high growth markets)
A North America
B Emerging Europe
Mature Europe
Asia Pacific
C D E
F Latin America
Other regions
%
20
7
38
21
10
4
100
C
D
EF
A
B
(Based on the full year 2011)
AkzoNobel around the world
Revenue by destination
In € millions
Q3 11 Q4 11Q4 10 Q1 11 Q2 11
4,097 4,051
3,7873,620
3,762
In € millions
437
377
551
507
301
Q3 11 Q4 11Q4 10 Q1 11 Q2 11
Revenue EBITDA
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 3/24
AkzoNobel I Report for the year 2011 and fourth quarter3
Operating ROI %Moving average ROI %
2010 20112009
9.2%
10.8%
8.9%
27.7%
23.2%
22.3%
Returns on invested capital
Continuing operations beore incidentals
4thquarter January-December
2010 2011 ∆% in€ millions 2010 2011 ∆%
3,620 3,787 5 Revenue 14,640 15,697 7
377 301 (20) EBITDA 1,964 1,796 (9)
10.4 7.9 EBITDAmargin(in%) 13.4 11.4
222 133 (40) EBIT 1,374 1,175 (14)
6.1 3.5 EBITmargin(in%) 9.4 7.5
MovingaverageROI(in%) 10.8 8.9
OperatingROI(in%) 27.7 22.3
0.82 0 .17 A dj us ted e ar nin gs pe r sha re (i n€ ) 3.71 2.91
Ater incidentals
4thquarter January-December
2010 2011∆%
in€ millions 2010 2011 ∆%
159 36 (77) Operatingincome 1,219 1,042 (15)
130 (62) Netincome/(loss)fromcontinuingoperations 664 469 (29)
32 (6) Netincome/(loss)fromdiscontinuedoperations 90 8
162 (68) Netincome/(loss)totaloperations 754 477 (37)
0.55 (0.26) Earningspersharefromcontinuingoperations(in€) 2.85 2.01
0.69 (0.29) Earningspersharefromtotaloperations(in€) 3.23 2.04
198 256 Capitalexpenditures 534 708
275 270 Netcashfromoperatingactivities 519 325
Interestcoverage 6.4 4.3
Investedcapital 12,718 13,708
Netdebt 936 1,895
Numberofemployees 55,590 57,240
Financialhighlights
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 4/24
4 AkzoNobel I Report for the year 2011 and fourth quarter
Revenuefortheyear2011wasup7percent,mainlyduetopricingactionstooffsetrawmaterialcostinflation.However,weakerendmarketsandcostinflationadverselyimpactedourresultsin2011.Theperformanceimprovementprogramtodeliver€500millionEBITDAin2014isontrackandweareconfidentthatthiswillbringusinlinewithourmedium-termambitions.
Perormance improvement program
Wehavelaunchedaperformanceimprovement
program to strengthen our competitiveness,
enhance our ability to grow, simplify our
supportstructuresandreduceourcostbase. Thissimplification andstandardizationof our
supportstructuresimpliesasignificantchange
inouroperatingmodelandbusinessculture.
Theprogram,whichweannouncedinOctober
2011,isacomprehensivethree-yearplanto
i mprov e o ur p erformance and d eli ver
€500 million EBITDA by 2014.The program
includesbusinessrestructuringandistodeliver
€200 million EBITDA in 2012. This implies
higherrestructuringcostforthecomingyear.
Theprogramisontrackandthefirstupdateon
progress and financial impact is due in our
2012half-yearlyreport.
Revenue
• InDecorativePaints,full-yearrevenue
growthwas7percentwithvolumesup
5percent;priceincreases3percentand
adverseimpactofcurrenciesof1percent.
RevenueinAsiaandtheAmericasshowed
double-digitgrowthin2011,mainlydriven
bypriceincreasesandthenewWalmart
contractintheUS.Demanddeclinedin
Europe,whilstgrowthratesachievedin
ChinaandSouthEastAsiaoutpaced
marketgrowth;however,thepaceof
marketgrowthsloweddowninthese
marketsinthesecondhalfoftheyear.
Q4revenuedevelopmentfollowedasimilar
regionalpatterntotherestof2011.
Revenueincreased6percent(7percentin
constantcurrencies),primarilydrivenbythe
US,LatinAmerica,ChinaandIndia,while
SouthEastAsiawasnegativelyimpacted
bythefloodinginThailandandslower
marketdevelopmentsinVietnamand
Malaysia.
• PerformanceCoatings2011revenuewas
up8percent,supportedbyvolumes
(2percent),acquisitions(2percent),andprice(5percent),andadverselyimpactedby
currencies(1percent).IndustrialCoatings
showedthelargestvolumeincrease,driven
bygoodperformancesinPackagingand
CoilCoatings,whileWoodFinishesand
Adhesiveshadlowervolumesduetoweaker
demandinthehousingmarket.
Financial highlights
+2%
+5% +1% -1% +7%8
10
0
2
4
6
Revenue development 2011
Increase Decrease
-2%
+6%
+1% 0% +5%8
10
0
2
-2
4
6
Revenue development Q4 2011
Increase Decrease
InQ4,revenueendedup7percentoverlast
year,supportedbyprice(7percent)andacquisitions(2percent);volumeswere
lowercomparedtothepreviousyear
(2percent).Signsofareductionintherate
ofrawmaterialpriceincreaseswereevident
inQ4,althoughmarginswerestillimpacted
bytheincreasedprices.
• SpecialtyChemicalshadasolid
performanceduring2011.Revenuegrewoverlastyearonpriceincreases,with
limitedoverallvolumegrowthduetothe
economicslowdownandgrowthbeing
hamperedinsomebusinessunitsdueto
capacityconstraints.Volumegrowthwas
evidentinmarketsectorsforSurface
Revenue
4thquarter January-December
2010 2011 ∆% in€ millions 2010 2011 ∆%
1,139 1,204 6 DecorativePaints 4,968 5,296 71,238 1,326 7 PerformanceCoatings 4,786 5,170 8
1,259 1,285 2 SpecialtyChemicals 4,943 5,335 8
(16) (28) Otheractivities/eliminations (57) (104)
3,620 3,787 5 14,640 15,697 7
in % versus 2010Vol um e Pr ic e/mi x A cqu isi ti on s E xc ha ng e
ratesTotal
DecorativePaints 5 3 – (1) 7
PerformanceCoatings 2 5 2 (1) 8
SpecialtyChemicals 1 7 – – 8
Total 2 5 1 (1) 7
in % versus Q4 2010Vol um e Pr ice /mi x A cq ui si ti on s E xc ha ng e
ratesTotal
DecorativePaints 2 4 1 (1) 6
PerformanceCoatings (2) 7 2 – 7
SpecialtyChemicals (4) 5 – 1 2
Total (2) 6 1 – 5
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 5/24
AkzoNobel I Report for the year 2011 and fourth quarter5
ChemistryandPulpandPaperChemicals,
wherethedemandremainedstrong.
DespitelowervolumesinQ4insomeofthe
businesses,revenueincreasedby2percentonthebackofpriceincreases,
althoughtheywereoffsetbyareduction
inEthyleneAminessalespricesduringthe
quarter.Salesvolumesdippedbelow
previousyearastheeconomyslowed
downandcustomerspostponedordersto
reduceinventorylevelstowardstheendof
theyear.
Acquisitions and investments
In 2011, we made several acquisitions and
significantinvestments:
• InDecorativePaintswehaveenteredintoa
partnershipinChinawithQuangxiCAVA TitaniumIndustryCo.Ltd.tohelpensure
supplyoftitaniumdioxide(TiO2 ).Inaddition,
weareinvesting€110millionina
replacementmanufacturingfacilityinthe
NorthEastofEngland.
• InPerformanceCoatings,theacquisitionof
coatingsmanufacturerSchrammHolding
AGclosedearlyOctober,2011.This
acquisitionwillenableustostrengthenour
globalleadershippositioninspecialty
plasticcoatings.Wearealsoinvesting
€60milliontoincreasetheproduction
capacityofourAutomotiveandAerospace
CoatingsbusinessinChinatomeetrisingdemand.
• InSpecialtyChemicals,wehaveacquired
BoxingOleochemicalsinJanuary2012.
Boxingistheleadingsupplierofnitrile
aminesandderivativesinChinaand
throughoutAsia.Weareinvesting
€170millionintwonewfacilitiesbeingbuilt
inBraziltosupplypulpmills,oneofthem
beingtheworld’slargest.
Wearealsoinvesting€45millioninNingbo,
Chinaand€140milliontoconvertour
chlorineplantinFrankfurt,Germany,to
membraneelectrolysistechnology.
Raw materials
Rawmaterialpriceincreaseswereasignificant
concern during 2011. Overall, the weighted
averageincreaseinourrawmaterialpricesfor
theyear was 16 percent. The increase year-
on-yearforQ4wasjustover10percent,which
isatalowerlevelthaninQ3,primarilydueto
astabilizationinallrawmaterialgroupsexcept
TiO2,wherewecontinuetoseesignificantprice
increases. The absolute impact of increased
rawmaterialpricesfortheyearisapproximately
€1billion(including2percentvolumeincrease),accounting for almost the entire increase in
costofsales.
