Hello, and welcome to AkzoNobel's Investor Update for the Q3 of 2021. I'm Kenny Choe, Head of Investor Relations team. Today, our CEO, Thierry Van Anker and CFO, Martin de Vries, will guide you through our results. We'll refer to the presentation, which you can follow on screen and download from our website at axonobel.com. A replay of this webcast will also be available.
There will
be an opportunity to ask questions after the presentation. For additional information, please contact our Investor Relations team. Before we start, I would like to remind you about the disclaimer at the back of this presentation. Please note this also applies to the conference call and answers to your questions. I will now hand over to Thierry, who will start on Slide 4 of the presentation.
Thank you very much, Kenny. Hello and a very warm welcome Welcome to everyone on the call, and I hope you're all enjoying the gradual return to normal around the world as this phase of COVID containment is among us. Our Q3 results demonstrate a strong pricing momentum with pricing up 9% overall And on track to offset the extraordinary raw material cost inflation by year end. Revenue for the Q3 was up 6% compared to 2020 5% higher versus 2019 in constant currencies With revenue up both for Paints and Coatings. Adjusted operating income decreased 32% To €240,000,000 as a result of the significant raw material cost inflation and supply constraints.
By the end of the Q3, we completed €557,000,000 out of our current €1,000,000,000 share buyback program And we announced an interim dividend of €0.44 per share, a modest increase balancing the current Challenging operating environment with our continued confidence in our Grow and Deliver strategy. Let's turn to slide number 5. Our strong pricing and growth segment performance Underpin our confidence in the Grow and Deliver strategy. We demonstrated growth for the 5th consecutive quarter with revenue up 5% versus 2019 in constant currencies. During the Q3, Decorative Faints in EMEA and South America showed strong growth versus 2019.
South America volumes were up 13% above 2019 levels, driven by strong market growth, But also as well as profitable share growth in Brazil and Argentina. Within the Coatings business, Revenue growth was 9% overall, supported by growth in all businesses compared to the same quarter last year. Our strong focus on margin management means we're continuing our pricing initiatives to address the significant and ongoing industry wide raw team. We delivered on average 9% higher pricing in Q3, a clear testimony To the agility of our organization. During all these supply chain disruptions, I'm very encouraged that we were able to keep Focusing on our essential grow and deliver strategy, including innovation and sustainability.
During this quarter, we announced the winners of our regional Paint the Future Challenge in China and we have picked 13 finalists Out of 216 participants participating start ups for our global Paint the Future Challenge starting in November. We also announced a milestone carbon reduction target for the company, signing the Science Based Targets initiative And committing to a 50% carbon reduction throughout our value chain by 2,030 as detailed on Slide 6. We are very proud of our carbon reduction targets that we announced last month, which will help tackle climate change, but also transform our business. We are the 1st paints and coatings company to have announced the carbon reduction target for the full value chain. Our target is to reduce Carbon emissions for our whole value chain saw Scope 1, 2 and 3 by 50% by 2,030 With the 2018 as a baseline.
This means our target is aligned with the Paris Agreement, which aims to limit global warming To a maximum of 1.5 degrees Celsius above pre industrial levels. As you know, at Oxonobel, we have a clearly defined approach Sustainability with our people, planet, paint strategy. As part of this, we are already reducing our Scope 1 and 2 emissions through energy efficiency And moving to 100 percent renewable electricity, a target we will already attain in EMEA next year. At the same time, the majority of our emissions sit in our value chain. Lowering our Scope 3 emissions means We have to work with all our value chain partners to transition to lower carbon alternatives.
