Dutch AkzoNobel expects lower Q3 earnings on low consumer confidence

SINGAPORE (ICIS)–AkzoNobel expects its third-quarter earnings to fall year on year, citing “near historical low consumer confidence” stemming from “high macro-economic uncertainty – especially in Europe and China”, the Dutch paints and coatings major said on Tuesday.

Its adjusted operating income in the July-September 2022 is projected to be in the range of €195m-215m, down from €241m in the same period last year, the company said in a statement.

AkzoNobel will announce its Q3 financial results on 20 October.

It said that “customers and channel partners in the paints and coatings industry are proactively destocking” in Europe and China.

“Current demand trends are expected to continue in Q4, whilst benefits will come from the company’s own initiatives to reduce costs, improve working capital and ongoing pricing initiatives,” the company said.

“While Q3 will see the highest raw material cost impact since the inflation cycle started early 2021, pricing will continue to offset raw material and freight inflation,” AkzoNobel said.

“Overall raw material supply is normalizing and raw material prices are starting to soften broadly,” the Dutch producer added.

In the second quarter, AkzoNobel’s net income fell by 59.4% year on year to €106m, weighed down by higher raw material and freight costs.

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