Akzo Nobel Q1 Net Income Up 9%; Continued growth at Pharma; Coatings and Chemicals bottoming out.Business Editors ARNHEM Arnhem (är`nəm), Ger. Arnheim, city (1994 pop. 133,670), capital of Gelderland prov., E Netherlands, a port on the Lower Rhine. It is an industrial, transportation, and tourist center. , The Netherlands--(BUSINESS WIRE)--April 23, 2002 Akzo Nobel's (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on : AKZOY) net income for the first quarter of 2002 was EUR EUR In currencies, this is the abbreviation for the Euro. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 234 million, up 9% compared with the previous year's results. "On balance all three groups achieved a better performance in their ongoing businesses. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. was up 4% and financing charges were significantly lower," explained Fritz fritz n. Informal A condition in which something does not work properly: Our television is on the fritz. [Perhaps from German Fritz Frohlich, CFO See Chief Financial Officer. of the Dutch-based international pharmaceuticals, coatings, and chemicals company. "Again our Pharma business continued its growth, while at Coatings and Chemicals the downtrend downtrend A series of price declines in a security or the general market. Many analysts feel that investors should avoid securities in a downtrend until the pattern is broken. Compare uptrend. is bottoming out. We are clearly benefiting from our balanced portfolio." Pharma: growth continued Sales of the ongoing Pharma operations were up 13% to EUR 1 billion. Frohlich commented: "Akzo Nobel's human healthcare business Organon or·ga·non or or·ga·num n. pl. or·ga·nons or or·ga·nums or or·ga·na 1. An organ. 2. A set of principles for use in scientific investigation. organon pl. organa [Gr.] organ. grew strongly again. Sales in the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. were up 17%; they now represent more than one third of Organon's sales worldwide. Remeron Remeron® Mirtazipine, see there (R), Puregon(R), and Livial(R) all contributed with over 20% higher sales when compared to last year's first quarter. Arixtra(R) was launched in the United States and received marketing approval for Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). . We also started the market introduction of the new NuvaRing NuvaRing® Gynecology An intravaginal contraceptive ring that releases low doses of progestins for 3 wks, followed by a ring-free wk. See Contraception. (R)
contraceptive contraceptive /con·tra·cep·tive/ (-sep´tiv)1. diminishing the likelihood of or preventing conception. 2. an agent that so acts. ." "We are still awaiting the outcome of legal proceedings All actions that are authorized or sanctioned by law and instituted in a court or a tribunal for the acquisition of rights or the enforcement of remedies. regarding possible generic competition for Remeron(R). Pending the judge's CERTIFICATE, JUDGE'S, English practice. The judge who tries the cause is authorized by several statutes in certain cases to certify, so as to decide when the party or parties shall or shall not be entitled to costs. decision we do not comment." As for the delayed introduction of the new antidepressant antidepressant, any of a wide range of drugs used to treat psychic depression. They are given to elevate mood, counter suicidal thoughts, and increase the effectiveness of psychotherapy. Ariza ARIZA ARIZ+Zapata (leasing & fleet management company in Mexico City, Mexico) he added: "The FDA FDA abbr. Food and Drug Administration FDA, n.pr See Food and Drug Administration. FDA, n.pr the abbreviation for the Food and Drug Administration. has addressed certain issues. Organon will hand over additional information to the FDA next month. It is expected that the product will not be introduced this year." Intervet, the animal healthcare company of Akzo Nobel Akzo Nobel is a multinational company, active in the fields of healthcare products, coatings and chemicals. Headquartered in Amsterdam, the Netherlands, the company has activities in more than 80 countries, and employs approximately 62,000 people. , continued its growth pattern (sales +7%), while the manufacturer of complex active pharmaceutical ingredients Diosynth Diosynth is a company that develops manufacturing processes for active ingredients for pharmaceutical companies all over the world. The company started in 1923 with the extraction of insulin from bovine pancreas, which is still one of their main products. (sales +9%) is continuing to invest for further growth. Coatings earnings slightly up The previously announced cost saving programs in Coatings are on schedule. Frohlich: "We will start to reap the benefits of these programs later this year. In this quarter we have seen that sales, margins and operating results of the continued Coatings activities were slightly up, in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding. See also: Spite higher pension charges. Decorative Coatings improved, while Marine & Protective Coatings and Car Refinishes sustained their positive trend of last year. The industrial activities turned in