On February 3, AkzoNobel released its financial performance report for the fourth quarter and full year of 2025. The company achieved total sales of €10.16 billion (approximately $11.51 billion or ￥82.24 billion), a 5.0% decrease compared to the previous year. Organic sales remained flat, with gains from higher prices and product mix changes offset by a decline in sales volume. Price and product mix rose by 2%, driven by proactive pricing strategies. However, sales volume dropped by 2%, impacted by macroeconomic uncertainties, especially in North America. Due to the strong euro, exchange rate effects reduced sales revenue by 4%, while other factors, mainly accounting for severe inflation, caused a 1% decrease, leading to an overall sales decline of 5%. (Exchange rates: 1 EUR = 1.1335 USD, 1 EUR = 8.0965 CNY)
For the full year of 2025, AkzoNobel posted an operating profit of €1.164 billion, a 26.94% increase year-over-year. This figure includes a confirmed profit of €83 million from divestments, legal provisions, and restructuring. The adjusted EBITDA was €1.444 billion, a 2.0% decrease from the previous year, impacted by a negative effect of €85 million from exchange rate fluctuations. Structural cost measures helped offset most of the impact from lower production volumes, and despite inflationary pressures on wages and other costs, operating expenses were lower than in the previous year. Adjusted EBIT margin improved to 14.2%. Net income attributable to shareholders was €635 million (approximately $719.8 million), a 17.16% increase year-over-year. Net cash from operating activities was €915 million, a 35.96% increase, benefiting from improved working capital management.
In the fourth quarter of 2025, AkzoNobel generated sales of €2.372 billion, a 9.0% decrease from the same period last year. Organic sales declined by 1%, as the positive impact from price and product mix changes more than offset the decrease in volume. Decorative paints sales in Europe and Asia remained flat, while sales in Latin America decreased. In the high-performance coatings segment, macroeconomic uncertainty in North America continued to negatively affect sales volume. Price/structure rose by 1%, driven by strong pricing strategies across all businesses, except in the decorative paints segment in Asia. The strong euro resulted in a 6% reduction in sales revenue, while asset divestments in India led to a 1% decrease, and other factors (mainly inflationary accounting adjustments) further reduced sales by 1%. As a result, total sales decreased by 9%.
In Q4 2025, operating profit surged to €787 million, a remarkable 520% increase year-over-year. This figure included a profit of €655 million from the divestment of assets in India, which contributed significantly to the operating profit. Adjusted EBITDA was €309 million, a 3.74% decrease, including a negative €28 million impact from currency translation. Structural cost measures helped mitigate the impact of lower production volumes, and despite higher wages and general inflation, operating expenses were still lower than last year. The divestment of Indian assets reduced adjusted EBITDA by €6 million compared to the previous year. Gross margin showed a slight improvement.
AkzoNobel’s CEO Greg Poux-Guillaume commented, “Despite a year where the overall market showed a decline, we managed to improve our profitability, with an adjusted EBITDA margin of 14.2% for the full year, and an improvement of 70 basis points in Q4. This demonstrates the strength of our operational execution, with our plans leading to better-than-expected cost savings, reduced headcount, and improved working capital.”
He further stated, “Our portfolio strategy, combined with strong cash flow generation, led to a net debt-to-adjusted EBITDA ratio of 2x at year-end, in line with our medium-term goals. We have also launched a new round of value-creation plans, which aim to deliver significant synergies and create a company that perfectly combines the strengths of both AkzoNobel and Axalta, offering the best experience to our customers, shareholders, and employees.”
Looking ahead, Poux-Guillaume noted, “Based on the current market conditions, we do not expect a significant recovery in our end markets by 2026. We anticipate a weaker first half of the year, with an improvement in the second half as the comparison base becomes more favorable. In this context, our efficiency improvement measures will continue to support our performance and help us achieve our medium-term objectives.”
Divestment of AkzoNobel India Ltd.
The company also confirmed that AkzoNobel India Ltd. (ANIL) is now part of the JSW Group, and therefore AkzoNobel no longer has control over it. Previously, on September 24, 2025, AkzoNobel sold a 5% stake in ANIL via a block transaction. Following the completion of the transaction with JSW, AkzoNobel retained a 9% stake, which was later sold via a block transaction on December 17, 2025. These block transactions, along with the agreement with JSW, have been accounted for as part of the transaction outcome.
Before selling the brand to JSW, AkzoNobel sold the rights to use the Dulux brand in India to ANIL for €115 million. Additionally, ANIL sold its powder coatings business and international research center to AkzoNobel Powder Coatings India Ltd. (a wholly-owned subsidiary of AkzoNobel) for €207 million.
