FFNEY2003 1

Safe Harbor Statement*This report contains statements which address such key issues as Akzo Nobel’s growth strategy, future financial results, market positions, product development, pharmaceutical products in the pipeline, and product approvals. Such statements, including but not limited to the “Outlook for 2003”, should be carefully considered and it should be understood that many factors could cause forecasted and actual results to differ from these statements. These factors include, but are not limited to price fluctuations, currency fluctuations, developments in raw material and personnel costs, physical and environmental risks, legal issues, and legislative, fiscal, and other regulatory measures. Stated competitive positions are based on management estimates supported by information provided by specialized external agencies.

* Pursuant to the U.S. Private Securities Litigation Reform Act 1995

FFNEY2003 2

2002 – strong start; weak finish2002 – strong start; weak finish

150

200

250

Q-1 Q-2 Q-3 Q-4

2002

2001

Excluding extraordinary and nonrecurring items.

EUR mln

+9%

–2%

–3%

–21%Y-t-dY-t-d––44%%

Net income

FFNEY2003 3

Coatings & Chemicals – strong performanceCoatings & Chemicals – strong performancePharma – downPharma – down

2002

Q-4, EUR bln Sales Δ% EUR mln EBIT Δ%

3.43.4 – 314314 (13)

2002

Pharma 1.01.0 (5) 180180 (20)

Chemicals 1.11.1 3 7979 7

Coatings 1.31.3 1 8181 23

Fourth quarter

FFNEY2003 4

Q-4 – net income 21% downQ-4 – net income 21% downEUR mln 2002 Δ% / 2001

Sales 3,383 –

EBIT 314 (13)

Noncons. companies – 20

Net income 176 (21)

ROS, % 9.3 10.6

Interest coverage 6.8 6.0

EPS, EUR 0.62 0.78

Excluding extraordinary and nonrecurring items.Fourth quarter

FFNEY2003 5

2002 – sales flat; EBIT down 5%2002 – sales flat; EBIT down 5%

2002

EUR bln Sales Δ% EUR mln EBIT Δ%

14.014.0 (1) 1,4921,492 (5)

2002

Pharma 4.04.0 (1) 768768 (8)

Chemicals 4.64.6 – 344344 1

Coatings 5.55.5 (1) 465465 9

FFNEY2003 6

Euro – strengthening throughout 2002Euro – strengthening throughout 2002

0.85

0.90

0.95

1.00

J F M A M J J A S O N D

2001 2002

USD –5% +5% +10% +13%

Y-t-d: Y-t-d: +6%+6%

Changes of average rates. 2002

FFNEY2003 7

% Total Autonomous Currencies Acquis./

growth growth divest

Pharma (1) 6 (4) (3)

Coatings (1) 3 (3) (1)

Chemicals – 2 (3) 1

Akzo Nobel (1) 3 (3) (1)

Sales – internal growth in all groupsSales – internal growth in all groups

2002

FFNEY2003 8

Pensions – impacted by stock marketsPensions – impacted by stock markets P&L charges

– 2002: up EUR 80 mln

– 2003: up EUR 130 mln

Cash

– EUR 100 mln extra in Q-4 2002

Balance sheet

– EUR 1.1 bln net provision against equity

2002

FFNEY2003 9

EBIT – increasingly affected by pensions EBIT – increasingly affected by pensions and currenciesand currencies

0

20

40

60

Q-1 Q-2 Q-3 Q-4

Pensions Currency

EUR mln

FullFullyearyear

80 80

80 80

160 160

2002

FFNEY2003 10

EUR mln Change Performance Pensions &

improvement currencies

Pharma (63) 7 (70)

Coatings 39 74 (35)

Chemicals 4 39 (35)

Other (59) (39) (20)

Akzo Nobel (79) 81 (160)

EBIT – performance improvement exceeded EBIT – performance improvement exceeded by pensions and currenciesby pensions and currencies

2002

FFNEY2003 11

2002 –2002 – earnings slightly downearnings slightly downdividend unchangeddividend unchanged

EUR mln 2002 Δ%

EBIT 1,492 (5)