a mixed performance. In April, we signed a contract to acquire the worldwide marine and aerospace coatings businesses of U.S. Paint, including the renowned AWLGRIP(R) brand for marine coatings systems. This acquisition extends our position in marine and aerospace coatings systems." Chemicals: downtrend bottoming out due to restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). The cost saving programs in the Akzo Nobel Chemicals group are progressing well and are contributing to earnings, which were slightly up on last year. Frohlich stated: "Higher pension costs and the impact of lower sales volumes were more than offset by the favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. effect of cost savings and lower raw material and energy prices. Catalysts and Functional Chemicals in particular showed a strong improvement. Other businesses continued to feel the impact of the soft U.S. economy and the weak PVC PVC: see polyvinyl chloride. PVC in full polyvinyl chloride Synthetic resin, an organic polymer made by treating vinyl chloride monomers with a peroxide. industry." This quarter the new low sulfur sulfur or sulphur (sŭl`fər), nonmetallic chemical element; symbol S; at. no. 16; at. wt. 32.06; m.p. 112.8°C; (rhombic), 119.0°C; (monoclinic), about 120°C; (amorphous); b.p. 444.674°C;; sp. gr. at 20°C;, 2. diesel requirements in Europe enhanced sales of our higher added value Added value in financial analysis of shares is to be distinguished from value added. Used as a measure of shareholder value, calculated using the formula:
adj. Hydroelectric. n. pl. hy·dros 1. Hydroelectric power. 2. A hydroelectric power plant. processing catalysts (HPC (Handheld PC) A palmtop computer that weighs less than one pound and runs specialized versions of popular applications. Microsoft coined the term for its Windows CE operating system, which is an abbreviated version of Windows. See Pocket PC. ). Improved financial position Frohlich added that Akzo Nobel's financial charges are significantly down. "We strengthened our financial position and are benefiting from lower short-term interest rates Short-term interest rates Interest rates on loan contracts-or debt instruments such as Treasury bills, bank certificates of deposit or commerical paper-having maturities of less than one year. Often called money market rates. and reduced net borrowings." The restructuring programs announced last year are being forcefully force·ful adj. Characterized by or full of force; effective: was persuaded by the forceful speaker to register to vote; enacted forceful measures to reduce drug abuse. implemented in Coatings and Chemicals. In the first quarter, the workforce in these groups was reduced by some 400 jobs. On balance, however, the Company increased its workforce by 300 jobs, mainly due to strong Pharma growth. Outlook reconfirmed - net income(1) above record year 2000 Akzo Nobel kept its outlook for the full year unchanged. Frohlich: "We reconfirm re·con·firm tr.v. re·con·firmed, re·con·firm·ing, re·con·firms To confirm again, especially to establish or support more firmly: reconfirmed the reservations. our earlier expressed expectation that our ongoing internal programs to boost performance will lead to a net income(1) for 2002 which exceeds the record year 2000, on the assumption that the economy will resume growth again in the second half of this year and that no major changes will occur in currency exchange rates." Note for the editor Akzo Nobel, based in the Netherlands Netherlands (nĕth`ərləndz), Du. Nederland or Koninkrijk der Nederlanden, officially Kingdom of the Netherlands, constitutional monarchy (2005 est. pop. 16,407,000), 15,963 sq mi (41,344 sq km), NW Europe. , serves customers throughout the world with healthcare products, coatings and chemicals. Consolidated sales for 2001 totaled EUR 14 billion. The Company currently employs over 66,000 people in 80 countries. Financial results for the second quarter will be published on July July: see month. 24, 2002. Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the : www.akzonobel.com (1) Excluding extraordinary and nonrecurring Non`re`cur´ring a. 1. Nonrecurrent; as, the costs of a layoff are considered as a nonrecurring expense s>. items.
Key Figures
Millions of euros (EUR) 1st quarter
2002 2001 (DELTA)%
Net income 234 215 9
- per share, in EUR 0.82 0.75
Sales
Pharma 1,009 960 5/13(1)
Coatings 1,337 1,362 (2)/2(1)
Chemicals 1,176 1,182 (1)
Total 3,488 3,470 1/4(1)
Operating income (EBIT)
Pharma 210 191 10/10(1)
Coatings 87 88 (1)/2(1)
Chemicals 102 99 3
Total 385 371 4/4(1)
Return on sales, in % 11.0 10.7
Interest coverage 7.3 5.8
Gearing 1.29 1.47(2)
Number of employees 66,600 66,300(2)
Net income up 9%
- Sales(1) growth 4%
- Operating income up 4% - in spite of EUR 20 million higher
pension costs
- Pharma - robust performance continued
- Coatings - earnings(1) slightly up
- Chemicals - downward trend bottoming out
- Restructuring programs - on schedule
- Interest coverage improved to 7.3
- Antidepressant Ariza - introduction delayed
- Outlook reconfirmed - net income(3) above record year 2000
(1) Continued operations.
