Orkla reports strong profit improvement

Orkla achieved EBIT (adj.) of NOK 2.1 billion in the third quarter of 2024, up 13% on the same period last year.

Group operating revenues rose by 4.3% in the third quarter of 2024, year-over-year, and volume growth was positive for the third successive quarter.

Orkla’s consolidated portfolio companies (including HQ and Business Service) grew EBIT (adj.) by 20%, to NOK 2.0 billion, in the third quarter of the year. The increase was broad-based across the consolidated portfolio companies, driven by organic revenue growth, margin improvement and positive mix effects.

Adjusted earnings per share were NOK 1.77, an improvement of 10% compared to the same period last year.

“Orkla’s good performance continued in the third quarter. We achieved EBIT (adj.) growth and increased cash flows in our consolidated portfolio companies. It is encouraging to observe that most of our companies have increased their operating margins while making substantial investments behind their brands through higher advertising spend. Jotun also delivered a good quarter, with continued sales momentum from volume growth and solid operating profits,” says Orkla President and CEO Nils K. Selte.

Profit from associated companies rose by 8.1% year-over-year and totalled NOK 550 million in the third quarter of 2024, mostly attributable to Orkla’s 42.7% ownership share in Jotun.

“Other income and expenses” amounted to a net of NOK -741 million in the third quarter. Orkla ASA recognised a write-down of NOK 299 million on its the common ERP template platform. In addition, there were write-downs of NOK 350 million related to trademarks and goodwill in some of Orkla’s portfolio companies. This was largely related to Orkla Confectionery & Snacks’ write-down of trademark and goodwill in Orkla Confectionery & Snacks Latvija (not related to the new biscuit factory), and Orkla Food Ingredients’ write-down of goodwill in NIC Germany.

Hydro Power’s EBIT (adj.) amounted to NOK 149 million in the third quarter, representing a year-over-year decline of 2.5%. The profit decline was due to significantly lower power prices in the southern and south-western part of Norway compared to the same quarter last year, although this drop was largely offset by higher volumes and repeal of a previously levied windfall tax.

Orkla is a leading industrial investment company with focus on brands and consumer-oriented companies. Its investment portfolio currently consists of 11 companies operating in sectors including paint, food products, food ingredients, confectionery and snacks, dietary supplements, cleaning products and personal care. As of 31 December 2023, Orkla had 19,671 employees and 114 factories in 24 countries.

Oslo, October 29, 2024

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