EBITDA
• InDecorativePaints,EBITDAwas
20percentbehindlastyear(19percentin
constantcurrencies),mainlydrivenbythe
increasesinrawmaterialprices(specifically
TiO2 )andunfavorableproductmixeffects
includingdowntrading.EBITDAmargin
endedat8.3percentin2011(2010:
11.0percent).Westartedtorestructure
operationsinEuropeandannounced
restructuringactivitiesintheUSin2012.
MarginsinQ4werenegativelyimpactedby
theincreasedcostsofrawmaterialsand
stockwrite-offs(€17million)intheUS
resultinginanEBITDAof0.9percent(2010:
5.5percent).
• InPerformanceCoatings,rawmaterialprice
increaseshadanegativeimpactonthefull-
yearresultsinallbusinesses.Margin
managementprograms–includingselling
priceincreasesandrestructuringeffortsin
maturemarkets–areongoingandcontinuetosupportperformance.Full-yearEBITDA
endedat€611million(2010:647million),
withanEBITDAmarginof11.8percent
(2010:13.5percent).
Signsofareductionintherateofraw
materialpriceincreaseswereevidentinQ4,
althoughmarginswerestillimpactedbythe
increasedprices.Asaresult,EBITDAinthe
quarterwas€141million(€147millionin
2010).
• WhilemostbusinessesinSpecialty
Chemicalsrecordedtheirbest-everprofitability,FunctionalChemicalssawits
earningsdecreaseafteraverystrong2010
performance,dueprimarilytotheEthylene
Aminesproductline.Witheffectivemargin
managementandcostcontrol,unitmargins
remainedatthe2010leveloffsetting
significantrawmaterialpriceincreasesand
Volume development per
quarter (year-on-year)
Q410 Q111 Q211 Q311 Q4 11
DecorativePaints 1 9 6 4 2
PerformanceCoatings 5 7 2 1 (2)
SpecialtyChemicals 3 6 1 (1) (4)
Total 3 7 3 1 (2)
Price/mix development per
quarter (year-on-year)
Q410 Q111 Q211 Q311 Q4 11
DecorativePaints 2 1 2 3 4
PerformanceCoatings 3 2 3 7 7
SpecialtyChemicals 8 6 8 8 5
Total 4 3 4 6 6
EBITDA
4thquarter January-December2010 2011 ∆% in€ millions 2010 2011 ∆%
63 11 (83) DecorativePaints 548 440 (20)
147 141 (4) PerformanceCoatings 647 611 (6)
221 207 (6) SpecialtyChemicals 939 906 (4)
(54) (58) Otheractivities/eliminations (170) (161)
377 301 (20) Total 1,964 1,796 (9)
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 6/24
6 AkzoNobel I Report for the year 2011 and fourth quarter
Incidentals included in operating income
4thquarter January-December
2010 2011 in€ millions 2010 2011
(29) (55) Restructuringcosts (120) (131)
(48) (33) Resultsrelatedtomajorlegal,antitrustandenvironmentalcases
(49) (9)
16 (11) Resultsonacquisitionsanddivestments 33 10
(2) 2 Otherincidentalresults (19) (3)
(63) (97) Incidentals included in operatingincome
(155) (133)
EBIT in other
4thquarter January-December
2010 2011 in€ millions 2010 2011
(29) (29) Corporatecosts (96) (98)
(12) (3) Pensions (7) (14)
4 (9) Insurances 2 1
(23) (21) Other (87) (64)
(60) (62) EBIT in “other” (188) (175)
adversecurrencyimpacts.Theenergy
marketintheNetherlandsremained
unattractiveforenergyproducersas"spark
spreads"(thedifferencebetweengasinput
costsversuselectricitysalesprices)adverselyimpactedourresults.Theoverall
portfolioshowsstrongprofitabilityinthese
difficulteconomiccircumstances,with
EBITDAat€906million(2010:
€939million)andEBITDAmarginat
17.0percent(2010:19.0percent).
Q4showedlowervolumesinmost
segments,duetolowerdemandand
customerstockcontrol.EBITDAwas
€207million(2010:€221million)and
EBITDAmarginat16.1percent(2010:
17.6percent).
Incidental items
Restructuring is mainly related to European
bus ines ses i n Deco rati ve Pai nts and
PerformanceCoatings.
EBIT in "other"
Corporatecostsendedinlinewithprevious
year.Additionalcostsforfunctionalexcellence
activities were offset by cost savings. The
resultofourcaptiveinsurancecompanieswas
inlinewiththepreviousyear,althoughwehad
ahighernumberofclaimsinthefourthquarter.
Othercostswerelowerduetocostsavings
andfavorablenon-recurringitems.
Net inancing expenses
Netfinancingchargesfortheyearincreased
by€11millionfrom€327millionto
€338million.Significantitemsincluded:
• Netinterestondebtwhichincreasedby
€56millionto€245million(2010:
€189million)duetotheloss(€67million)on
thebuybackofcompanybondsin
Decemberpartlyoffsetbyhigherfinancing
income.
• Financingexpensesonpensionswhich
decreasedby€41millionto€59million(2010:€100million)mainlyduetolower
discountrates.
• Adecreaseincostsof€16millionon
foreigncurrencyresultsofhedgedfuture
interestcashflows.
InQ4,we incurreda gain of€8 million asa
result of hedged future interest cash flows.
Other main changes were related to lower
financing expenses on pensions (€8 million)
and lower discount rates for provisions
(€20million).Mid-December,weboughtback
atotalnominalamountof€528millionofour
2014and2015bondsandreplacedthemwithbondswithlowerinterestrates.Thistransaction
resultedina loss of€67millioninthefourth
quarter,whichwillbesetoffinlateryearsby
si gni fi can tl y lo wer int eres t co st s. T he
transactionhasimprovedourmaturityprofile.
Tax
Theyear-to-datetaxrateis27percent(2010:
19percent).Thetaxratebenefitsfromseveral
adjustmentstopreviousyearsandtax-exempt
gains,themainonebeingareleaseofananti-
trustprovision.Thetaxratein2010waslow
because of several adjustments to previous
years, partly related to settlements with tax
authorities.
The Q4 tax is impacted positively by the
inf luence of changes in tax rates on themeasurement ofdeferredtax andby several
adjustmentstopreviousyears.
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 7/24
AkzoNobel I Report for the year 2011 and fourth quarter7
Revenue development Q4 2011
-1%
+2%
+4%
+1%
+6%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
4
6
0
Revenue development 2011
-1%
+5%
+3% 0% +7%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
4
6
0
Full-yearrevenuegrowthwas7percentwith
volume s up 5 perce nt, price inc rea ses
3percentandadverseimpactofcurrenciesof
1percent.RevenueinAsiaandtheAmericas
showed double-digit growth in 2011 in
constant currencies, mainly driven by price
increases,volumegrowthinAsiaandthenew
Walmart contract in the US. Growth rates
achieved in China and South East Asia
outpacedmarketgrowth;however,thepaceof
marketgrowthsloweddowninthesecondhalf
oftheyear.VolumesinEuropewerepositivefor
the year, however demand declined in the
secondhalfoftheyear.Continuousinvestment
inbrands,distributionandpeople,aswellas
expansion into mid-tier segments in high
growthmarkets,isprogressing.Achangein
the management structure in Europe and
NorthAmericawillallowforbetterleveragingof
economiesofscaleandwillleadtofurthercost
reductions. EBITDA was 20 percent behind
lastyear(19 percentin constantcurrencies),
mainly driven by increases in raw material
prices (specifically TiO2 ) and unfavorable
product mix effects including down trading.
TheEBITDAmarginwas8.3percentin2011.
Q4 revenue development followed a similar
regionalpatterntotherestof2011.Revenue
increased 6 percent (7 percent in constant
currencies),primarilydrivenbytheUS,Latin
America, Chinaand India, while South East
Asiawasnegativelyimpactedbytheflooding
inThailandand slowermarketdevelopments
in Vietnam and Malaysia. Margins were
negativelyimpactedbytheincreasedcostsof
rawmaterials andstock write-offs in theUS
(€17million),resultinginanEBITDAmarginin
Q4of0.9percent.
Europe
InEurope,revenuewasup3percent(4percent
in constant currencies). It was a mixed
performance across the region with a solid
starttotheyearbutasignificantslow-downin
the second half of 2011 in those countries
mostimpactedbytheeurocrisis.Revenuein
the more mature markets showed modest
growth,mainlyonthebackofpriceincreases
under weakmarketconditions,while Turkey,
PloandandRussiadeliveredstrongerrevenue
growth.Thereweresharegainsinsomeofour
keymarketsandastrongperformancefrom
ourBuilding Adhesivesbusiness. Allregionsreportedrevenuegrowth,withtheexceptionof
theSouthernregion.Marginsintheyearwere
under pressure due to raw material price
increases and – in the non-euro markets –
currencyeffects.Tomitigatetheseeffects,the
b us ine ss i mp lem en ted ac ti ve ma rg in
management.Costsfortheyearwereslightly
• Full-yearrevenueincreased7percentwith5percentvolumeincreaseand3percentpriceincrease
• EBITDA20percentbehindthepreviousyear• StrongestrevenuegrowthinChina,IndiaandLatinAmerica• ChallengingyearinEuropeandtheUSwith
continuedrestructuring• Marginsnegativelyimpactedbyhigherrawmaterialcosts
andmixeffect• Activemarginmanagementcontinues
DecorativePaints
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 8/24
8 AkzoNobel I Report for the year 2011 and fourth quarter
In € millions
90
191
148
1163
Q1 11 Q2 11 Q3 11 Q4 11Q4 10
In € millions
Q2 11 Q3 11 Q4 11Q4 10 Q1 11
1,461 1,435
1,2041,139
1,196
Revenue
EBITDA
up on the back of some store related
acquisitions,specificITERP-relatedcostsand
brandinvestmentssupportingsharegrowthin
somekeygrowthmarkets.