(2) At December 31.
(3) Excluding extraordinary and nonrecurring items.
The 2001 figures have been restated for the change in accounting principles in respect of pensions and other postretirement benefits. The data in this report are unaudited. The report for the 2nd quarter of 2002 will be published on July 24, 2002.
CONDENSED CONSOLIDATED STATEMENT OF INCOME
Millions of euros 1st quarter
2002 2001 (DELTA)%
Sales 3,488 3,470 1/4(1)
Operating costs (3,103) (3,099)
Operating income (EBIT) 385 371 4/4(1)
Financing charges (53) (64)
Operating income less
financing charges 332 307
Taxes (103) (98)
Earnings of consolidated
companies, after taxes 229 209 10
Earnings from
nonconsolidated companies 13 16
Earnings before minority
interest 242 225
Minority interest (8) (10)
Net income 234 215 9
Return on sales, in % 11.0 10.7
Interest coverage 7.3 5.8
Basic/diluted net income
per share, in EUR 0.82 0.75
EBITDA 554 541 2
Capital expenditures 155 146
Depreciation 159 160
Number of employees 66,600 66,300(2)
(1) Continued operations.
(2) At December 31.
Safe Harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. Statement(a) This report contains statements which address such key issues as Akzo Nobel's growth strategy, future financial results, market positions, product development, pharmaceutical products in the pipeline, and product approvals. Such statements, including but not limited to the "Outlook", should be carefully considered, and it should be understood that many factors could cause forecasted and actual results to differ from these statements. These factors include, but are not limited to price fluctuations, currency fluctuations, developments in raw material and personnel costs, physical and environmental risks, and legislative, fiscal, and other regulatory measures. Stated competitive positions are based on management estimates supported by information provided by specialized spe·cial·ize v. spe·cial·ized, spe·cial·iz·ing, spe·cial·iz·es v.intr. 1. To pursue a special activity, occupation, or field of study. 2. external agencies. (a) Pursuant to the U.S. Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and 1995. Net income up 9% Net income improved 9% to EUR 234 million. Operating income increased 4%-in spite of EUR 20 million higher pension charges-and financing charges were lower. Net income per share was EUR 0.82 (2001: EUR 0.75). Continued robust performance at Pharma - earnings of Coatings and Chemicals slightly higher Sales of EUR 3.5 billion were up 1% on last year. For continued activities this was 4%. Sales development breaks down as follows (in %):
Acquisitions/ Currency
Volume Price divestments translation Total
Pharma 7 2 (5) 1 5
Coatings (2) 2 (3) 1 (2)
Chemicals (2) - - 1 (1)
Akzo Nobel - 2 (2) 1 1
Operating income improved 4%, in spite of EUR 20 million additional pension charges. On balance, the continued activities of all groups turned in a better performance. The poor performance of the stock markets in 2001 had a negative influence on the investment results of Akzo Nobel's pension funds, leading to higher pension costs for all groups in 2002. Implementation of the major restructuring programs initiated in 2001 is on schedule. Return on sales Return on sales A measurement of operational efficiency equalingnet pre-tax profits divided by net sales expressed as a percentage. return on sales The portion of each dollar of sales that a firm is able to turn into income. was 11.0%, against 10.7% in the first quarter of 2001. Financing charges decreased significantly, as a result of lower short-term interest rates and reduced net borrowings. Interest coverage in the first quarter improved to 7.3 (2001: 5.8). The income tax charge decreased to 31% (2001: 32%), reflecting changes in the geographic distribution of the Company's results. Earnings from nonconsolidated companies declined from EUR 16 million to EUR 13 million, due to lower results for Methanor, ECI ECI Employment Cost Index ECI Election Commission(er) of India ECI Enterprise Content Integration ECI Early Childhood Intervention ECI Environmental Change Institute Elektro-Chemie, and Flexsys. Outlook reconfirmed - net income(1) above record year 2000 We reconfirm our earlier expressed expectation that our ongoing internal programs to boost performance will lead to a net income(1) for 2002 which exceeds the record year 2000, on the assumption that the economy will resume growth again in the second half of this year and that no major changes will occur in currency exchange rates. (1) Excluding extraordinary and nonrecurring items.
