Company head Manuela Banu, who has in the past four years conducted a business restructuring, says she relies on the force of the company’s seven brands, but does not rule out a new acquisition one year after the latest move of this kind, when it took over a food distributor.
“The company has been through a restructuring, during which we have relocated production [margarine, ketchup and mustard]. Now we are no longer talking about major restructuring, but about adjusting to the model that the market is using now.”
In 2008 and 2009 the company piled up overall losses of EUR13.7 million, while revenues fell for 4 consecutive years between 2007 and 2010. So the Norwegian company closed down plants in Craiova and Targoviste and moved production to the three remaining plants in Bucharest, Iasi and Covasna.
The first signs of the restructuring strategy are only now starting to appear more clearly in Orkla’s financial results, as the Norwegian producer managed to end last year with a gross turnover of EUR39 million (EUR33 million net), up 20% against 2011.
For this year Manuela Banu has built a revenue budget estimated at EUR43 million (gross turnover), up 10% on 2012 results. The head of Orkla did not wish to give details on the company’s profit, but says “we are on the rise, if we are talking about all business lines.”
“We are targeting sustainable organic growth. The market is stationary or slightly down. The growth will come much more slowly than the declines came in the past.”
A new takeover not ruled out
One year after Orkla took over Food Distribution Solutions, Manuela Banu says she does not rule out a similar move, but that the company does not plan to buy a production facility, rather a business that can support the current infrastructure of Orkla Foods.
“We are looking at any opportunity, any business that can consolidate our market position and can help us grow fast. We are not necessarily interested in tangible assets, plants, production facilities.”
The producer was one of the most active players on the mergers and acquisitions market before 2007 and during that period managed to make takeovers estimated at EUR25 million. The assets that Orkla bought in Romania include Topway Craiova, Ardealul Covasna and Royal Brinkers.
(English version by Daniela Stoican)