CEO Forum
March 2015 www.coatingsworld.com Coatings World | 65
Charles Shaver: Last year presented both opportunities and
challenges for coatings that tracked the overall economy in key
markets. The continued economic improvement in the U.S. provided our industry with growth in many of the end-use markets
we serve. Asia Pacific was also relatively strong, led by China’s
continued growth in the personal and commercial vehicle markets and due to its expanding infrastructure. Europe’s economy
was less robust. The instability in Russia and the Ukraine, along
with the weakening of the Euro, affected growth and foreign exchange based revenue. Latin America also presented uncertainties, particularly with the slowdown of the Brazilian economy.
One of the strengths of Axalta, however, is that our global footprint and offerings in so many coating end-use categories helps
us offset these fluctuations, finding growth opportunities in one
geography even if another is slowing.
CW: Did your company see an increase in
revenue in 2014?
Büchner: For AkzoNobel as a whole, 2014 annual revenue
totaled € 14. 3 billion ( 17. 4 US$* principal exchange rate
against the euro of 1.216 based on 12/31/14), down two percent in Euro on 2013 as
a consequence of currency effects and divestments. Our Performance
Coatings Revenue was
flat compared with the
previous year, while
Decorative Paints was
down because of divestments and currencies. Revenue is not our only objective as our
strategic targets include profitability through organic growth
and operational efficiency.
Bunch: PPG’s business also performed well in 2014, reflect-
ing these positive industry trends, and the benefits from
some company-specific initiatives. For 2014, PPG’s sales
were $15.4 billion, up eight percent over 2013 due to higher
sales volumes and acquisitions. Our full year sales volumes
grew more than four percent in the U.S. and Canada, be-
tween 3. 5 –and- 4.0 percent in Asia and Latin America, and
about 2.5 percent in Europe. I was pleased with our strong
financial performance and overall operational execution in
what was a modest growth year from a global economic
perspective. Our earnings improved in each major region by
at least 14 percent. This includes an improvement of more
than $100 million, or 21 percent, in Europe, despite muted
regional economic activity and currency headwinds late in
the year in that region. Most of our businesses continued
to execute very well and in several cases we outperformed
respective global industry growth rates. Strategically, 2014
was another very eventful and successful year as we con-
tinued to enhance our business portfolio. This includes the
first quarter sale of our ownership interest in the Transitions
Optical joint venture for cash of $1.7 billion on a pre-tax
basis, or $1.5 billion after-tax. Also the Comex acquisition
completed in the fourth quarter was the second largest in
our company’s history. We are very pleased to now have this
high quality business as part of PPG.
Cao: Carpoly Group’s overall
growth was slightly above ten percent in 2014. We would say it was a
satisfactory result given the current
economic situation and the internal
restructuring work achieved so far.
However, industrial wood coating and decorative coating retail
have been struggling for single digit
growth, while decorative coating
project segment and some newly established business units enjoyed high growth (above 30 percent).
Jullien: Our sales growth followed a similar pattern as the overall markets, with a slower start at the beginning of the year but
ending with a decent growth in the second half and we saw
organic growth of around five percent for the full year. This was
driven by our Protective segment in China and in South East
Asia, and by our Decorative segment in UK and China.
A number of sub-segments also performed strongly in certain
countries and regions. The rail car segment in the U.S. was particularly strong, for example, while power generation saw good
growth in South East Asia, wind energy saw good growth India
and infrastructure performed well in the Middle East.
Roy: Berger registered a growth in excess of 13 percent by
value in 2014. The growth rate registered was slightly lower
than what we have been registering in the past few years but
we expect a bounce back in 2015 due to improving business
sentiments in India.
Shaver: We reported our first full year earnings now that we
are a publicly traded company following our IPO in November
2014. Our net sales for 2014 were $4.4 billion, an increase of
4.0 percent excluding negative foreign
currency impacts compared to prior
year Pro Forma results. Our adjusted
EBITDA was $841 million, an increase
of 14.0 percent over prior year Pro
Forma results. We were pleased with the
results that we achieved in the fourth
quarter and for the full year. While we experienced significant
currency headwinds in the fourth quarter, net sales increased as
a result of growth in volume and price.
Contributing to these results, we won new business in key
end use markets. We expanded our business in a number of respects, especially with a view to consolidating and globalizing
existing franchises. For example, in an offering that serves both