Pharma - robust performance continued
Millions of euros 1st quarter
2002 2001 (DELTA)%
Sales
Organon 648 579
Intervet 275 257
Diosynth 126 116
Intragroup sales/other (40) (58)
Total continued operations 1,009 894 13
Diagnostics 66
Total 1,009 960 5
Operating income (EBIT) 210 191 10
Return on sales, in % 20.8 19.9
EBITDA 253 232 9
Capital expenditures 68 49
Invested capital 2,640 2,558(1)
Number of employees 21,500 21,100(1)
(1) At December 31.
- Human healthcare:
- New products - Arixtra(R) and NuvaRing(R) launched in U.S.
- Remeron(R) - sales up 24%; lawsuits ongoing
- Puregon(R) - 25% growth
- Contraceptives - slower growth; Implanon(R) further up
- Ariza - introduction delayed
- Animal healthcare - solid growth
- Diosynth - expanding for growth
Sales of the continued Pharma operations were up 13% to EUR 1.0 billion, while operating income rose 10% to EUR 210 million. Return on sales was 20.8%. For the launch of new products marketing costs were increased 14% to EUR 330 million in the first quarter. R&D expenses were raised 18% to EUR 144 million to secure the future pipeline. Pharma results were impacted by higher pension costs. Human-healthcare sales and earnings grew strongly compared to the first quarter of 2001. The main products developed as follows:
Millions of euros or % Sales
Q1 2002 (DELTA)% Q1 2001
Remeron(R) 169 24
Contraceptives 130 2
Puregon(R) 99 25
Livial(R) 50 22
Organon's sales in the United States were up 17% on the first quarter of 2001. At EUR 227 million, they now represent 35% of Organon's sales. In the first quarter, the new pentasaccharide antithrombotic antithrombotic /an·ti·throm·bot·ic/ (-throm-bot´ik) 1. preventing or interfering with the formation of thrombi. 2. an agent that so acts. antithrombotic 1. Arixtra(R), for which the Company has a joint venture with Sanofi-Synthelabo, was launched in the United States; marketing approval was received for Europe. The market introduction of NuvaRing(R) (contraceptive ring) in the United States was started. The lawsuits Organon filed against seven generic pharmaceutical companies in the United States for infringement The encroachment, breach, or violation of a right, law, regulation, or contract. The term is most frequently used in reference to the invasion of rights secured by Copyright, patent, or trademark. of its U.S. patent covering the use of Remeron(R) with SSRIs SSRIs Selective serotonin reuptake inhibitors, a class of medication used to treat depression. Mentioned in: Erectile Dysfunction are ongoing. Organon has to clarify certain issues before the FDA can approve its new antidepressant gepirone ER (Ariza). Organon trusts it can satisfactorily address these issues. It is not possible to provide more information with regard to marketing authorization The right or permission to use a system resource; the process of granting access. See access control. until after receipt of further response from the FDA. It is expected, however, that the product will not be introduced in 2002. The animal healthcare activities successfully continued their growth pattern, with considerable sales gains and improved margins. To secure future growth, capital expenditures were increased to EUR 68 million (2001: EUR 49 million).
Coatings - earnings(1) slightly up
Millions of euros 1st quarter
2002 2001 (DELTA)%
Sales
Decorative Coatings 428 438
Industrial activities 428 416
Marine & Protective
Coatings 192 176
Car Refinishes 178 174
Industrial Products 137 137
Intragroup sales/other (26) (27)
Total continued
operations 1,337 1,314 2
Printing Inks 48
Total 1,337 1,362 (2)
Operating income (EBIT) 87 88 (1)/2(1)
Return on sales, in % 6.5 6.5
EBITDA 128 131 (2)/1(1)
Capital expenditures 25 36
Invested capital 2,453 2,395(2)
Number of employees 28,900 28,900(2)
(1) Continued operations.
(2) At December 31.
