Expansion and financial investments brought good 3Q results for Orkla

28.10.2005: Group pre-tax profit in the third quarter totalled NOK 1.8 billion, up from NOK 484 million last year. New businesses and a good financial market made the strongest contribution to the high profit level. Earnings per share increased by NOK 5.4 to NOK 7.3 in the third quarter. Profit from the Financial Investments division was more than twice as high as in the same quarter last year.

Orkla has made many new industrial investments in the past year. SladCo, Elkem, Sapa, Alufinal, Panda, Hallöfisk and Collett Pharma have all joined the Group since the third quarter of last year, and operating revenues and profit from most of them are already included in the corporate accounts.
 
"Following the Board's decision that Orkla will further develop Elkem, Sapa and Borregaard itself, it is even clearer that we have two main industrial areas: Branded Consumer Goods and Speciality Materials. In future we will allocate resources to areas where we believe they will generate the greatest value and seek opportunities in areas where, in terms of strategy and expertise, Orkla is naturally qualified to run competitive businesses," says Group President and CEO Dag J. Opedal.
 
In the Industry division, Branded Consumer Goods (Orkla Foods, Brands and Media) has had a stable development, but faced special challenges on the Swedish grocery market. Within Speciality Materials both Elkem and Borregaard achieved good profit in the energy sector, while Elkem Silicon is struggling with declining markets and lower demand. The markets for Sapa and Borregaard are also challenging, while the performance of Elkem Aluminium was satisfactory.
 
At the end of the first nine months, Group pre-tax profit totalled NOK 5.5 billion, compared with NOK 2.7 billion last year. Structural growth and underlying sales growth at Orkla Brands contributed to an 11 per cent rise in operating revenues for the Branded Consumer Goods area in the third quarter.  
 
The Financial Investments division realised portfolio gains of NOK 672 million in the third quarter, compared with NOK 248 million last year. The return on the investment portfolio was 30 per cent at the end of September, and the net asset value of the portfolio increased by almost NOK 1.7 billion in the third quarter.