Meet AkzoNobel Leading market positions delivering leading performance. Company presentation March, 2013

Transcription

1 Meet AkzoNobel Leading market positions delivering leading performance Company presentation March, 2013

2 AkzoNobel today Revenue 15.4 billion 50,610 employees 44% of revenue from high growth markets Major producer of Paints, Coatings and Specialty Chemicals Leadership positions in many markets Revenue by Business Area Operating income* by Business Area EBITDA** by Business Area 36% 37% 44% 48% 47% 38% Performance Coatings Decorative Paints 27% 8% 15% Specialty Chemicals 5.4% Growth 2012 vs % Return on sales (operating income/revenue) 10.4% EBITDA/revenue *2012 excluding impairment ( 2.1 billion) **New definition including incidentals and after IAS19 2

3 High growth markets are 44% of revenue and their importance will increase % of 2012 revenue, excluding Decorative Paints North America 38% Mature Europe 15% North America 11% Latin America 8% Emerging Europe 2% Middle East and Africa 26% Asia Pacific Our goal: Greater than 50% of revenues from high growth markets 3

4 AkzoNobel strategy 4

5 The vision and new targets Vision: Leading market positions delivering leading performance To be a leader in: Operating efficiency and customer service Innovation Sustainability New targets Return on sales (ROS, operating income/revenue) Return on investment (ROI, operating income/average 12 months invested capital) Carbon emissions across the value chain Eco-premium products 5

6 Strategy on a page Strategic focus areas Processes Actions End-user segmentation Care for the customer Reduction of product and process complexity Cash and return on investment Embedded safety and sustainability Diverse and inclusive talent development Behavior-based and process safety Operational control cycle Continuous improvement Innovation Procurement Talent management Deliver dependably Grow organically Innovate Simplify Standardize Continuously improve Buildings and Infrastructure Transportation Consumer Goods Industrial 6

7 We will drive five strategic focus areas 1. Care for the customer 1. Care for the customer 2. Reduction of product and process complexity 3. Focus on cash and return on investment 3. Cash and return on investment 4. Embedded safety and sustainability 4. Embedded safety and sustainability 5. Diverse and inclusive talent development 5. Diverse and inclusive talent development 7

8 The company core processes will support our strategic focus areas Core processes Process owner Behavior-based and process safety Integrated Supply Chain (HSE) Operational control cycle CEO/CFO Continuous improvement Integrated Supply Chain (Operations) Innovation RDI Procurement Integrated Supply Chain (Procurement) Talent management HR 8

9 Actions > Deliver dependably > Grow organically > Innovate > Simplify > Standardize > Continuously improve 9

10 Market segments ~43% of revenues New Build Projects Maintenance, Renovation and Repair Building Products and Components ~16% of revenues Automotive OEM, Parts and Assembly Automotive Repair Marine and Air Transport ~16% of revenues Consumer Durables Consumer Packaged Goods ~25% of revenues Natural Resource and Energy Industries Process Industries 10

11 Our sustainability strategy: Creating more value with fewer resources More customer value in our end-user segmentation Resource scarcity across the value chain will create opportunities Scope 3 upstream Scope 1 and 2 Scope 3 downstream Raw materials Own operations, including energy use Customer operations End-user End of life Scope 4 Energy/ resource benefits in use 11

12 Sustainability is business; Business is sustainability Downstream eco-premium solutions : 20% of our revenues by 2020 We will increase the revenue from solutions that generate direct resource and energy benefits for our customers, consumers and users Reduction of carbon emissions 25-30% reduction per ton by 2020 (2012 base) We will reduce our carbon emissions through the value chain Resource efficiency As of 2014 AkzoNobel will report on an innovative new index measuring how we improve resource efficiency across the full value chain - compared to the value we generate 12

13 End-user segment trends, combined with sustainability, direct our innovation spend End-user segments Sustainability Sustainability = Business Business = Sustainability Direction of innovation spend (2.5% of 2012 revenue) 13

14 Our proposition: Leading market positions delivering leading performance AkzoNobel has gone through a significant amount of strategic change over the past five years Today, the company has Excellent portfolio of businesses Good long term growth potential on the basis of end-user segment growth Strong positions in high growth markets (44% of revenue) Leadership positions in many markets Clear leader in sustainability Track record of delivering sustainable innovations and products Strong brands, both in consumer and industrial markets Clear focus to deliver on our significant potential Improved returns and cash flow Leveraging scale Simplification and standardization Continued innovation 14

15 Trusted portfolio of global brands 15

16 Organizational overview 16

17 Decorative Paints 17

18 Decorative Paints overview Revenue by end-user sub-segment Revenue by geographic region 16% Maintenance, renovation and repair New build projects 8% 4% Mature Europe 14% 49% Asia Pacif ic Latin America Emerging Europe 84% 25% Other regions Decorative Paints key figures (new definition) million 2012* Revenue 4,297 EBITDA 284 Operating income 94 Return on sales 2.2% Return on investment 3.0% # Employees 17,020 BA-level core processes and capabilities Branding Distributor, wholesaler, retail management Understanding and serving professional painters Consumer inspiration Quality management, including product portfolio management *After the divestment of Decorative Paints North America, excluding impairment ( 2.1 billion) 18

