Paints and speciality coatings maker AkzoNobel is to speed up its planned reorganisation in an effort to offset the ‘challenging’ economic conditions.

The company said on Thursday that second quarter sales were down 4% on the year earlier period at almost €3.9bn.

Operating profit fell 14% but net profit was almost double the 2012 second quarter at €429m. This was due to a deferred tax asset and the sale of its North American decorative paints division, the company said in a statement.

Savings

AkzoNobel has revised upwards the cost of the reorganisation from €205m to €325m, which it expects to generate in cost savings of €500m from next year. The reorganisation will mainly affect its European operations.

In May, chief executive Ton Büchner said larger production sites are needed to pressure costs.

‘We are thinking of five or six mega factories,’ he told the Financieele Dagblad. ‘At the moment we have 20 to 25 small and medium-sized plants in Europe but this is not always efficient.’ A number of less profitable plants will have to close.