This is not only the right thing to do, But it would also be a driver for innovation and business results as this can be achieved only through fundamental supply chain redesigns And by working on our product portfolio to deliver more than 50% of the revenue from sustainable solutions by 2,030. I would also hereby encourage our value chain partners to commit to the SBTI targets as well by announcing their own plans so we can work together to provide sustainable solutions Let's now turn to Slide 7, which summarizes how we view current demand trends In North America and EMEA, the backlog For our supply to our customers due to raw material supply constraints is still clouding the picture, while South Asia continued to be impacted by lockdowns. The underlying demand for paints is strong in most regions, Positive regions. Positive momentum continues for EMEA and South America. In EMEA, Demand from the do it yourself segment is normalizing at a higher level than 2019 as expected, While professional demand is returning to pre pandemic levels.
Compared to the previous quarter, South Asia continued to be impacted by renewed lockdowns in various countries, especially Vietnam, Malaysia and Indonesia. As a result, the business did not materially recover. However, at the start of Q4, we saw lockdowns beginning to be lifted. Demand for Industrial Coatings remains strong, especially the Packaging and the Wood segments, Although impacted by lockdowns in South Asia as well as raw material availability and pricing. Growth trends for Powder Coatings are particularly strong and driven by both demand and market share growth, Including sizable adoptions in the electrical vehicle industry.
Although underlying demand is strong, supply constraints And continued lockdowns impacted the growth within this segment for the Q3. Automotive and Specialty Coatings trends are also positive. Both vehicle Refinishes and Aerospace Coatings show further signs of sequential recovery, while demand for consumer electronics, which was high in 2020, Continues to normalize. While demand for Marine and Protective Coatings is weaker than other segments, We're seeing further signs of recovery, especially for the Protective segment. Demand for Yacht Coatings continues to be very strong.
As usual, we will zoom in on 2 of our businesses business units in a bit more detail. This time, we'll be zooming in on our Decorative Paints business in China and our Automotive and Specialty Coatings business. So let's turn to Slide 8 for our Decorative Paints business in China. The growth for this business It's supported by our sustainable offering and wider and widening distribution. In this €5,000,000,000 market, We are the number one player in the premium segments with profitability above global decorative paints average.
We are the clear leader in sustainability and Dulux is recognized in China as a super brand. Year to date, our revenue is up 3% in constant currencies compared to the same period in 2019. Revenue growth in Emulsion Paints, Wall Paints, is significantly higher than that and in line with GDP compounded GDP growth. At the same time, adjusted operating income increased 18% year to date in 2021 Compared to the same period in 2019. Our strategy for Deco China is focused on expanding our positions now to Tier 3 As we started this strategy about 18 months ago, we have expanded to 90 new cities and increased our reach By around 11,000 stores.
The project market exposure in our China Deco business is less than 20 And of our Decorative Paints China sales. As we've indicated before, we have been very selective with regards to what projects We wanted to participate in over the past years and as such have stepped away from some growth opportunities in the past. We did so because we took into account for that project market the historically higher risk on receivables As well as the lower margins in this segment of the industry and our doubts about the longevity of some of the trajectories. And within the project segment, which is the lower margin segment, our direct exposure to nationwide property developments is immaterial. That means less than 2%.
We are very much focusing on retail since a number of years. We're So focused on mitigating current energy challenges and have sufficient manufacturing capacity to meet current demand. Our energy use is around 1% of sales for our paints business in China. Turning to Slide 9, highlighting our Automotive and Specialty Coatings business. This segment continues its trajectory of profitable Sequential recovery.
As you know, the Vehicle Refinish business makes up around half of this segment for us And the other half is made up of 3 different businesses: Aerospace, Consumer Electronics and Specialty Plastics, With the latter indirectly serving the automotive industry. As pictured on the revenue Chart in the middle, consumer electronics saw high demand during the first half of this year, whereas specialty plastics remained relatively subdued. Aerospace is showing continued strong recovery and vehicle refinishes is normalizing post the pandemic. Within our Refinish business, we have a global number 3 position in this €6,000,000,000 market segment. We have shown clear margin management discipline Over the years, we also renewed our business partnerships with several premium OEMs, including Mercedes and McLaren.
