Orkla ASA : Improvement for Orkla in the Nordic region
Orkla's operating profit (EBITA) totalled NOK 1,103 million in the fourth
quarter of 2012, up from NOK 873 million in the corresponding period of 2011.
The Nordic branded consumer goods businesses and Sapa Heat Transfer achieved
For continuing operations, Orkla's fourth-quarter operating revenues totalled
NOK8,457million, compared with NOK 8,124 in the corresponding period of
Full-year operating revenues amounted to NOK 30 billion. Operating profit was
NOK3,295million in 2012, compared with NOK 2,872 million in 2011.
"Simultaneously with implementing comprehensive structural changes, we
achieved profit growth in our core business. I am particularly pleased that
many of our large branded consumer goods companies in the Nordic region
reported improvement in the latter part of the year. Orkla now has a single
strategic agenda: building up our position as the leading Nordic branded
consumer goods company," says President and CEO Åge Korsvold.
The branded consumer goods business
The Nordic food companies achieved sales growth in the grocery channel in the
fourth quarter. Operating profit in Orkla Foods Nordic amounted to NOK 392
million, a rise of 11% in relation to comparable operating profit in the
fourth quarter of 2011. Stabburet continued to improve its performance in the
Norwegian market. Abba Seafood (Sweden), Beauvais foods (Denmark) and the
Baltic businesses also delivered profit growth. The Finnish businesses posted
operating profit on a par with the fourth quarter of 2011. Abba Seafood and
Procordia are to be integrated and will form one of Sweden's leading food
companies. Following completion of the acquisition of Rieber & Søn, Orkla will
establish national food companies in Norway and Denmark as well. This is
subject to the approval of the competition authorities.
Orkla Brands Nordic also achieved sales growth in the grocery channel.
Operating profit in the business area amounted to NOK 408 million, an
improvement of 16% in relation to comparable operating profit in the fourth
quarter of 2011. Lilleborg and Nidar reported both sales and profit
improvement in the Norwegian market. Profit also increased for large Nordic
businesses such as the Chips Group and the Axellus Group. Göteborgs/Sætre saw
a decline in profit as a result of high factory costs related to ongoing
restructuring and demanding conditions in the Norwegian grocery market. Jordan
became part of Orkla Brands Nordic on 1September 2012. The company, which is
market leader in the Nordic region for oral hygiene and paintbrushes, is
performing in accordance with expectations.
Orkla Brands International posted operating profit of NOK 62 million, compared
with NOK87million in the corresponding period of 2011. MTR Foods continued
to increase its sales in India, even though growth was lower than at the start
of 2012. Orkla Brands Russia is undergoing a demanding adjustment process.
Changes in the market situation, where nation-wide grocery chains in
particular are taking market shares, necessitates significant restructuring of
Orkla Food Ingredients reported operating profit of NOK 74 million, an
improvement of 8% in relation to comparable operating profit in the fourth
quarter of 2011. Despite weak markets in Southern and Eastern Europe, both
operating revenues and operating profit increased.
Sapa Heat Transfer posted fourth-quarter operating profit of NOK 73 million,
up from NOK6million in the corresponding period of 2011. This improvement is
the result of a comprehensive improvement programme implemented in the Swedish
production operations. The company had lower deliveries to the European
automotive industry, but this was largely offset by increased demand in the
USA and China. Orkla's goal is to divest Sapa Heat Transfer in the first
quarter of 2013.
Operating profit for Orkla Eiendom in the fourth quarter was NOK 104 million,
compared with NOK 28 million in the corresponding period of 2011. Hydro Power
reported fourth-quarter operating profit on a par with the same period of
Profit from associates amounted to NOK 47 million in the fourth quarter,
compared with NOK 59 million in the corresponding period of 2011. Profit was
mainly linked to Jotun, which achieved satisfactory sales growth in the
Sales of shares totalled NOK 436 million in the fourth quarter. As at 31
December 2012, the market value of the share portfolio was NOK 2,630 million.
The portfolio is expected to be sold in the first half of 2014.
Together with Norsk Hydro, Orkla aims to establish a globally leading provider
of aluminium solutions. The establishment of the joint venture is subject to
the approval of the competition authorities. The Sapa operations that will be
part of the joint venture were highly negatively impacted by weak European
markets, while there was improvement in North America.
In the fourth quarter, 81% of the shares in Borregaard Chemicals were sold in
connection with the company's listing on the stock exchange, generating a
total accounting gain of NOK110million. NOK 412 million related to the
adjustment of the value of the investment in REC was expensed in the quarter.
Orkla's profit before tax amounted to NOK 638 million in the fourth quarter,
compared with NOK 1,317 million in the corresponding period of 2011. The Board
of Directors of OrklaASA proposes to pay a dividend of NOK 2.50 per share for
the 2012 financial year.
Oslo, 7 February 2013
EVP Corporate Communications and Corporate Affairs
Tel: +47928 45 828
SVP Investor Relations
Tel: +47 22 54 44 11 / +47977 13250
An Excel file with key figures is available at www.orkla.com
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
Presentation of 4th Quarter 2012
4th Quarter 2012
This announcement is distributed by Thomson Reuters on behalf of Thomson
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information contained therein.
Source: Orkla ASA via Thomson Reuters ONE
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