Improved profit for all business areas

Orkla's third-quarter operating profit (EBITA*) ended at NOK 1,166 million,
compared with NOK 811 million in the same quarter of 2009. Profit improved in
all business areas. The return on the Share Portfolio was 21.3 percent as of 30
September.

"It is gratifying to note the clear improvement in results in the third quarter.
Underlying operations were strengthened in all business areas, while Elkem's
silicon-related business in particular has also benefited from better markets
and higher prices," says Orkla President and CEO Bjørn M. Wiggen.

Orkla's third-quarter operating revenues totalled NOK 16.3 billion, up from NOK
14.1 billion in 2009. The growth in sales is primarily ascribable to increased
capacity utilisation and higher prices for Elkem's silicon-related operations,
as well as to market growth and increased market shares for Sapa. Orkla Brands
had another good quarter with underlying profit growth of 5 percent.

Several of the Nordic Orkla Brands companies reported improved results, while
the business in Russia faced special challenges as regards production and sales
due to the heat wave in Russia this summer. The year-to-date return on the Share
Portfolio was 21.3 percent, compared with 16.0 percent for the Nordic reference
index and 2.7 percent for the Oslo Stock Exchange Benchmark Index.

As long as the market price of Orkla's REC shares is lower than their
capitalised value, the accounting value will be written up or down in step with
the fluctuations in market price. Through the third quarter, the REC share price
rose from NOK 15.61 to NOK 19.92. The positive accounting effect on Orkla's
profit was NOK 2 billion in the quarter.

Pre-tax profit in the third quarter totalled NOK 3,434 million, compared with
NOK 494 million last year.

Orkla's Board of Directors appointed in September Bjørn M. Wiggen as Orkla's new
CEO. Wiggen came from the position as CEO of Sapa. At the same time, Timothy R.
J. Stubbs was appointed new head of Sapa. Svein Tore Holsether, former Business
Area President for Sapa Asia & Middle East, has now been appointed Executive
Vice President with overall responsibility for Orkla's M&A activities. Holsether
will take up the position in January 2011.  Stubbs and Holsether will be part of
Orkla's new Group Executive Board.

"Orkla will continue to be a portfolio company in the future," says Bjørn M.
Wiggen. "However, we want to focus the portfolio on a smaller number of
businesses, and thereby ensure, not least, that we have sufficient capital to
develop the areas in which we are best qualified and positioned to create long-
term value for our shareholders. However, we are under no pressure, and we will
take the time we need to find good solutions.

Since the end of the third quarter, Orkla has entered into an agreement to sell
Borregaard Skoger to Statskog for NOK 1.7 billion.

* Operating profit (EBITA): Before amortisation and other income and expenses.

Key figures Q3-10 (Q3-09) in NOK million:
Operating revenues: 16,263 (14,088)
EBITA: 1,166 (811)
Profit before taxes: 3,434 (494)
Earnings per share diluted (NOK): 3.1(0.5)
Cash flow from operations: 683 (1,663)

As of 30 September 2010(as of 30 September 2009):
Net interest-bearing debt: 23,983(28,226)
Equity (%):49.4 (50.3)
Net gearing: 0.54 (0.59)

The third quarter in brief

  * Profit growth for all business areas. Third-quarter EBITA* amounted to NOK
    1,166 million, compared with NOK 811 million in the same quarter of 2009.
  * Orkla Brands continued to achieve profit growth. EBITA* totalled NOK 776
    million (NOK 759 million)**. Good growth for Orkla Brands Nordic, but the
    situation was more challenging in Russia and the Baltics.
  * Orkla Aluminium Solutions reported sales and profit growth in the third
    quarter. Sales rose by 29% and third-quarter EBITA* was NOK 162 million (NOK
    29 million)**.
  * In Orkla Materials, market conditions improved for both Elkem Silicon-
    related and Borregaard Chemicals, resulting in EBITA* of NOK 131 million
    (NOK -162 million)** for Elkem Silicon-related and EBITA* of NOK 92 million
    (NOK 90 million)** for Borregaard Chemicals.
  * The return on the Share Portfolio for the first nine months was 21.3%,
    compared with 16.0% for the Morgan Stanley Nordic Index and 2.7% for the
    Oslo Stock Exchange Benchmark Index.
  * In Orkla Associates, REC posted EBITDA of NOK 827 million (NOK 449
    million)** in the third quarter. Jotun reported operating profit of NOK
    1,041 million (NOK 858 million)** for the first eight months.
  * The Group's investment in REC is accounted for according to the equity
    method. Orkla bases the value of its equity interest on the market price as
    long as the market price is lower than the carrying value, according to the
    principles applied for associates. The REC share price rose through the
    third quarter from NOK 15.61 to NOK 19.92. In total, the accounting impact
    on profit was NOK 2 billion in the quarter.
  * On 25 October, Orkla entered into an agreement of selling the wholly-owned
    forest companies Borregaard Skoger AS, AS Børresen and Borregaard Vafos AS
    for a total of NOK 1,725 million. The transaction is subject to approval by
    Stortinget (the Norwegian Parliament). Completion of the transaction also
    assumes approval of the Norwegian Competition Authority.

