UpdateAkzoNobel shares rise, company cautiously optimistic on growth

23 July 2010 11:03  [Source: ICIS news]

(Updates throughout)

LONDON (ICIS news)--AkzoNobel’s shares rose by more than 5% in early trading on Friday after it reported a 76% year-on-year surge in its net profit for the second quarter, but the Dutch specialty chemicals company said it was only cautiously optimistic as the economy continues to show uncertainties.

At 09:29 GMT, shares in AkzoNobel had risen by 5.03% to €46.54.

The company's second-quarter net profit increased to €273m ($350m), up from €155m in the 2009 second quarter, as sales improved in all its core businesses.

Overall sales for the April-June period increased by 13% year on year to €3.9bn, with earnings before interest, tax, depreciation and amortisation (EBITDA) jumping 21% to €614m, it said.

“Our second-quarter results show a further increase of revenue and profitability across each of AkzoNobel’s business areas, evidencing that we are benefiting from the recovery and our ongoing restructuring,” said AkzoNobel CEO Hans Wijers in a statement.

However, the company stressed that despite emerging from the global economic crisis in better shape, underlined by the early achievement of its 2011 EBITDA margin target of 14%, there were still several risk factors related to growth.

“One of the principal uncertainties facing our company is the development of the global economy. Economic recovery remains fragile and it continues to be difficult to predict customer demand,” said AkzoNobel.

It added that the developed markets remained challenging. Raw material price pressure and shortages were also expected to continue into the third quarter.

“We will keep a careful eye on the trading environment and costs will continue to be managed aggressively,” the company said.

AkzoNobel said it would provide an update regarding the company's future ambitions at a capital markets day in London on 28 September.

For more on AkzoNobel visit ICIS company intelligence
Read Paul Hodges’ Chemicals and the Economy blog
To discuss issues facing the chemical industry go to ICIS connect

By: Hilde Ovrebekk
+44 20 8652 3214

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly