Orkla Reports Continued Growth in Profits In First Quarter
Norwegian food producer Orkla has seen its EBIT-adjusted operating profit increase by 10% in the first quarter of 2017. Profit before tax increased by 4%, to NOK 1,295 million.
The company attributes the increase to growth in Orkla’s branded consumer goods business. The division increased its operating profit by 7%, to NOK 921 million. It also reported a 6% growth in turnover, and organic growth of 1.6%.
Overall, the company’s turnover rose by 5% (NOK 9,081 million), which it attributes to Orkla Confectionery & Snacks, Orkla Care and Orkla Foods.
Commenting on the results, Orkla President and CEO Peter A. Ruzicka said, “There is still growth in most of the markets in which Orkla operates, although the growth is slowing. I am pleased that this time we can report growth that is somewhat ahead of market growth.”
In response to its market growth, Orkla has decided upon a number of business strategies to boost performance. It decided to exit the mayonnaise-based salad category in Norway, as well as close down production of marzipan in Italy and move chocolate production in Latvia to new premises.
It also intends to make a NOK 500 million investment in new technology and rationalisation of pizza production at Stranda, Norway. It has also acquired three sales and distribution companies in Germany, the Netherlands and the UK which in turn is strengthening its positions in ice cream and bakery ingredients.
As well as internal growth, Orkla also reports growth in profit from associates and joint ventures. Profits have risen to NOK 485 million.
© 2017 European Supermarket Magazine – your source for the latest retail news. Article by Aidan O'Sullivan. Click subscribe to sign up to ESM: The European Supermarket Magazine.