SANDEFJORD, Norway - Jotun recorded a nine percent growth in operating revenues in the first four months of 2012, as sales increased both in volume and value terms.
In the first four months of 2012, the Jotun Group recorded operating revenues of NOK 3 784 million, up from NOK 3 482 million in the same period last year. The group’s profit for the period rose to NOK 295 million, from NOK 261 million in the first four months of 2011. All of Jotun’s four divisions reported higher operating income during the period.
Strong sales growth in the Paints division, the group’s second largest in terms of revenues, was driven by robust performance in Saudi Arabia, Oman, UAE, Pakistan, Indonesia, Malaysia and Thailand.
In the Dekorativ division, sales rose across the exterior, interior and professional segments, supported by all-time high sales in Sweden. The division inaugurated a new factory in Sandefjord, Norway, which is also Jotun’s single-largest investment to date.
The Coatings division recorded higher sales, but growth was offset by a drop in profits and a decline in margins due to challenging economic conditions in Europe and reduced activity in other select markets. The shipping industry is experiencing over-capacity issues that have depressed freight rates and slowed new orders, which have impacted the Marine Coatings segment.
The Powder Coatings division saw sales rise sharply in the Middle East and increase in Southeast Asia. Meanwhile, the division experienced lower sales in Central Europe, and operations in Norway experienced a loss.
Commenting on the results, Morten Fon, Jotun’s President and CEO, said, “We have had a satisfactory start to the year in terms of both sales and profitability. Strength in decorative paints offset challenges seen in marine coatings, and slow economic development in Europe has been outweighed by growth in other geographies, showing the resilience of Jotun’s business model in the face of challenging global economic conditions.
“Ahead, we expect continued sales growth based on our established presence in key growth economies, and earnings may show signs of improvement as raw material prices stabilize and pricing measures take effect.”