Akzo Nobel | Strategy and Financial Highlights Information from ICIS

Edited from: “Strategy” and “Chairman's statement” 2008 Annual Report

Following the Organon BioSciences divestment and the acquisition of ICI, AkzoNobel says it has become the world’s largest coatings and specialty chemicals company. It further says that it has now entered a phase in which it will focus on improving its performance levels, reflecting the benefits of its scale.

“The fact that we have strong positions in diverse, highly attractive sectors, with a wide geographical spread, will enable us to meet the short-term challenges, particularly those arising from the impact of the ongoing economic recession, as well as helping to position the company for the long-term”, says chief executive officer and chairman, Hans .

The company has set the following key goals:

Value creation

(1)   Outgrow its markets; and

(2)   Improve its earnings before interest, tax, depreciation and amortisation (EBITDA) margin to a minimum of 14% by the end of 2011.

Sustainability

(1)   Remain in the top three in the Dow Jones Sustainability Indexes;

(2)   Reduce its total recordable injury rate; and

(3)   Deliver a change in people development, in part through substantively improving the diversity of its company.

Strategy

(1)   Successfully integrate ICI;

(2)   Delivering profitable growth by leveraging its strong emerging markets and technology positions, augmented by bolt-on acquisitions;

(3)   Improving margins through enhanced pricing and procurement processes;

(4)   Increasing operational effectiveness, partly through restructuring, particularly in mature markets;

(5)   Embedding the AkzoNobel values;

(6)   Creating an industry-leading “talent factory” and

(7)   Strive for world class levels of sustainability and safety.

Outlook

Looking ahead, the company says that it has strong market positions in a number of highly attractive sectors with a wide geographical spread. It also says that it has a robust balance sheet with manageable 2009 refinancing needs.

AkzoNobel believes that the actions it is taking mean that its company is well positioned to meet the current challenges and, as a result, will be in good shape to take advantage of the recovery when it comes.

The company says that it will remain focused on achieving its medium-term target of an EBITDA margin of 14% by the end of 2011, continuing to deliver the €340m ICI synergies, on driving margin management programmes across the company and on “rigorous” cost management.

“We are acutely aware that global market conditions and lack of visibility do not allow for any certainty. The harsh trading conditions experienced towards the end of the fourth quarter of 2008 have continued into 2009 and, as a result, we expect this year to be very challenging”, says Wijers.

See the article and analysis of the ICIS Top 100 on ICIS news.

Financial highlights: Akzo Nobel, year ended 31 December

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Akzo Nobel Company Structure

Akzo Nobel supplies a range of decorative paints, performance coatings and speciality chemicals. Akzo NV was formed in 1969 by the merger of the (Dutch companies) Koninklijke Zout Organon and AKU, and became Akzo Nobel in 1994 after successfully acquiring Nobel Industries.
More about Akzo Nobel Structure

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