Slide 1: Second quarter results 2010
Second quarter results 2010 Oslo, 21 July 2010
Slide 2: Agenda
Agenda ¾ Highlights for the Orkla Group Dag J. Opedal, CEO ¾ Operational and financial performance by business area Terje Andersen, CFO 22 Second Q4 and full-year quarter results results2010 2009
Slide 3: Highlights second quarter 2010
Highlights second quarter 2010 • Profit improvement for all business areas vs. weak Q2-09 – Continued profit growth for Orkla Brands and Jotun (42.5%) – EBITA turnaround and recovering markets for Sapa – Strong demand and higher prices for Elkem Silicon-related – Return on Share Portfolio well above
Slide 4: Strong EBITA improvement vs. weak Q2-09
Strong EBITA improvement vs. weak Q2-09 EBITA performance from Q2-09 to Q2-10 (figures in NOK million) 238 -34 -11 -78 * 23 937 446 334 19 EBITA Q2 Orkla Orkla Elkem Elkem Borregaard Orkla Other EBITA Q2 2009 Brands Aluminium Silicon- Solar Chemicals Materials 2010 Solutions related ex Energy Solar
Slide 5: Continued EBITA improvement
Continued EBITA improvement Rolling 12 months NOK million 4,504 4,602 4,448 4,240 3,444 3,522 2,919 2,591 2,376 2,448 Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09 Q4-09 Q1-10 Q2-10 5 Second quarter results 2010
Slide 6: Short-term outlook
Short-term outlook • Overall stable retail markets for Orkla Brands – Signs of rising raw material prices in some markets – Demanding market conditions in Russia • Holiday season will impact results for Orkla Aluminium Solutions in Q3 • High capacity utilisation and improved prices in second half fo
Slide 7: Operational and financial performance by business area
Operational and financial performance by business area Terje Andersen, CFO 7 Second quarter results 2010
Slide 8: Group income statement
Group income statement Amounts in NOK million Q2-10 Q2-09 Change Operating revenues 16 002 13 652 17% EBITA 937 334 181% Amortisation intangibles -15 -50 Other revenues and income -188 -10 EBIT 734 274 Associates -2 908 - 210 Dividends 251 180 Gains and losses/write-downs Share Portfolio 248 228 Net
Slide 9: Cash flow as of 30 June 2010
Cash flow as of 30 June 2010 Amounts in NOK million 30.06.2010 30.06.2009 Industry division: Operating profit 1 603 495 Amortisations, depreciations and write-downs 1 287 1 283 Changes in net working capital -2 155 304 Net replacement expenditure - 730 - 630 Cash flow from operations 5 1 452 Financi
Slide 10: Orkla Brands
Orkla Brands 10 Second quarter results 2010
Slide 11: Stable long-term profit trend
Stable long-term profit trend 12 months rolling EBITA 3in NOK million 200 3 000 2 800 2 600 2 400 2 200 2 000 1 800 1 600 1 400 1 200 Q2-03 Q2-04 Q2-05 Q2-06 Q2-07 Q2-08 Q2-09 Q2-10 11 Second quarter results 2010
Slide 12: Profit growth in second quarter
Profit growth in second quarter Amounts in NOK million • EBITA +3% compared with Q2 Operating revenues Q2-10 Q2-09 Change last year Orkla Brands 5 440 5 663 -4 % – Some negative Easter effects Orkla Foods Nordic 2 262 2 436 -7 % Orkla Brands Nordic 1 832 1 877 -2 % – Underlying growth in line with Q
Slide 13: Examples of organic growth in Q2 2010
Examples of organic growth in Q2 2010 13 Second quarter results 2010
Slide 14: Orkla Aluminium Solutions
Orkla Aluminium Solutions 14 Second quarter results 2010
Slide 15: The market is recovering, with the exception of Building and Construction
The market is recovering, with the exception of Building and Construction Amounts in NOK million • Satisfactory results in Operating Revenues Q2-10 Q2-09 Change seasonally strong quarter Orkla Aluminium Solutions 7 251 4 904 48% – Mainly driven by Sapa Profiles 5 748 3 532 63% strengthening volumes
Slide 16: Orkla Materials
Orkla Materials 16 Second quarter results 2010
Slide 17: Improved markets for the silicon-related operations throughout H1-10
Improved markets for the silicon- related operations throughout H1-10 Amounts in NOK million • Strong demand and higher prices Operating revenues Q2-10 Q2-09 Change for Elkem Silicon-related Orkla Materials 3 003 2 714 11% • Elkem Solar in ramp-up phase with Elkem Siliconrelated 1 980 1 587 25% Borr
Slide 18: Orkla Associates and Orkla Financial Investments
Orkla Associates and Orkla Financial Investments 18 Second quarter results 2010
