AkzoNobel says it achieved “solid” full-year 2023 results, while its Q4 2023 performance confirms “positive momentum in margin expansion and deleveraging”.
Revenue in constant currencies for the full year was up five per cent, driven by pricing, while reported revenue was negative two per cent. Operating income improved 45 per cent to €1.029 billion (2022: €708 million) while adjusted operating income increased 36 per cent to €1.074 billion (2022: €789 million), despite €77 million in adverse currency translation. ROS was reported at 10.1 per cent (2022: 7.3 per cent).
Adjusted EBITDA was €1.429 billion (2022: €1.157 billion), despite €92 million in adverse currency translation. Net cash from operating activities was €1.126 billion (2022: €263 million), and net debt to EBITDA leverage ratio improved to 2.7 (2022: 3.8).
A final dividend was proposed at €1.54 per share, the same as the corresponding period in 2022.
In Q4 2023, revenue in constant currencies rose four per cent on higher volumes and pricing, while reported revenue was negative three per cent. Operating income improved 108 per cent to €214 million (2022: €103 million) while adjusted operating income increased 75 per cent to €221 million (2022: €126 million). ROS was 8.7 per cent (2022: 4.8 per cent), and net cash from operating activities was €574 million (2022: €291 million).
AkzoNobel CEO Greg Poux-Guillaume said 2023 was a year in which the company delivered a “clear rebound in performance”.
“Our volumes stabilised, outperforming many of our markets, and our profits rebounded on resilient pricing and the first effects of raw material deflation. In parallel, our efforts to transform our company gathered pace, allowing us to absorb persistent global inflation and unfavourable currency effects to beat the targets we set ourselves at the beginning of the year.
“We have good momentum heading into 2024 and we expect to resume growing volumes while delivering further margin and profit expansion. We aim to deliver €1.50 to €1.65 billion adjusted EBITDA for 2024, based on current market conditions, and to achieve a net-debt-to-EBITDA leverage ratio to around 2.3x by the end of 2024,” said Poux-Guillaume.
For the mid-term, AkzoNobel aims to expand profitability to deliver an adjusted EBITDA margin of above 16 per cent and a return on investment between 16 per cent and 19 per cent. The company aims to lower its leverage to around two times in the mid-term and said it is committed to retaining a strong investment grade credit rating.