The Group
Orkla's third-quarter operating revenues totalled NOK 16,263 million (NOK
14,088 million)**. The improvement from last year was driven by increased demand
and market growth for Orkla Aluminium Solutions and Elkem Silicon-related.

Compared with the third quarter of 2009, the Norwegian krone has strengthened
against the euro. The Group had currency translation effects that had a negative
impact on sales of NOK 361 million in the third quarter and around NOK 1.8
billion for the year to date.

Group third-quarter EBITA* amounted to NOK 1,166 million (NOK 811 million)**.
Orkla Brands reported a satisfactory profit performance in the quarter with
underlying*** profit growth of 5%. For Orkla Aluminium Solutions, higher sales
and the positive effects of internal improvement projects boosted profit by NOK
133 million in the quarter, compared with last year. Orkla Materials posted
third-quarter profit of NOK 321 million (NOK 139 million)**. Market conditions
were good for both Elkem Silicon-related and Borregaard's chemical operations.
Elkem Solar increased production during the quarter. EBITA for Elkem Solar alone
amounted to NOK -144 million (NOK -191 million)**.

Borregaard's energy operations reported a good quarter with higher prices than
last year. The reservoir levels at the Saudefaldene plant were still low.
However, the figures for the third quarter of 2009 include NOK 81 million from
power plants sold as of 31 December 2009.

For the Group as a whole, EBITA* was negatively impacted by currency translation
effects totalling NOK 70 million for the year to date, and NOK 12 million in the
third quarter alone.

At the end of the third quarter, the return on the Share Portfolio was 21.3%,
compared with 16.0% for the Morgan Stanley Nordic Index and 2.7% for the Oslo
Stock Exchange Benchmark Index. Gains/losses and write-downs on the Share
Portfolio totalled NOK 318 million (NOK 334 million)** in the third quarter, and
NOK 905 million (NOK 247 million)** for the year to date. Dividends received in
the third quarter amounted to NOK 60 million (NOK 14 million)** and NOK 448
million (NOK 238 million)** for the year to date. At the end of the first nine
months, the Financial Investments area had made net sales of portfolio
investments totalling NOK 1,178 million, including NOK 674 million in the third
quarter.

The Group's equity interests in REC (39.7%) and Jotun (42.5%) are presented
according to the equity method on the line for associates. Orkla bases the value
of its interest in REC on the market price as long as the market price is lower
than the carrying value, according to the principles applied for associates. The
REC share price rose through the third quarter from NOK 15.61 to NOK 19.92. In
total, the accounting impact on profit was NOK 2 billion in the quarter.
Reference is also made to note 8 in this report.

Group profit before tax amounted to NOK 3,434 million (NOK 494 million) in the
third quarter and NOK -1,777 million (NOK 461 million)** for the year to date.
The tax charge as of 30 September is estimated to be NOK 750 million (NOK 92
million)**. Earnings per share amounted to NOK 3.1 (NOK 0.5)** in the third
quarter and NOK -2.5 (NOK 1.4)** for the year to date.

On 1 October Orkla entered into an agreement to sell Orkla Finans. The
acquisition entails the purchase by Pareto AS of all the shares in Orkla Finans
AS.

* Operating profit before amortisation and other income and expenses
** Figures in parentheses are for the corresponding period in the previous year
*** Excluding acquired and sold operations and currency translation effects

Orkla ASA
Oslo, 28 October 2010

Ref.:

SVP Corporate Communications
Ole Kristian Lunde
Tel.: [phone]

SVP Investor Relations
Rune Helland
Tel.: [phone]

VP Investor Relations
Siv M. S. Brekke
Tel.: [phone]

This information is subject of the disclosure requirements acc. to §5-12 vphl
(Norwegian Securities Trading Act)


[HUG#1456232]





3rd Quarter 2010: 


http://hugin.info/111/R/1456232/396126.pdf

Presentation of 3rd Quarter 2010: 


http://hugin.info/111/R/1456232/396105.pdf

Quarterly and accounting figures: 


http://hugin.info/111/R/1456232/396028.xls




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