21 JULY 2011http://af.reuters.com
Orkla to close plants, raise prices
Edited by : AL CIRCLE
2 min read
Orkla also said it would raise prices on consumer goods to improve declining margins, and repeated that as a financial investor in struggling solar equipment maker Renewable Energy Corp (REC) REC.OL> it would only sell down its 39.7 percent stake at the right price.
"We do not see that the current share price is at a level we think is correct. So, that means that we continue to work through REC with improving the business, and see how it is best to increase the value for REC shareholders," chief executive Bjoern Wiggen told a news conference.
Orkla, whose activities span pickled herring, pralines, socks and metals, sold its Elkem unit's silicon operations to China National BlueStar for $2 billion earlier this year and aims to further streamline its business.
It failed to grab the opportunity to exit REC before the market collapsed in 2008, and the value of its holding has dropped more than 95 percent from a peak in late 2007.
Orkla reported a 16 percent rise in second-quarter earnings before interest, tax and amortisation (EBITA) to 1.08 billion Norwegian crowns ($195 million), in line with a forecast in a Reuters poll.
Operating revenue rose 12 percent to 15.9 billion crowns, compared with a forecast for 15.6 billion. The company made a 2.4 billion crown pretax loss after a 4 billion writedown of the value of its stake.
Orkla shares were up 2.2 percent by 0840 GMT, outperforming a 1.4 percent rise in Oslo's benchmark index .
"We do not see that the current share price is at a level we think is correct. So, that means that we continue to work through REC with improving the business, and see how it is best to increase the value for REC shareholders," chief executive Bjoern Wiggen told a news conference.
Orkla, whose activities span pickled herring, pralines, socks and metals, sold its Elkem unit's silicon operations to China National BlueStar for $2 billion earlier this year and aims to further streamline its business.
It failed to grab the opportunity to exit REC before the market collapsed in 2008, and the value of its holding has dropped more than 95 percent from a peak in late 2007.
Orkla reported a 16 percent rise in second-quarter earnings before interest, tax and amortisation (EBITA) to 1.08 billion Norwegian crowns ($195 million), in line with a forecast in a Reuters poll.
Operating revenue rose 12 percent to 15.9 billion crowns, compared with a forecast for 15.6 billion. The company made a 2.4 billion crown pretax loss after a 4 billion writedown of the value of its stake.
Orkla shares were up 2.2 percent by 0840 GMT, outperforming a 1.4 percent rise in Oslo's benchmark index .
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