Akzo Nobel N.v. · EURONEXT:AKZA
Akzo Nobel — Q3 2024 Earnings Presentation
15 slides from Akzo Nobel's earnings presentation, Oct 23, 2024
Slide 1: Investor Update
Investor Update October 23, 2024 1
Slide 2: Forward-looking statements
Forward-looking statements This presentation1 does not constitute or form a part of any offer to sell, or any invitation or other solicitation of any offer, to buy or subscribe for any securities in the United States or any other jurisdiction. Some statements in this presentation are 'forward-lookin
Slide 3: Q3 2024 Overview
Q3 2024 Overview Organic growth + gross margin expansion continue, OPEX down sequentially Q3 2024 YoY YTD 2024 YoY • Organic sales +1% • Organic sales +2% • Volumes +1% • Volumes +1% • Price/mix flat (mix -1%) • Adj. gross margin +180 bps • Adj. gross margin +60 bps • Adj. EBITDA €1,182m or 14.6% €1
Slide 4: Key initiatives supporting our ambitions
Key initiatives supporting our ambitions Transformation to be accelerated by SG&A and Portfolio actions Industrial efficiency • Site closures on track for year-end • Next wave of measures to be announced in early 2025 • Benefits reaffirmed: >€25m in 2024, €70m in 2025, >€250m by 2027 SG&A actions •
Slide 5: Volume development
Volume development Growth momentum in mixed markets, Deco China the outlier Q3 2024 Q4 2024e Deco EMEA UK/Benelux robust; weaker in Central and SE Europe Flat Flat/- Deco LATAM Strength in Brazil drives performance; continued softness in Colombia ] +MSD% +MSD% Deco SE Asia Indonesia and India growin
Slide 6: Q3 business performance
Q3 business performance Q3 EBITDA equals Q2 adjusted for FX; OPEX higher YoY, but sequentially down AkzoNobel Deco Coatings Q3 revenue development % YoY Q3 revenue development % YoY Q3 revenue development % YoY Organic sales: Organic sales: Organic sales: +1% +1% +2% 2 (3) 1 (3) 1 (3) - - - - - - (1
Slide 7: Operating results for Q3 and YTD 2024
Operating results for Q3 and YTD 2024 Continued ROI rebound, strong FCF in Q3 despite temporarily higher working capital Return Operating on investment working capital (ROI) Operating working capital Operating Free cashworking flow (FCF) capital (%) (% of revenue) (€m) 17.7% 380 17.0% 13.4% 11.8% 24
Slide 8: Outlook
Outlook Growing profit YoY while adapting to volatile markets FY2024 Outlook • Adj. EBITDA: around €1.5 billion • CAPEX: €320m • Volumes: +LSD% • Net Debt/EBITDA: around 2.7x • Industrial efficiency benefit: >€25m • Stable dividend Outlook is based on organic volumes and constant currencies, assumes
Slide 9: Contacts and upcoming events
AkzoNobel Media Relations Upcoming events T +31 (0)88 - 969 7833 Ex-dividend date of 2024 interim dividend October 28, 2024 Contact: Joost Ruempol Record date of 2024 interim dividend October 29, 2024 media.relations@akzonobel.com Payment date of 2024 interim dividend November 7, 2024 Q4 results Jan
Slide 10: Price/mix and volumes
Price/mix and volumes AkzoNobel Deco Coatings price/mix (% YoY) 1616 1919 12.5 14 1414 1313 12 11 11 5 4 10 111111 3 3 3 2 2 3 2 2 1 10 2 2 0 1 8 -1 1 -1 1 7 0 1 0 1 -2 5 5 0 1 0 -2 4 4 2 0 2 0 -4 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 2020 2021 2022 2023 2024 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q
Slide 11: Mid-term ambitions
Mid-term ambitions Expanding profitability underpinned by growth and industrial excellence Strategic priorities Targets Sustainability-driven Adj. EBITDA margin ROI innovation Growth in focus >16% 16-19% segments and markets Adj. EBITDA growth Industrial efficiency benefit CAGR: >6% >€250m by 2027 I
Slide 12: Planning assumptions
Planning assumptions 2024 Mid-term Adj. EBITDA CAGR ‘23-’27: >6% ~€1.5bn Margin: >16% Organic volumes +LSD% +LSD% Industrial efficiency benefit >€25m >€250m Identified items ~€150m Industrial efficiency: €130-150m (‘24-’26) CAPEX €350m pa, incl. €50m pa from €250m €320m industrial efficiency (‘24-’2
Slide 13: Performance measures
Performance measures Definitions of alternative performance measures • Adjusted earnings per share are the basic earnings per share from continuing operations, excluding Identified items and taxes thereon • Adjusted gross profit is revenue less cost of sales, excluding identified items • Adjusted gr
Slide 14: Additional financial information
Additional financial information Consolidated statement of free cash flows Operating income to net income Q3’23 Q3’24 € million YTD’23 YTD’24 Q3’23 Q3’24 € million YTD’23 YTD’24 443 355 EBITDA 1,079 1,067 354 259 Operating income 815 790 — — Impairment losses 2 — (68) (19) Financing income and expen
Slide 15: Alternative performance measures
Alternative performance measures Adjusted earnings per share Average invested capital (€m) Q3’23 Q3’24 Δ% Operating income (€m) YTD’23 YTD’24 Δ% Q3’23 Q3’24 YTD’23 YTD’24 Q3’23 Q3’24 Δ% from continuing operations (€m) Oct’22 – Sep’23/Oct’23 – Sep‘24 156 127 -19% Decorative Paints 401 364 -9% 198 170