Oslo / NO. (ok) Operating profit (Ebit adjusted) of Norway’s Orkla ASA increased by 7 percent in the third quarter to NOK 1,353 million. Orkla’s operating revenues increased in the third quarter by 3 percent, to NOK 10,126 million. Branded Consumer Goods achieved turnover growth of 2 percent. Organic turnover growth was 0.8 percent in the period, adjusted for the loss of a distribution agreement in Orkla Confectionery + Snacks. Three out of four business areas delivered profit growth.
«We had sales growth in a majority of the markets in which we operate, and are particularly pleased by the progress made in Finland, Central Europe and India. Growth in Orkla Care was hampered by a weak performance in Poland and the UK. Several of Orkla’s categories in Norway have been affected by lower campaign activity and higher retail prices to consumers, which had a negative impact on volume growth. In addition, the huge increase in taxes in the Norwegian market resulted in growth in online and cross-border shopping. It is encouraging that the Government is now reversing the increase in the chocolate and confectionery tax», says Orkla President and CEO Peter A. Ruzicka.
Orkla made a number of structural changes in the third quarter. In the Czech Republic and Slovakia, it decided to integrate the two companies Hamé and Vitana to form a single Orkla Foods company. In the UK, Orkla Food Ingredients acquired the chocolate and caramel manufacturer County Confectionery, which chiefly supplies the industrial market.
Profit from associates totalled NOK 116 million in the third quarter. This 13 percent increase is largely attributable to Jotun. The market situation remains challenging in Marine Coatings.
Hydro Power achieved operating profit of NOK 102 million in the third quarter, an improvement of 28 percent from the same period of 2017. The increase is mainly due to higher power prices, while production volume declined.
Orkla’s profit before tax rose by 4 percent to NOK 1,364 million in the third quarter. Earnings per share for continuing operations increased by 3 percent, to NOK 1.01.