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Investing.com -- Akzo Nobel NV (AS:AKZO) posted a 1.7% year-on-year decline in first-quarter core earnings but managed to outperform analyst expectations, supported by cost-cutting efforts and price increases.
The Dutch maker of Dulux paint reported adjusted EBITDA of €357 million ($406.7 million), compared to €363 million a year earlier. The figure came in ahead of the €345 million projected in a company-compiled Vara consensus.
"Our efficiency measures are paying off, allowing us to compensate for softer markets and persistent inflation," CEO Greg Poux-Guillaume said in a statement.
While the ongoing tariff conflict between the U.S. and China is expected to have some financial impact, Akzo described the effect as limited. The company estimates an annualized EBITDA hit of €25 million on U.S. exports and €10 million on U.S. imports.
"Our local-for-local and procurement derisking strategic principles continue to largely shield us from direct impacts on our cost base or our ability to deliver," Poux-Guillaume added.
Revenue for the quarter came in at €2.61 billion, a 1% decline from a year ago, but still slightly ahead of the €2.64 billion forecast by analysts in the company’s consensus.
"Investors have become used to small quarterly misses so a beat in 1Q25 and no change to 2025 guidance is a notable achievement," Barclays (LON:BARC) analysts commented in a post-earnings note.
"There will inevitably be questions about whether there’s enough visibility to guide a quarter, let alone a year, ahead but these results should be taken well," they added.
Akzo Nobel had flagged a softer first quarter due to challenging comparisons in China and specific issues in Turkey. But the analysts believe investors will remain cautious on the company’s volume growth outlook for the year until there is clear evidence of improvement in the quarterly trend.