From the Sector

AkzoNobel has updated its Q2 outlook based on the impact of the evolving business environment, including the effect of China lockdowns and the slower start to the EMEA DIY season.

Overall demand signs for paints and coatings remain robust, with North America still constrained in raw material availability and logistics, but sequentially improving. In Europe in particular, macro-economic uncertainty related to consumer confidence has increased.

Consumer demand in the Deco DIY channels in Europe – which represent 40% of total Deco EMEA revenue – got off to a slow start in Q2, subsequently impacted by inventory reductions in the DIY channel. In June, Deco DIY channel demand improved back to 2019 levels. Despite share gains and our Deco Professional business performing as anticipated, the total Q2 operating income for our Decorative Paints segment is expected to be down by approximately €50 million versus expectations entering the second quarter.

COVID-19 lockdowns in China during Q2 impact both paints and coatings. This impact was mainly on our coatings business, while paints was able to almost offset by progressing with its geographical expansion initiatives. The re-opening in June is showing a positive rebound, but not enough to catch up on all the missed revenue in the quarter, resulting in a negative operating income impact of approximately €40 million for the quarter, versus expectations entering Q2.

AkzoNobel continues to focus on achieving its €2 billion adjusted EBITDA target for 2023, despite the volatile market environment having a material impact on the company’s Q2 2022 financials.

Since few days, most countries have been facing a new wave of Covid, reinforced by the rapid expansion of the Omicron variant. Impacted by this surge, many companies among the 1,700 companies that have confirmed they will attend M&O in January at the Parc des Expositions of Paris-Nord Villepinte, indicate that they don’t want their employees to take risks and are now alerting to the disruptions they are experiencing in their operations. The obligations of compliance with isolation rules, even when people are vaccinated, and the numerous work absences are in fact starting to seriously disrupt the functioning of their services, supply or production circuits.

Moreover, facing the peak of contamination, several countries are currently taking restrictive measures regarding international travel. Measures which are now delaying or discouraging visitors from confirming their attendance. In addition, the French government has announced, December 27^th 2021 a 2.000 people gauge for major events, so probably fairs such as Maison&Objet Paris.

Under these circumstances, seeking to avoid a risky situation and committed to making all efforts to ensure an optimal return on investment for exhibitors, buyers and specifiers, the SAFI decides to postpone the next session of the Maison&Objet trade event from 24th to 28th March 2022. Period for which we hope to see an improvement in the situation.

Exhibitors who have already confirmed their registration and location may have the same location conditions, which will allow them to keep the same stand showcase. Likewise, visitors who have already ordered their badges for the January edition will of course have access to the show from March 24^th to 28^th, 2022.

With an opening scheduled for the day before, Maison&Objet In The City, an event organised on the sidelines of the Maison&Objet fair and offering a journey of discoveries in the heart of Parisian showrooms, will be held from 23 to 28 March 2022.

By postponing the fair until the end of Q1, SAFI wishes to bring together the best operational and healthy conditions to allow actors in the art of living, decoration, and design to be inspired, to accelerate their development and to forge new business relationships

In summary: the next editions of the Maison&Objet fairs will therefore be: March 24^th - 28^th, 2022 + September 8^th - 12^th, 2022

• Waiver of dividend
• Expansion of Board of Directors

The shareholders of Autoneum Holding Ltd approved all proposals of the Board of Directors at today’s Annual General Meeting and agreed to forgo dividend payments. Liane Hirner and Oliver Streuli were newly elected to the Board of Directors. Based on Art. 27 of the Covid-19 Ordinance 3, the Board of Directors of Autoneum Holding Ltd decided to hold the 2021 Annual General Meeting without physical attendance by the shareholders. For this reason, the Company had asked them in advance to exercise their rights exclusively via the Independent Proxy. He represented 63.5% of a total of 4 672 363 shares.

The shareholders approved the Annual Report, the Annual Financial Statements and the Consolidated Financial Statements 2020. In view of the net loss in the 2020 financial year, the Board of Directors proposed forgoing dividend payments, which was approved by a large majority of the shareholders. Hans-Peter Schwald, Chairman of the Board of Directors, said: “2020 was extremely challenging for the entire automobile industry and also for Autoneum. The pandemic-related drop in revenue has impacted profitability. Despite the net loss, Autoneum reached important financial improvements in 2020. We expect to return to profitability in 2021 and our aim to distribute at least 30% of the net profit attributable to Autoneum shareholders as dividends remains unchanged. The Board of Directors, the Group Executive Board and the Company as a whole are committed fully to ensuring that Autoneum continues to make significant operational and financial improvements.”

Chairman Hans-Peter Schwald and the other members of the Board of Directors, Rainer Schmückle, Norbert Indlekofer, Michael Pieper, This E. Schneider and Ferdinand Stutz were confirmed in office. Newly elected to the Board of Directors were Liane Hirner and Oliver Streuli.

With Liane Hirner and Oliver Streuli and the resignation of Peter Spuhler, who did not stand for reelection in order to be able to focus on managing Stadler Rail, the Board of Directors of Autoneum Holding Ltd has expanded from seven to eight members. Hans-Peter Schwald explained: “The expertise of Liane Hirner and Oliver Streuli in the areas of finance and corporate management is of great value to Autoneum. As the Board of Directors, we look forward to this enhancement to the Board and to working with both of them.”

Peter Spuhler has been an important driving force since the Company became independent, he played a major role in shaping Autoneum thanks to his entrepreneurial expertise and showed great commitment to the Company. The Board of Directors thanks him sincerely and wishes him continued success.

This E. Schneider, Hans-Peter Schwald and Ferdinand Stutz were re-elected to the Compensation Committee. Oliver Streuli was elected as a new member of this committee. In addition, the shareholders of Autoneum Holding Ltd granted discharge to all members of the Board of Directors and the Group Executive Board with a large majority.

The consultative vote on the 2020 remuneration report was approved by 83.4%. Due to the severe impact of the coronavirus pandemic on the Group’s business development, the members of the Board of Directors renounced half of their compensation for the 2020 financial year and, in order to  align their remuneration with shareholder interests, decided to receive it entirely in Autoneum shares. In addition, a waiver of salary amounting to 10% of the basic salary for a period of three months was agreed upon with the senior management as part of a reduction of personnel costs.

The proposals for the remuneration of the Board of Directors and the Group Executive Board for the 2022 financial year as well as the other proposals were also approved by a large majority.