Akzo Nobel Q3 Profit Rises; Says On Track To Deliver On 2015 Targets

(RTTNews) - Dutch paints maker Akzo Nobel NV (AKZOY.PK, AKZOY) Tuesday said the third-quarter profit increased from last year, despite a slide in revenues. The company said it is on track to deliver on its 2015 targets.

Net income attributable to shareholders increased to 205 million euros ($262.8 million) from 155 million euros, on the back of higher operating income and lower finance expenses.

Operating income grew 11 percent to 335 million euros from 303 million euros, reflecting the benefits of ongoing operational efficiency programs.

Revenue, however, declined 2 percent to 3.686 billion euros from 3.778 billion euros last year, with volume growth being offset by negative currency effects and divestments.

Return on sales or ROS improved to 9.1 percent from 8.0 percent. Excluding restructuring costs of 55 million euros, ROS was 10.6 percent, compared to 10.0 percent in 2013.

In Decorative Paints, revenue declined 8 percent to 1.050 billion euros due to the divestment of Building Adhesives and the adverse price/mix effect driven by the sale of the German stores. Operating income was higher amid lower restructuring expenses. Volumes were flat, as market conditions in Europe remained challenging.

In Performance Coatings, revenue was flat at 1.420 billion euros as price/mix and adverse currencies offset higher volumes. The new organizational structure reduced the number of global management layers, leading to higher restructuring costs.

In Specialty Chemicals, revenue declined 1 percent to 1.239 billion euros due to adverse currency developments and price pressure in some segments such as in caustic. Volume was in line with last year, with growth being offset by some planned outages in the chain, as well as industrial action in Rotterdam.

The company also declared an interim dividend of 0.33 euro per share.

Looking ahead, AkzoNobel said it is on track to deliver on its 2015 targets despite the continued fragile economic environment.

CEO Ton Büchner said, "Conditions continue to be challenging, but we have a resilient strategy focused on stimulating organic and sustainable growth. Coupled with the benefits from our ongoing operational efficiency programs, we are on track to deliver on our 2015 targets."

The stock fell 1.8 percent on Monday to close at 49.33 euros.