- Restructurings - on schedule
- Decorative Coatings - improved performance
- Marine & Protective Coatings - positive development sustained
- Industrial activities - mixed performance
- Acquisition of AWLGRIP(R) marine and aerospace coatings
business
Sales and operating income of the continued Coatings activities were up 2% on the previous year. Return on sales was 6.5%. On balance, margins were higher, offset by higher pension costs. The implementation of the major restructuring programs is progressing well. Coatings will start to reap the benefits of these programs later in the year. The performance of Decorative Coatings improved. Marine & Protective Coatings and Car Refinishes sustained the positive trend of last year. The industrial activities turned in a mixed performance with lower results for Powder Coatings Powder coating is a type of dry coating, which is applied as a free-flowing, dry powder. The main difference between a conventional liquid paint and a powder coating is that the powder coating does not require a solvent to keep the binder and filler parts in a liquid suspension in Europe and for the transportation coatings activities, while the wood and coil coatings businesses did better. Capital expenditures were decreased to EUR 25 million (2001: EUR 36 million). In the first quarter, Akzo Nobel increased its interest in Vivechrom, Greece, from 51% to 76% in order to further strengthen its position in the Greek paint market. In April, Akzo Nobel signed a contract to acquire the worldwide marine and aerospace coatings businesses of U.S. Paint and NOF Europe. The product range includes the world-renowned AWLGRIP(R) products for marine coatings systems. This acquisition extends the Company's position in the professional topsides paint segment and improves its aerospace coatings position in the corporate jet market, as well as its overall position in the global aerospace market.
Chemicals - downward trend bottoming out
Millions of euros 1st quarter
2002 2001 (DELTA)%
Sales
Pulp & Paper Chemicals 251 249
Functional Chemicals 198 208
Surface Chemistry 171 175
Polymer Chemicals 152 154
Resins 102 111
Catalysts 107 94
Base Chemicals 107 95
Salt 70 71
Plastics and Processing
Additives 53 54
Energy 39 43
Intragroup sales/other (74) (72)
Total 1,176 1,182 (1)
Operating income (EBIT) 102 99 3
Return on sales, in % 8.7 8.4
EBITDA 183 183 -
Capital expenditures 60 58
Invested capital 3,136 3,132(1)
Number of employees 15,000 15,100(1)
(1) At December 31.
- Cost-saving programs - progressing well and contributing
- Lower raw material and energy prices
- Catalysts and Functional Chemicals - strong improvement
- Polymer, Pulp & Paper, and Base Chemicals - suffering from
weak market conditions
- Methacrylates monomer business - divested
Chemicals' first-quarter sales of EUR 1.2 billion were almost on a par with last year. Operating income was up 3% to EUR 102 million despite higher pension costs. Return on sales was 8.7% (2001: 8.4%). On balance, the impact of lower sales volumes and higher pension costs was more than offset by the favorable effect of lower raw material and energy prices, and cost savings. The major cost-saving programs are progressing well and contributed to first-quarter performance. This especially goes for Catalysts, which turned in a substantially better performance after the closure of the Los Angeles Los Angeles (lôs ăn`jələs, lŏs, ăn`jəlēz'), city (1990 pop. 3,485,398), seat of Los Angeles co., S Calif.; inc. 1850. site and benefited from lower energy prices. Functional Chemicals profited from lower raw material prices. The polysulfide pol·y·sul·fide n. A sulfide compound containing at least two sulfur atoms per molecule. activities did better. The bleaching bleaching, process of whitening by chemicals or by exposure to sun and air, commonly applied to textiles, paper pulp, wheat flour, petroleum products, oils and fats, straw, hair, feathers, and wood. chemicals business and Surface Chemistry felt the impact of the soft U.S. economy, while results of Polymer Chemicals and Base Chemicals suffered from the weak PVC industry. At EUR 60 million (77% of depreciation), capital expenditures were virtually unchanged from the previous year. This quarter the new Nebula nebula (nĕb`y lə) [Lat.,=mist], in astronomy, observed manifestation of a collection of highly rarefied gas and dust in interstellar space. catalyst-developed by Catalysts in
collaboration Working together on a project. See collaborative software. with ExxonMobil and Nippon Ketjen-was introduced, which is
twice as efficient in the removal of sulfur from diesel than existing
