Directors’
report
1. MAIN ACTIVITIES
Jotun’s primary business activities include the development, production,
marketing and sales of paints and coatings systems and related products
for the treatment, protection and beautification of surfaces.
Jotun is a global company made up of 67 companies in 47 countries,
including 38 production facilities. The company extends its reach to other
countries through a network of subsidiaries, associates, joint ventures,
sales offices and distributors. The parent company, Jotun A/S, has its
headquarters in Sandefjord, Norway. Of the Group’s operating revenue,
approximately 11 per cent is related to its activities in Norway while 89 per
cent is related to the rest of the global network.
The Jotun Group is organised into seven regions: “Scandinavia”, “West
Europe”, “East Europe and Central Asia”, “Middle East, India and Africa”,
“North East Asia”, “South East Asia and Pacific” and “the Americas”.
Jotun’s business is organised into business categories: Decorative Paints
and Performance Coatings.
Decorative Paints
Jotun develops, manufactures and distributes interior and exterior paints
to consumers and professionals worldwide. In addition to direct sales,
Jotun sells through a network of about 8 500 dealers, worldwide.
Performance Coatings
Marine Coatings:
Jotun is the world’s leading provider of marine coatings to the
newbuilding and maintenance markets. Jotun also supplies coatings
solutions for leisure boats and mega yachts.
Protective Coatings:
Jotun is a leading supplier of protective coatings (steel and concrete
protection) to companies active in the offshore, energy, infrastructure and
hydrocarbon processing industries.
Powder Coatings:
Jotun is a leading supplier of powder coatings to companies active in
industries related to appliances, furniture, building components, pipelines
and other products.
2. REVIEW OF THE ANNUAL ACCOUNTS
In 2020, the Jotun Group recorded total operating revenue of
NOK 21 070 million, which is an increase of seven per cent compared to 2019
(NOK 19 652 million). Excluding positive currency effects, mainly due to a
weaker Norwegian krone, underlying revenue growth was three per cent.
The underlying sales growth was modest, mainly due to the coronavirus
pandemic. This hampered sales growth in all segments and especially
in South East Asia and the Middle East. Increased revenue was primarily
achieved by good growth in Decorative Paints, due to a surge in demand
in selected markets, like Scandinavia and Turkey.
Back to contents >
Board of Directors
Despite challenges related to the COVID-19 pandemic, including
temporary shutdowns of factories in some countries, the Group achieved
all-time high profit for the year.
PROFITS
The Group achieved an operating profit for the year of NOK 3 489 million,
compared to NOK 2 320 million in 2019. The profit improvement is
attributable to sales growth and higher gross margins due to favourable
raw material prices combined with measures to control operating costs.
Net financial costs increased by NOK 89 million to NOK 331 million, mainly
due to realised currency effects related to dividend income. This resulted
in a profit before tax of NOK 3 158 compared to NOK 2 079 million in 2019.
Jotun’s activities are subject to corporate tax in the countries in which the
Group operates, and income tax amounted to NOK 780 million in 2020.
This led to a profit for the year of NOK 2 378 million compared to
NOK 1 549 million in 2019.
The parent company, Jotun A/S, achieved a total profit for the year of
NOK 970 million in 2020, compared to NOK 639 million in 2019.
ALLOCATION OF PROFIT FOR THE YEAR:
In 2020, Jotun A/S posted profit for the year of NOK 970 million.
The Board of Directors proposes the following allocation:
Proposed dividend NOK 599 million
Transfer to equity NOK 372 million
Jotun Annual Report 2020 I 9