The divested businesses covered AkzoNobel’s operations in India, excluding its powder coatings business and international research center. These divested operations generated total sales of €316 million in 2025, with €192 million from decorative paints and €124 million from high-performance coatings. Operating profit from these divested businesses amounted to €44 million, with €29 million from decorative paints, €21 million from high-performance coatings, and a €6 million loss from other activities. The adjusted EBITDA from the divested businesses was €54 million, with €34 million from decorative paints, €24 million from high-performance coatings, and a €4 million loss from other activities.
In Q4 2025, AkzoNobel's Decorative Paints segment generated sales of €925 million, a 9% decline year-over-year. Organic sales were down 1% due to lower volume. While sales in China increased, the decline in Latin America and SESA regions offset this gain. Sales in the EMEA region remained stable. Positive pricing strategies benefited the EMEA and Latin America regions, but negative product mix changes were observed. Due to the strong euro, exchange rate effects reduced sales revenue by 6%, and the asset divestment in India impacted sales by 1%, while other factors (mainly inflation-related accounting adjustments) further decreased sales by 1%. Overall, sales revenue decreased by 9%.
Operating profit in the Decorative Paints segment increased to €74 million (2024: €41 million), benefiting from reduced confirmed projects (down €19 million compared to 2024). Adjusted EBITDA rose to €125 million (2024: €113 million), including a negative €13 million impact from currency exchange. Lower operating expenses and improved gross margin partially offset the slight volume decline. The adjusted EBITDA margin expanded to 13.5%.
For the full year 2025, the Decorative Paints segment achieved sales of €4.09 billion, a 5.0% decline compared to 2024. Organic sales were flat, with price increases and product mix changes partially offset by lower sales volume. Sales declined in Europe, the Middle East, and Africa (EMEA), as well as in Latin America, while sales in Asia increased, driven by better performance in China. Price/structure increased by 1%, benefiting from strong pricing strategies in Europe and Latin America. Exchange rate impacts reduced sales revenue by 4%, and other factors (mainly inflation accounting adjustments) caused a 1% decline, leading to an overall sales decline of 5%.
Operating profit for the full year 2025 was €401 million (2024: €405 million). Confirmed projects contributed a €22 million increase (driven by restructuring plans), which was partly offset by lower operating expenses. Adjusted EBITDA rose to €648 million (2024: €635 million), despite a €40 million negative impact from currency exchange. The adjusted EBITDA margin increased to 15.8% (2024: 14.8%).
Regional Performance
EMEA: Q4 2025 sales were €503 million, a 5.0% decline, with organic sales down 1%. DIY sales grew, primarily in the UK, Southern Europe, Southeastern Europe, and Africa, but this was offset by a decline in the professional business. Pricing was strong, but product mix was unfavorable. For the full year 2025, sales decreased by 2% to €2.412 billion, driven by slightly lower volumes in a weak market, though Southern Europe and Africa saw growth.
Latin America: In Q4 2025, organic sales grew by 1%, but sales revenue declined by 10% to €225 million due to currency translation. Pricing was strong, excluding inflation-driven pricing in Argentina. Sales volume decreased, mainly in Brazil, although Argentina saw growth, partly offsetting the decline in Brazil. For the full year 2025, organic sales grew 6%, but sales revenue decreased by 8% to €758 million due to currency translation. Volume decreased slightly, mainly due to Brazil.
In Q4 2025, the High-Performance Coatings division achieved sales of €1.447 billion, a 10.0% decline compared to the same period last year. Organic sales decreased by 2%, primarily due to a reduction in volume, although this was partially offset by price increases. Macroeconomic uncertainties in North America continued to impact sales volume, while the effect in Europe was less significant. All business segments showed price increases. The strong euro caused a 6% decrease in sales revenue, while the divestment of assets in India led to a 1% reduction, and other factors (primarily inflationary accounting adjustments) also contributed to a 1% decrease. As a result, total sales revenue declined by 10%.
In Q4 2025, the operating profit for the High-Performance Coatings division was €117 million (2024: €150 million). Lower operating expenses and higher pricing were offset by reduced sales volume and lower gross margins. Adjusted EBITDA was €190 million (2024: €230 million), including a negative impact of €19 million from currency translation. The adjusted EBITDA margin was 13.1% (2024: 14.4%).
