Orkla Foods, the Norway-based business, has seen rising commodity costs hit third-quarter profits.
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The company, a unit of Norwegian conglomerate Orkla, posted operating profit of NOK245m (US$45.4m), down 40% on the year. Falling profits in Norway and Sweden hit earnings.
Orkla Foods, which operates in the Nordic region and in central and Eastern Europe, saw third-quarter revenues dip 1.7% to NOK3.6bn.
“Higher prices for factor inputs continue to pose a challenge for Orkla Foods, and the prices of important raw materials continued to rise in the third quarter,” the company said.
The company said it would start to increase prices in a bid to alleviate the rise in commodity costs but added that contractual factors meant the price hikes would take time to take effect.
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By GlobalDataOrkla Foods also said that “further structural changes” would be considered to boost margins. In September, the company sold its stake in Superfish, one of Poland’s leading fish companies.
Orkla Foods’ international arm posted losses of NOK27m for the quarter thanks to the sale of Superfish and other restructuring in Poland.
On a lighter note, the company’s ingredients business saw earnings jump 14% to NOK40m in the quarter in the back of rising sales.
