Orkla Operating Profit (EBIT) Increased 7% in the third quarter and ended at NOK 1,444 million. Operating revenue also increased by 7%, to 10,880 million NOK. Jaan CEO Ivar Semlitsch has launched Orkla’s competitiveness project.
The company business showed organic sales growth of 1.5% and an increase in operating profit of 6.2%.
- The Orkla brand business went in a satisfactory quarter with growth both in the upper and lower parts. All four business areas showed organic growth during the quarter. It’s nice to see that after a relatively strong third quarter of last year, we can still ensure profit growth, albeit with different companies. “T again out of four business growth profits,” says Orkla President and CEO Jaan Ivar Semlitsch, who adds:
- We will achieve financial goals for the period until 2021. I started the project so that we can organize ourselves as best as possible in order to increase organic growth and reduce complexity. In addition, I want a clearer mergers and acquisitions agenda. Derfor will strengthen its business and sharpen its support functions. Preliminary estimates indicate that we can also reduce annual costs at Orkla headquarters by NOK 150-200 million.
During the quarter, Orkla Confectionery & Snacks acquired 20% of Iceland’s leading chocolate and candy company Nói Siríus. Orkla Food Ingredients acquired the Dutch ingredient company Vamo, while Orkla House Care entered into an agreement to acquire the remaining 50% in Anza Verimex Holding. On September 25, 2019, the Oslo City Council approved the sale of Orkloi Gate 16 Treshkhov to the city of Oslo.
In the third quarter, Orkla Financial Investments earned operating income of NOK 29 million, compared with minus NOK 8 million for the same period last year. Progress was mainly associated with the Finnish company Kotipizza Group.
Hydro Power’s operating profit was 78 million Norwegian kroner in the third quarter, compared with 102 million Norwegian kroner for the same period in 2018. The decrease was mainly due to lower electricity prices.
Jotun had another strong quarter, which helped increase associate profits by 43% to NOK 166 million in the third quarter.
This quarter, goodwill impairment costs associated with Harris drawing tools company in the UK and trademarks Orkla Health Gerimax and Colon C. brought Orkla a pre-tax profit of NOK 1,276 million, a decrease of 6%.
The adjusted result for the shares increased by 11% to 1.18 kroons.
Income statement, Orkla Q3 2019
Cash flow, Orkla Q3 2019
Group Balance Sheet, Orkla Q3 2019