Akzo Nobel (AKZA) Q1 2026 earnings summary

Executive summary

• Q1 adjusted EBITDA reached €345 million, 7% above consensus, with margin up 80 bps to 14.5% year-over-year, marking the fourth consecutive quarter of margin expansion.

• Organic sales declined 1% year-over-year, with reported revenue down 9% due to FX and India divestment.

• Industrial transformation advanced with three site closures in Q1, totaling 15 since inception, and Deco Asia portfolio review ongoing.

• Deco Asia portfolio review progressed with the sale of Pakistan at 14x EBITDA; Axalta merger preparations and €1.1 billion bond issuance reinforced liquidity.

• Net income attributable to shareholders was €93 million, with EPS from total operations at €0.54.

Financial highlights

• Adjusted EBITDA rose 7% at comparable scope and FX, reaching €345 million.

• Adjusted EBITDA margin improved to 14.5%, up 80 bps year-over-year, driven by Deco's 300 bps margin expansion.

• Free cash flow improved to -€144 million from -€183 million in Q1 last year.

• Working capital ended at 16.8% of revenue, 120 bps below prior year.

• Adjusted earnings per share from continuing operations was €0.89, down from €0.94 in Q1 2025.

Outlook and guidance

• Full-year 2026 adjusted EBITDA expected at or above €1.47 billion, based on constant currencies and adjusted for India divestment.

• Q2 adjusted EBITDA expected around €400 million, with volumes forecasted broadly flat and pricing to offset raw material inflation.

• Announced price increases (mid-single to low teens) to fully offset high teens raw material inflation for the remainder of the year.

• Additional pricing actions will be taken if inflation worsens.

• Leverage ratio expected around 2x net debt/adjusted EBITDA by end of 2026.