Orkla Associates consists primarily of the investments in Renewable Energy Corporation ASA (REC) (39.73 % stake) and Jotun AS (42.5 % stake). REC and Jotun are presented in Orkla's financial statements according to the equity method, and Orkla's share of the profit after tax is shown on the line for profit from associates. Orkla raised its stake in REC from 27.5 % to 39.73 % in 2007. Orkla's profit contribution from REC was NOK 607 million in 2007, while the profit contribution from Jotun came to NOK 209 million. The figures given below are on a 100 % basis and are taken from the companies' reports.
REC posted operating revenues of NOK 6,642 million, up 53 % compared with 2006. EBITDA ended the year at NOK 3,172 million compared with NOK 1,965 million in 2006.
Jotun's operating revenues totalled NOK 8,872 million, up 15 % from 2006. EBIT came to NOK 804 million an increase of NOK 645 million in 2006.
More on REC
REC is a major actor in the solar energy industry. The business includes all parts of the value chain, from production of raw material to finished solar cells and modules. As a global actor, REC mainly serves markets in Europe, the US and Asia. The company has about 1,750 employees. REC business activities are organised in the three divisions REC Silicon, REC Wafer and REC Solar.
REC Silicon produces silane gas and silicon for various application areas for the solar cell and electronics industry and has two production facilities in the US. REC Silicon is the largest supplier of silicon to the solar industry.
REC Wafer produces monocrystalline ingots and multicrystalline wafers, both for the solar cell industry, from its production facilities located in Norway. REC Wafer is today the world's largest manufacturer of wafers.
REC Solar manufactures and markets solar cells and modules. Solar cells are produced in Norway while solar cell modules are produced in Sweden.
REC continued its vigorous expansion in 2007. In October the company announced plans to build the world's largest fully integrated factory for production of wafers, cells and modules in Singapore. Production is scheduled to start in 2010.
In the course of the year, several major delivery agreements were signed, at fixed prices and volumes, for the coming years. The longest agreements run until 2015.
More on Jotun
Jotun is one of the world's largest manufacturer of paints and powder coatings. The Group has 71 companies and 39 production facilities on all continents. In addition Jotun has agents, branch offices and distributors in more than 70 countries. The Group has a total of 5,900 employees. Jotun's operations cover development, production, marketing and sale of paint systems and products designed to protect and decorate surfaces in the residential, shipping and industrial markets.
The Jotun Group comprises four divisions: Jotun Dekorativ, Jotun Coatings, Jotun Paints and Jotun Powder Coatings. Each division has its specific products, segments and geographical areas of responsibility.
The Jotun Dekorativ division has segment responsibility for Jotun's decorative paints, stains and varnish deliveries to the trade and to Do-It-Yourself (DIY) markets in Scandinavia.
The Jotun Coatings division has global segment responsibility for development, production and sale of paint systems for the shipping, manufacturing and offshore industries. This responsibility also includes decorative paints for local markets in Europe and selected markets in Asia.
The Jotun Paints division has segment responsibility for decorative paints in all markets outside Scandinavia, as well as for marine and protective coatings for markets in the Middle East and South East Asia.
The Jotun Powder Coatings division has global segment responsibility for decorative and functional powder coatings designed for industrial corrosion protection and metal surface treatment.
Jotun experienced good markets in 2007. High global activity in shipbuilding, oil and gas projects and substantial growth in the construction industry in the Middle East increased sales for the Jotun Group. However, persistent high raw material prices and a weaker USD reduced margins slightly in core areas.
Jotun continued its international expansion through 2007. A new factory is being built in India which is scheduled for completion in spring 2008. In the second four-month period of 2007 decisions were taken to build new factories in Korea and Libya to meet the steadily growing demand. Both factories will be operative in the course of 2009.