SANDEFJORD, Norway - For the first eight months of 2010, the Jotun Group reported an increase in operating profit of 21 percent, an increase in profit before tax of 32 percent and an increase in operating revenue of 3 percent. Investments and growth in the Asia and Middle East markets supported the gain.
The Jotun Group reported, in Norwegian krone, total operating income of NOK 8,044 million and a profit before tax of NOK 1,032 million for the first eight months of 2010. "We are continuing the same positive trend as in the first four-month period. The sales volume has increased in all divisions with the exception of Dekorativ, and the cost development trend has been good for the period. We have also made substantial investments in strategically important markets and infrastructure," said President and CEO Morten Fon. The final result for 2010 is expected to be on par with last year's result.
The Jotun Dekorativ division showed significantly improved earnings compared with the same period last year. The sales volume in Norway has declined somewhat, but sales value has increased. Denmark's results are somewhat lower than in 2009, while the division’s growth in Sweden is significant.
Jotun Coatings is showing growth in both sales volume and sales value, with the greatest growth in China and South Korea. Higher raw material prices are still a challenge, and the company has implemented measures such as price increases and product-mix modifications to improve profitability.
Jotun Paints continues to show the good growth it has seen for some time now, and sales are particularly good in Vietnam, Indonesia and Oman. New markets such as Libya and Pakistan are also reporting healthy growth.
All of the divisional units in Jotun Powder Coatings are expected to report a solid growth this year in terms of sales, despite the spiraling raw material costs.
The high level of investment in facilities will continue in order to meet the increasing demand for Jotun's products. Jotun has invested NOK 295 million thus far this year. The largest investments are related to factories in Norway, Malaysia and the United States, in addition to implementation of Jotun's new global ERP system to improve control, production flow and service levels.
Jotun is expecting 2010 results on par with last year. "We are very satisfied with the group's performance," said Fon.