Operating income

Operating income increased 3 percent to €987 million, due to higher operating results and lower restructuring charges, offset by higher incidental items (€85 million adverse items in 2014 and €61 million favorable items in 2013). In 2014, restructuring charges were €253 million (2013: 348 million). The majority of the restructuring charges related to Performance Coatings.

  • In Decorative Paints, operating income in 2013 included the gain of €198 million from the divestment of Building Adhesives. Excluding this effect, operating income improved. Restructuring charges were lower than the previous year for both the full year and Q4. In addition, costs were down following the implementation of restructuring programs and strict cost control
  • In Performance Coatings, operating income increased 4 percent compared with 2013. Improved operational effectiveness more than compensated for increased restructuring charges. A major restructuring activity was the implementation of a new organizational structure with fewer management layers and clearer accountability
  • Specialty Chemicals increased profitability over the previous year, with significant savings from restructuring programs. Operating income in 2013 was affected by €121 million incidental charges

Average raw material costs were stable compared with 2013 exit prices. In some high growth markets, currency effects on imported raw materials have affected some businesses.

Full-year ROS was 6.9 percent (2013: 6.6 percent). Excluding incidental items, ROS was 7.5 percent (2013: 6.1 percent).

For the quarter, ROS was 2.4 percent (2013: 3.3 percent). Excluding incidentals, ROS was 4.8 percent (2013: 1.6 percent).

Fourth quarter

 

 

 

 

 

January - December

2013

 

2014

 

Δ%

 

in € millions

 

2013

 

2014

 

Δ%

146

 

16

 

(89)

 

Decorative Paints

 

398

 

248

 

(38)

73

 

106

 

45

 

Performance Coatings

 

525

 

545

 

4

(30)

 

93

 

 

 

Specialty Chemicals

 

297

 

508

 

71

(73)

 

(132)

 

 

 

Other activities/eliminations

 

(262)

 

(314)

 

 

116

 

83

 

(28)

 

Total

 

958

 

987

 

3