ORKLA ASA Orkla's operating revenues increased by 6.1% toNOK 11,772 million in the second quarter of 2021. Operating profit (EBIT adj.) rose 5.0% toNOK 1,265 million .Orkla's profit before tax increased by 12% toNOK 1,344 million in the second quarter. Earnings per share rose 9.5% toNOK 1.04 in the quarter. Adjusted earnings per share rose 3.6% toNOK 1.14 .Substantially higher power prices contributed to a rise inHydro Power's operating profit toNOK 112 million in the second quarter, a year-over-year improvement ofNOK 131 million . Jotun, in whichOrkla has an ownership interest of 42.6%, contributed to an increase in profit from associates of 2.8% toNOK 255 million in the second quarter. Branded Consumer Goods had organic growth of 6.9% in the quarter. Easing of coronavirus restrictions and higher demand in the Out of Home sector contributed to 20.5% organic growth for Orkla Food Ingredients, compared with a weak second quarter of 2020. Orkla Consumer Investments had organic growth of 13.2%, driven by increased sales for Orkla House Care and Kotipizza.Orkla Foods had organic growth of 3.0% in the quarter andOrkla Care 2.5%, while Orkla Confectionery & Snacks saw a decline of 1.2%. Branded Consumer Goods, including Headquarters, saw a 5.4% reduction in operating profit, ascribable to a higher level of activity and increased costs. The decline was partly coronavirus-related, as the cost base was extraordinarily low in the second quarter of 2020. Moreover, there was a slight change inOrkla's product mix in the quarter. "The coronavirus pandemic has continued to impact onOrkla in the past quarter. We have seen high infection rates and lockdowns of society, especially inIndia , but the situation has also been challenging in several other countries. I am pleased that our top-line results were strengthened by volume-based organic growth, and that parts of the Out of Home sector approached a normal situation. However, I am not satisfied with our cost and profit performance, but we are monitoring it closely and will consider taking necessary action," saysOrkla President and CEOJaan Ivar Semlitsch , who is concerned about rising raw material prices: "Orkla is exposed to a broad range of raw materials. The coronavirus pandemic has contributed to bottlenecks and disruptions in global value chains. This situation, combined with increased demand, will result in higher raw material prices going forward," Semlitsch points out.Orkla has made a number of strategically important acquisitions in the second quarter to strengthen its positions in selected categories and geographies. In June,Orkla announced its entry into an agreement to purchase 75% of the shares in New York Pizza, one ofthe Netherlands' leading pizza chains. The transaction valued New York Pizza atEUR 145 million , equivalent toNOK 1.5 billion , at enterprise value. Together, New York Pizza and Kotipizza own 518 franchisee-operated sales outlets, 286 of which are inFinland , 229 inthe Netherlands , two inGermany and one inBelgium . In the same month,Orkla Health announced that its acquisition of 100% of the shares in NutraQ has been completed and approved by all relevant competition authorities. NutraQ is a leading supplier of subscription-based health and wellness products in the Nordic region. The purchase price valued the company atNOK 3.1 billion at enterprise value. In June, completion was also announced of the purchase of the Icelandic company Nói Siríus, which is the leading manufacturer of chocolate and confectionery inIceland . In 2020, the company had a turnover of ISK 3.6 billion (approx.NOK 230 million ). With this acquisition, Orkla Confectionery & Snacks is now represented by its own companies in all the Nordic markets and the Baltics. Furthermore, Orkla Food Ingredients has completed its purchase of the two British companies Cake Décor and For All Baking, which manufacture and sell cake decorations and accessories through online stores, bakeries and grocery chains. Turnover for the two companies in 2020 totalledGBP 14.4 million (approx.NOK 168 million ). On 13 July, Orkla Food Ingredients entered into an agreement to purchase the Swiss companyHans Kaspar , a leading specialist in the manufacture of ingredients for chocolate and ice cream producers. In 2020, the latter company had a turnover ofCHF 13.3 million (approx.NOK 125 million ).Orkla ASA Oslo ,15 July 2021 Ref.: Group Director Corporate Communications and Corporate AffairsHåkon Mageli , mob.: +47 928 45 828 SVP Investor RelationsKari Lindtvedt , mob.:+47 950 75 114 An Excel spreadsheet showing key figures may be found at https://investors.orkla.com/. This information is considered to be inside information pursuant to the EU Market Abuse Regulation and is subject to the disclosure requirements pursuant to Section 5-12 the Norwegian Securities Trading Act. Thisstock exchange announcement was published by Kjetil Sørum, Investor Relations Manager atOrkla ASA , on15 July 2021 at07:00 CEST .
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