We're expanding our end user digital and service offering with digital orders now making up more than 50% of our revenue. Customer collaboration is also focused here around decarbonization and reduced energy usage. In the €600,000,000 Aerospace market, we have a number one position. We are seeing a faster global market recovery than originally anticipated At the start of the pandemic, this is supported by solid growth rates in the MRO segment And growth in our Aerospace related film business. We're also realizing commercial synergies with Mapyro customers and products Following the acquisition earlier.
I will now hand over to Maarten, who will share more about the financial details and results from Slide 11 onwards. Maarten?
Yes. Thank you, Thierry, and good morning, everybody, on the call. During the Q3, revenue was up 6% versus prior year And 5% higher versus the Q3 of 2019 in constant currencies. Initiatives resulting in price up 9% with mix 2% positive. The normalization of the Deco EMEA DIY channel led to positive mix and lower volumes.
Adjusted operating income decreased with 32% to EUR 241,000,000 As a result of the significant raw material inflation and supply constraints, partly offset by 9% pricing and Cost discipline. This resulted in a return on sales of 10% versus 15.5% in the 3rd quarter of last year. Adjusted operating income excludes the impact of identified items, Which had a net negative impact of SEK 15,000,000 for the Q3, mainly related to transformation initiatives. And last but not least, adjusted EBITDA was at EUR 325,000,000 26 percent lower Versus the Q3 of 2020. Then in Slide 12, the development of adjusted operating income during the Q3.
We delivered significant pricing in the 3rd quarter, Although not fully compensating for the impact of raw material cost inflation and lower volumes. Lower volumes, mainly due to supply constraints and lockdowns, represented a €64,000,000 headwind, While significant pricing delivered €210,000,000 and mix contributed €37,000,000 Currencies had a minor effect of negative €4,000,000 Raw material and other variable cost inflation, including freight costs, resulted in a net negative impact of €278,000,000 compared with the Q3 of 2020. Operating expenses and other one offs were €30,000,000 higher than the Q3 of 2020. As a reminder, we had EUR 22,000,000 temporary savings in the Q3 of last year. The majority of these temporary cost savings returned in 2021 as expected.
Unfortunately, due to civil unrest in South Africa, a SEK 5,000,000 negative impact is included in adjusted EBIT For the Q3, of which the majority is in the one offs and other category. By the end of September, Deco was virtually at par between pricing and raw material impact, while Coatings, where the challenge is steep but still catching up. Turning now to Decorative Paints for the Q3. Revenue for paints was 11% higher In constant currencies versus 2019 and 1% versus the same period of last year. Pricing was up 7%, Driven by strong pricing initiatives in all regions and mix was 3% positive driven by Deco EMEA.
For Deco EMEA, positive mix effects and lower volumes were driven by normalization in the DIY segment. As expected, we see DIY normalizing above 2019 levels and demand from the professional segments returning, Which is usually lower volumes, but at higher average selling prices. Decorative Paints EMEA Was impacted by supply constraints in the Q3. Revenue for South America was up 25% in constant currencies, driven by both pricing initiatives and market share gains in Brazil and Argentina. For Asia, China showed a strong growth in the premium segment.
Pricing initiatives were offset by lower volumes As Vietnam, Malaysia and Indonesia were still materially impacted by lockdown measures in the Q3 of 2021, While India showed signs of recovery. Despite the strong revenue performance in most regions along with underlying demand being robust, The combination of supply constraints, lockdowns and raw material costs resulted in an adjusted operating income 27% lower That's €151,000,000 and a return on sales of 14.9%. So moving now to the 3rd quarter results of Performance Coatings. Revenue for Coatings was up 9 Growth was driven by price increase price initiatives of 11%, while mix was flat. Growth was also supported by strong demand for Industrial Coatings and continued sequential recovery in Marine and Protective Coatings.
Revenue growth in Powder Coatings was driven by pricing initiatives, mainly in the automotive as well as the Jeschaud and Consumer segment. Powder Coating showed strong underlying demand, although still impacted by supply constraints, Especially in North America.
