Tuesday, Akzo Nobel N.V (AKZOY,AKZOY.PK) posted 30% stronger third-quarter earnings for the three months ended September, despite lower revenues on decreased volume.
The Netherlands-based paints, coatings and specialty chemicals maker reported that net income increased 30% to EUR 197 million or EUR 0.84 per share from EUR 152 million or EUR 0.63 per share for the year-ago period.
Profit for the period from continuing operations was EUR 230 million compared with EUR 162 million in 2008. Earnings per share rose to EUR 0.89 from EUR 0.60 for the prior-year period, the company said.
The company reported restructuring costs of EUR 116 million compared with EUR 28 million a year ago. Akzo said other incidental items included a gain of EUR 58 million in the U.S., arising from the freezing of certain defined benefit pension plans and transition to defined contribution plans, as well as from the amendment of post-retirement healthcare plans. Additionally, divesting PTA Pakistan resulted in a gain of EUR 23 million for the period.
Operating income rose 19% to EUR 352 million from EUR 296 million for the same period last year, and operating cost levels better aligned with lower volumes, the company said.
Third-quarter revenue declined 10% to EUR 3.64 billion from EUR 4.05 billion a year ago, on a volume decline of 8%.
Segment-wise, decorative Paints revenue fell 4% to EUR 198 million from EUR 207 million, while Performance Coatings revenue was up 12% at EUR 166 million from EUR 148 million and Specialty Chemicals revenue was EUR 220 million, down 9% from EUR 242 million last year.
Akzo said net income for the nine months ended was down 21% to EUR 345 million or EUR 1.49 per share from EUR 436 million or EUR 1.72 per share in September 2008.
Earnings from continuing operations fell to EUR 334 million or EUR 1.44 per share from EUR 377 million or EUR 1.49 per share a year ago.
Year-to-date revenue fell 11% to EUR 10.58 billion from EUR 11.85 billion for the same period last year.
Akzo proposed an interim dividend of EUR 0.30 per share compared with EUR 0.40 per share in 2008, payable April 28, 2010, based on its dividend policy of an annual pay-out ratio of at least 45% of net income before incidentals and fair value adjustments for the ICI acquisition.
Looking ahead AkzoNobel Chief Executive Hans Wijers said, "We have seen some signs of an improvement in emerging markets, but overall we don't foresee a quick recovery. We remain committed to implementing our restructuring and integration programs and we are on track to deliver on our previously stated EBITDA margin target of 14 percent by the end of 2011."
AKZOY.PK last traded over the counter at $66.36, Monday.
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