Jotun Group's positive development continues. Positioning in area with high level of growth yields results. Nevertheless, the group is prepared for future setbacks in the market.
Jotun Group's positive development continues. Positioning in areas with high levels of growth yields results. Nevertheless, the group is prepared for future setbacks in the market.
The group's operating profit before tax was NOK 807 million, compared to NOK 701 million for the same period last year. The operating income for the period was NOK 6.7 billion, which is NOK 603 million more than for the same period last year.
"We are humbled by this positive trend, but it is nice to see that growth has continued, even compared with the record year we had in 2007. We are prepared for the effects of reduced growth in the global economy. Among other things, it is important for us to be able to position ourselves in the countries and sectors where there is reason to believe that growth will remain relatively strong over time," said CEO Morten Fon. He pointed out that the Jotun Group has a long-term investment programme for further growth. "We will be opening a new factory in South Korea in the first half of 2009. Our next project is the construction of a factory in Libya and we are also looking at other markets," said Fon.
High prices for raw materials impact on profits
The price of raw materials is generally increasing, which has led to a degree of pressure on profits. There was generally a downward trend in the prices for important raw materials at the end of the period, but this did not have any significant effect. The Jotun Group is also exposed to the currency markets in particular against USD.
Areas of growth
South East Asia and the Middle East continue to be important areas of growth for the group. Countries where there was particularly strong growth in sales included China, Saudi Arabia, Vietnam and Indonesia. The significance of the Chinese market for Jotun continued to grow and during the summer, the company hired its 1,000th employee in the country.
Challenging market conditions
"We can already see that the year as a whole will be good. It will certainly be necessary to make adjustments, to meet challenges from developments in the world economy," said Fon. Given the current economic situation, he does not expect growth to continue at the same pace.