Slide 19: REC (39.7%) - Strong demand in Q2
REC (39.7%) - Strong demand in Q2 REC Q2-10 Q2-09 Change • Improved operations in all divisions Revenues 2 758 2 280 21 % EBITDA 455 250 82 % EBIT -146 -52 -181 % • Ramp-up in Singapore is Profit/loss before tax 866 -689 226 % progressing well ¾ Reference is made to www.recgroup.com 19 Second quarte
Slide 20: Jotun (42.5%) – continued profit growth in first tertial
Jotun (42.5%) – continued profit growth in first tertial Amounts in NOK million • Strong start to the year Jotun T1-10 T1-09 Change • Profit growth of 32% Revenues 3 640 3 736 -3 % compared with last year due EBIT 446 339 32 % to cost improvements Profit/loss before tax 448 306 46 % • Weaker results
Slide 21: Orkla Financial Investments
Orkla Financial Investments S ha re P o rt f o lio M S C I N o rdic OSEB X S &P 5 0 0 2010 2008-2010 2006-2010 9,3% 7,6% 5,9% 4,4% 3,0% -0,8% -6,7% -6,1% -9,5% -9,8% -11,7% -13,6% • Return on Share Portfolio in H1-10 + 9.3% • Market value of NOK 11.2 billion for the Share Portfolio • Orkla has close
Slide 22: Sapa Investor Trip
Welcome to Sapa Investor Trip 27-28 September 2010 Budapest, Hungary Sapa Profiles Kft. Székesfehérvár, Hungary 22 Second quarter results 2010
Slide 23: Q&A
Q&A ¾ Dag J. Opedal, CEO ¾ Terje Andersen, CFO ¾ Bjørn Wiggen, EVP ¾ Torkild Nordberg, EVP 23 23 Second Q4 and full-year quarter results results2010 2009
Slide 24: Appendix
Appendix 24 Second quarter results 2010
Slide 25: Financial calendar
Financial calendar 27-28 September 2010 - Sapa Investor Trip, Hungary 28 October 2010 - Third quarter 2010 14 April 2011 - Annual General Meeting 2011 15 April 2011 - Share quoted ex. dividend 25 Second quarter results 2010
Slide 26: Cash flow as of 30 June 2010
Cash flow as of 30 June 2010 Amounts in NOK million 30.06.2010 30.06.2009 Industry division: Operating profit 1 603 495 Amortisations, depreciations and write-downs 1 287 1 283 Changes in net working capital -2 155 304 Net replacement expenditure - 730 - 630 Cash flow from operations 5 1 452 Financi
Slide 27: Balance sheet as of 30 June 2010
Balance sheet as of 30 June 2010 Amounts in NOK million Balance 30.6.2010 31.12.2009 Intangible assets 14 969 14 731 Property, plant and equipment 25 185 24 694 Financial assets 9 891 15 922 Non-Current assets 50 045 55 347 Inventories 8 551 7 531 Receivables 14 622 16 568 Share Portfolio etc. 11 28
Slide 28: Largest holdings in the Share Portfolio as of June 2010
Largest holdings in the Share Portfolio as of 30 June 2010 Amounts in NOK million Principal holdings Industry * Market value Share of Share of portfolio (%) equity (%) Tomra Systems Industrials 623 5% 15.3 % Rieber & Søn Food & Beverage 507 4% 16.0 % XXL Holding AS Retail 440 4% 15.5 % Amer Sports C
Slide 29: Currency translation effects
Currency translation effects Amounts in NOK million Revenues Q1-10 H1-10 Orkla Brands -166 -318 Orkla Aluminium Solutions -455 -1 084 Elkem 8 -36 Borregaard -15 -36 Total -628 -1 474 EBITA Q1-10 H1-10 Orkla Brands -15 -23 Orkla Aluminium Solutions -23 -39 Elkem 3 2 Borregaard 1 2 Total -34 -58 29 Se
Slide 30: Appendix: Financial items
Appendix: Financial items 30 Second quarter results 2010
Slide 31: Net financial items
Net financial items Amounts in NOK million Q2-10 Q2-09 Full year 2009 Net interest expenses -99 -183 -883 Currency gain/loss 9 11 15 Other financial items, net -24 - 18 - 84 Net financial items -114 -190 -952 31 Second quarter results 2010
Slide 32: Debt maturity profile
Debt maturity profile Average maturity NOK million 4.7 years 9 000 8 000 7 000 6 000 5 000 4 000 3 000 2 000 1 000 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2021 Drawn amounts Unutilised credit facilities 32 Second quarter results 2010
Slide 33: Net gearing 0.6 as of Q2-10
Net gearing 0.6 as of Q2-10 NOK billion Net gearing 60 1,40 54 1,20 48 42 1,00 36 0,80 30 0,60 24 18 0,40 12 0,20 6 - 0 -6 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 10 Q2 10 -0,20 Equity Net interest-bearing liabilities Net gearing 33 Second quarter results 2010
Slide 34: Funding Sources
Funding Sources Unutilised credit facilities 25% 8.6 Banks 46% 16.1 10.1 Bonds and CP 29% Figures in NOK billion 34 Second quarter results 2010
Slide 35: Second quarter results 2010
35 Second quarter results 2010