The
vessel grew with 12% for Marine and Protective Coatings, Mainly driven by the Protective and Yacht segments. Revenue for Automotive and Specialty Coatings was 6% higher, Mainly due to pricing initiatives offsetting slightly lower volumes, Aerospace is showing continued recovery, Whereas demand for consumer electronics continues to normalize. Growth in Industrial Coatings Was driven by pricing initiatives and wood and packaging coatings were particularly strong. The significant raw material inflation combined with ongoing supply constraints resulted in adjusted operating income 30% lower €136,000,000 and a return on sales at 9.7%. Now turning to the next slide, Slide 15.
We continue to maintain a strong focus on cash And working capital management. This resulted in operating working capital as percentage of revenue at 13.6% Versus 13.5% in the same period last year and 13.9% in the Q3 of 2019. The slight increase is driven by raw material cost inflation, which caused inventories as well as payables to increase. Free cash flow, excluding pension, prefunding and top up payments, was €198,000,000 for the Q3 of 2021, mainly due to lower profit for the period. Year to date, we were at EUR 225,000,000 Mainly due to higher profit for the period offset by the increase in the absolute level of working capital.
Capital expenditures for the quarter were at €70,000,000 We are investing in growth, The optimization of our asset footprint and ongoing integration of our ERP systems. As mentioned earlier this year, for the full year 2021, we expect capital expenditures to be around €275,000,000 The net debt to EBITDA leverage ratio was at 1.3 times at the end of the Q3 of 2021, in line with our target leverage ratio of net debt to EBITDA In between 1 to 2 times. We remain committed to retaining strong investment Great. That is great, team. Moving now to Slide 16.
Year to date, Our adjusted EPS was up 19% to €3.32 per share. Adjusted EBITDA increased 7% year to date, although 26% lower for the 3rd quarter Due to significant raw material cost inflation. Delivering on our capital allocation priorities, We've completed €557,000,000 of our current €1,000,000,000 share buyback by the end of the 3rd quarter And increased our interim dividend to EUR 0.44 per share. Moving now to Slide 17. As expected, we are seeing significant raw material headwinds continue.
We currently expect more than 20% raw material cost inflation for the full year 2021 versus prior year. For the Q4, we expect between EUR 310,000,000 EUR 340,000,000 impact from raw material Cost inflation. At the same time, we are delivering significant price increases to offset this with Q3 pricing at 9% And September pricing at the 10% run rate. For the 4th quarter, We expect pricing to be between 12% 14% and are on track to offset the raw material cost inflation on a run rate basis by the end of this year. And now back to Thierry for the concluding remarks on the next slide.
Thank you, Maarten. To summarize, we delivered significant pricing of 9% With, as Martin indicated, a Q3 exit run rate of our pricing of plus 10%. We delivered 6% high revenues in the 3rd quarter while delivering on our capital allocation priorities. The trends differ strongly per region and per segment, although we expect significant raw material inflation and supply disruption To continue through mid-twenty 22. Margin management and cost discipline are in place To deliver an average annual 50 basis points increase in return on sales over the period 2021 to 2023.
As mentioned, with our grow and deliver strategy, we target to grow at least in line with our relevant markets, building on our strong foundation. In addition, we are confident in our €2,000,000,000 adjusted EBITDA target for 2023, in line with our strategy. And I'll now hand it over to Kenny for information about upcoming events and the Q and A session on Slide 20.
Thank you, Thierry. Before we start the Q and A session, I would like to draw your attention to some of the upcoming events shown on Slide 20. The ex dividend date of our 2021 Interim dividend is on October 22nd and the record date is on October 25th, followed by the payment on November 4th. We'll announce our results for the Q4 of 2021 on February 9, 2022. This concludes the formal presentation, and we would be happy to address your questions.
Please state your name and company when asking a question and limit the number of questions to 2 per person, so others can participate. Operator, please start the Q and A session.
Thank you.
