Investors Visit – September 17, 2009…Market and business characteristics • Global market size...

AkzoNobel Car Refinishes

Investors Visit – September 17, 2009

Creating art with the MP4-24, and some Sikkens paint….

Investors Visit – September 17, 2009

Jim Rees, Managing DirectorAkzoNobel Car Refinishes

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Meet Car Refinishes

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Organizational overview

• Functional Chemicals• Pulp & Paper Chemicals• Industrial Chemicals• National Starch• Surface Chemistry• Polymer Chemicals• Chemicals Pakistan

• Continental Europe• Northern & Eastern Europe• UK, Ireland & South Africa• United States• Canada• Latin America• China & North Asia• South East Asia & Pacific• India and South Asia

Supervisory Board

Board of Management

Corporate Staff Departments

• Car Refinishes• Industrial Finishes• Powder Coatings• Marine & Protective

Coatings• Packaging Coatings

Business areaSpecialty Chemicals

Business areaDecorative Paints

Business areaPerformance Coatings

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AkzoNobel strategic ambitions

Tied to incentives, both for value creation and sustainability

Leading in value creation• Outgrow our markets• EBITDA margin > 14% by end 2011• 0.5% improvement in operating working

capital (OWC) level, p.a.

Leading in sustainability• Top 3 Dow Jones Sustainability index• Reduction in total recordable injury rate• Step change in people development

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CR’s Strategic ambitions

Today – what we areThe world’s third Largest Car Refinishescompany

Tomorrow – what we want to beTo challenge the #2 positionin the global Refinishes market

How we will achieve this: Strategic agenda

• Drive profitable growth • Participate in industry consolidation • Achieve operational effectiveness through process improvement

• Maximize employee performance and satisfaction• Strive for world class levels of sustainability and safety• Build and maintain value-creating relationships with key external stakeholders

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Our business

• One of world’s leading suppliers of paints and services for the VR, OEM CV and APC markets

• Revenue of € 885 million (2008)

• Employ around 4,900 people, active in more than 130 countries

• Cover OEM value chain including insurance companies, fleet owners, car makers, paint distributors and end users

• Sustainability an integral part of strategy and business process

• Products based on high performance low bake technology

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Vehicle Refinish

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Market and business characteristics

• Global market size is €5 billion¹

• Paints and services for collision repairers and commercial vehicle refinishers

• Market strongly dependent on GDP and vehicle population size. Major growth opportunities in emerging markets, especially BRIC

• Value chain includes insurance companies, fleet owners, car makers, paint distributors and end-users

• Leading brands include: Sikkens®, Lesonal®, Dynacoat®and Wanda®

¹ Source Euromonitor and other sources

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OEM Commercial Vehicles

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Market and business characteristics

• Global market size is €850 million¹

• Paints and services for OEM buses and trucks and specialized commercial vehicle builders

• Customers: Major bus and truck makers including International Truck, Yutong Bus, Volvo CE, Scania, MAN, Oshkosh, Iveco/CNH

• Market strongly dependent on GDP and new vehicle build rate. Big markets in North America, Europe and Japan. Major growth opportunities in emerging markets, especially BRIC

• Market is a blend between true business-to-business industrial and car refinishes approach

¹ Source Euromonitor and other sources

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Automotive Plastic Coatings

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Market and business characteristics

• Global market size is €1.3 billion¹

• Coatings for automotive components

• Market strongly dependent on OEM car production volumes. Significant opportunities in emerging markets, especially in China, India and Eastern Europe

• Customers: tier 1 Automotive suppliers like Plastic Omnium, Peguform, Plascar, Visiocorp, and most Automotive OEMs

• Business-to-business market with Tier 1and Tier 2 OEM suppliers, but closely connected to OEMs for technical approvals

¹ Source Euromonitor and other sources

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Partnerships with Automotive OEMs

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Worldwide Operations

Asia Pacific8%

Americas33%

Europe59%

(incl. regional sales share)

3 International Research Centers 2 Color Development Centers4 Technical Centers 8 Manufacturing Sites▲ ■♦

▲ ▲

▲♦♦■

■■■

■ ■■

■

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Market positions

5551Automotive Plastic Coatings

3333OEM Commercial Vehicles

3344 Vehicle Refinish

TotalAsiaAmericasEurope

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Volume projection, by geography: global light vehicle sales (in million units)

North America

11 11 11

0

10

20

30

2010 2015 2020

Europe

1719

22

0

10

20

30

2010 2015 2020

China

9

17

0

10

20

30

2010 2015 2020

India

24

7

0

10

20

30

2010 2015 2020

32

0,4%

Source: A.T. Kearney

2,8%

13,7%

13,3%

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Global light vehicle sales 2003 – 2020 (in million units)

>100

66

97

87

8075

70

6560

55

5861

525045

64 6670

97908885

807775

68

60

0

10

20

30

40

50

60

70

80

90

100

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

55

optimistic

pessimisticForecast:

Source: A.T. Kearney

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CR’s Strategic ambitions

Today – what we areThe world’s third Largest Car Refinishescompany

Tomorrow – what we want to beTo challenge the #2 positionin the global Refinishes market

How we will achieve this: Strategic agenda

• Drive profitable growth • Participate in industry consolidation • Achieve operational effectiveness through process improvement

• Maximize employee performance and satisfaction• Strive for world class levels of sustainability and safety• Build and maintain value-creating relationships with key external stakeholders

Investors Visit – September 17, 2009

Klaas Kruithof, PhD - R&D DirectorAkzoNobel Car Refinishes

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Why Paint(ing)

Coloremotion, differentiation

Protectionrust, degrade, extend life cycle

Functionalitya new added-value feature

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Color

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Leadership in Color

• We deliver an “invisible repair” to our customers

• Objective is “1st time OK” for our customers

• Large color offer and high consistency in quality and application

• Understanding of color science

• Benchmark for the Automotive industry for color digitization

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Match by the eye: “color doc”

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Texture: effect colors

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Automatchic 6i

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Automatchic 6i from the inside

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Film technology

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Paint: Delivery forms

Liquid paint, organic solvent

Liquid paint, water

Liquid paint, water, but peelable

All of the above with brush, roller, spray gun, curtain, dip

Powder coating

Hot melt

Paint film, laminate or molding

Film with adhesive, “sticker”

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SoliantPaint film

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Decorative Films and Laminates

Bright film!

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Film technology

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Low-Bake and Fast-Cure

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Application + Cure: integrated process

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Low-Bake and Fast-Cure(Future) Functionality of Coatings

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Scratch and Mar Resistance

• Scratches happen anyway: self-healing effect

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Autoclear LV ExclusiveSelf healing clearcoat, reflow capacity

15 min heat

scratch

6 μm

< 1 μm

15 min heat

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• Dirt removal by rain drops: “lotus effect”

• Nanotechnology

Self Cleaning

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Sustainability

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Eco efficient technology

• Renewable resources

• Low carbon footprint

• Waste reduction

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Energy Capture and Radiation

• Heat absorption or reflection

• Electrical energy (solar cells)

• Glow-in-the-dark

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Our customers’ future first…

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Thank you for your attention

AkzoNobel Car Refinishes

Investors Visit – September 17, 2009