19 Decorative Paints AkzoNobel is a leading decorative paints company with strong positions across the world Our Decorative Paints business supplies a full range of interior and exterior decoration and protection products for both the professional and the do-it-yourself markets The product range includes paints, lacquers and varnishes as well as products for surface preparation (pre-deco products) We also supply building adhesives and floor leveling compounds for tile, floor and parquet layers. 19

20 Decorative Paints Architectural coatings Interior and exterior wall paints and trim paints (lacquers) Woodcare and specialty products Lacquers and varnishes for wood protection and decoration Specialty coatings for metal, concrete and other critical building materials 20

21 Industry leading brands Pre-deco products Fillers, wall treatments, sealants and putties for consumers and professional Adhesives for the building and renovation industry Tile and floor adhesives and floor leveling compounds used for building and renovation 21

22 World leader Geographic expansion into high growth markets Leadership position in developed markets World s leading decorative paints company 22

23 Performance Coatings 23

24 Performance Coatings overview Revenue by end-user segment Revenue by geographic region 23% 14% 36% Transportation Consumer Goods Buildings and Infrastructure Industrial 8% 4% Mature Europe 27% North America 11% Asia Pacific 30% 20% Emerging Europe Latin America 27% Other regions Performance Coatings key figures (new definition) million 2012 Revenue 5,702 EBITDA 673 Operating income 542 Return on sales 9.5% Return on investment 21.7% # Employees 21,310 BA-level core processes and capabilities Industrial key account management Technical support and service Design, color and color matching Continuous innovation in functionality and ease-of-use Sustainable, safe solutions 24

25 Performance Coatings We re world leaders when it comes to performance coatings Performance coatings have hundreds of uses and we ve divided them into four businesses: Industrial Coatings, Powder Coatings, Automotive and Aerospace Coatings and Marine and Protective Coatings We supply a wide range of industries and sectors including automotive, consumer electronics, aviation, shipping and leisure craft, sport equipment, construction, furniture, and food and beverage 25

26 Marine and Protective Coatings 26

27 Marine and Protective Coatings We are the global market leader for marine paints, antifoulings and protective coatings We produce paints and antifouling materials used in shipbuilding, ship maintenance and repair, and by yachts and other pleasure craft We also supply protective coatings for bridges and buildings, and fire protection products for large plants and off-shore installations Our International brand has been used by famous customers including Sydney Harbor Bridge, the London Eye in the UK and seven of the stadiums used in the 2010 FIFA World Cup in South Africa 27

28 Automotive and Aerospace Coatings 28

29 Automotive and Aerospace Coatings AkzoNobel Automotive and Aerospace Coatings is one of the world s leading suppliers of paints and services for vehicle repair, OEM commercial vehicles, automotive plastics and aerospace coatings markets. We provide coatings for original equipment and refinishing applications to body shops, aircraft manufacturers, fleet owners, automotive suppliers and major bus and truck producers. Our portfolio includes strong brands such as Sikkens, Lesonal, Dynacoat, Wanda, and Sikkens Autocoat BT We are active in more than 130 countries and offer outstanding customer service, topnotch training, full technical and logistical support, and detailed local knowledge. 29

30 Industrial Coatings AkzoNobel Industrial Coatings protect and enhance thousands of products made from steel, aluminum and wood 30

31 Industrial Coatings Coil coatings applied to coiled steel and aluminum prior to fabrication: Used in roofing, siding, garage and entry doors and gutters, air conditioners, heaters, furnaces and ventilation units and appliance markets Extrusion coatings applied to some of the world s most prestigious high-rise buildings Packaging Coatings delivers: Hi-tech internal and external coatings and inks for food and drink packaging Consistent high quality visual appearance for caps and closures Wood Finishes and Adhesives supply to: Four key market sectors: cabinetry, furniture, flooring and building products Wood finishes including stains, glazes, clear coats and primers provide lasting beauty and protection to wood products Our wood adhesives and board resins are the bonding agents in engineered wood and laminates 31

32 Wood Finishes and Adhesives Finishes and adhesives for everything wood! 32

33 Wood Finishes and Adhesives AkzoNobel is the world s leading supplier of wood finishes and adhesives. We supply four key market sectors: cabinetry, furniture, flooring and building products. Our industrial wood finishes including stains, glazes, clear coats and primers provide lasting beauty and protection to wood products. We offer a comprehensive selection of sustainable wood coatings including high solids, waterborne, UV and VOC-free. Our market-leading wood adhesives and board resins are the preferred bonding agents in engineered wood and laminates. Proprietary adhesives application equipment maximizes productivity and performance and minimizes environmental impact Our expansive geographic footprint enables us to meet the global requirements of our customers. 33

34 Powder Coatings 34

35 Powder Coatings We are the largest global manufacturer of powder coatings and a world leader in powder coatings technology Powder coatings are solvent-free paints applied to metal and other conductive surfaces. They are used on metal furniture, window frames, radiators, pipes and cars, and even wood and plastic We supply eight key market sectors appliance, architectural, automotive, functional, furniture, general industry, general trade coaters and IT with our global brands Interpon and Resicoat 35