We will now begin our Q and A session. Our first question is from Mr. Mubasher Chaudhry from Citi. Sir, your line is open. You may begin.
Hi. Thank you for taking my questions. 2, please. The first one is around the headlines on Chromology. Could you just provide Involved in the process for the asset.
And I just some comment on If you would have wanted to go for the asset and if not, then why not? Different thoughts around that, please. And a couple of questions I think in EMEA, the 11% decline is split between The impact in Southeast Asia, COVID, the backlog in EMEA and kind of the DIY slowdown. Could you help us Break that down between negative words from the SARS of Asia COVID and the backlog in And Meyer, just trying to figure out the impact of the DIY slowdown. Thank you.
Yes. Okay. Russia, the line wasn't super good. So I think we are guessing for some percentages what you asked. So I mean just we'll Sorry to go there and then you tell us whether we're answering the right question.
I think your first question was around the Chromology headline And whether we had an interest or not an interest in the asset, we are always interested to look at an asset and there's also then a valuation that we put on those assets. So yes, we did indeed look at the assets. I think we looked at the valuation for it. There is a certain top line that we felt What's actually going to help us? The French market is a complicated one, and we have a position there.
So then adding to that position adds to the complication. And then basically, the current owner is making their choice on who goes in there. So it was an interest, it is what it is. And I think it is in line with us being disciplined buyers in the market out there and being realistic on how much we can get out of our capital allocation. There's one business in the industry we know extremely well, and that is our own business.
So therefore, the share buyback is often always a very strong contender Four assets that maybe add on in that. So that's on the first two questions on that. And then we'll see where this goes. Now let me just check with Basel when I've Your question because your signal interrupted a couple of times. Does that answer the chronology question?
Yes. It does. I guess The valuation from my numbers looks relatively compelling. So just one Just in general, when you're thinking about acquisitions, what kind of valuation is something that you would look at?
Yes. But I think, Mubasher, there we've been pretty consistent. I think that we are okay to for any asset to pay a multiple as needed. But we do have to see then with the realistic synergies and with the market dynamic, whether that actually starts to get in line with even for an attractive asset, So getting in line with our own valuation. Now don't forget that if for those players who were pretty active in Specifically here, the French market, you also have to take into account potential desynergies, which also is something you have to be better for the whole element.
So again, I think we stay consistent and Maarten is, I think, the brother in arms in this one, not to have our testosterone get the better of us And keep focusing on what is the value creation mid- and longer term for the company. So and then that drives the valuation for any asset, by the way, that we go after. So the attractiveness is probably more if you look on any valuation. I think we do pretty serious work on what is real And what can we deliver on that? So but let me get on the second question, which I think was mostly focused on the volume part, I think, for Deco EMEA For Deco in general, it's probably good to give a bit more detail here for the 4 regions around the world.
China is doing very well. Specifically, our retail business there is doing extremely well. If I look at our growth in the premium segments, It's actually up almost to 29% to 30% versus 2019. And our geographic expansion 2 Tier 3, Tier 4 cities is really very successful. It also has been a fantastic way to shelter us from the current turbulences there in the project Market where we really don't have any exposure.
Southeast Asia is down quite significantly still because of the lockdowns. So again, for us, yes, India reopened, but that is not necessarily a big change versus quarter over quarter last year Because there were intermittent times when the market was open there, the bigger impact for us is the fact that Indonesia, Malaysia and Vietnam, 3 big countries for us, were still Close the business and only opened up, I think, out of the last week of September or the 1st week of October. So and then still trying to get back to Something that resembles Norman. So that if you look at the volume element, and I think it's in the deck somewhere on Page 24, I think, from memory, That gives you some of the parts in there. So that's a significant part of that delta.
The second part is Let me then go to another region. It's Latin America. Latin America is doing very well. I mean, bolt on market is doing very well, but also Pretty significant share growth in the markets that we're operating there in Brazil and Argentina. That's very good margin.
