Recently, the "CEO Forum 2020" was held by the American coating world magazine. Participants in this year's forum included CEOs of leading coatings companies from the United States, Europe and Asia Pacific, who shared some insights on the industry.
Participants: Robert Bryant, CEO of Astor; John falder, CEO of HMG coatings; Boris gorella, CEO of Beckers group; Michael H. McGarry, chairman and CEO of PPG industry; Lars Peterson, President and CEO of Haihong elderly group; abhijit Roy, chief executive officer of Earl coatings; Zhengming Tian, chairman, President and CEO of Nippon coatings; and Thierry vanlancer, CEO of Akzo Nobel.
Paint world: what is the overall performance of paint market in 2019?
Ashtar Bryant: the paint industry is still a strong industry, but the paint market is mixed in 2019. The global demand for touch up paint is stable, which plays a role in the strength of Astor. The demand comes from the strong global automobile market, which grew by more than 3% last year, i.e. 89 million new cars. Driven by broader industrial production indicators, the industrial terminal market has suffered some pressure in 2019, and the transportation market has also encountered some resistance. This year, global light vehicle demand has declined.
HMG paint falder: the UK market in 2019 is an interesting place. The political uncertainty of brexit and numerous delays lead to the company's restriction or delay in spending until we have a clear political path. Supply and import problems, as well as legislative confusion, are disadvantages.
Gorella: for Berger, 2019 is an exciting year, the highest sales year in our 154 year history. Our innovative research work and customer-centered technical support make our coil coating field in the "leading position". We will further consolidate our position as a global leader!
PPG McGarry: the global paint market remains resilient in 2019, and we expect the market to improve by 2020. PPG's impressive performance in the aerospace, protection and marine coatings (PMC) business in 2019 reflects the customer's demand for our specific technology. Our aviation coatings business has achieved strong growth, surpassing industry performance in the United States and Asia. Driven by continued strong growth in Asia, our protection and marine coatings business achieved single digit growth above the industry level in the fourth quarter of 2019.
Peter sson: we see that although the general industrial market has shrunk slightly, the market for protective equipment has picked up in 2019. The global marine market also began to pick up in 2019. The shipbuilding market is still at a very low level. Although there is uncertainty in the future regulation and how to achieve emission reduction, it still shows signs of recovery. Due to the increase in dry docks, fleet age and net fleet number, the marine inventory market has grown and the maintenance and repair market is quite strong.
As expected, the decoration market in Europe, Middle East and Africa is full of challenges, and the demand is flat or even down.
Earl paint Roy Roy: India's economy is facing some strong resistance in 2019, with overall growth much lower than in the past decade. Some of them are due to system and infrastructure problems, while others are related to the overall slowdown of the world economy. Car OEMs and the real estate industry are in deep recession, hurting companies that depend on them.
As far as Earl is concerned, we can achieve double-digit sales and value growth in most market segments except the automobile business. This year, the price of raw materials is basically stable, and our strong R & D channels can improve cost-effectiveness, so as to ensure that our bottom line growth is very healthy. Many of our new initiatives in distribution, paint services and retail have been very good, helping to boost sales. Our investment in strengthening the supply chain has also begun to bear fruit, and we are ready to take full advantage of the expected demand growth.
Nippon Tanaka Zhengming: in our main Asian market, compared with 2018, the demand for paints and coatings will increase slightly in 2019. In particular, China's housing construction demand increased by 9.2% compared with 2018. China's car production fell 6% to 26.09 million. In the Japanese market, the number of housing construction projects is 4% less than in 2018. The production of construction machinery dropped by 3.7% to 390000 units, but the production of automobile industry was 9.22 million, almost the same as that in 2018. The total amount of paint produced in Japan is 1.64 million tons, basically the same as that in 2018.
Aksu vanlancker: our 2019 performance shows that we are transforming. Despite rising raw material costs and weak end market demand, we have made good progress. Our performance improvement accelerated in the second half of 2019, resulting in a return on business sales growth of nearly 200 basis points to 12.5%.
After the sale of the specialty chemicals business, we fulfilled our commitments and returned € 6.5 billion to shareholders.
At the same time, we continue to invest in the future. We launched a 50 million euro us wood coatings business investment and completed the acquisition of mapaero to consolidate our global position in aerospace coatings and expand the paint the future innovation ecosystem.
Paint world: does your company's revenue grow in 2019?
