Akzo Nobel’s quarterly core profit rises 8%, revenue slips

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Dutch paints and coatings maker Azko Nobel reported weaker-than-expected revenues on Wednesday, as lower volumes and adverse currency effects hit sales in the third quarter.

The company reported a net revenue of 2.33 billion euros ($2.69 billion), missing Reuters expectations of 2.48 billion euros.

Meanwhile, Akzo Nobel’s third-quarter core profit rose 8 percent to 243 million euros, underpinned by higher prices and costs savings.

When asked whether Akzo Nobel’s third quarter results had helped bring a feeling of harmony among the company’s executives and its shareholders, CEO Thierry Vanlancker told CNBC: “If you look at our third quarter, I think we do show significant improvement — I mean there are big headwinds on currency and on raw materials — but the fact that we deliver a stronger third-quarter result is significant proof that we are working on it.”

Earlier this year, Akzo Nobel sold its Specialty Chemicals division for 10 billion euros to Carlyle Group after it rejected an unwanted takeover offer from U.S. rival PPG Industries in 2017.

At the time, the company vowed to increase its return on sales to 15 percent by 2020 and to improve the return on investments to above 25 percent.

In the company’s earnings report, Vanlancker said the company was still on course to meet these targets, although the numbers stood at 10.4 and 12.6 percent respectively in the third quarter.

“We have outlined a bridge on how to get from 2017 to 2020 and as we methodically go through those steps and deliver on them, I do believe we get in a much better and a much more balanced conversation with our shareholders,” Vanlancker told CNBC’s “Squawk Box Europe” on Wednesday.

Akzo Nobel said it would implement additional savings totaling 200 million euros by 2020 to reach its goals — but, in doing so, this would lead to one-off costs of 350 million euros over the next two years.

Shares of the company were up more than 4 percent during early morning deals on Wednesday.

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