Dutch AkzoNobel Q3 net profit rises 41% on lower restructuring costs

21 October 2013 06:45  [Source: ICIS news]

AkzoNobel headquartersSINGAPORE (ICIS)--AkzoNobel posted a 41% year-on-year increase in third-quarter net profit to €155m ($212m), aided by lower restructuring costs and strong sales volumes, the Dutch paints and coatings producer said on Monday.

Revenue in the September quarter 2013 slipped 5% to €3.78bn but operating income grew 22% to €303m as return on sales improved to 8.0% from 6.3% in the previous corresponding period, the company said in a statement.

Earnings before interest, tax, depreciation and amortisation (EBITDA) for the three months ending September increased 7% year on year to €456m.

"The trading environment behind these results has not changed in that demand remains soft and on a comparative basis Q3 [third quarter] last year was particularly weak,” AkzoNobel chief financial officer Keith Nichols said in the statement.

In the first nine months of the year, AkzoNobel generated a net profit of €673m, up 63% year on year, even when revenues dipped 5% to €11.1bn, it said.

Operating profit in January-September 2013 was down 3% to €842m, but return on sales inched up to 7.6% from 7.4% in the same period last year, AkzoNobel said.

Nine-month EBITDA slipped 6% year on year to €1.31bn, it said.

“The economic environment remains challenging and AkzoNobel does not expect an early improvement in the trends faced in its end-user market segments,” the company said.

In the fourth quarter, AkzoNobel is expecting around €160m in restructuring charges to be booked.

“This means that full-year operating income before incidental items is unlikely to exceed €908m,” it said.

($1 = €0.73)

By: Pearl Bantillo
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