InQ4,revenuewasinlinewith2010.Revenue
was impactedby the worsening oftheeuro
crisis.Marginscontinuedtobeunderpressure
duetorawmaterialcostsincreases,butwere
partlyoffsetbymarginmanagement.
Americas
Revenue in the US was 12 percent above
2010(inconstantcurrencies:up 17percent),
whichwasprimarilydrivenbythenewbusiness
with Walmart. In2011,the USpaint market
was essentially flat versus the prior year,
primarily driven by weakness in the trade
market.In2011,wecontinuedourinvestmentintheGliddenbrandandintroducedGlidden
DuoandGliddenTrimandDoorproductsat
TheHomeDepot.ProfitperformanceintheUS
declined due to rawmaterial costincreases
outpacing pricing actions, a weaker product
mix, stock write-offs and investments in
Walmart.
InCanada,2011revenuewas5percentbelow
2010(inconstantcurrencies:down4percent),
mainlydrivenbyvolume.Demandforpaintin
2011 was not as strong as it was in2010,
whenastrongrealestatemarketandhome
renovationtaxcreditsactedaskeycontributors
to economic growth. In addition, Canada’sgrowthwasimpactedbyslowrecoveryinthe
USandrisinginflation,allofwhichundermined
theconfidenceofconsumers.
In Latin America, ful l-year revenue was
15percentabove2010(inconstantcurrencies:
17 percent).All countries contributed to the
accelerated growth in theregionby building
brand equity through the activation of our
mission:AddingColourtoPeople’sLives.This
brandequitywasconvertedintomarketshare
andprofitthroughpoint-of-salelocationsand
the innovativeexecutionof theTudode Cor
Minha Casa (I want colors for my house)
programinBrazil.
Q4 revenue in the Americas increased by
16percent(inconstantcurrencies:17percent),
mainly driven by Latin America and the US.
Volume development in the US increased
significantlyduetotheWalmartcontract.
Keybrands
Revenue
4thquarter January-December
2010 2011 ∆% in€ millions 2010 2011 ∆%
543 535 (1) DecorativePaintsEurope 2,585 2,658 3
366 421 15 DecorativePaintsAmericas 1,547 1,690 9
231 250 8 DecorativePaintsAsia 841 952 13
(1) (2) Other/intragroupeliminations (5) (4)
1,139 1,204 6 Total 4,968 5,296 7
Beore incidentals
63 11 (83) EBITDA 548 440 (20)
5.5 0.9 EBITDAmargin(in%) 11.0 8.3
8 (45) – EBIT 343 230 (33)
0.7 (3.7) EBITmargin( in%) 6.9 4.3
MovingaverageROI(in%) 5.2 3.5
Ater incidentals
(26) (9 4) O pe ra tin g inc om e 275 137
63 76 Capitalexpenditures 154 204
Investedcapital 6,404 6,749
Numberofemployees 21,950 22,340
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 9/24
AkzoNobel I Report for the year 2011 and fourth quarter9
Asia
In2011,ourgrowth inAsiawas strong, but
slowed down somewhat during the year.
Revenueincreased13percentfrom2010(in
constantcurrencies:16percent),withallAsiancountriescontributingtothisgrowth.
Our full-yearrevenuegrowth (16 percent) in
Chinasignificantlyoutpacedmarketgrowthin
2011(2percent).Investmentinbrandbuilding
hasstartedtocometofruition,withincreased
brand awareness across China. We
succ essf ul ly launc he d the Let’s Colour
campaign to build brand image and inspire
customers to redecorate their houses. We
openedorupgradedover900thirdpartyDulux
customer stores in 2011 to accelerate the
expansion of our “controlled” distribution
footprint. Major new product launches likeForestBreathandVOC-freeseriesgenerated
significantrevenue.Wecontinuedto investin
people, while at the same time built
organizational and system capabilities for
future growth. The sales organization was
restructuredto aggressively grow theproject
business:we welcomedmore than300 new
colleaguestoourorganization,withthemajority
beingdeployedinfieldsales.Wecontinuedto
buildcapabilityinourDuluxEasyPaintservice
in order to build a leading position in the
redecoration market. The market outlook for
next year is still uncertain. Wewill,however,
continuetoaccelerateourbrandbuildingandchannel development to fully capture the
growthpotentialinthemedium-tolong-term.
TheSouthEastAsiabusinessgrewfasterthan
themarketandweimprovedourcompetitive
position, cementing our overall number one
position in the region. This was achieved
through continued investment in the Dulux
brandacrosstheregion:particularlythelaunch
oftheDuluxLet’sColourbrandidentity,aswell
askeyproductandinnovationlaunchessuch
as DuluxWeathershield2nd Generationand
ournewDuluxInspireofferinginVietnamand
Thailand (designed for the mid-market). Themarkets have also been impacted by the
economic slowdown, particularly Indonesia
andMalaysia,andourThailandbusinesshas
been affected by the recent flooding. We
continuedtoinvestinourbusinesspartners–
painters,architects,interiordesigners–andour
channelsandcustomers,alongwithcontinued
expansionofourtintingmachinefootprint.In
ordertostayaheadofourgrowth,wemadea
major transition in our distribution systemin
Indonesiaandcontinuedtobuildupoursupplychainfootprintandcapabilitiesaccordingly.
GrowthinIndiawasstrongin2011andahead
ofthemarket.Werevisedourproductportfolio
and re-established Duluxas a quality leader.
Velvet Touch Trends launch doubled our
“specialeffects”salesinlaunchmarkets.Dulux
GuardianandDuluxWeatherShieldMaxwere
launchedintheretailchannelinDecemberin
threeregions(North,SouthandEastIndia)with
encouraging feedback from the market.
Contractor engagement continued to rise,
peakinginDecember,supportinga40percent
volumegrowthinthetradebusiness.Thesteepincrease in raw material prices was almost
completelymitigatedwithpricingactionsand
the adverse effect of the high currency and
price inflation was mitigated by a tight cost
controlprogram.
TheoverallgrowthmomentuminAsiacontinued
inQ4.However,inChinameasuresintroduced
by the central government to curb rising
propertypriceshaveledtosomesofteningof
demand in Q4. Asia revenue increased by
8 percent in Q4 ( in constant currencies
9 percent) while maintaining healthy profit
levels. Continued strong revenue growth inChinaandIndiawasoffsetbyaslowdownin
SouthEastAsiaasaresultofthefloodingin
ThailandandweakerdemandinIndonesiaand
Malaysia.
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 10/24
10 AkzoNobel I Report for the year 2011 and fourth quarter
Revenue development Q4 2011
0%
-2%
+7%
+2% +7%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
-2
4
6
0
Revenue development 2011
-1%
+2%
+5%
+2%
+8%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
4
6
0
PerormanceCoatings• Full-yearrevenueup8percent,withvolumesup2percent• EBITDA6percentbehindprioryear• Marginsimpactedbyhigherrawmaterialcost
• Performanceimprovementprograminitiated• StronggrowthinIndustrialCoatingsbutweaknessin
WoodFinishesandAdhesives• Integrationofacquiredactivitiesdeliveringresults
PerformanceCoatings2011revenuewas up
8percent,supportedbyvolumes(2percent),
acquisitions(2percent),andprice(5percent),
a nd a dver se ly impac te d by c ur re nc ie s
(1 percent). Industrial Coatings showed the
largest volume increase, driven by goodperformancesinPackagingandCoilCoatings,
whileWoodFinishesandAdhesiveshadlower
volumesduetoweakerdemandinthehousing
market.PowderCoatingsvolumes,excluding
acquisitions,wereimpactedinthesecondhalf
oftheyearbytheweakeconomicenvironment.
Rawmaterialpriceincreaseshadanegative
impactonthefull-yearresultsinallbusinesses;
the rate of increase began to soften in Q4
2011. Ma rgin management progra ms –
i nclu di ng s el li ng p rice i ncreas es and
restructuringeffortsin mature markets – are
ongoingandcontinuetosupportperformance.
Full-yearEBITDAendedat€611million,with
an EBITDA margin of 11.8 percent (2010:
13.5percent).
InQ4,revenueendedup7percentoverlast
year, supported by price (7 percent) andacquisitions(2 percent); volumes were lower
comparedtothepreviousyearsamequarter
(2percent).Signsofareductionintherateof
rawmaterialprice increaseswere evident in
Q4,althoughmarginswerestill impactedby
theincreasedprices.Asaresult,EBITDAinthe
quarterwas€141million(€147millionin2010).
Marine and Protective Coatings
Revenuefor Marine andProtective Coatings
wasup4percent.InMarine,volumefellshort
oflastyear.Afterrecordactivitylevelsinnew
construction in China and Korea last year,
demandsoftenedinthesecondhalfof2011.
Maintenanceand repair markets have been
mixed, with some slow recovery over the
courseoftheyearindeepseamaintenance.In
ProtectiveCoatings,theyearhasseenstrong
revenuegrowth,withpositivedevelopmentinbothheavy industry as wellas oil and gas
markets, with increasing infrastructure
requirementsinChina,India,SouthEastAsia,
SouthAmericaandtheMiddleEastregions.In
Yacht, it has been a tough year with weak
demand across all regions. Volume off-take
waslow withour keydistributors giventheir
low retail activity in core European and US
markets; likewise the number and scale of
super-yachtprojectswaslowerthanhadbeen
anticipated. Raw material increases put
pressureonmarginsinallsectors.Attheend
ofthefirstquarter,welaunchedInterline9001,
our next-generation chemical tank coatingtechnology. The coating offers fewer cargo
restrictions, reduced cleaning time and zero
absorptionformanycargos.Theproductwas
well-received in the market, with positive
feedback from major operators. A new
€7 million, state-of-the-art fire protection
laboratorywasopenedattheFellingsiteinthe
UK,creatinga globalcenterof excellencefor
f ire prote ct ion developme nt which wil l
significantlyimproveourabilitytodevelopand
bringnewproductstothemarket.
Thefinalquarterendedwithslowactivitylevels,
causingvolumestoendlowerthanQ42010.Marine Deep Sea and Protective Coatings
generatedvolumesabovethelevelseenduring
the last quarter of previous year and new
construction continuedto belower thanthe
sameperiodlastyear.
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 11/24
AkzoNobel I Report for the year 2011 and fourth quarter11
Revenue
EBITDA
Revenue
4thquarter January-December
2010 2011 ∆% in€ millions 2010 2011 ∆%
349 373 7 MarineandProtectiveCoatings 1,345 1,398 4
185 195 5 WoodFinishesandAdhesives 776 781 1
256 258 1 AutomotiveandAerospaceCoatings 994 1,030 4
230 235 2 PowderCoatings 804 940 17
222 273 23 IndustrialCoatings 882 1,049 19
(4) (8) Other/intragroupeliminations (15) (28)
1,238 1,326 7 Total 4,786 5,170 8
Beore incidentals
147 141 (4) EBITDA 647 611 (6)
11.9 10.6 EBITDAmargin(in%) 13.5 11.8
119 109 (8) EBIT 540 495 (8)
9.6 8.2 EBITmargin(in%) 11.3 9.6
MovingaverageROI(in%) 26.5 22.0
Ater incidentals
104 83 Operatingincome 487 458
36 43 Capitalexpenditures 87 116
Investedcapital 2,122 2,351
Numberofemployees 21,020 21,960
In € millions
147 143
Q1 11
170
157
Q2 11 Q3 11
141
Q4 11Q4 10
In € millions
Q1 11 Q2 11 Q3 11Q4 100
0
0
0
01,237
1,312 1,295
Q4 11
1,326
1,238
Wood Finishes and Adhesives
2011revenuewas1percentabovetheprior
year, adversely impacted by lower volumes.
Demand remained sluggish in the mature
marketsofNorthAmericaandEuropeformostof the year. We continue to strengthen our
position in the high growth markets with a
focuson the Asiandomesticmarkets,Latin
America and Eastern Europe. In 2011, we
commissioned a new wood finishes
manufacturingfacilityinVietnam,andbegan
constructionof a new boardresin facility in
Peru.In2011,weintroducedVOC-compliant
c oat ings into our E uropea n a nd N orth
American distribution lines and we
commercializedanewgenerationof superior
scratch-resistant coatings for pre-finished
hardwoodflooring.
Revenueforthequarterwas5percentabove
prioryear, driven by pricing actions to offset
higherrawmaterialcostswithvolumesalmost
flat.Thedemanddriverswererelativelystable
inthefourthquarter.The UShousingmarket
wasslightlyimprovedduringthequarter,but
the macroeconomic environment in Europe
becamemorevolatile.Thestrongestregional
growthwasrealizedinLatinAmerica.
Automotive and Aerospace Coatings
Revenuein2011ended4percenthigherthan
thepreviousyear.Revenuegrowthwasdriven
byavolumeincreaseof4percentmainlyduetostronggrowthinAsia,recoveryofdemand
in North and South America, and robust
demandintheAerospaceCoatingsmarket.In
2011 we also successfully introduced the
WandawaterbornebasecoatinNorthAmerica
and Asia. Adverse currency translation
impacted revenue.Increases in rawmaterial
pricesweremitigatedbysellingpriceincreases.
Weexperiencedslowdownindemandmainly
comingfromcountriesmostimpactedbythe
eurozone crisis. The expansion of our US
automotiverepairdistributionnetworkthrough
thedivestmentofcompanyownedstoresto
LKQwaspartiallycompensatedbythePrimeacquisition.Weannouncedaninvestmentof
€60milliontoincreaseproductioncapacityof
ourbusinessesinChinawhichbuildsonlast
year'sacquisitionofPrimeAutomotive.
Keybrands
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 12/24
12 AkzoNobel I Report for the year 2011 and fourth quarter
In Q4, revenues increased 1 percent. The
growth rate in Asia slowed down, but was
coveredbyincreasedvolumesinAmericasand
Aerospace coatings. Total volumes ended
similartoQ42010.
Powder Coatings
Revenuein2011ended17percenthigherthan
thepreviousyear,withacquisitionscontributing
10 percent of this growth. Excluding
acquisitions,volumesinthesecondhalfofthe
yearwereadverselyimpactedbytheweakening
oftheeconomicenvironment.Continuedraw
material price increases impacted margins
adversely,thoughwerepartiallyoffsetbysales
price increases. The Americas and Europe
contributed to strong volume growth. The
Rohm and Haas integration process was
completed as planned. A leading globala gricultur al a nd c onstruct ion c ustome r
selectedInterponACEHighTempBlackasthe
only high tempe ra ture powder coat ing
approvedfortheiruse.Ambitiousplansforthe
highgrowthmarketswerealsohighlightedby
ope ning exte nded new f aci li ties at the
manufacturingplantinIzmir,Turkey.
RevenueinQ4wasaheadofthepreviousyear
by2percentsupportedbygoodperformance
intheAutomotiveandAgriculturalconstruction
equipmentactivities.However,volumesbefore
acquisitions were impacted by the weak
economic environment. The Architecture,Furniture and Domestic Appliances activities
showe d f ur ther wea knesse s, mainly in
SouthernEuropeandpartsofAsia.
Industrial Coatings
Industrial Coatings had a good year with
revenueincreasing19 percent,mainlydue to
highervolumes,pricerealization,thesuccessful
integrationoftheLindgensPackagingbusiness
(acquiredin2010)andtheSchrammacquisition
(Q42011).Thedriversforgrowthin2011came
fromPackagingCoatings’beverageandfood-
re lated businesse s a nd C oi l C oatings’
c on st ru ct io n a nd a gr ic ul tu re- re la tedbusinesses.Packaging continuedto grow in
Europe and Asia, while Coil grew in the
Americas.SpecialtyPlasticshadlowerrevenue
in2011duetoreduceddemandinthewireless
and IT segments in Asia. We saw a slight
slowingdownofactivitiesduringQ4inEurope,
whileNorth America continued to be strong.
Weopened a new Coil factory inBangalore,
India,inthebeginningof2011,tosupportour
growingdemandforcoilproductsandweare
addingcapacityinSongjiang,China,tosupportthecontinuedgrowingdemandforpackaging
coatingsinChina.
Overall, Industrial Coatings showed strong
revenue growth of 23 percent in the fourth
quarter,supportedbytheSchrammandSSCP.
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 13/24
AkzoNobel I Report for the year 2011 and fourth quarter13
Revenue development Q4 2011
+1%
-4%
+5% 0% +2%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
-4
-2
4
6
0
Revenue development 2011
0%
+1%
+7% 0% +8%
Volume AcquisitionsPrice/mix Exchange
rates
Total
Increase Decrease
8
10
2
4
6
0
Aftera strong2010,theSpecialtyChemicals
portfoliodeliveredasolidperformanceduring
2011. Most businesses, such as IndustrialChemicals,SurfaceChemistry,andPulpand
PaperChemicals recordedgood growthand
the ir best-ever profi ta bi li ty. Funct iona l
Chemicalssawitsearningsdecrease aftera
strong 2010 performance, especially in the
EthyleneAminesproductline.Revenuegrew
overlastyear,mainlyonpriceincreaseswith
overallvolumesshowinglimitedgrowthdueto
theeconomicslowdown,whichbecamemore
visibleinsomesegmentsduringtheyear,as
well as growth being hampered in some
businessunitsduetocapacityconstraints,for
whichsolutionsareunderway.Somespecific
product lines captured substantial growth,especially in market sectors for Surface
Chemistry and Pulp and Paper Chemicals,
wherethedemandremainedstrong.Chemicals
Pakistancontinuedtobeplaguedbydifficult
businessconditions,amongthemapersistent
naturalgasshortageinthecountry,leadingto
higher costs for using alternative energy
sources aswell as6 percent lower off-take
from our customers. Raw material prices
increasedsignificantlyduringtheyear,despite
startingtoleveloffandstabilizebytheendof
2011. More headwind came from adverse
t ra ns ac ti on al c ur re nc y d ev el op me nt s
impactingmarginsandalsofromtheenergymarket in the Netherlands, where spark
spreads (the difference between gas input
costs versus electricity sales prices) are
unattractive for energy producers. With
effectivemarginmanagementtheseeffectsare
compensatedinourpricing,andoverallforour
portfolio ourunit margins remainedclose to
the same level. The overall strong portfolio
showeda decentprofitabilityinthesedifficult
economiccircumstances.
