06 March 2008 11:37 [Source: ICIS news]
(Releads and updates throughout, adding ICI figures and latest share price)
By Nigel Davis
LONDON (ICIS news)--The new Akzo Nobel, including ICI, had sales of €14.4bn ($22bn) and a total operating profit before adjustments of €1.4bn on a pro forma basis, the Netherlands-based coatings and chemicals group said on Thursday.
The ICI paints business, which Akzo Nobel is retaining, produced 54% higher operating profits in the fourth quarter, although US revenues were down 6%.
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ICI fourth quarter pre-tax profits were 34% higher at £141m ($281m/€183m) on sales up 6.6% at £1.24bn. Full-year pre-tax profits were up 18.9% at £573m on 1.1% higher sales at £4.90bn.
Akzo Nobel will release full pro forma figures in April but said EBITDA (earnings before interest, tax, depreciation and amortisation) in 2007 was €1.9bn. Pro forma net income before incidentals and a fair value adjustment related to the ICI acquisition was €942m.
Akzo Nobel is retaining the ICI decorative paints and specialty polymers businesses and selling the adhesives and electronic materials to Henkel.
The revenue split including ICI is 36% decorative paints, 32% performance coatings and 32% specialty chemicals.
It will have 60,000 employees and an underfunded pension liability of €1.5bn, Akzo Nobel said. The ICI pension deficit was down significantly at the end of the fourth quarter at £300m from £1.2bn in 2006.
Akzo Nobel reported a 22% year-on-year rise in fourth-quarter EBITDA at €264m. The coatings sector posted a 25% EBITDA surge from €114m to €143m while its chemicals sector reported a 5% EBITDA climb from €131m to €137m.
Margins and returns in both segments were significantly higher.
CEO Hans Wijers described the fit with ICI as perfect and added at a press conference that the integration programme was on track.
Wijers added that upfront costs will be taken this year as the company begins to realise synergies between the two companies.
Akzo Nobel's share price was up almost 5% at €51.91 in late morning trading.
($1 = €0.65/£0.50)
Serene Cheong contributed to this article
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