Performance Coatings
Highlights Q4 2018:
- ROS up at 10.9% (2017: 9.7%) with a price/mix of 11%, driven by pricing initiatives
- Marine and Protective Coatings revenue was up 5% in constant currencies; profitability improved due to cost savings and pricing actions
- Powder Coatings continued the positive trend with growth of 6% in constant currencies
Q4 2018:
- Revenue 2% up and up 4% in constant currencies, with 11% positive price/mix driven by pricing initiatives
- Adjusted operating income was up €20 million at €153 million (2017: €133 million) mainly driven by pricing initiatives and cost control more than offsetting adverse currencies, higher raw material costs and lower volumes
- ROS at 10.9% (2017: 9.7%)
Full-year 2018:
- Revenue was 3% lower, although up 1% in constant currencies, mainly due to positive price/mix, partially offset by lower volumes
- Adjusted operating income at €629 million (2017: €669 million) due to adverse currencies, higher raw material costs and lower volumes, partly compensated by pricing initiatives, continuous improvement and cost savings
- ROS at 11.3% (2017: 11.6%); ROS in the second half-year increased to 11.5% (2017: 10.0%)
- ROI at 20.5% (2017: 23.4%)
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Q4 2018:
Revenue was up 2% and up 4% in constant currencies. Pricing initiatives continued to gain traction. Volumes were lower in all segments.
Adjusted operating income increased as pricing initiatives and cost control more than offset adverse currencies, higher raw material costs and lower volumes.
Operating income was adversely impacted by €23 million identified items relating to the transformation of the organization.
Full-year 2018:
Revenue was 3% lower and up 1% in constant currencies. Pricing initiatives continued to gain traction, with further increases planned. Volumes were lower.
Adjusted operating income decreased. The impact of pricing initiatives, asset network optimization and cost control did not yet fully offset adverse currencies, higher raw material costs and lower volumes.
Operating income was adversely impacted by €52 million identified items relating to the transformation of the organization.
Fourth quarter |
|
January-December |
||||||||||
2017 1 |
2018 |
∆% |
∆% CC 2 |
in € millions |
2017 1 |
2018 |
∆% |
∆% CC 2 |
||||
|
||||||||||||
296 |
307 |
4% |
6% |
Powder Coatings |
1,173 |
1,218 |
4% |
8% |
||||
320 |
333 |
4% |
5% |
Marine and Protective Coatings |
1,424 |
1,291 |
(9%) |
(5%) |
||||
353 |
341 |
(3%) |
(2%) |
Automotive and Specialty Coatings |
1,426 |
1,392 |
(2%) |
2% |
||||
419 |
421 |
– |
3% |
Industrial Coatings |
1,805 |
1,738 |
(4%) |
1% |
||||
(16) |
1 |
|
|
Other/intragroup eliminations |
(53) |
(52) |
|
|
||||
1,372 |
1,403 |
2% |
4% |
Total |
5,775 |
5,587 |
(3%) |
1% |
||||
Revenue development Q4 2018
Revenue development 2018
Fourth quarter |
|
January-December |
||||
2017 |
2018 |
∆% |
in € millions |
2017 |
2018 |
∆% |
133 |
153 |
15% |
Adjusted operating income |
669 |
629 |
(6%) |
132 |
130 |
(2%) |
Operating income |
668 |
577 |
(14%) |
9.7 |
10.9 |
|
ROS% |
11.6 |
11.3 |
|
|
|
|
|
|
|
|
|
|
|
Average invested capital |
2,860 |
3,066 |
|
|
|
|
ROI% |
23.4 |
20.5 |
|
Powder Coatings
Revenue in Q4 was up 4% and up 6% in constant currencies. Growth was supported by new applications and pricing initiatives.
Full-year revenue was up 4%, and up 8% in constant currencies, due to volume growth and positive price/mix effects.
The acquisition of the V. Powdertech business in Thailand in 2017 helped to fuel growth and strengthen our leading powder coatings business in South East Asia.
Marine and Protective Coatings
Revenue in Q4 was up 4%, and 5% higher in constant currencies. Continued focus on pricing initiatives and cost-saving programs increased profitability. Demand stabilized.
Full-year revenue was 9% lower, and 5% lower in constant currencies, due to lower volumes.
We continue to implement measures focused on restructuring and right sizing.
Automotive and Specialty Coatings
Revenue in Q4 was 3% lower and 2% lower in constant currencies due to lower volumes, partly offset by positive price/mix. Aerospace Coatings revenue was driven by strong demand and customer wins, while Specialty Coatings was impacted by softer demand, especially in Asia.
Full-year revenue was 2% lower, although up 2% in constant currencies, due to favorable price/mix and the acquisition of Disa Technology (Disatech) in 2017 offsetting lower volumes.
Industrial Coatings
Revenue in Q4 was flat and up 3% in constant currencies as a result of continued focus on pricing initiatives. Price/mix effects more than offset lower volumes. Volumes for Packaging Coatings were higher due to customer line wins with our next generation product.
Full-year revenue was 4% lower, although up 1% in constant currencies. Positive price/mix more than offset lower volumes. Demand differed per region and segment.