For the full year of 2025, the High-Performance Coatings division posted sales of €6.068 billion, a 5.0% decline from the previous year. Organic sales were flat, as positive pricing effects in all business segments were offset by lower sales volumes. The marine and protective coatings businesses experienced sales growth, but macroeconomic uncertainties, especially in North America, significantly reduced their overall performance. Currency translation had a 4% negative impact on sales, and other factors (mainly inflationary accounting adjustments) led to a 1% decrease, resulting in a 5% drop in total sales revenue.
In the full year of 2025, the operating profit for the High-Performance Coatings division was €300 million (2024: €679 million), which included a €36.5 million negative impact from confirmed items, mainly related to provisions for a lawsuit in Australia and restructuring plans. Excluding these confirmed items, lower operating expenses and higher pricing partially offset the effects of lower sales volumes and reduced gross margins. Adjusted EBITDA for the full year was €843 million (2024: €913 million), including a €56 million negative impact from currency translation. The adjusted EBITDA margin for the full year was 13.9% (2024: 14.2%).
For the full year of 2025, organic sales grew by 5%, and sales revenue remained flat at €1.570 billion. Protective coatings experienced double-digit growth driven by North American and Asian markets, while marine coatings remained stable due to a strong comparative base from the previous year.
For the full year of 2025, organic sales declined by 1%, and sales revenue fell by 6% to €1.347 billion due to currency effects. Lower sales volumes reflected weak demand in the automotive and vehicle refinishing segments, especially in North America, although aerospace sales showed higher volumes. Price and product mix increased positively.
In Q4 2025, organic sales declined by 4%, and sales revenue decreased by 12% to €438 million due to currency translation effects. For the full year of 2025, organic sales declined by 3%, primarily due to lower sales volumes, and sales revenue fell by 8% to €1.871 billion due to currency translation effects. During both Q4 and the full year, sales in all sectors decreased, with the packaging business particularly affected by a high comparative base from the previous year.
Regional Sales Breakdown:
Netherlands: €330 million (2024: €329 million)
Other EMEA regions: €4.556 billion (2024: €4.727 billion)
North Asia: €1.592 billion (2024: €1.668 billion)
South Asia: €1.206 billion (2024: €1.311 billion)
North America: €1.264 billion (2024: €1.363 billion)
Latin America: €1.210 billion (2024: €1.313 billion)
Net cash generated from operating activities in Q4 was €462 million (2024: €398 million), with the increase mainly attributed to improvements in working capital. As of December 31, 2025, net debt stood at €2.942 billion, compared to €3.901 billion in the previous year. This decrease was primarily due to net cash generated from operating activities (€915 million) and net proceeds from acquisitions and disposals (€816 million), partially offset by capital expenditures (€309 million) and dividend payments (€382 million). The leverage ratio (net debt/adjusted EBITDA) at the end of 2025 was 2.0, compared to 2.6 in the previous year.
Based on current market performance and trading conditions, the company expects an adjusted EBITDA increase of €100 million at constant exchange rates. Therefore, after adjusting for the divestment of the Indian assets, adjusted EBITDA for the full year 2026 is expected to reach or exceed €1.470 billion.
AkzoNobel aims to enhance profitability, targeting an adjusted EBITDA margin above 16% and a return on investment (ROI) between 16% and 19%. This will be supported by organic growth and operational excellence. The company expects its leverage ratio to remain around 2x by the end of 2026, with continued focus on achieving an investment-grade credit rating.
AkzoNobel also announced that the merger with Axalta Coating Systems (subject to shareholder and regulatory approval) is expected to be completed by the end of 2026 or early 2027. The two companies have reached a final agreement on a stock-for-stock merger to create a global leader in coatings, combining complementary brand portfolios to better serve key end markets and deliver value to shareholders, employees, and other stakeholders.
Regarding the merger, AkzoNobel plans to pay a special cash dividend of €2.5 billion to its shareholders, minus any regular annual and interim dividends paid to AkzoNobel’s shareholders before 2026 (these dividends are paid before the completion of the transaction). The payment of the special dividend depends on the completion of the transaction and the regular dividend level for 2026.
Following the completion of the merger, AkzoNobel’s shareholders will own approximately 55% of the combined company, while Axalta shareholders will hold around 45%, based on the merged company’s book value. The transaction is expected to close by the end of 2026 or early 2027, subject to shareholder approval, necessary regulatory approvals, the authorization for the combined company’s stock listing on the New York Stock Exchange, the payment of the special dividend, consultation requirements with AkzoNobel’s employee representative bodies, and other customary closing conditions.
