AkzoNobel reported improved profitability in the fourth quarter and full year 2025, citing continued execution of efficiency programs, portfolio actions and working capital improvements despite lower volumes and foreign exchange headwinds.

In the fourth quarter, organic sales declined 1% compared with the prior year, while reported revenue decreased 9% due to currency translation effects. Operating income increased to €787 million, compared with €127 million in the prior-year period. Adjusted EBITDA totaled €309 million, with the adjusted EBITDA margin expanding to 13.0% from 12.3%, driven by efficiency actions and cost discipline. Net cash from operating activities was positive €462 million.

For the full year, organic sales were flat, with price and mix improvements offsetting lower volumes. Reported revenue declined 5%. Adjusted EBITDA reached €1.44 billion, within 1% of initial guidance, while the adjusted EBITDA margin increased to 14.2%, up from 13.8% in 2024. Operating income rose to €1.16 billion, reflecting contributions from portfolio actions including the divestment of Akzo Nobel India. Net cash from operating activities increased to €915 million on working capital improvements.

During 2025, AkzoNobel completed the divestment of its India business, generating proceeds of €922 million and strengthening the company’s balance sheet. The company ended the year with leverage of approximately 2x net debt to adjusted EBITDA, aligned with its mid-term targets.

Commenting on the results, CEO Greg Poux-Guillaume said the company continued to improve profitability despite broadly weaker end markets, citing operational execution, cost reductions and working capital discipline. He also pointed to the proposed all-stock merger with Axalta as the next phase of value creation, subject to shareholder and regulatory approvals.

Looking ahead, AkzoNobel said it does not anticipate a material recovery across end markets in 2026 and expects a weaker first half, with some improvement in the second half due to easier comparisons. Based on current market visibility, the company expects to deliver €100 million of adjusted EBITDA improvement in constant currencies, with full-year 2026 adjusted EBITDA expected to be at or above €1.47 billion, excluding effects from the proposed Axalta transaction.

Closing of the Axalta merger remains subject to approvals and is expected in late 2026 or early 2027.