Akzo Nobel (AKZA) Q1 2025 earnings summary

Executive summary

• Q1 2025 adjusted EBITDA was €357 million (13.7% margin), flat year-over-year at constant currency, as higher prices and cost reductions offset lower volumes and inflation pressures.

• Organic sales were flat, with a 2% positive price/mix offset by a 2% volume decline, including timing effects in Turkey.

• Over 70% of targeted 2,200 SG&A headcount reductions are already effective, with OPEX flat year-over-year despite 8% wage and inflation pressures.

• Successfully issued a €500 million 10-year bond at 4% in March, securing long-term funding.

• Operating income fell 26% to €192 million, mainly due to €72 million in restructuring costs.

Financial highlights

• Revenue was €2,613 million, down 1% year-over-year, with organic sales flat as 2% price/mix increase offset lower volumes.

• Adjusted EBITDA was €357 million (13.7% margin), or €364 million excluding FX impact, ahead of expectations.

• Free cash flow was negative €183 million, improved from negative €211 million in Q1 2024, reflecting seasonality and higher CapEx.

• Adjusted earnings per share from continuing operations was €0.94, down from €1.12 in Q1 2024.

• Net income attributable to shareholders was €107 million, down from €181 million in Q1 2024.

Outlook and guidance

• Full-year 2025 adjusted EBITDA is expected above €1.55 billion at constant currency, with gross savings of €170 million and CapEx of €350 million.

• Net debt/adjusted EBITDA targeted below 2.5x by year-end, with stable dividend anticipated.

• Volumes expected to be flat to low single-digit growth for the year; Q2 visibility impacted by macroeconomic and FX uncertainties.

• Mid-term ambitions include adjusted EBITDA margin above 16% and ROI of 16-19%.