36 Specialty Chemicals 36

37 Specialty Chemicals overview Revenue by end-user segment Revenue by geographic spread 18% 6% Buildings and Infrastructure Transportation 10% 4% 3% Mature Europe North America 40% Asia Pacific 58% 18% Consumer Goods Industrial 22% 21% Latin America Emerging Europe Other regions Specialty Chemicals key figures (new definition) million 2012 Revenue 5,543 EBITDA 830 Operating income 500 Return on sales 9.0% Return on investment 13.6% # Employees 10,750 BA-level core processes and capabilities Management of integrated value chains Continuous technological advancement Engineering and project management Process safety Product and margin management Managing capital intensive businesses and expansions 37

38 Strong platforms for growth AkzoNobel is a major supplier of specialty chemicals with leading positions in selected market segments Our products are used in a wide variety of everyday products such as ice cream, soups, disinfectants, plastics, soaps, detergents, cosmetics, paper and asphalt 38

39 Functional Chemicals 39

40 Functional Chemicals Very diverse product offering, used in many end-use applications Our Functional Chemicals business makes chemical intermediates, performance chemicals and end-products Our portfolio includes cellulosic specialties, chelates, ethylene amines, metal alkyls, micronutrients, organic peroxides, polysulfides, redispersible powder polymers, salt specialties and sulfur products These chemicals are used in everyday items such as detergents, vinyl, automotive parts, agricultural products, pharmaceutical products, food products, wallpaper adhesives, plastic bags and cosmetics 40

41 Pulp and Performance Chemicals 41

42 Pulp and Performance Chemicals We are a leading global force in pulp bleaching technologies, paper chemicals, colloidal silica and expandable microspheres. Our brand names include Eka, Expancel, Purate, Kromasil, Bindzil, Cembinder, Levasil and Bevasil. 42

43 Industrial Chemicals 43

44 Industrial Chemicals Our Industrial Chemicals business makes salt, chlor-alkali products and derivatives such as monochloracetic acid (MCA) These products are essential for the success of the chemical, detergent, construction, food, paper and plastic industries Our portfolio includes chlorine, hydrochloric acid, caustic lye and water treatment chemicals. We re also Europe s largest producer of vacuum salt We supply electricity, gas and steam to plants, mainly through combined heat and power generation plants 44

45 Surface Chemistry 45

46 Surface Chemistry We are a leading global supplier of surface-active agents and specialty polymers Surface Chemistry are chemicals that combine or separate two different materials, they are remarkably flexible and can be used to emulsify, disperse, clean, wet, aggregate, foam, defoam, disinfect or soften They re used in a huge range of industrial and consumer products including cleaning goods, oil field applications, printing, paints, fabric softeners, flooring, food packaging and electronics They can also reduce the need for solvents in paints and cleaning products Specialty polymers for personal care provide the holding power in hair sprays and gels and add softness to mousses, conditioners, shampoos and other styling aids. They are also used in cosmetic and beauty products, like sunscreens, hand and body creams and lotions Specialty polymer products also include dispersants, anti-scalants for water treatment and detergent builders, as well as thickeners for the carpet, adhesive and detergent industries 46

47 AkzoNobel OneHUB Integration COE Ruloff Kristinsson, ir March 6, 2014

48 Agenda Role of OneHUB Philosophy Challenges Continuous Integration

49 Organizational overview 49

50 OneHUB is... Ready-to-use solution & full blown service The common e-channel of AkzoNobel to the outside world for electronic business transactions Based on Business Scenarios for supporting Partner Integration, notably ewarehouse, VMI, OTC/PTP, e-logistics, ecustoms, HR, Treasury, and many more Business Drivers: R e d u c e OWC # of manual trans supply chain costs transportation costs IT Costs I n c r e a s e Service quality Efficiency Productivity Number of perfects

51 A THREE Pronged Strategy Integration tools (middleware) is used To build flexible and agile integrated business processes (e.g. simplify the on boarding process as with PTP) 2. To leverage IT functionality and utilize capacity more efficiently (e.g. reuse of defined processes and tools) 3. To facilitate the expansion or contraction of the IT landscape (e.g. reducing the number of ERP systems while focusing on increasing analytical and reporting abilities)

52 Continuous Improvement Business unit Footer 52

53 Change is constant How can we make the business agile? How can we control support costs? How can we control project costs? Business unit Footer 53

54 MY Integration Hierarchy Agility requires a solid and broad foundation Speed to delivery requires reuse Quality is linked to preventing errors No solid foundation NO-GO Organizational Agility Reuse Standardized Secure Available and Stable Business unit Footer 54

55 The Process Focus is on testing Development UAT Business unit Footer 55

56 The Approach Focus on testing to ensure a solid foundation NEW Must not Break OLD Test the basics know what you are testing Establish clear processes challenge the process Keep focused on the goals perfection in testing is not the goal Business unit Footer 56

57 Questions Business unit Footer 57