AkzoNobel Decorative Paints

In 2010 we were able to put more effort into developing the business. This included further strengthening our US activities, accelerating growth in high growth markets, developing a strategy which is sustainable for the planet and building the people, brands and competencies that we need in order to win globally. It proved to be a particularly good year for us in South East Asia, especially Indonesia and Vietnam, as well as in China, where we achieved substantial growth, assisted by our network of close to 4,000 stores. We increased our market share and have significantly strengthened our brand health and brand presence in that part of the world. We also enjoyed major success in the US, where the impactful relaunch of our Glidden brand helped us to secure the contract as the primary paint supplier to Walmart, putting us ahead in the retail channel. We are establishing a strong number two position in the US and are striving to win new business there.

We also continued to build a leadership position in South America, where we saw steady growth. Our presence in Brazil in particular has been significantly enhanced due to the effectiveness of our global Let’s Color campaign, which is adding color to people’s lives by transforming grey spaces and revitalizing local neighborhoods and communities. It is also a key step in establishing Dulux as a truly global brand and has helped us to gain considerable market share in Brazil. In Europe, 2010 started off very well, but the slow housing market and lack of newbuilding gradually had an impact, which resulted in most of our markets in Continental Europe declining. However, our performance in Eastern Europe – mainly Poland and Russia – was good, and our UK and Turkish businesses also had a strong year. Other highlights included a landmark agreement with the Forest Stewardship Council and our continued global efforts to train thousands of people as Dulux professional painters.

Despite the challenging trading conditions in some geographies, the decorative paints sector remains an attractive market, and as the world’s largest decorative paints company, we will use our scale, competencies and strong brands to accelerate growth, particularly in the high growth markets. Asia, South America and Eastern Europe, for example, will continue along their strong growth curve and I am optimistic about our opportunities and our ability to build our global organization. As well as investing in the development of our people, we are continuing to invest in innovation. We have set up a separate innovation organization – with its own global director – which is rooted in business and customer needs. It is dedicated to driving our agenda to develop more sustainable products, such as Ecosure, Dulux Weathershield and Sikkens Alpha SanoProtex antibacterial paint for hospitals and clinics, which have been very successful. This focus on strong organizational development, combined with our global approach to building people, brands and competencies, will play a crucial role as we move forward.