So that's a success story overall for us. If you then zoom in and that's probably more of interest is on the Deco EMEA market. We do see now very consistently the do it yourself market in Europe Normalizing to what it was in 2019, plus mid single digits. So in fact, and that proves what I think the people in the industry, including ourselves, have been saying that there is a new set of customers that has appeared. So On do it yourself, it's 2019 plus mid single digits, so that's actually pretty positive.
But that is a significant down in volume from 2020 in do it yourself. At the other side of the spectrum, the Professional Trade business is, in fact, back at 2019 levels, and that was significantly down in 2020. So that makes if you look in our target that looks the top line for Deco EMEA is actually pretty good. There's 2 volume effects for Deco EMEA that you have to take into account. One is the fact that the swing from do it yourself to the professional trade is net negative in volume, So and definitely versus 2020.
Again, we said that before, the mix is different in the trade business. It's typically higher average selling price products, also different segments, a lot of exterior painting, a lot of wood, metal, Whereas do it yourself is to has a higher element of wall paints in there, which is at a different pricing point and different volumes that go along. So that effect alone, I would say, the normalizing do itself and getting back off trade, even though on the top line, you wouldn't see that. It results in a 3% to 4% drop in volume by that alone. I also want to point out that last year, we had a lot of conversation after the Q3 around what happened With our volumes and our mix at the same time, because we had the opening up of the Middle East, African markets, which was an enormous peak of lower priced material that came in.
And of course, that effect was not there right now. So I would say, Really, the difference is that the percentages for Deco, you have to see that year over year with a bizarre pattern in 2020 And the patents that we have in 2021. But overall, for Odeco, volume wise, we're actually very encouraged. Share wise, we're very encouraged. And actually, the markets are holding up pretty well.
One element I want to point out is that, yes, there is probably 1% or 2% also still there in those businesses of Not being able to supply, which I would call backlog on the volume, which we call the backlog orders in place, which we cannot supply Because either metal packaging is still an issue or some of the necessary additives in some countries or tints That are difficult to obtain still through the supply chain situation. And Vassar, does that answer your question?
That's really helpful. Thank you. Yes. Thank you.
Thank you. Our next question is from Mr. Charlie Webb from Morgan Stanley. Sir, your line is open.
Good morning, everyone. Thank you very much for the useful slides in there. Maybe just a couple from me. First off, just on expectations around volumes. Thank you for the price and the raw material headwinds.
You clearly set those out for the Q4. Just wondering if you could give us a better sense on The demand outlook for the Q4, how that compares to Q3? As you said, some of the lockdowns in Southeast Asia perhaps being lifted, But presumably raw material constraints still a bit of an issue. So just one around how you see the Q4? And then also just kind of Casting a 9 to 2022, how should we think about the volume backdrop for AXA when you look across your end markets, perhaps more in Performance Coatings, But just thinking about how those markets looking into 2022, do you expect a continued recovery?
Or do you think we're somewhat there now?
That would be helpful. Thank you.
Yes. All right, Charlie. So let me try and then Maarten chip in. I think for the Q4, it would probably be a normal quarter, and then you have Take into account the backlog. So part of the answer is, in fact, the raw material.
In fact, we're selling everything that we can get our hands on. So the backlog is probably continuing to be there in the Q4. You see in some of the charts, we also show the pricing that actually betrays fact I would say that the or shows the fact that the raw material situation is somewhat stabilizing, but it's stabilizing at a very Brittle level, I would say. The force majeurs that at 1 point were 500 in our network in the beginning of the year, big Material big volume material groups that has actually been pretty stubbornly sitting around this 50, 55 force majeurs, Typically smaller volume products additives. Nevertheless, for a paint manufacturer, that's equally annoying because if you miss an ingredient, Frankly, you can't supply the product.