Noncons. comps. 38 (45)

Net income 892 (4)

2002 2001

ROS, % 10.7 11.1

Interest cover 7.3 6.1

EPS, EUR 3.12 3.25

Dividend, EUR 1.20 1.20

Excluding extraordinary and nonrecurring items2002

FFNEY2003 12

Pharma – a challenging yearPharma – a challenging year

EUR mln 2002 Δ%

Sales 4,008 (1)

EBIT 768 (8)

ROS, % 19.2 20.5

R&D % sales 15.0 13.2

ROI, % 30.5 33.7

EBITDA 948 (5)

Capex 297 (6)

2002

FFNEY2003 13

Pharma – a challenging year Pharma – a challenging year (2)(2) Autonomous growth 6% - negative currency impact 4%

Cost-cutting programs – affecting 800 jobs

Organon– Remeron® patent case U.S. lost – new products – delay / slow take-off

Intervet – under pressure

Diosynth – strong performance

2002

FFNEY2003 14

Coatings –Coatings – strong performancestrong performance

EUR mln 2002 Δ%

Sales 5,521 (1)

EBIT 465 9

ROS, % 8.4 7.6

ROI, % 20.0 18.1

EBITDA 623 6

Capex 131 (28)

2002

FFNEY2003 15

Autonomous growth 3% – negative currency impact 3%

Restructurings – extended and accelerated

Continuous strengthening of portfolio

Significant working capital reduction

Decorative Coatings – benefiting from cost savings

Industrial activities – improving despite weak business climate

Marine & Protective – excellent performance

Coatings –Coatings – strong performance strong performance (2)(2)

2002

FFNEY2003 16

Chemicals –Chemicals – stable in difficult businessstable in difficult businessconditionsconditions

EUR mln 2002 Δ%

Sales 4,598 –

EBIT 344 1

ROS, % 7.5 7.4

ROI, % 11.5 11.0

EBITDA 672 (1)

Capex 248 (20)

2002

FFNEY2003 17

Chemicals –Chemicals – stable in difficult businessstable in difficult businessconditions conditions (2)(2)

Autonomous growth 2% – negative currency impact 3%

Restructurings – extended

Further portfolio strengthening

Catalysts – great year

Salt and Base Chemicals – solid performance

Pulp & Paper, Surface, Polymer Chemicals – fierce competition

Agreement on termination of regular chlorine transport in Netherlands

2002

FFNEY2003 18

Moderate net nonrecurring chargeModerate net nonrecurring chargeIn EUR mln

• Restructuring and impairment

(236

)

• Divestment gains

91

• Others

7

Gross

(138

)

Taxes

64

Total

(74

)

Restructurings at all groups – impacting 1,500 jobs

500 jobs at Pharma – not included

Divestment Rosemont U.K.

2002

FFNEY2003 19

Programs New Total Realized2001 2002/2003 program so far

Pharma 800 800 100

Coatings 2,000 500 2,500 1,400

Chemicals 1,500 700 2,200 700

Akzo Nobel 3,500 2,000 5,500 2,200

Number of employees – restructurings Number of employees – restructurings expandedexpanded

2002

FFNEY2003 20

Balance sheet – debt down EUR 0.8 blnBalance sheet – debt down EUR 0.8 bln

EUR bln 2002 2001

Noncurrent assets 7.3 0.3 Working capital 2.6 (0.5)

9.9 (0.2)

Equity 2.2 (0.8)

Provisions 4.4 1.4

Net interest-bearing debt 3.3 (0.8)

9.9 (0.2)

2002

FFNEY2003 21

Outlook 2003Outlook 2003Net income* significantly below 2002

Pensions costs – EUR 130 mln higher

Strong negative currency impact

Generic competition Remeron® in U.S.

* Excluding extraordinary and nonrecurring items.2003

FFNEY2003 22

Determined to deliverDetermined to deliver Focus on Customers, Costs and Cash

Debt reduction program continued

Capex – at 2002 level

Group priorities

– Pharma – protect margins; prepare for growth

– Coatings – growth and margins up

– Chemicals – focus on cost and cash

2003