Orkla’s operating profit (EBIT adj.) increased by 19% to a total of NOK 1,178 million in the third quarter of 2016.
Branded Consumer Goods achieved a 15% improvement in operating profit, which amounted to NOK 1,209 million. Orkla strengthened its operations through a number of acquisitions and internal improvement projects.
Orkla’s operating revenues rose by 13% to NOK 9,429 million in the third quarter.
Branded Consumer Goods reported organic top-line growth of 2%. Orkla Foods, Orkla Confectionery & Snacks and Orkla Care showed improvement, while Orkla Food Ingredients delivered a slightly weaker performance in the quarter. Growth for Branded Consumer Goods was on a par with market growth.
“For the tenth consecutive quarter we have achieved organic turnover growth in Branded Consumer Goods. Orkla posted a clear improvement in operating profit due to acquired companies, higher sales and internal improvement projects. In addition, work is still in progress on a major integration process after several acquisitions,” says Orkla President and CEO Peter A. Ruzicka.
In the third quarter, Orkla made a number of acquisitions and strengthened its presence in several markets. With the purchase of Harris, Orkla House Care has become the leading supplier of “Do-It-Yourself” painting tools in the UK. Sonneveld acquired 70% of the shares in Broer, making it the Netherlands’ leading supplier of almond paste, bakery ingredients and ice cream powder. Through the acquisition of the Colon-C brand, Orkla Health has strengthened its position in the gut health segment in Poland.
Profit from Orkla’s associates and joint ventures increased by 31% to NOK 313 million in the third quarter. Orkla’s share of profit in Sapa was NOK 172 million, compared with NOK 54 million in the corresponding period of 2015. This progress is due to improvement programmes and the continued reorientation of sales towards higher value products. Jotun also contributed positive results, but sales growth has tapered off slightly in the course of the year. Hydro Power achieved operating profit of NOK 64 million in the third quarter of 2016, compared with NOK 22 million in the corresponding period of 2015. The improvement is largely attributable to a rise in realised power prices.
Orkla’s profit before tax increased by 24%, totalling NOK 1,328 million in the third quarter.
Orkla’s diluted earnings per share rose by 31% to NOK 1.05 in the third quarter of 2016.