AkzoNobel has published its results for the second quarter (Q2) of 2020, showing its focus on margin and cost savings in response to COVID-19 headwinds.
The company says its return on sales increased to 14 per cent, up from 13.7 per cent in 2019, while COVID-19’s impact on the company eased – revenue was only about five per cent lower in June compared to almost 30 per cent lower in April. The company reported its total cost savings delivered €116 million, of which €38 million in structural savings related to transformation initiatives.
According to the results, AkzoNobel reported revenue of €1.987 billion in Q2 2020, which is 19 per cent lower than the same quarter in 2019 and 17 per cent lower in constant currencies, with positive price/mix of two per cent and 18 per cent lower volumes, mainly due to the impact of the pandemic.
“Despite lower end market demand, our business return on sales increased 30 basis points to 14 per cent for the second quarter as a result of continued focus on margin management and cost-saving measures,” said Thierry Vanlancker, CEO of AkzoNobel. “I’m extremely proud of our teams around the world who have continued to focus on serving our customers and delivered this resilient performance while also helping many communities affected by the pandemic.
“Our rigorous cash management and strong balance sheet put us in a sound position to deal with the ongoing uncertainty from COVID-19 as we strive to deliver powerful performance as a frontrunner in our industry.”
The company reported €207 million operating income, which includes €31 million negative impact from identified items, related to transformation costs. This compares to 2019 operating income of €308 million, including €3 million positive identified items. As a result, operating income as a percentage of revenue (OPI margin) was 10.4 per cent, while 2019 was 12.16 per cent.