Akzo Nobel India Limited has informed the Exchange about Investor Presentation
Akzo Nobel India Ltd. Investor Call
3rd Nov 2023
Our strategic priorities – a recap
Hold onto pricing gains to expand margins
Adjust cost base to market reality
Margin Management
Operating Expenses
Working Capital
Integrated Supply Chain
Reduce working capital to increase cash flow
Respond more effectively to business opportunities
Inauguration of robotic palletizer at Thane site by AkzoNobel CEO, Grégoire (Greg) Poux-Guillaume
Investor Call – Q2 2023-24
2
Paints: Commercial aggression, demand softness impacting growth
• Premium leading category growth
• Demand for Projects business remained strong given continuing Real Estate growth
• Accelerating urbanization in semi- urban markets translating into higher growth than metros and Tier-1 cities
• Presence in ~5,300 towns
• Trend of margin improvement
continues
Investor Call – Q2 2023-24
3
Innovations driving growth
All weather protection with Dulux Weathershield Protect Rainproof
New Dulux AssuranceTM warranty program
Reimagining wood finishes with 2,000+ colour options
Featured amongst world’s best creative work in Lürzer's Archive
Investor Call – Q2 2023-24
4
Coatings: Double digit growth continued for Powder, MPY; recovery for ICO
Auto & Specialty Coatings
Industrial Coatings
Powder Coatings
Marine & Protective Coatings
Revving up the performance for McLaren
Sustainable solutions for construction & allied industries
Powering the future with new Resicoat EV range
Fire-proofing and anti-corrosion solutions for heavy industries
• Double-digit growth in
Premium segment; Value Brands performance was ~flat
•
Pick-up in OEM ahead of festive season
•
•
Strong rebound in Coil on the back of healthy export orders
Packaging impacted by suppressed demand
• Double-digit growth across Architectural, I&C and GTC segments on the back of broad-based demand
•
Automotive growth modest on a high base
I&C: Industrial & Consumer GTC: General Trading Companies
• Marine driven by strong
orders in Defence and global drydockings
• Protective Coatings driven by Oil & Gas and Power segments – helped by push for Make in India
Confidential & restricted
5
Q2 2023-24 Performance Quarter characterized by demand softness, margins expansion
Quarter Highlights
H1 Highlights
•
•
•
•
•
Revenue growth of 3%
Growth driven by B2B businesses
Subdued demand and erratic rains impact in B2C business
GM% at 44.7% (vs. 38.4% LY)
EBITDA% at 14.8% (vs. 11.5% LY)
PAT up by 44%
•
•
•
•
•
Record performance across all parameters in absolute terms
Revenue growth of 5%
GM% at 43.8% (vs 38.7% LY)
EBITDA% at 15.5% (vs. 12.2% LY)
PAT up by 43%
Investor Call – Q2 2023-24
6
Q2 and H1 FY 2023-24 Performance
*
*
* indicates YoY change in OPEX/ Revenue
Investor Call – Q2 2023-24
7
30-Sep-2330-Sep-2230-Sep-2330-Sep-22IncomeRevenue from operations9,5639,2623%19,55518,6395%Other income894817189Total income9,6529,31019,72618,728ExpensesCost of goods sold5,2925,70810,98511,429Employee benefits expense8257531,6541,510Finance costs27346158Depreciation and amortisation expense211196404389Other expenses 2,0271,7373,8763,425Total expenses8,3838,4283%16,98116,8112%Exceptional Items0000Profit before tax1,2698822,7451,917Tax expense 327228704494Net Profit for the period94265444%2,0411,42343%Quarter endedH1 ended(₹ mn) OWC and Cash Flow
Continued improvement in working capital…
…resulting in stronger operating cash flow
Investor Call – Q2 2023-24
8
1011135355102995.7%9.6%-30.0%-25.0%-20.0%-15.0%-10.0%-5.0%0.0%5.0%10.0%15.0%020406080100120140160180Sep-23Sep-22DIODSODPOOWC/Revenue(₹ mn)H1 2023-24H1 2022-23Operating profit before Working cap changes3,0842,300Tax(758)(596)Working cap movements424(342)Cash Flow from Operating activities2,7501,362Capex(415)(404)Dividend (incl. Div. Tax)(1,822)(1,594)Investments(805)1,165Other movements(134)(131)Net increase/ (decrease) in Cash(427)399Cash & Cash equivalents at period end2,6881,842Bank Balances other than above3,431Total Cash, eq. & Bank Balance6,119 Steadily progressing towards our ESG ambitions by taking daily action
Renewable sources meeting 45% of energy requirements
Supporting lives & livelihoods in aspirational districts
Safety, Integrity & Sustainability ingrained in our Code of Conduct
Circular use for 56% of our obsolete material and waste streams
Educational access to 6,700+ children
Independent Directors - 50% Independent Audit Committee - 100%
Investor Call – Q2 2023-24
9
Safe Harbour Statement
This report contains statements which address such key issues as AkzoNobel’s growth strategy, future financial results, market positions, product development, products in the pipeline and product approvals. Such statements should be carefully considered, and it should be understood that many factors could cause forecast and actual results to differ from these statements. These factors include, but are not limited to, price fluctuations, currency fluctuations, developments in raw material and personnel costs, pensions, physical and environmental risks, legal issues, and legislative, fiscal, and other regulatory measures, as well as significant market disruptions such as the impact of pandemics. Stated competitive positions are based on management estimates supported by information provided by specialized external agencies. For a more comprehensive discussion of the risk factors affecting our business, please see our latest annual report.
Thank you!