technologies.In the first quarter of 2002, Akzo Nobel reached an agreement to divest To deprive or take away. Divest is usually used in reference to the relinquishment of authority, power, property, or title. If, for example, an individual is disinherited, he or she is divested of the right to inherit money. its methacrylates monomer monomer (mŏn`əmər): see polymer. monomer Molecule of any of a class of mostly organic compounds that can react with other molecules of the same or other compounds to form very large molecules (polymers). business, as this activity no longer fitted within the Company's portfolio. Early in April, agreement was reached on divestment divestment to strip one's investment from an entity. of the lead stabilizer stabilizer: see airplane. activities to the management of this business. As a consequence, the remaining activities of Plastics and Processing Additives no longer have enough critical mass to continue as a stand-alone business unit. Therefore, they will be integrated in the business unit Functional Chemicals as from October 1, 2002.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Millions of euros 1st quarter
2002 2001
Total earnings before minority interest 242 225
Depreciation and amortization 169 170
Cash flow 411 395
Changes in provisions and deferred
tax assets 42 (7)
Retained income nonconsolidated
companies (6) (8)
Changes in working capital (198) (122)
Other items 17 2
Net cash provided by operations 266 260
Capital expenditures (155) (146)
Acquisitions (11) (69)
Proceeds from divestments 66 10
Other changes 17 (10)
Net cash used for investing activities (83) (215)
Dividends paid (2) (6)
Funds balance 181 39
Net cash (used)/generated by
financing activities (221) 62
Effect of exchange rate changes on cash
and cash equivalents - (4)
Change in cash and cash equivalents (40) 97
Strong cash flow The first-quarter funds balance improved from EUR 39 million to EUR 181 million due to lower acquisition expenditure and higher proceeds from divestments. Cash flow from operations Cash flow from operations A firm's net cash inflow resulting directly from its regular operations (disregarding extraordinary items such as the sale of fixed assets or transaction costs associated with issuing securities), calculated as the sum of net income plus noncash expenses was slightly higher. Capital expenditures totaled EUR 155 million (97% of depreciation) with key focus on Pharma. Proceeds from divestments principally stemmed stemmed adj. 1. Having the stems removed. 2. Provided with a stem or a specific type of stem. Often used in combination: stemmed goblets; long-stemmed roses. from the sale of Printing Inks. Net cash used by financing activities mainly concerned the redemption of short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. borrowings.
CONDENSED CONSOLIDATED BALANCE SHEET
Millions of euros March 31, 2002 Dec. 31, 2001
Intangible assets 506 508
Property, plant and equipment 4,577 4,568
Financial noncurrent assets 1,846 1,895
Inventories 2,323 2,270
Receivables 3,520 3,229
Cash and cash equivalents 415 455
Total 13,187 12,925
Akzo Nobel N.V. shareholders'
equity 2,862 2,621
Minority interest 143 138
Equity 3,005 2,759
Provisions 2,967 2,960
Long-term borrowings 2,230 2,235
Short-term borrowings 2,060 2,267
Current liabilities 2,925 2,704
Total 13,187 12,925
Gearing 1.29 1.47
Shareholders' equity per share,
in EUR 10.01 9.17
Number of shares, in millions 285.9 285.9
CHANGES IN EQUITY
Shareholders' Minority
Millions of euros equity interest Equity
Situation at December 31, 2001 2,621 138 2,759
Income 234 8 242
Dividends (2) (2)
Changes in exchange rates 5 1 6
Issue of new shares 2 2
Changes in minority interest
in subsidiaries (2) (2)
Situation at March 31, 2002 2,862 143 3,005
Balance sheet - further strengthened Invested capital at March 31, 2002 amounted to EUR 9.3 billion, an increase of EUR 0.1 billion compared to year-end 2001, mainly due to seasonally higher working capital. Equity increased EUR 0.2 billion due to first-quarter income, while net interest-bearing borrowings were down EUR 0.2 billion. Gearing improved to 1.29 (December 31, 2001: 1.47). Workforce - on balance up At the end of the first quarter of 2002, the Company had 66,600 employees, compared with 66,300 at year-end 2001. Growth of the business, predominantly pre·dom·i·nant adj. 1. Having greatest ascendancy, importance, influence, authority, or force. See Synonyms at dominant. 2. at Pharma, resulted in an increase of 600, while acquisitions added 100. Restructuring and cost saving measures at Coatings and Chemicals caused a decrease of 400 in this quarter. Arnhem, April 23, 2002 The Board of Management Additional Information The explanatory ex·plan·a·to·ry adj. Serving or intended to explain: an explanatory paragraph. ex·plan sheets used by the CFO during the press conference can be viewed on Akzo Nobel's Internet site at: htttp://www.akzonobel.com/news/presentations.asp Akzo Nobel N.V. Velperweg 76 P.O. Box 9300 6800 SB Arnhem The Netherlands Tel. + 31 26 366 4433 Fax + 31 26 366 3250 E-mail ACC@akzonobel.com Internet http://www.akzonobel.com Note for the editor Akzo Nobel, based in the Netherlands, serves customers throughout the world with healthcare products, coatings and chemicals. Consolidated sales for 2001 totaled EUR 14 billion. The Company currently employs approximately 66,000 people in 80 countries. Financial results for the first quarter will be published on April 23, 2002.
Internet: www.akzonobel.com
www.international-coatings.com
www.akzonobelaerospace.com
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