Orkla’s profit before tax for the fourth quarter of 2016 increased by 42%, to NOK 1,344 million, due to improvement for the Branded Consumer Goods business and Sapa, and the sale of a property in Switzerland.
Branded Consumer Goods achieved operating profit of NOK 1,249 million, equivalent to growth of 5%. The growth is primarily due to positive contributions from acquired companies and cost improvements throughout the value chain.
Operating revenues for Orkla’s Branded Consumer Goods business increased by 5%, to NOK 9,734 million, while organic growth was 0.1%.
“Despite the strong fourth quarter of 2015, Orkla’s Branded Consumer Goods business succeeded in achieving organic growth. Orkla Confectionery & Snacks delivered an impressive performance with yet another good quarter. We are also pleased that Orkla Care was able to accelerate its growth rate towards the end of 2016 after a somewhat demanding start to the year. Acquired companies are developing as planned and contributing to value creation in Orkla. Sapa, which had substantially improved operations, is definitely also contributing,” says Orkla President and CEO Peter A. Ruzicka.
Profit from associates and joint ventures rose by 81%, to NOK 161 million. Orkla’s share of profit from Sapa was NOK 190 million, compared with NOK 17 million in the fourth quarter of 2015. Sapa’s improved performance is chiefly attributable to a higher proportion of sales of more value-added products as well as internal improvement projects. Jotun reported a weak result in the fourth quarter, due to lower activity in the shipping and offshore sectors, accounting write-downs and increased provisions.
Financial Investments posted operating profit of NOK 115 million, compared with NOK -17 million in the fourth quarter of 2015. The improvement is primarily due to the sale of an industrial property in Switzerland. Hydro Power reported operating profit of NOK 31 million, compared with NOK 49 million in the fourth quarter of 2015. The profit decline is mainly due to significantly lower product volume as a result of less precipitation.
The Group’s overall operating profit (EBIT adj.) increased by 19%, to NOK 1,307 million in the fourth quarter of 2016. Earnings per share (diluted) rose by 49% in the fourth quarter, to NOK 1.09.
For the full year, Orkla’s operating revenues rose by 14%, to NOK 37,758 million. Operating profit (EBIT adj.) increased by 19% in 2016, to NOK 4,298 million. At year end, the Group had 18,154 employees. Orkla’s Board of Directors proposes to pay a dividend of NOK 2.60 per share for the 2016 financial year.