Decorative Paints
Half-year:
- Volumes up 6%, driven by Asia and Latin America
- Revenue was impacted by adverse price/mix effects. Favorable impact from Brazilian real was offset by the weakening of pound sterling
- EBIT and operating income improved 8%, driven by volumes and cost control, adversely impacted by unfavorable price/mix effects and higher than anticipated raw material costs
- ROS increased to 10.1% (2016: 9.6%); ROI increased to 13.5% (2016: 12.3%)
Q2:
- Volumes up 3%, driven by Asia and Latin America
- Revenue was impacted by adverse price/mix and currency effects
- EBIT and operating income were adversely impacted by unfavorable price/mix effects and higher than anticipated raw material costs, partly offset by cost measures
Levis premium paint brand launched in China
AkzoNobel has launched its Levis premium paint brand in the professional market segment in China. The move will provide more options for Chinese consumers, and reflects the growing demand in the country for premium coatings solutions.
Half-year:
Revenue was up driven by strong volume growth. Positive volume developments were partly offset by adverse price/mix. Volumes were up 6% with volume growth in Asia and Latin America. The favorable impact from the Brazilian real was offset by the weakening of the pound sterling.
EBIT increased 8%, mainly as a result of improved volumes and cost control.
Q2:
In Q2, revenue was down 1%. Positive volume developments were offset by adverse price/mix and currency effects. In China, significant growth in the premium and mass segment was realized.
EBIT decreased 8%, mainly as a result of higher raw material costs and price/mix effects. Appropriate measures are being taken to address the higher raw material prices.
Second quarter |
|
January-June |
||||||
2016 |
2017 |
∆% |
in € millions |
2016 |
2017 |
∆% |
||
|
||||||||
627 |
584 |
(7) |
Decorative Paints Europe, Middle East and Africa |
1,139 |
1,091 |
(4) |
||
104 |
118 |
13 |
Decorative Paints Latin America |
205 |
237 |
16 |
||
324 |
346 |
7 |
Decorative Paints Asia |
573 |
643 |
12 |
||
– |
(2) |
|
Other/intragroup eliminations |
(1) |
(3) |
|
||
1,055 |
1,046 |
(1) |
Total |
1,916 |
1,968 |
3 |
||
|
|
|
|
|
|
|
||
131 |
121 |
(8) |
EBIT |
183 |
198 |
8 |
||
131 |
121 |
(8) |
Operating income |
183 |
198 |
8 |
||
12.4 |
11.6 |
|
ROS% * |
9.6 |
10.1 |
|
||
|
|
|
|
|
|
|
||
|
|
|
Average invested capital |
2,856 |
2,757 |
|
||
|
|
|
Moving average ROI (in %) * |
12.3 |
13.5 |
|
||
|
|
|
|
|
|
|
||
26 |
27 |
|
Capital expenditures |
52 |
45 |
|
||
|
|
|
Number of employees |
14,700 |
14,700 |
|
||
Revenue development half-year 2017
Revenue development Q2 2017
Europe, Middle East and Africa
Revenue was down due to adverse currency effects and lower volumes with a flat price/mix. Volume was down 1% with trends that varied across the region. Volumes increased for continental Europe.
In Q2, revenue was down due to adverse currency effects, notably the pound sterling, price/mix and lower volumes. Following successful product campaigns, positive developments were visible, including in the Netherlands, Belgium and Africa, while the UK was affected by lower consumer confidence. Growth is also visible in our Russian business following portfolio optimization and a nationwide Dulux campaign.
Latin America
Revenue was up 16% driven by positive currencies (up 4% excluding currency effect) and higher volumes. Overall volume growth was consistent across the region.
In Q2, revenue was up 13% driven by positive currencies (up 7% excluding currency effect) as well as higher volumes. While some markets showed signs of slight recovery, volume and revenue improvements were mainly driven by growth in distribution channel and new product launches, for example the renewed local propositions for Weathershield for Walls and Roofs, as well as EasyCare in Brazil.
Asia
Asian markets continued to show positive demand trends and revenue was up 12%, driven by a strong performance in China. Strong volume growth was partly offset by price/mix as significant growth was realized in the premium and mass market segments. Vietnam and Indonesia also showed strong revenue growth.
In Q2, revenue increased by 7%. Strong volume growth more than offset adverse price/mix effects. Volume growth remained strong in China, particularly in the premium and mass market segments. In China, our Levis premium products in the professional market segment were successfully launched. Vietnam and Indonesia also showed strong revenue growth. In South Asia, we accelerated the expansion of our distributor network. Growth in India was temporarily impacted by the national implementation of the new goods and services tax per July 1, 2017.