Q4showedlowervolumesinmostsegments,
due to lower demand and customer stock
control. Despite these factors, revenueincreasedby2percentonthebackofprice
increases.
Functional Chemicals
Followingastrongyearin2010andagood
start in Q1 2011, the performance of the
FunctionalChemicals’businesswasimpacted
by the economic downtur n. For mos t
businesses,salesvolumesended belowlast
year.ThenewEthyleneAmines’andChelates’
plantsinNingbo–whichstartedupduringthe
year–kepttheportfolio’soverallsalesvolumes
inlinewith2010.
However, as a result of effective marginmanagement–onthebackofpriceincreases
– revenue increased by 6 percent, seen at
somebusinesssegmentsinQ4.Performance
intheyearwasalsoimpactedbyyear-on-year
increasesinrawmaterialcostsandunfavorable
transactionalcurrencyimpacts.
SpecialtyChemicals• Full-yearrevenueincreased8percent,mainlydrivenby
priceincreases• Weakeningdemandinsomesegmentsvisibleduringtheyear
• Performanceimprovementprograminitiated• Full-yearEBITDAdecreased4percentto€906millionagainst
astrong2010• EBITDAmarginremainedsolidat17.0percent(2010:19.0percent)
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 14/24
14 AkzoNobel I Report for the year 2011 and fourth quarter
In € millions
220
241
221
Q1 11 Q2 11
238
Q3 11
207
Q4 11Q4 10
In € millions
Q2 11 Q3 11Q4 10 Q1 11
1,351 1,350 1,349
Q4 11
1,2851,259
Revenue
EBITDA
In Q4, earnings declined compared to the
previousquarter.Salesvolumesdippedbelow
previousyearastheeconomysloweddown
and customers postponed orders to reduce
inventorylevels towards theend of theyear.Formanyproductlinesthisresultedinvolumes
beingbelow normal levels, however, market
shares were maintained in general. The
reductioninperformanceoverthelastquarter
was most visible in Functional Chemicals,
which experienced sales price pressure in
somesegmentstowardstheendoftheyear,
drivenbylowerdemandandimprovedproduct
availabilityin themarket.Raw material price
increasescontinuedtohaveanimpact,though
stabilized towards theend of theyear. The
main driverfor the increases was higheroil
prices, resulting in higher prices for oil
derivatives.
Industrial Chemicals
IndustrialChemicalsperformedstronglyduring
the year. Chlor-Alkali and Monochloroacetic
Acid(MCA)benefitedfromhighercausticlye
pricesthanlastyear,withtheMCAbusiness
realizinghighvolumesinhigh-marginmarkets,
especially in China. The Chlor-Alkali
performance was also characterized by a
strongchloro-methanesbusiness,aswellas
favorable results of electricity hedging and
changed electricity regulations in Germany.
TheenergymarketintheNetherlandsremained
unattractive for energy producers as "sparkspreads" (the difference between gas input
costsversuselectricitysalesprices)adversely
impactedourresults.Saltalsoperformedwell,
increasing its market share with its highest
recorded chemical transformation (CT) salt
volume. On t he back of t hese st rong
performances,revenueincreasedby9percent;
howevertotalsalesvolumestayedflatexcept
for MCA, Dimethyl ether (DME) and chloro-
methanes.Therewasalsoamajormaintenance
stop ea rl ier in the ye ar f or Elec trolysis
Rotterdam, which is done once every four
years.
The fourth quarter saw revenue increase by
1percent,butvolumesdeclinedby6percent
– dominated by lower customer demand –
except for MCA. Overall, salt volumes were
strong, except for the road salt business,
whichwasimpactedbymildwinterconditions.
Keybrands
Revenue
4thquarter January-December
2010 2011 ∆% in€ millions 2010 2011 ∆%
461 457 (1) FunctionalChemicals 1,813 1,917 6282 285 1 IndustrialChemicals 1,070 1,165 9
200 220 10 SurfaceChemistry 847 945 12
270 276 2 PulpandPaperChemicals 1,044 1,116 7
82 81 (1) ChemicalsPakistan 305 330 8
(36) (34) Other/intragroupeliminations (136) (138)
1,259 1,285 2 Total 4,943 5,335 8
Beore incidentals
221 207 (6) EBITDA 939 906 (4)
17.6 16.1 EBITDAmargin(in%) 19.0 17.0
155 131 (15) EBIT 679 625 (8)
12.3 10.2 EBITmargin(in%) 13.7 11.7
MovingaverageROI(in%) 19.9 17.8
Ater incidentals119 133 Operatingincome 604 622
91 133 Capitalexpenditures 273 366
Investedcapital 3,457 3,620
Numberofemployees 11,080 11,510
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 15/24
AkzoNobel I Report for the year 2011 and fourth quarter15
Transportation of chloro-methanes volumes
washamperedbylowwaterlevelsontheRhine
River.
Surace ChemistrySurfaceChemistryperformed wellcompared
to2010withrevenuegrowingby12percent
duetohighersalesprices,mainlydrivenbyraw
materialpriceincreases.Allgeographicregions
contr ibuted to the improvement, which
occurred in most market sectors. Plant
utilization was high and ran at full capacity,
resultingintheproductsbeingsoldoutforthe
majority of the year. Our industrial markets
performedstrongly,especiallyinagrochemicals
andmining,whilehighoilpricescontributedto
stronger demand for oilfield chemicals. The
co ns ume r- rel ate d mar ket s, ho we ve r,
experiencedsomesofteningthisyear.Marginsweresqueezedasrawmaterialpricesescalated
during the year and exhibited significant
volatility during Q3, however, they stabilized
during the last quarter of the year. Currency
impactsweresignificantduetoaweakerUS
dollar,impactingourmarginsandthestronger
Swedish krona, impacting our cost base in
those countries. The Boxing Oleochemicals
acq uis it io n in Chin a recent ly receiv ed
governmentapproval,whichwillcontributeto
strengthening the company’s position in
specialty surfactants within the region and
provideamanufacturingbaseinChina.Margin
management and effective cost controldeliveredastrongperformancefortheyear.
Revenue in Q4 increased by 10 percent
comparedtolastyear,mainlydrivenbyprice
increasesinallregions.However,volumewas
slightly below last year. Traditionally the
business is seasonaland itexperiencedthe
normaltrendforthistimeofyear,withsomeof
thelargerPersonalCarecustomersreducing
stocksduringthequarter.
Pulp and Paper Chemicals
TheperformanceofPulpandPaperChemicals
endedtheyearstronglywithrevenueincreasingby 7 percent despite adverse transactional
currencyeffects.Demandstrengthwasdriven
by Bleaching Chemicals and the Specialty
Productsportfolio,whilevolumessoftenedin
thePaper Chemicals business. Theincrease
was supported by most businesses and
regions,especiallyAmericasand AsiaPacific.
The overall performance was significantly
affectedbytransactionalcurrencyimpactsas
wellasrawmaterialpriceincreases.However,
marginmanagementinitiativesremainedstrong
withpriceincreasestocountertheseimpacts,as well as a favorable regional/product mix,
contributing to an overall strengthening in
marginsacrossallbusinesses.Pricesonraw
materialsroseconsiderablyduringthefirsthalf
oftheyear,impactingPaperChemicalsmore
thantheBleachingproducts.However,thelast
quarter saw prices leveling out and even
decreasing in certain regions. Cost control
measures remained strong, despite the
unfavorablecurrencyimpactsduetocostbase
inSweden.
VolumesinQ4increasedby2percentoverlast
year. Project activitiesin Brazil andour mostrecent investment in China supported the
developme nt, c ontr ibut ing to a robust
conclusionoftheyear.Currencyimpactwas
also less adverse than in previous quarters,
with favorable prices and decreasing raw
materialcostsleadingtoastrongfinalquarter.
Chemicals Pakistan
Business c onditions re ma ined diff ic ult
throughout 2011 for Chemicals Pakistan,
resultinginaloweroutcomecomparedtolast
year.Domesticdownstreammarketconditions
remained subdued during the year as the
energy shortages persisted along with theongoing economic crisiscreating uncertainty
andsuppressingoveralldemand.Throughout
the year, the polyester market continued to
experiencedifficult market conditions due to
thevolatilityinfeedstockandcottonmarkets.
The continued shortage of gas and resultant
usageofexpensivefurnaceoilintheSodaAsh
business c ontinued to impac t margins.
However,despitetheoverallvolumedecreasing
in2011,pricesincreasedonthebackofhigher
raw material prices, resulting in revenue
increasingby8percent.
InQ4,revenuedecreasedby1percent,ontheback of lower volumes in all businesses.
PolyesterandSodaAshremainedparticularly
effectedduetothelowerdownstreamdemand
drivenbythesevereenergyshortage,resulting
from thepersistinggap between supplyand
demandofnaturalgas.