Bryant: Axel's net sales in 2019 were $4.5 billion, down only 0.5% (a reported 4.6%) due to adverse foreign exchange rates and divestitures. Last year, we saw a rather difficult economic and market background, and the sales volume of many end markets around the world was adversely affected. However, due to the stable demand for touch up paint, our global net touch up paint sales increased by 3.3% before the impact of exchange rate conversion.
Falder: 2019 is a year of considerable growth for our small company. Our turnover has reached a record level.
Gorella: we have achieved double-digit growth in the global coil coating business, while ace has achieved some steady development.
McGarry: net sales from continuing operations increased by about 1% to $15.1 billion in 2019, excluding adverse foreign currency translation. Despite the recession in many OEM end use markets, we are able to achieve sales growth. We are very proud that we have completed four acquisitions in 2019, strengthening our business portfolio.
Peterson: for Haihong old people, 2019 is a year of harvest, in which we have recovered positive growth. Our revenue increased to EUR 1534 million from EUR 1346 million in 2018, a natural growth rate of 2.5%.
Strong performance is based on organic growth, especially in the second half of the year and in Asia. We do see challenging situations in multiple markets, many of which affect our 2019 performance. The uncertainty of brexit has affected our decoration business in the UK and Ireland; the uncertainty of geopolitics and economic slowdown in the Middle East have affected our EMEA region; while the potential state bankruptcy in Argentina and the trade war between China and the United States have increased the uncertainty in our Americas and Asia Pacific region. However, despite these challenges, all of our regions have performed well in 2019 and we are very satisfied.
Roy: Although the market is full of challenges, our sales volume and value have maintained healthy growth this year, although we will be more satisfied with the higher growth rate. Even in a tough market environment, our investment philosophy in research, human resources and new market segments enables us to maintain the growth engine even in a tough market environment.
Tanaka: in fy2019, excluding M & A and other temporary factors, net sales increased 3% year on year. Operating profit increased by 4.8% year on year, and our business performed well. In addition to the strong performance of Chinese decorative coatings with high market share, the strong performance of Japanese and American decorative coatings also contributed to our operating profit. Last year, revenue increased by 10.3% through the acquisition of Dulux group in Australia and betek Boya, a Turkish decoration manufacturer.
Vanlancker: revenue was flat with 4% positive / mixed revenue and 1% acquisition, but sales fell 5% due to our "value over sales" strategy.
Paint world: which areas of the paint and paint market have brought the biggest growth opportunities to your company?
Bryant: Ashtar has seen multiple growth areas in the global high-performance coatings and transportation coatings. We want to continue to build our global business by expanding our geographic reach with innovative new product launches and by sharing market share with existing and impervious customers in each of our businesses. Considering the continuous integration within the coating industry, we also see significant opportunities for growth through M & A.
In the industrial sector, we see a huge opportunity for the growth of wood coatings business, and will continue to promote new coating innovation and product market entry, with a focus on water-based solutions. Our M & A opportunities are also focused on the industrial sector, which can provide many targets in the current field and the surrounding market of coatings.
In the field of transportation, we will continue to launch new products to support the growth of our customers around the world. Specifically, in China, with the growing middle class and the increasing demand for new cars per capita, we believe that light vehicles will have long-term growth opportunities. Also in China, commercial vehicles are expected to grow, producing more than 1 million commercial vehicles a year to modernize the fleet, while the market for trains and buses will grow as many new players enter the region. Globally, we see growth opportunities in the rail and trailer sectors, as well as emerging opportunities in specialty OEMs and other commercial vehicle sectors.
Falder: HMG's business model covers a wide range of markets, all of which we believe have huge growth potential. In particular, with the advent of our innovative acrythane 4G finish and graphene containing acrythane ultra commercial vehicle finish, the development of waterborne and decorative coatings and commercial vehicle market has brought exciting potential opportunities for HMG.
Gorella: in order to meet the local demand for Berger's expertise and production capacity, we have further expanded our Asian network, established a second plant in Vietnam and a new plant in Bangladesh. North American business is very mature, with branches in the United States and Mexico. Close cross-border cooperation ensures that we can quickly, reliably and timely provide customers with better and more innovative products and services.
McGarry: with the development of the industry, technology is still a key component of customer experience. Whether internal or external, PPG recognizes that our industry must adapt to and provide future digital tools to improve customer experience. One example is our PPG service platform, a digitally supported service platform that makes it easy for businesses with multiple commercial facilities across the United States to identify and contact registered professional painters, and then manage and schedule routine paint maintenance projects.
Peterson: we have a strong commitment to our three core areas