So I think that backlog is going to continue to be there in the Q4 and would probably be the only deviation From having a normal Q4, I do want to point out the Q4 Deco has a seasonality, and there will be a more normal seasonality Then we've seen in the Q4 of 2020, but in the rest, I don't think there would be wild swings in there. I don't know, Mads, if you want
to add something to the first question, Aure? Yes, I think you I mean a normal quarter that means that we are very much looking at a 2019 situation in that sense. And then the uncertainty is indeed with the supply situation and supply disruptions. And as we indicated, the raw material situation, which now to peak at in Q4, So where we originally thought kind of the peak in Q3, it looks now at peaking in Q4. Yes.
Charlie, let
me move to the second question around the outlook for demand in 2022. First of all, we do Back to raw material situation in 2022 to be less hectic. That means stabilizing at this brittle level going into 2022. And that's also why we say, look, I mean, the raw materials will probably still be very much top of mind to the first half of the year. Hopefully, we see it in the second quarter.
Hopefully, a little bit more of a breathing room, but we're not betting on that. And our whole pricing plan and our whole market plan is based On the current situation, but we don't expect it necessarily to deteriorate further from where we are either. You see that in some of the graphs that are standing there. If you look at the months, Deco, well, let me go maybe bullet points to the 4 regions. China for 2022, we remain pretty bullish.
Again, our business is predominantly a retail business. You may remember that over the last 2, 3 years, we had to explain why we weren't showing the growth as some others, and we explained that we walked away from low margin products That also had, by the way, sometimes a year to 2 years receivables associated with that. So as a result, we basically focused very much On the retail and the upper side, the premium and the mid tier of the retail business. And that is like given what's happening currently in China, the reset that is happening in the development market, that was obviously a good move. So we are somewhat sheltered, to be honest, and it doesn't really impact us directly at all.
There might be some indirect effects to distributors and other retail partners That may have something to do there. But we are pretty positive, in fact, for the continued development of our business In China, for Deco, mostly, however, share gains in Tier 3, Tier 4 cities. We talked about this 11,000 stores. Volumes for our premium product line are up almost 30% versus 2019, so it's actually going very well. Southeast Asia is only up from here because they were closed for business.
So there's no reason to expect that, that would be different in 2022. It's going to be interesting in quarter 4 how it ramps up because a lot of the painters in the big cities in Vietnam have to come from the countryside and we do see that a bit Slower actually having people getting back to normal, but I'm sure that is a relatively short term transitional situation there. We saw the similar thing In countries like India for a number of weeks also. Latin America, total success story. We gained significant market share In Brazil, actually gained expanded our market lead in Argentina with very good pricing.
It's actually also marked And share store capturing, etcetera. So that's actually very positive. Then on Deco EMEA, we do believe that the trend that we see right now On the normalization of the trade business, so that will be ongoing. And that, in fact, do it yourself, we see no reason why that wouldn't Settle or continue to settle at this mid single digits above 2019, so pretty positive. Also some very nice market share gains in key countries for us.
Now that goes off at glacial speed, but all the signals are actually very positive there, so very encouraged. So that's on Deco. If you go to the industrial markets, the demand for powder coating This is extremely strong. That is a business, however, that is really held back on raw material supply, which is a real constraint. Specifically, I would say North America is the region where that is impacting the most.
But that business is, 1st of all, extremely efficient in getting its prices up. And they have to do a lot, but they are doing a lot. Underlying demand continues to grow for that business And extremely encouraged by really visible, tangible and increasing adoptions around Electrical Vehicles for Power Coatings, which is actually pretty positive, added segment effect already in Already in 2021, but definitely if we see new adoptions in 2022 happening there. If we go to Automotive and Specialty Coatings, We are pretty sheltered from the automotive market, so the chip situation only impacts us gradually. There are 2 elements, I think, that are a bit balancing each other in Automotive Specialty Coatings.
On the one hand, Aerospace is And you see that also the chart that we show in the deck is in fact back at 2018 levels for us, not 2019, but 2018 levels. And actually, the MRO, so the maintenance and repair, is actually very quickly coming back to the to what it was in 2019. That is then somewhat in volume offset with consumer electronics. Consumer electronics, where we were a big player in Asia, had somewhat of a COVID upside As people were working from home on equipment, that is also normalizing. It's normalizing pretty much in line with 2019, but those are Somewhat offsetting elements there.