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 16/24
16 AkzoNobel I Report for the year 2011 and fourth quarter
Condensed inancial statements
Consolidated statement o comprehensive income
4thquarter January-December2010 2011 in€ millions 2010 2011
179 (60) Prot/(loss) or the period 837 541
Other comprehensive income
198 316 Exchangedifferencesarisingontranslationofforeignoperations 827 55
(16) (22) Cashowhedges 50 (55)
(16) (7) Incometaxrelatingtoothercomprehensiveincome (35) 9
166 287 Other comprehensive income or the period (net o tax) 842 9
345 227 Comprehensive income or the period 1,679 550
Comprehensive income attributable to
279 202 Shareholdersofthecompany 1,523 486
66 25 Non-controllinginterests 156 64
345 227 Comprehensive income or the period 1,679 550
Consolidated statement o income
4thquarter January-December
2010 2011 in€ millions 2010 2011
Continuing operations
3,620 3,787 Revenue 14,640 15,697
(2,230) (2,423) Costofsales (8,672) (9,670)
1,390 1,364 Gross prot 5,968 6,027
(857) (868) Sellingexpenses (3,341) (3,407)
(314) (342) Generalandadministrativeexpenses (1,103) (1,229)
(83) (98) Researchanddevelopmentexpenses (334) (356)
23 (20) Otheroperatingincome/(expenses) 29 7
159 36 Operating income 1,219 1,042
(56) (141) Netnancingexpenses (327) (338)
4 (1) Resultsfromassociatesandjointventures 25 23
107 (106) Prot/(loss) beore tax 917 727
40 52 Incometax (170) (194)
147 (54) Prot/(loss) or the period rom continuing operations 747 533
Discontinued operations
32 (6) Prot/(loss)fortheperiodfromdiscontinuedoperations 90 8
179 (60) Prot/(loss) or the period 837 541
Attributable to
162 (68) Shareholdersofthecompany 754 477
17 8 Non-controllinginterests 83 64
179 (60) Prot/(loss) or the period 837 541
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 17/24
AkzoNobel I Report for the year 2011 and fourth quarter17
Shareholders' equity
Shareholders'equityatyear-endof2011increased
to€9.2billion,mainlyduetotheneteffectof:
• Netincomeof€477million.
• Dividendpaymentsof€304million.
Dividend policy and inal dividend
Weareaimingtopayastabletorisingdividend.
Wehaveintroducedastockdividendoptionwith
cash dividend as default. Given our strong
fundamentalsandasasignalofconfidenceinour
ability to deliver the performance improvement
programinchallengingmarkets,wewillproposea
2011 final dividend of €1.12 per share, which
wouldmakeatotal2011dividendof€1.45(2010:
€1.40)pershare.
Condensed consolidated balance sheet
in€ millions December31,2010
December 31,2011
Assets
Non-currentassets
Intangibleassets 7,308 7,392
Property,plantandequipment 3,384 3,705
Othernancialnon-currentassets 1,977 2,198
Total non-current assets 12,669 13,295
Currentassets
Inventories 1,678 1,924
Tradeandotherreceivables 2,788 2,917
Cashandcashequivalents 2,851 1,635
Othercurrentassets 108 98
Total current assets 7,425 6,574
Total assets 20,094 19,869
Equity and liabilities
Total equity 9,509 9,743Non-currentliabilities
Provisionsanddeferredtaxliabilities 2,444 2,284
Long-termborrowings 2,880 3,035
Total non-current liabilities 5,324 5,319
Currentliabilities
Short-termborrowings 907 494
Tradeandotherpayables 3,305 3,349
Othershort-termliabilities 1,049 964
Total current liabilities 5,261 4,807
Total equity and liabilities 20,094 19,869
Changes in equity
in€ millions Subscribedshare capital
Additionalpaid-in
capital
Cashfowhedge
reserve
Cumulativetranslation
reserves
Otherreserves
Shareholders’equity
Non-controllinginterests
Total equity
Balance at January 1, 2010 465 2 (6) (777) 8,091 7,775 470 8,245
Protfortheperiod – – – – 754 754 83 837
Othercomprehensiveincome – – 35 734 – 769 73 842
Comprehensive income or the period – – 35 734 754 1,523 156 1,679
Dividendpaid – – – – (320) (320) (83) (403)
Equity-settledtransactions – – – – 27 27 – 27
Issueofcommonshares 2 7 – – – 9 – 9
Acquisitionsanddivestments – – – – (30) (30) (18) (48)
Balance at December 31, 2010 467 9 29 (43) 8,522 8,984 525 9,509
Protfortheperiod – – – – 477 477 64 541
Othercomprehensiveincome – – (38) 47 – 9 – 9
Comprehensive income or the period – – (38) 47 477 486 64 550
Dividendpaid 1 24 – – (329) (304) (58) (362)
Equity-settledtransactions – – – – 32 32 – 32
Issueofcommonshares 1 14 – – – 15 – 15
Acquisitionsanddivestments – – – – (1) (1) – (1)
Balance at December 31, 2011 469 47 (9) 4 8,701 9,212 531 9,743
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 18/24
18 AkzoNobel I Report for the year 2011 and fourth quarter
15.313.9
Operating working capital
In % of revenue
Q1 11
14.5
Q2 11
14.9
Q3 11
14.4
Q4 11Q4 10
Invested capital
Invested capital at year-end 2011 totaled
€13.7 bil lion, €1.0 bil lion higher than at
year-end2010.Investedcapitalwasimpacted
bytheneteffectof:• Anincreaseof€0.2billionbytheacquisition
ofcoatingsmanufacturerSchrammHolding
AGearlyOctober,2011
• Anincreaseof€0.3billionoflong-term
receivablesrelatedtopensionfundsin
assetposition
• Anincreaseofoperatingworkingcapitalof
€0.2billionduetomoreexpensiveraw
materialsandactionstoensuresupplyof
titaniumdioxide.Expressedasa
percentageofrevenue,operatingworking
capitalwas14.4percent(year-end2010:
13.9percent)
• Paymentsofaccruedinterestof€0.2billion,including€31millionaccrued
interestonbondswhichwerepaidbackin
December2011,withregularcoupondates
inthefirstquarter.
Pensions
Thefundedstatusofthepensionplansat
year-end2011wasestimatedtobeadeficit
of €0.5billion(year-end2010:€1.0 billion;
Q32011:€0.7billion).Themovement
comparedtoyear-end2010isdueto:
• Top-uppaymentsof€354millioninto
certaindefinedbenefitpensionplans
• Lowerdiscountratesincreasingthepensionobligation
• LowerinflationinUKdecreasingthe
pensionobligation
• Higherassetreturns.
In January2012, we concluded thetriennial
actuarial funding review of the ICI Pension
Fund. We expect to have top-up payments
overthe remainingsix years of the recovery
planthatare£198millionlowerintotalthanthe
sumofthecurrentschedule:
• In2012and2013,theywillbe£62million
perannumlower
• In2014,2015and2016,theywillbe£19millionperannumlower.
• In2017,theywillbe£16millionlower.
In addition, we have agreed to terminate a
contingentassetonourbalancesheetinorder
tofundfurtherde-riskingactivitiesandthereby
reducefuturedemandsonourcashflows.
Workorce
At year-end 2011, we employed 57,240 staff
(year-end 2010: 55,590 employees). The net
increasewasdueto:
• Anincreaseof900duetoacquisitionsand
divestments,mainlyfromtheSchramm
acquisition(790employees)
• Adecreaseof1,050employeesdueto
ongoingrestructuring
• Anincreaseof1,800employeesduetonew
hiresinhighgrowthmarkets.
Cash lowsOperating activities in 2011 resulted
in a cash inflow of €325 million (2010:
€519million).Thechangeismainlyduetoa
neteffectof:
• Lowerprofitfromcontinuingoperations
• Higheroperatingworkingcapital
• Fairvaluechangesandcashsettlementsfor
foreigncurrencyhedgingactivities
• Lowerpaymentsrelatedtoprovisions
• Lowerpaymentsfortaxandinterest.
Net debt
Net debt increased from €936 mil lion at
year-end2010 to €1,895million at year-end
2011,mainlydueto:
• Operatingcashinflowof€325million
• Capitalexpendituresof€708million
• Netcashoutflowforacquisitionsand
divestmentsof€138million• Paymentsofdividendsof€362million.
Mid-December,weboughtbackhighinterest
bonds for a total nominal amount of
€528 million and a total consideration of
€633million.Thistransactionresultedinaloss
Invested capital
in€ millions December31,2010 December 31, 2011
Tradereceivables 2,101 2,250
Inventories 1,678 1,924
Tradepayables (1,763) (1,978)
Operating working capital in Business Areas 2,016 2,196
Otherworkingcapitalitems (1,203) (1,018)
Non-currentassets 12,669 13,295
Lessinvestmentsinassociatesandjointventures (175) (198)
Deferredtaxliabilities (589) (567)
Invested capital 12,718 13,708
Operating working capital
in€ millions,%ofrevenue December31,2010 December 31, 2011
DecorativePaints 651 14.3 709 14.7
PerformanceCoatings 714 14.4 792 14.9
SpecialtyChemicals 651 12.9 695 13.5
Total 2,016 13.9 2,196 14.4
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 19/24
AkzoNobel I Report for the year 2011 and fourth quarter19
Fortheyearaheadweexpecttoseethefull
year benefit of the price rises that we havebeen able to achieve, and which now have
offsetmostoftherawmaterialpriceincreases.
Currently we are experiencing greater price
stabil ity in most raw materials, with the
exception of TiO2, which we anticipate will
continue to rise in price, and for which we
have plans in place to pass through further
price rises in the future. In addition, we are
movingaheadwiththeimplementationofour
Performance Improvement Program which
should bring significant benefits in 2012and
beyond,underpinningourmargins.
