Orkla ASA, the industrial group transforming itself into a consumer goods company, fell the most in more than a year and a half in Oslo after an unexpected writedown in Russia and as weak sales hit earnings.
Shares in Orkla, based in the Norwegian capital, fell as much as 9.7 percent, the most since Nov. 4, 2011, and traded 9.5 percent lower at 47.48 kroner as of 3:20 p.m. About 3.1 million shares have been traded so far today, more than double the average daily volume during the last three months.
Orkla, which has interests ranging from frozen pizza and underwear through to renewable energy and paints, has sold assets as it focuses on becoming a branded goods producer. It has spun off its Borregaard ASA biochemicals operation and is combining its Sapa aluminum-products unit with Norsk Hydro ASA’s, while buying Rieber & Soen ASA, which sells ready-made foods, sauces and soups, and toothbrush-maker Jordan AS.
The integration of Rieber, which cost Orkla 6.1 billion kroner ($1.02 billion), is taking longer than expected, Daniel Johansson, an analyst at Fondsfinans ASA, said by phone from Oslo. Investors are also disappointed that Orkla ended talks about selling its Sapa Heat Transfer unit, a disposal that was expected during the last three months, said the analyst, who has a neutral recommendation on Orkla.
Orkla posted a second-quarter net loss of 735 million kroner on weaker than expected sales and after taking a 1.5 billion-krone writedown on assets in Russia and categorizing Sapa as a discontinued operation. Orkla was expected to report net income of 851.3 million kroner, according to the average of six analyst estimates compiled by Bloomberg. Sales were 7.9 billion kroner, missing the 8.1 billion-krone estimate.
Shares in Orkla have gained 11 percent during the last 12 months, giving it a market value of 48.4 billion kroner. That makes it the seventh-largest company on the Oslo stock exchange.