Akzo Nobel N.v. · EURONEXT:AKZA
Akzo Nobel — Q1 2006 Earnings Presentation
28 slides from Akzo Nobel's earnings presentation, Apr 20, 2006
Slide 1: Delivering on growth
Rob Frohn, CFO Q1 2006 Results Delivering on growth April 20, 2006
Slide 2: Q1 2006 operational headlines
Q1 2006 operational headlines Operational performance up substantially - Top line growth • strong start to the year for all businesses • revenues up 12% - Operational EBIT up 21% - Net income, excluding incidentals up 39% Strong financial position
Slide 3: Q1 Operational Performance
—— AKZO NOBEL Q1 OPERATIONAL PERFORMANCE
Slide 4: Excellent operational performance
Excellent operational performance EUR mln Q1-2006 ∆% Revenues 3,392 12 EBIT* 332 21 Net income* 215 39 Ratios 2006 2005 EBIT margin*, % 9.8 9.0 * Excluding incidentals.
Slide 5: Organon – Puregon
Organon – Puregon®
Slide 6: Organon – continued strong growth
Organon – continued strong growth Healthy revenues growth in key franchise - NuvaRing® accelerating in US; over 1 million users globally - Strong contribution from fertility product Puregon® - Anesthesia – ongoing positive trend Investing in marketing and pipeline - R&D up 32% for late stage pip
Slide 7: Organon – growth in key franchises
Organon – growth in key franchises Autonomous growth , % on Q- 1 2005 on Q- 4 2005 Contraceptives 15 6 – of which NuvaRing® 66 12 Puregon® /Follistim® 14 9 Remeron ® (8) 3 Anesthesia 15 11 Livial® 2 (8)
Slide 8: Organon – continued strong growth
Organon – continued strong growth EUR mln Q1- 2006 ∆% Revenues 644 12 EBIT* 85 (4) Ratios 2006 2005 EBIT margin*, % 13.2 15.5 S&D % revenues 31.9 31.9 R&D % revenues 19.2 16.3 *Excluding incidentals
Slide 9: Intervet – range of Nobilis vaccines
Intervet – range of Nobilis® vaccines
Slide 10: Intervet – record sales, steady profitable growth
Intervet – record sales, steady profitable growth Revenues up 8% to an all-time high Double digit growth in Americas and Asia Avian influenza slowed down European business EBIT margin over 20%
Slide 11: Intervet – record sales, steady profitable growth
Intervet – record sales, steady profitable growth EUR mln Q1- 2006 ∆% Revenues 282 8 EBIT* 58 9 Ratios 2006 2005 EBIT margin*, % 20.6 20.2 S&D % revenues 24.1 23.1 R&D % revenues 9.6 10.7 *Excluding incidentals
Slide 12: Coatings – Chartek
Coatings –Chartek®
Slide 13: Coatings – excellent volumes, sharply higher EBIT
Coatings – excellent volumes, sharply higher EBIT Excellent growth across the board, revenues up 16% EBIT and EBIT margin up sharply Raw material pressure from metals and oil derivatives Cost reduction programs in mature markets Offer announced for Sico, Canada’s largest coatings manufactu
Slide 14: Coatings – all business segments improving
Coatings – all business segments improving Industrial Activities - excellent performance Marine & Protective Coatings - strong earnings growth Car Refinishes - turning the corner Decorative Europe - challenging business conditions
Slide 15: Coatings – excellent volumes, sharply higher EBIT
Coatings – excellent volumes, sharply higher EBIT EUR mln Q1-2006 ∆% Revenues 1,434 16 EBIT* 104 68 Ratios 2006 2005 EBIT margin*, % 7.3 5.0 *Excluding incidentals
Slide 16: Chemicals – Kromasil
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Slide 17: Chemicals – strong start to the year
Chemicals – strong start to the year Top line up 8%, growth across the board Robust 11% EBIT margin performance Increasing pressure from energy price
Slide 18: Chemicals – strong start to the year
Chemicals – strong start to the year Focus on 5 growth platforms successful Pulp & Paper, Polymer, and Functional Chemicals and Surfactants – double digit revenues growth Base Chemicals slightly down from strong Q1 2005
Slide 19: Chemicals – strong start to the year
Chemicals – strong start to the year EUR mln Q1-2006 ∆% Revenues 1,037 8 EBIT* 114 15 Ratio 2006 2005 EBIT margin*, % 11.0 10.3 *Excluding incidentals
Slide 20: Q1 Financial Performance
—— AKZO NOBEL Q1 FINANCIAL PERFORMANCE
Slide 21: Incidentals gains on balance lower than in Q1 2005
Incidentals gains on balance lower than in Q1 2005 Gains on Barcelona site disposal and divestments Charges for restructuring and impairments Additions to antitrust and environmental provisions Q1 2005: Termination of Risperdal® co-promotion
Slide 22: Impact of incidentals on net income
Impact of incidentals on net income EUR mln 2006 2005 Δ% Net income excluding incidentals 215 155 39 Special benefits 149 Gains on disposals/ divestments 128 2 Charges for restructuring (42) (5) Charges for anti-trust/ environmental (43) (1) Tax charge (9) (13) Net income including incidentals 249 2
Slide 23: Strong financial position further improved
Strong financial position further improved March ‘06 / Dec. ‘05; EUR bln 2006 2005 Equity 3.8 3.6 Net borrowings 1.5 1.6 Gearing (ratio) 0.39 0.44 YTD ratios 2006 2005 Interest coverage 10.4 13.1 EBITDA coverage 14.3 17.4 Credit rating re-confirmed by Moody’s and S&P in Q1
Slide 24: 2006 Agenda
—-— AKZO NOBEL 2006 AGENDA
Slide 25: Agenda 2006 (1)
Agenda 2006 (1) Organon Continue to grow key franchises Unlock value Organon late stage product pipeline Intervet Continue roadmap improvements
Slide 26: Agenda 2006 (2)
Agenda 2006 (2) Coatings/ Chemicals Accelerate growth across portfolio, including acquisitions Focus on costs in mature markets (mainly EU) Conclude 2005 Chemicals divestment program Trading conditions 2006 Strong start to the year Well positioned for further growth in the current environm
Slide 27: Delivering on growth – Q&A
Delivering on growth Q&A April 20, 2006
Slide 28: Safe harbor statement
Safe harbor statement* This presentation contains statements which address such key issues as Akzo Nobel’s growth strategy, future financial results, market positions, product development, pharmaceutical products in the pipeline, and product approvals. Such statements should be carefully considered,