The major uncertainty remainsthe economicenvironment.Ourconcernsarefocusedonthe
riskof recessionin Europe,delayed recovery
ofthe US property market and the potential
for a slowdownin China. Each ofthese can
haveasignificantimpactonourcustomersin
theseregions, that wouldin turn impact our
sales volumes. These, together with certain
rawmaterials,remainourprincipalsensitivitiesin2012.
AkzoNobel has a strong portfolio of
complementary businesses, with many
leading market positions and exposure to
growth markets. This, combined with our
ongoingmanagementactions,meansthatwe
areconfidentthatwecandelivermedium-term
growthinlinewithourstrategicambitions.
Amsterdam, February 15, 2012
The Board o management
of€67million.However,goingforwardthisloss
will be off-set by the significantly reducedcoupon on a new €800 million seven year
bondlaunchedinthesamemonth.Asaresult,
ourmaturityprofilehasimproved.
Medium-term ambitions and outlook
Wehavetheaspirationtobetheworld’sleading
Coatings and Specialty Chemicals company.
Our medium-term ambitionsare to grow to
€20 billion revenue, increase EBITDA each
year while maintaining a 13 to 15 percent
margin,reduceOWCpercentofrevenueyear-
on-yearby0.5percenttowardsa12percent
level,andpayastabletorisingdividend.
The sustainability ambitions are to remain
atop threeleader inourindustry, tobe top
quartilein our peer group interms ofsafety
performance,diversity,employeeengagement
and development, and eco-efficiency
improvementrates.
Condensed consolidated statement o cash lows
4thquarter January-December
2010 2011 in€ millions 2010 2011
1,630 1,453 Cash and cash equivalents at beginning o period 1,919 2,683
Adjustments to reconcile earnings to cash generated rom operating activities
147 (54) Prot/(loss)fortheperiodfromcontinuingoperations 747 533
166 173 Amortization,depreciationandimpairments 640 633
58 209 Changesinworkingcapital (124) (344)
(20) (43) Changesinprovisions (651) (498)
(76) (15) Otherchanges (93) 1
275 270 Net cash rom operating activities 519 325
(198) (256) Capitalexpenditures (534) (708)
6 (167) Acquisitionsanddivestmentsnetofcashacquired 2 (138)
(1) (8) Otherchanges 53 (2)
(193) (431) Net cash rom investing activities (479) (848)
(4) 80 Changesfromborrowings (33) (470)
(97) (80) Dividends (403) (362)
(51) – Otherchanges (45) 7
(152) – Net cash rom nancing activities (481) (825)
(70) (161) Net cash used or continuing operations (441) (1,348)
1,095 7 Cashowsfromdiscontinuedoperations 1,095 11
1,025 (154) Net change in cash and cash equivalents o total operations 654 (1,337)
28 36 Effectofexchangeratechangesoncashandcashequivalents 110 (11)
2,683 1,335 Cash and cash equivalents at December 31 2,683 1,335
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 20/24
20 AkzoNobel I Report for the year 2011 and fourth quarter
Quarterly statistics
20102011
Q1 Q2 Q3 Q4 year in€ millions Q1 Q2 Q3 Q4 year
Revenue
1,056 1,401 1,372 1,139 4,968 DecorativePaints 1,196 1,461 1,435 1,204 5,296
1,049 1,260 1,239 1,238 4,786 PerformanceCoatings 1,237 1,312 1,295 1,326 5,170
1,154 1,258 1,272 1,259 4,943 SpecialtyChemicals 1,351 1,350 1,349 1,285 5,335
(13) (12) (16) (16) (57) Otheractivities/eliminations (22) (26) (28) (28) (104)
3,246 3,907 3,867 3,620 14,640 Total 3,762 4,097 4,051 3,787 15,697
EBITDA
82 205 198 63 548 DecorativePaints 90 191 148 11 440
143 191 166 147 647 PerformanceCoatings 143 170 157 141 611
207 257 254 221 939 SpecialtyChemicals 241 220 238 207 906
(33) (39) (44) (54) (170) Otheractivities/eliminations (37) (30) (36) (58) (161)
399 614 574 377 1,964 Total 437 551 507 301 1,796
12.3 15.7 14.8 10.4 13.4 EBITDA margin (in %) 11.6 13.4 12.5 7.9 11.4
Depreciation
(29) (32) (31) (32) (124) DecorativePaints (30) (30) (33) (33) (126)
(19) (21) (20) (21) (81) PerformanceCoatings (21) (21) (21) (24) (87)
(52) (53) (54) (55) (214) SpecialtyChemicals (55) (56) (56) (60) (227)
(5) (4) (2) (5) (16) Otheractivities/eliminations (2) (3) (4) (2) (11)
(105) (110) (107) (113) (435) Total (108) (110) (114) (119) (451)
Amortization
(19) (20) (19) (23) (81) DecorativePaints (21) (20) (20) (23) (84)
(6) (7) (6) (7) (26) PerformanceCoatings (7) (7) (7) (8) (29)
(11) (12) (12) (11) (46) SpecialtyChemicals (12) (13) (13) (16) (54)
– 1 (2) (1) (2) Otheractivities/eliminations – – (1) (2) (3)
(36) (38) (39) (42) (155) Total (40) (40) (41) (49) (170)
EBIT
34 153 148 8 343 DecorativePaints 39 141 95 (45) 230
118 163 140 119 540 PerformanceCoatings 115 142 129 109 495
144 192 188 155 679 SpecialtyChemicals 174 151 169 131 625
(38) (42) (48) (60) (188) Otheractivities/eliminations (39) (33) (41) (62) (175)
258 466 428 222 1,374 Total 289 401 352 133 1,175
7.9 11.9 11.1 6.1 9.4 EBIT margin (in %) 7.7 9.8 8.7 3.5 7.5
Operating income
19 146 136 (26) 275 DecorativePaints 37 137 57 (94) 137
101 153 129 104 487 PerformanceCoatings 106 155 114 83 458
126 195 164 119 604 SpecialtyChemicals 173 147 169 133 622
(22) (39) (48) (38) (147) Otheractivities/eliminations (39) (11) (39) (86) (175)
224 455 381 159 1,219 Total 277 428 301 36 1,042
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 21/24
AkzoNobel I Report for the year 2011 and fourth quarter21
20102011
Q1 Q2 Q3 Q4 year in€ millions Q1 Q2 Q3 Q4 year
Incidentals per Business Area
(15) (7) (12) (34) (68) DecorativePaints (2) (4) (38) (49) (93)
(17) (10) (11) (15) (53) PerformanceCoatings (9) 13 (15) (26) (37)
(18) 3 (24) (36) (75) SpecialtyChemicals (1) (4) – 2 (3)
16 3 – 22 41 Otheractivities/eliminations – 22 2 (24) –
(34) (11) (47) (63) (155) Total (12) 27 (51) (97) (133)
Incidentals included in operating income
(17) (21) (53) (29) (120) Restructuringcosts (9) (20) (47) (55) (131)
(9) 8 – (48) (49) Resultsrelatedtomajorlegal,antitrustandenvironmentalcases
1 21 2 (33) (9)
1 1 15 16 33 Resultsonacquisitionsanddivestments
– 26 (5) (11) 10
(9) 1 (9) (2) (19) Otherincidentalresults (4) – (1) 2 (3)
(34) (11) (47) (63) (155) Total (12) 27 (51) (97) (133)
Incidentals per cost category
(16) (20) (37) (53) (126) Costofsales (4) (5) (25) (18) (52)
(5) (3) (7) (28) (43) Sellingexpenses (3) (9) (20) (34) (66)
(7) 1 (3) (4) (13) Generalandadministrativeexpenses
(1) (4) (1) (18) (24)
– – (2) 1 (1) Researchanddevelopmentexpenses
– – (1) (8) (9)
(6) 11 2 21 28 Otheroperatingincome/(expenses) (4) 45 (4) (19) 18
(34) (11) (47) (63) (155) Total (12) 27 (51) (97) (133)
Reconciliation net nancing expense
12 12 16 11 51 Financingincome 14 17 14 12 57
(67) (72) (53) (48) (240) Financingexpenses (61) (63) (49) (129) (302)
(55) (60) (37) (37) (189) Net interest on net debt (47) (46) (35) (117) (245)
Other interest movements
(25) (26) (26) (23) (100) Financingexpensesrelatedtopensions
(16) (13) (15) (15) (59)
(8) (29) (6) 4 (39) Interestonprovisions (5) (12) (13) (16) (46)
– 2 (1) - 1 Otheritems 5 7 (7) 7 12
(33) (53) (33) (19) (138) Net other nancing charges (16) (18) (35) (24) (93)
(88) (113) (70) (56) (327) Net nancing expenses (63) (64) (70) (141) (338)
Quarterly net income analysis
5 7 9 4 25 Resultsfromassociatesandjointventures
7 8 9 (1) 23
(18) (26) (22) (17) (83) Protattributabletonon-controllinginterests
(16) (22) (18) (8) (64)
141 349 320 107 917 Prot/(loss)beforetax 221 372 240 (106) 727(53) (76) (81) 40 (170) Incometax (73) (99) (74) 52 (194)
88 273 239 147 747 Prot/(loss)fortheperiodfromcontinuingoperations
148 273 166 (54) 533
38 22 25 (37) 19 Effectivetaxrate(in%) 33 27 31 49 27
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 22/24
22 AkzoNobel I Report for the year 2011 and fourth quarter
2010 2011
Q1 Q2 Q3 Q4 year Q1 Q2 Q3 Q4 year
Earnings per share rom continuing operations (in €)
0.30 1.06 0.93 0.55 2.85 Basic 0.57 1.07 0.63 (0.26) 2.01
0.30 1.05 0.92 0.55 2.83 Diluted 0.56 1.07 0.63 (0.26) 1.99
Earnings per share rom discontinued operations (in €)
0.05 0.11 0.09 0.14 0.38 Basic (0.02) 0.07 – (0.03) 0.03
0.05 0.11 0.09 0.14 0.38 Diluted (0.02) 0.07 – (0.03) 0.03
Earnings per share rom total operations (in €)
0.35 1.17 1.02 0.69 3.23 Basic 0.55 1.14 0.63 (0.29) 2.04
0.35 1.16 1.01 0.69 3.21 Diluted 0.54 1.14 0.63 (0.29) 2.02
Number o shares (in millions)
232.7 233.3 233.4 233.5 233.2 Weightedaveragenumberofshares
233.6 233.9 234.0 234.3 233.9
233.2 233.4 233.5 233.5 233.5 Numberofsharesatendofquarter 233.7 234.0 234.0 234.7 234.7
Adjusted earnings (in € millions)
141 349 320 107 917 Prot/(loss)beforetaxfromcontinuingoperations
221 372 240 (106) 727
34 11 47 63 155 Incidentalsreportedinoperatingincome
12 (27) 51 97 133
36 38 39 42 155 Amortizationofintangibleassets 40 40 41 49 170
(71) (97) (107) (4) (279) Adjustedincometax (88) (107) (100) 9 (286)
(18) (26) (22) (17) (83) Non-controllinginterests (16) (22) (18) (8) (64)
122 275 277 191 865 Adjusted net income orcontinuing operations
169 256 214 41 680
0.52 1.18 1.19 0.82 3.71 Adjusted earnings per share(in €)
0.72 1.09 0.91 0.17 2.91
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 23/24
AkzoNobel I Report for the year 2011 and fourth quarter23
Moving average ROI iscalculatedasEBITof
the last twelve months divided by average
investedcapital.
