Other income rose 4% to Rs 15.81 crore. Interest cost was Rs 92 lakh compared to Rs 76 lakh. Depreciation rose 4% to Rs 19.17 crore. PBT before EO fell 17% to Rs 82.66 crore. The company had EO expense of Rs 8.72 crore during the quarter related to VRS payments and other termination benefits compared nil in the corresponding previous year quarter. PBT after EO fell 26% to Rs 73.94 crore.

Tax expense was down 32% to Rs 19.86 crore as the company has chosen to exercise the option of lower tax rate of 25.17%. Net profit fell 23% to Rs 54.08 crore.

The outbreak of COVID 2019 pandemic has created economic disruption throughout the world including India. Akzo Nobel India Limited has ensured compliance with the lockdown protocols in accordance with the guidelines issued by the Central and State governments and local authorities. The operations of the company were significantly impacted due to supply chain disruptions caused by lock down of plants, offices and warehouses. The company has resumed operations in a phased manner consistent with the directives from the Government of India/ State governments/ Local authorities.

The revenue had started to show stability in first two months of 2020 after two quarters of decline. However, the countrywide lockdown due to COVID 2019 has severely impacted the business from the second fortnight of March 2020 coinciding with the outbreak of COVID and subsequent national lockdown.

As the complex situation regarding the global pandemic continues to evolve, AkzoNobel remains focused on ensuring employee health and safety and maintaining business continuity. Various steps are underway to continue serving customers, reducing costs while responding quickly to changes in market demand.

Performance for year ended Mar20

For year ended Mar20, net sales fell 9% to Rs 2661.81 crore compared to corresponding previous year period. However company operating margins rose 250 bps to 14.2% leading a 11% increase in operating profit to Rs 379.17 crore.

Other income fell 11% to Rs 37.62 crore. Interest cost was Rs 9.34 crore compared to Rs 4.45 crore. Depreciation rose 21% to Rs 79.01 crore. PBT before EO as a result rose 4% to Rs 328.44 crore. The company had net EO expense of Rs 5.23 crore during the quarter (EO expense of Rs 8.72 crore during the quarter related to VRS payments and other termination benefits and EO income of Rs 3.49 crore divestment provisions and indirect taxes on divested business no longer required) compared to EO income of Rs 65 lakh in the corresponding previous year period both representing divestment provisions no longer required and accordingly written back. PBT after EO was up 2% to Rs 323.21 crore. Tax expense was down 18% to Rs 85.75 crore. Net profit rose 13% to Rs 237.46 crore.

Amit Jain, Chairman, AkzoNobel India: "AkzoNobel historically has had a consistent dividend policy. Despite the prevailing pandemic situation and the uncertainties around it, the Board has recommended a dividend of Rs 14 per share, subject to the approval of shareholders. CSR initiatives focussed on responding to COVID 2019 in these unprecedented times. The company has focussed on e-health initiative, providing food to daily wage earners and contribution to the PM Cares Fund. AkzoNobel continues to abide by the government directives, and we are thankful to the central and state government for providing continued support."

Rajiv Rajgopal, Managing Director, AkzoNobel India: "The revenue and profitability were impacted during the quarter due to the outbreak of COVID 2019. In the full year, the business profitability (EBIT%) has improved 180 bps due to structural portfolio and cost actions. Our top priority at AkzoNobel is the health and safety of our people. The team continues to focus on people engagement, continuity of operations, cash & liquidity management and supporting communities around which we operate. We have extended support to our painter community through accelerated pay-outs."

The BMW Group has chosen AkzoNobel to be a trusted supplier of vehicle refinishes products and services to a large part of its distribution network around the world. The deal came into effect on February 1, 2020. Covering 44 locations, the agreement means that the company's premium Sikkens and Lesonal brands are now approved for paint repairs of BMW and Mini passenger cars at authorized dealers, repairers, importers and national BMW Group branches.

The scrip is trading at Rs 1836 at BSE