And refinish, that is virtually back at 2019 levels already. And that will continue, I think, in 2022. Marine and Protective, still a very brittle business. I would say the protective business is indeed showing a pulse, and I think that's going to be improving For 2020 continuing to improve in 2022. Again, we are at the end of these projects.
Whether it's a capital investment, those projects started to happen more in the latter part of the oil prices and gas prices We're getting back up there. So that is probably more in the latter half of twenty twenty two. Whereas the Marine business, what we see is that The drydocking is a bit lower mostly because any ship that is out there is being used right now in this supply chain disruption. So that gives drydocking a little bit of a back seat. But for newbuilds and for C Stores, That business is actually pretty positive right now.
And if you then go to Industrial Coatings, that is also the business that has significantly impacted Backlogs, that is our high volume business. Again, we said that before. If you would put all our Performance Coatings in one big bucket, Half of that bucket would be our Industrial Coatings business in volume. And that's where, in fact, there's quite some backlogs are also there, and
that gives them an over dimensional
impact in volume. But on the underlying So, impact in volume. But on the underlying segments, I would say Metal Coatings is probably a bit normalizing to 2019 levels. That was up in 2020, but Packaging and Wood Coatings, on the other hand, are containing the demand is very strong. So long story short, Charlie, on the questions.
All of our markets, actually, the underlying demand is pretty positive. There are minor exceptions that is actually trending up. The big issue continues to be to get the raw materials and to supply.
That's very helpful. Thank you very much.
Thank you. Thank you. Our next question is from Alex Stewart from Barclays. Sir, your line is open.
Hi, good morning, everybody.
Can I just clarify a couple of points you made, I think, for Sebastian's question? So I think you said that the shift in your DIY to Pro is about 3 percentage points on volume. Is that for decorative paint and if I got that number right? And then did I also catch that you thought that availability issues were 2 percentage points of the 11% reduction of volume for Sodexo. And then if you wouldn't mind giving the equivalent number For the volume disruption in Coatings, it would really help us understand what's temporary and what's permanent.
Thank you.
Yes. I've got another question as well, but I'll get back to that once you go on to this.
Yes. All right. Okay. Well, let's handle the Because I think the Deco one is obviously top of mind. So let me then walk through the steps Endecco EMEA.
First of all, and that's on Chart 24 in the deck, it would also be good to look at the Q3 of 2020 where we then had To explain why it was so exceptionally up, and that was mostly because Middle East Africa was up for business, which is high volume business, Lower average selling price because it's an importer market in most countries, etcetera. Good value business, but that was different. That effect is much more gradual right now, so that So that is a big part of the volume impact on ZECO EMEA. As such, it's a normal sequential well, disruption of the normal sequences It's also, by the way, why last year we had to explain why our mix was so negative and then we explained while the volume is up, it's related to the mix and that's also why the positive this year because that effect wasn't really there. So that's one part that's one element of the volume And a big element of it.
The second part is that do it yourself is and we said that before is actually let me go back on what we also covered in the Q2. The do it yourself business in Europe is about the same size in revenue as the Professional business, but it is Significantly higher volume because it is the higher volume wall paints that go in there, Whereas the Professional trade has different has also wall paints, of course, but has facade materials, has wood coatings, metal Trim, etcetera, which are in different volumes. It's a different mix, and it's also higher pricing mix, by the way. So What we now see is by do it yourself normalizing versus 2020, that actually has an over dimensional volume impact, Whereas the trade comes back up and in fact that's why on the revenue side, it actually is more or less a wash If you go between the quarter 3 2020, which was one of those COVID boom quarters and the quarter we have right now. So that is indeed this 3%, 4% if you calculated.
That effect alone is almost 3%, 4% volume