Orkla results second quarter 2008

Key figures Q2-08 (Q2-07) in NOK million:

Operating revenues 17 569 (14 049)
EBITA 1 230 (1 194)
Profit before taxes 2 498 (3 053)
Earnings per share diluted (NOK) 1.9 (2.6)
Cash flow from operations 331 (790)

As of Q2-08 (as of Q2-07):
Net interest-bearing debt 22 649 (17 728)
Equity (%) 52.6 (57.1)
Net gearing 0.43 (0.32)


The second quarter in brief
*     Orkla's EBITA for the first half of 2008 ended at NOK 2,292
  million (NOK 2,661 million)1, while EBITA for the second quarter
  alone was NOK 1,230 million (NOK 1,194 million)1.
*     Orkla Brands continued to improve its profit performance in the
  second quarter, and the underlying2 increase in EBITA at the end of
  the first half year was 8 %.
*     Despite declining volumes in the second quarter, Orkla
  Aluminium Solutions reported satisfactory profit for the first
  half-year. However, the market outlook is clearly weaker in Europe,
  and there are still no signs of improvement in the US.
*     In Orkla Materials, profit from Elkem was in the second quarter
  again impacted by the low contribution to profit from aluminium
  operations and the higher costs recognised, as planned, in Elkem's
  solar project. For this reason, combined with the lower
  contribution to profit from energy trading in the first quarter,
  Elkem's first-half profit was NOK 379 million lower than last year.
  Borregaard's profit growth continued in the second quarter, but the
  market outlook in important product areas is weaker forward.
*     Orkla Associates' contribution to profit was boosted in the
  second quarter by a gain of NOK 830 million on the sale of Orkla's
  stake in Hjemmet Mortensen. REC's second-quarter profit rose 10 %
  to NOK 889 million, while Jotun continued its positive trend.
*     Orkla Financial Investments has written down portfolio
  investments in accordance with IFRS requirements by NOK 527 million
  in the second quarter. At the end of the first half-year,
  impairment charges totalled NOK 1.056 million. This contributes to
  an accounting loss of NOK -183 million on portfolio investments in
  the first half of 2008.
*     The first-half return on the Share Portfolio was a negative 8.3
  %, compared with a negative 16.9 % for the Morgan Stanley Nordic
  Index (a negative 5.6 % for the Oslo Stock Exchange Benchmark
  Index).
*     Pre-tax profit for the first half-year amounted to NOK 3,379
  million (NOK 6,558 million)1, while profit for the second quarter
  alone totalled NOK 2,498 million (NOK 3,053 million)1.



THE GROUP
Orkla's first-half operating revenues totalled NOK 34,513 million
(NOK 27,937 million)1, while second-quarter operating revenues
amounted to NOK 17,569 million (NOK 14,049 million)1. A large part of
the revenue increase is ascribable to the consolidation of Alcoa's
extrusion operations into Orkla Aluminium Solutions, as the
operations are included in the figures as from the third quarter of
2007. However, there was underlying2 improvement for all the business
areas in the Group's industrial operations. In the first half of
2008, the Norwegian krone was considerably stronger than in 2007,
particularly measured against the USD, but also against euro-related
currencies. This has resulted in a negative currency translation
effect that has reduced operating revenues by NOK 1,347 million so
far in 2008 and NOK 637 million in the second quarter.

The Group's EBITA rose 3 % in the second quarter to NOK 1,230 million
(NOK 1,194 million)1, while first-half EBITA was NOK 2,292 million
(NOK 2,661 million)1. Orkla Brands and Borregaard achieved profit
growth in the second quarter. This was counteracted by Elkem
Aluminium's continued poor profit performance, higher costs
recognised in Elkem Solar and lower activity and contribution to
Group profit on the part of Orkla Finans. For the Group as a whole,
EBITA was negatively affected by currency translation effects
totalling NOK 65 million so far this year and NOK 32 million in the
second quarter.

In the second quarter, Orkla signed an agreement with Egmont
regarding the sale of Orkla's shares in Hjemmet Mortensen AS. Egmont
has taken over Orkla's 40 % minority holding for NOK 950 million. In
the second quarter, Orkla also received dividends totalling NOK 72
million from Hjemmet Mortensen, relating to the 2007 accounting year.
The share sale gave rise to a book gain of NOK 830 million for Orkla
in the second quarter. This is presented in the financial statements
on the line for profit from associates. The cash flow effect of the
transaction will be seen in the second half of 2008.

Orkla's stakes in REC (39.73 %) and Jotun (42.5 %) are presented
according to the equity method on the line for associates. The
contribution from associates to Group profit so far this year totals
NOK 1,332 million (NOK 646 million)1 , while the contribution in the
second quarter amounted to NOK 1,153 million (NOK 294 million)1. Of
the total amount, REC's contribution to Orkla's profit so far in 2008
accounts for NOK 280 million (NOK 487 million)1 of which NOK 196
million (NOK 198 million)1 is the second-quarter contribution.

At the end of the first half-year, the return on the Share Portfolio
was a negative 8.3 %, compared with a negative 16.9 % for the Morgan
Stanley Nordic Index (a negative 5.6 % for the Oslo Stock Exchange
Benchmark Index). Gross portfolio gains of NOK 663 million were
realised in the second quarter, but due to impairment charges of NOK
527 million under IFRS, net realised portfolio gains and changes in
the fair value of associates amounted to NOK 112 million (NOK
1,011 million)1. Dividends received in the second quarter amounted to
NOK 310 million (NOK 413 million)1.

Orkla's earnings per share, diluted, were NOK 2.5 in the first half
of 2008, while first-half earnings per share in 2007 were NOK 5.3,
due to the realisation of high portfolio gains and other financial
gains. As of the end of the first half-year, a tax charge of
approximately 21 % was estimated for 2008.

1 The figures in brackets refer to the corresponding period of the
previous year.
2 Excluding acquisitions, divestments and currency translation
effects.



Orkla ASA,
Oslo, 13 August 2008

Contacts:
Terje Andersen, CFO, Tel.: [phone]
Rune Helland, SVP Investor Relations, Tel: [phone]
Lars Røsæg, Investor Relations, Tel.: [phone]