F inancial News
AkzoNobel posts €1.5B loss in 4Q
AkzoNobel reported a €1.52 billion ($1.93
billion) loss for the fourth quarter, due
mostly to writedowns on the value of
Imperial Chemical Industries (ICI),
which it bought last year and was hit
hard by the global economic downturn.
The loss compares to a € 56 million profit
in the fourth quarter a year earlier.
Operating profit fell 21% to €219 million,
while sales were down 2.7% to € 3. 56 billion. The net loss was caused by a €1.3
were down 1.7% from the $905.7 million reported a year ago. Net income
for the quarter decreased 23.9%, to
$41.7 million from $54.9 million a year
ago. Sales in the company’s industrial
segment grew 3.3% to $625.6 million
from $605.8 million in the year-ago
second quarter. Consumer segment
sales fell 11.8% to $264.4 million from
$299.9 million a year ago.
“Our consumer businesses continue
to face a difficult retail climate, largely
attributable to the lingering effects of
the weak domestic housing market that
has impacted many of our large retail
accounts,” said Frank Sullivan, RPM’s
chairman and CEO.
billion charge against the value of ICI,
which it acquired for € 11. 5 billion last
year, and another €200 million charge to
integrate the company and cut jobs.
In September, Akzo said it would cut
3,500 jobs by 2011, representing approximately 12% of its work force. So far it
has carried out 1,660 of those cuts.
Akzo’s decorative paint business,
which sells paint for the home and features brands such as Dulux, Glidden,
Flexa and Sikkens, showed a 41%
decline in operating profit to € 41 million, with a 13% fall in sales in Europe,
its largest market.
“In the fourth quarter we experienced
a slowdown in many previously fast-growing emerging markets,” the company said in a statement. In the U.S. it said
both professional and DIY sales volumes were down “significantly” again.
AkzoNobel said that operating profits fell 19% to €89 million at its performance coatings division, which
makes industrial paints used on cars,
ships, planes and construction.
VALSPAR’S 1Q SALES DROP 16%
First-quarter sales at Valspar dropped
16.4% from the same period last year to
$639.5 million. Net income for the first
quarter of 2009 dropped to $14.2 million
from $24 million the year before.
Excluding non-cash adjustments of
$0.03 per share for Huarun minority
interest shares in fiscal 2008 and 2009,
and a $0.06 per share charge in fiscal
2009 related to restructuring actions,
first-quarter adjusted net income per
share was $0.20, lower than $0.24 in the
prior-year quarter. Sales for its coatings
segment was $374.7 million, compared
to $471.4 million last year. Paint segment generated sales of $212.7 million
compared to $228.7 million a year ago.
Looking ahead, the company said it still
expects adjusted net income per share
for fiscal 2009 to be in the range of $1.55
to $1.65, excluding restructuring
charges. Wall Street analysts estimate
earnings of $1.50 per share. CW
RPM’S INCOME DROPS 23% IN 2Q
RPM International’s sales of $890 million for second quarter of fiscal 2009
PPG’S INCOME FALLS 65% IN 4Q, FIRM COULD SLASH 4,500 JOBS
On the heels of a 65% drop in net income, PPG reported it could slash up to
4,500 jobs. While PPG has reported record sales for the fourth quarter of $3.2
billion, surpassing the prior year’s fourth quarter results by three percent, net
income plunged 65% to $71 million from $200 million a year ago. Performance
coatings segment sales in the fourth quarter
2008 increased $85 million, or eight percent, versus the prior year’s quarter. Sales grew as a
result of acquisitions—most notably the
SigmaKalon protective and marine coatings
business. Industrial coatings segment sales for
the quarter decreased $166 million, or 18%, due
primarily to lower volumes in the automotive
OEM coatings and industrial coatings businesses, reflecting the severe declines
in global demand. The architectural coatings EMEA (Europe, Middle East and
Africa) segment represents the largest business from the SigmaKalon acquisition. Segment sales for the quarter were $414 million and segment earnings
were break-even.
Chairman and CEO Charles Bunch said the company could cut as many as
4,500 U.S. and European jobs due to the slump in the automobile industry. PPG
announced a cut of 1,000 jobs in September. The next round of layoffs would
come some time in the first quarter, Bunch said.