Net debtisdefinedas long-termborrowingsplus short-term borrowings less cash and
cashequivalents.
Operating income isdefinedinaccordance
with IFRS and includes the relevant
incidentalresults.
Operating ROI iscalculatedasEBITbefore
amortizationofthelasttwelvemonthsdivided
by a ve rage investe d ca pita l e xc luding
intangibleassets.
Operating working capital is defined as
thesumofinventories,tradereceivablesandtradepayablesintheBusinessAreas.When
expressedasaratio,operatingworkingcapital
is measured against four times last
quarterrevenue.
Revenueconsistsofsalesofgoods,services,
androyaltyincome.
Sae Harbor Statement
Thisreportcontainsstatementswhichaddress
such key issues as AkzoNobel’s growth
strategy, future f inancial results, market
positions, productdevelopment, products in
the pipeline and product approvals. Suchstatements should be carefully considered,
anditshouldbeunderstoodthatmanyfactors
couldcauseforecastandactualresultstodiffer
fromthesestatements.Thesefactorsinclude,
but are not limited to, price fluctuations,
currency fluctuations, developments in raw
material and personnel costs, pensions,
physicalandenvironmentalrisks,legalissues,
and legislative, fiscal, and other regulatory
measures. Stated competitive positions are
basedonmanagementestimatessupported
byinformationprovidedbyspecializedexternal
ag encies. Fo r a more comp rehens iv e
discussion of the risk factors affecting ourbusiness,pleaseseeourlatestAnnualReport.
Brands and trademarks
Inthisreport,referenceismadetobrandsand
trademarks owned by, or licensed to,
AkzoNobel. Unauthorized use of these is
strictlyprohibited.
Accounting policies
Thefullyear2011financialfiguresofAkzoNobel
included in the primary statements in this
reportarederivedfromthefinancialstatements
2011.Thesefinancialstatements havebeenauthorizedforissue.Thefinancialstatements
havenotyetbeenpublishedbylawandstill
havetobeadoptedbythegeneralmeetingof
shareholders. In accordance with section
2:393BW,KPMGAccountantsN.V.hasissued
an unqualified auditor's opinion on these
financialstatements, whichwill bepublished
on February 23, 2012. All quarterly figures
areunaudited.
Comparedtothe2010financialstatementsthe
majoraccountingprinciplesareunchanged.
Seasonality
Revenue andresultsin Decorative Paintsareimpactedbyseasonalinfluences.Revenueand
profitabilitytendtobehigherinthesecondand
thirdquarteroftheyearasweatherconditions
determinewhetherpaintsandcoatingscanbe
applied.InPerformanceCoatings,revenueand
profitability vary with building patterns from
originalequipmentmanufacturers.In Specialty
Chemicals,theFunctionalChemicalsandthe
Surface Chemistry businesses experience
seasonalinfluences.Revenue and profitability
are affectedbydevelopmentsintheagricultural
seasonandtendtobehigherinthefirsthalfof
theyear.
The "other" category
In the category "other" we report activities
whicharenotallocatedtoaparticularbusiness
area. Corporate costs are the unallocated
costsofourheadofficeandsharedservices
center in the Netherlands. Pensions reflects
pensioncostsaftertheeliminationofinterest
cost ( re ported a s f inancing e xpense s) .
Insurances are the results from our captive
insurancecompanies.Otherincludesthecost
of share-based compensation andcompany
projects, the results of treasury and legacy
operationsaswellastheunallocatedcostof
somecountryorganizations.
Glossary
Adjusted earnings per share arethe basic
earningspersharefromcontinuingoperations
excluding incidentals in operating income,
amortization of intangibleassets andtax on
theseadjustments.
Comprehensive income is the change in
equity during a period resulting from
transactionsandothereventsotherthanthose
changes resulting from transactions with
shareholdersintheircapacityasshareholders.
Constant currencies information excludes
foreigncurrency translation effectsassuming
foreign currency exchange rates have not
changed between the prioryear period and
thecurrentperiod.
EBIT isoperatingincomebeforeincidentals.
EBIT marginisEBITas percentageofrevenue.
EBITDA is EBIT before depreciation and
amortization and refers to EBITDA before
incidentals.
EBITDA margin is EBITDA as percentageof
revenue.
Emerging Europe: CzechRepublic,Estonia,
Hungary, Poland, Romania, Rus sian
Federation,Slovenia,TurkeyandUkraine.
Incidentalsarespecialchargesandbenefits,
results on acquisitions and divestments,
restructuring and impairment charges, and
chargesrelatedtomajorlegal,anti-trust,and
environmentalcases.EBITDAandEBITbefore
incidentalsarekeyfiguresweusetoassessourperformance,asthesefiguresbetterreflect
the underlying trends in the results of the
activities.
Interest coverage is oper at ing income
dividedbynetinterestonnetdebt.In2010,we
usedthedefinitionoperatingincomedivided
by net financing expenses and included
non-cashitemssuchas interestonpensions
andprovisions.Wehavechangedthedefinition
starting 2011. The 2010 figure has been
adjustedtoalignwiththe2011definition.
Invested capital is total assets (excludingcash and cash equivalents, investments in
associates,assetsheld forsale) lesscurrent
incometaxpayable,deferredtaxliabilitiesand
tradeandotherpayables.
Mature markets compriseofWesternEurope,
theUS,Canada,JapanandOceania.
Notes to the condensed inancial statements
8/2/2019 AkzoNobel Report for the Year 2011
http://slidepdf.com/reader/full/akzonobel-report-for-the-year-2011 24/24
1 2
www.akzonobel.com
AkzoNobelisthelargestglobalpaintsand
coatingscompanyandamajorproducerof
specialtychemicals.Wesupplyindustriesand
consumersworldwidewithinnovativeproducts
andarepassionateaboutdevelopingsustainable
answersforourcustomers.Ourportfolioincludes
wellknownbrandssuchasDulux,Sikkens,
InternationalandEka.Headquarteredin
Amsterdam,theNetherlands,weareaGlobal
Fortune500companyandareconsistentlyranked
asoneoftheleadersintheareaofsustainability.Withoperationsinmorethan80countries,our
57,000peoplearoundtheworldarecommittedto
excellenceanddeliveringTomorrow’s
Answers Today™
Akzo Nobel N.V.
Strawinskylaan2555
P.O.Box75730
1070ASAmsterdam,theNetherlands
Tel:+31205027555
Fax:+31205027666
Internet:www.akzonobel.com
Formoreinformation: Theexplanatorysheetsusedduringthe
pressconferencecanbeviewedonAkzoNobel’s
corporatewebsitewww.akzonobel.com
AkzoNobelCorporateCommunications
Tel:+31205027833
Fax:+31205027604
E-mail:[email protected]
AkzoNobelInvestorRelations
Tel:+31205027854
Fax:+31205027605
E-mail:[email protected]
Financial calendar
Reportforthe1stquarter2012 April19,2012
AnnualGeneralMeeting April23,2012
Ex-dividenddateof2011naldividend April25,2012
Recorddateof2011naldiv idend Apr il27,2012
ElectionperiodcashorstocknaldividendApril30,2012–
May18,2012
Paymentdateofcashdividendanddelivery
ofnewshares May24,2012Reportforthe2ndquarter2012 July19,2012
Reportforthe3rdquarter2012 October18,2012