ORK - Results Q3

Orkla has largely been unaffected by the economic downturn except for Financial Investments and Media. The industry division continues to make progress and third quarter operating profit before other revenues and expenses increased by 27% to NOK 933 million. This improvement was mainly ascribable to expansion in Orkla Beverages where operating profit rose 70% due to the establishment of Carlsberg Breweries and continued profitable growth in Eastern Europe, as well as strong results for Orkla Brands and Chemicals.

For Orkla Brands, profit improvement can mainly be credited to Lilleborg Home and Personal Care and Confectionery. Volume growth for lignin, stable prices for speciality cellulose, a high USD exchange rate and reduced costs were the key reasons for the improved results for Chemicals

Operating profit for Orkla Foods was slightly higher than last year in spite of a weak SEK exchange rate and high raw material prices. Stabburet in Norway and Felix Abba in Finland performed favourably. Orkla Media's operating revenues increased following the consolidation of Berlingske, but operating profit was negatively affected by a marked slowdown in the advertising markets in Poland, Denmark and lately also in Norway. Comprehensive cost reduction programmes have been implemented in response to the weak advertising markets.

Profit after tax was substantially down compared with third quarter of last year due to extraordinarily high gains on sales of financial investments in that period. In the first nine months of 2001, Orkla's share portfolio had a negative return of -21%, while the return on the OSE was -24.9%. The market value of the portfolio as of 30 September 2001 was NOK 13.5 billion, and unrealised gains (before tax) amounted to NOK 1.0 billion.

Key figures third quarter and YTD - all figures in NOK million:

Income Statement third quarter and YTD (2000 in parentheses)
Operating revenues 11283 (8623) YTD: 33222 (24903)
Other revenues and expenses 0 (0) YTD: 19 (40)
Operating profit 933 (737) YTD: 2456 (1931)
Associated companies 75 (111) YTD: 235 (239)
Dividends received 56 (44) YTD: 541 (411)
Portfolio gains -335 (2349) YTD: 172 (3080)
Financial items, net -359 (-205) YTD: -952 (-681)
Profit before tax 370 (3036) YTD: 2452 (4980)
Taxes -100 (-816) YTD: -662 (-1337)
Profit after tax 270 (2220) YTD: 1790 (3643)
Earnings per share (NOK) YTD: 7.7 (16.5).


Balance Sheet as of 30.09.2001 (30.09.2000 in parentheses)
Long-term assets 28914 (21306)
Portfolio investments etc. 12689 (12856)
Short-term assets 14727 (9635)
Total assets 56330 (43797)
Equity and minority interests 18939 (17819)
Interest-bearing liabilities 24681 (16935)
Interest-free liabilities and provisions 12710 (9043)
Book equity to total assets ratio (%) 33.6 (40.7)

Cash Flow third quarter and YTD (2000 in parentheses)
Free cash flow from Industry division 907 (882) YTD: 1669 (895)
Group's self-financing capacity 829 (873) YTD: 1204 (-289)
Net cash flow 368 (3238) YTD: -3638 (-178)
Change in net interest bearing liabilities -254 (-3325) YTD: 3425 (223)
Net interest bearing liabilities as of 30.06.2001 is 21406


Results by Business Area third quarter and YTD (2000 in parentheses)
Operating revenues
Orkla Foods 2682 (2693) YTD: 8079 (8010)
Orkla Beverages 4144 (2019) YTD: 11227 (5564)
Orkla Brands 1080 (1156) YTD: 3328 (3349)
Orkla Media 1744 (841) YTD: 5517 (2585)
Branded Consumer Goods 9614 (6674) YTD: 28046 (19414)
Chemicals 1641 (1836) YTD: 4923 (4971)
HQ/Unallocated -18 (68) YTD: 102 (182)
Industry 11237 (8578) YTD: 33071 (24567)
Financial Investments 46 (45) YTD: 151 (336)
Group 11283 (8623) YTD: 33222 (24903)

Operating profit
Orkla Foods 204 (196) YTD: 507 (503)
Orkla Beverages 527 (310) YTD: 1021 (622)
Orkla Brands 142 (154) YTD: 451 (392)
Orkla Media -20 (16) YTD: 89 (114)
Branded Consumer Goods 853 (676) YTD: 2068 (1631)
Chemicals 108 (96) YTD: 426 (311)
HQ/Unallocated -30 (-27) YTD: -80 (-126)
Industry 931 (745) YTD: 2433 (1856)
Financial Investments 2 (-8) YTD: 23 (75)
Group 933 (737) YTD: 2456 (1931)