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Wood Finishes and Adhesives

Revenue for Wood Finishes and Adhesives increased by 13 percent over the prior year, supported by currencies. Volume levels increased 6 percent over 2009 for the year, but the rate of growth began slowing in Q3 and fell below prior year in Q4. This was due to the fragile economic recovery in our end markets and the volatility which still exists in the wood finishes and adhesives markets. The main demand drivers for the industrial wood and adhesives markets include residential construction and remodeling activity, which has been severely impacted by the global economic recession. The North American housing market remains weak, which has resulted in limited growth opportunities for our North American and Asian indirect export businesses.

The European and Latin American wood finishes markets recovered faster and both realized double digit volume growth in 2010. In particular, Turkey showed strong growth in the first half of the year, while the Northern European business gained momentum as the year progressed. Adhesives had a strong year led by the European business, which was aided by a strong export market for structural elements. Despite the difficult economic conditions, we continue to invest in high growth markets. During the year, we began construction of a new manufacturing facility in Vietnam for wood, coil and specialty plastics.

Copyright © 2011 Akzo Nobel N.V.