AkzoNobel’s full-year 2019 results show transformation on track, with further step up in profitability, despite softer end market according to its representatives. Highlights for the superyacht market include the development and introduction of Awlfair SF the high-performance spray filler technology as part of the Awlgrip range.
“Our 2019 results show we are on track with our transformation. We made good progress, despite higher raw material costs and softer end market demand. Our performance improvement accelerated during the second half of 2019, resulting in business return on sales up by almost 200 basis points to 12.5 per cent,” cinnebts Thierry Vanlancker, CEO of Akzonobel.
“We delivered on our commitment and returned €6.5 billion to shareholders, following the sale of Specialty Chemicals. At the same time, we continued to invest in our future. We kickstarted a €50 million investment in our US wood coatings business, completed the acquisition of Mapaero to strengthen our global position in aerospace coatings and expanded our Paint the Future innovation ecosystem.”
Superyacht builders and applicators are now able to use Awlgrip’s new spray filler technology that, according to Akzonobel, is “all set to make waves in the industry”. The high-performance filler can be applied be pressurised airless spray, rather than by hand. The innovation also allows for wet-on-wet application, as well as enabling the application of up to two coats per day without the need for sanding in-between.
In December 2019, AkzoNobel and Pinmar (part of GYG plc) signed a letter of intent to partner in studying the optimum application process for Awlfair SF. The hope is that by working together the two brands are able to determine how best to apply the new technology. The study will be supported by AkzoNobel’s partners Hogg and Graco, the developers of the spray equipment and components used to apply Awlfair SF, respectively.
“The Awlfair SF product is a major development in superyacht fillers, and alongside the adoption of the right application methodology offers a step change both in time and quality for the fairing of new build yachts,” commented Remy Millott, Chief Executive Officer at GYG plc. “We are delighted to collaborate with our longstanding partner AkzoNobel in bringing their product and our methodology to market. Pinmar has built its reputation on being at the forefront of new technologies and standards in superyacht finishing. We look forward to working closely with AkzoNobel and the Awlgrip brand as a part of this exciting new innovation.”
Because of Awlfair’s application method, the adoption of this technology is going to require a fundamental rethink of the traditional superyacht filing and fairing process, which is currently all geared towards hand application. As part of the letter of intent, Pinmar will provide AkzoNobel with its technical expertise to identify the application process that best guarantees the success of the new system. In order to analyse the results of the various application methods, Pinmar and AkzoNobel intend to engage Wrede Consulting, a leading superyacht paint surveyor, in order to produce an objective validation of the study’s results.
AkzoNobel full-year 2019 results:
- Revenue was flat, with positive price/mix of 4% and acquisitions contributing 1%, offset by 5% lower volumes due to our value over volume strategy
- Adjusted operating income up 24% at €991 million (2018: €798 million) driven by pricing initiatives and cost savings; ROS up at 10.7% (2018: 8.6%); ROS excluding unallocated costs up at 12.0% (2018:10.6%)
- Operating income up 39% at €841 million, including €150 million negative impact from identified items, mainly related to transformation costs and non-cash impairments, partly offset by a gain on disposal following asset network optimization (2018: €605 million including €193 million negative impact from identified items, mainly related to €130 million transformation costs and €57 million one-off non-cash pension costs); OPI margin improved at 9.1% (2018: 6.5%)
- Net income from total operations at €539 million, including €22 million discontinued operations (2018: €6,674 million, including €6,264 million from discontinued operations)
- Final dividend proposed of €1.49 per share
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