Oslo, 5 May 2010

First quarter results 2010

First quarter results 20102 Q4 and full-year results 20092

Agenda

Highlights Q1Dag J. Opedal, CEO

Financial Investments and AssociatesRoar Engeland

Orkla Aluminium Solutions and Orkla Materials Bjørn Wiggen

Orkla BrandsTorkild Nordberg

First quarter results 20103

Highlights first quarter 2010• Broad-based profit improvement vs. weak Q1-09

– Positive contribution from Orkla Brands, Sapa, Elkem Silicon-related and Jotun (42.5 %)

– Power production approx. 60% lower than normal due to extraordinarily low reservoir levels

• Cyclical upturn supports revenue growth (+ 11%)

• Return on Share Portfolio + 11.2% (vs. MS Nordic Index + 10.2%)

• Three add-on acquisitions in Orkla Brands: Kalev, Peterhof and Sonneveld

• Broadening customer base confirms product quality for Elkem Solar– New contract with leading solar energy company

• REC write-down, NOK 4.6 billion

First quarter results 20104

704-6

233

102

471

203 -25 -8-248

-18

Q1-09 Orkla Brands OrklaAluminiumSolutions

Elkem ex.Solar

Elkem Solar Borregaard OrklaMaterialsEnergy

OrklaFinancial

Investments

Other Q1-10

EBITA performance from Q1-09 to Q1-10(figures in NOK million)

Broad-based EBITA improvement vs. weak Q1-09

*

* NOK 130 million from divested power assets

First quarter results 20105

Q3-09

2,376 2,448

Q1-10Q4-09

2,919

NOK million

4,6024,448

Q3-08

4,504

Q1-08 Q2-08 Q4-08

2,591

Q1-09

4,240

Q2-09

3,444

Rolling 12 months

Comprehensive actions – EBITA improvement

First quarter results 20106

Market outlook slightly firmer

• More positive underlying momentum in cyclical sectors going into Q2

• Increased capacity utilisation

• International financial markets continue to be volatile

• Orkla is well positioned

First quarter results 20107

Extensive ramp-up in2010/11

Business outlook

Robust development

(39.7%)

(42.5%)

Well positioned for cyclical upturn

Moses Lake Singapore Herøya Glomfjord Kristiansand

First quarter results 20108

Roar Engeland

Financial performanceOrkla Financial Investments Orkla Associates

First quarter results 20109

Group income statement

Amounts in NOK million Q1 2010 Q1 2009 Change

Operating revenues 14 893 13 448 11 %EBITA 704 233 202 %Amortisation intangibles -10 -50Restructuring and significant impairment 27 0

EBIT 721 183Associates -4 484 135Dividends 138 45Gains and losses/write-downs Share Portfolio 339 - 315Net financial items - 136 - 363

Profit before tax -3 422 - 315Tax expenses -190 -40

Profit for the period continuing operations -3 612 - 355Discontinued operations 0 993Profit for the period -3 612 638Minority interests' share of the profit/loss for the period 8 - 70Majority interests' share of the profit/loss for the period -3 620 708

Earnings per share diluted (NOK) -3,6 0,7

First quarter results 201010

• Market value of NOK 11.7 billion

• Return on Share Portfolio in Q1-10 + 11.2%

• Change in unrealised gains in Q1, + NOK 0.7 billion

Orkla Financial InvestmentsShare Portfolio

-5,5 %

11,2 %

-2,8 %

10,2 %

-7,0 %

1,4 %

5,4 %

-4,2 %

2010 2008-2010

Portfolio MSCI Nordic OSEBX S&P 500

First quarter results 201011

Orkla Associates – REC (39.7%)

• Orkla will be participating in the outlined equity rightsissue in REC (NOK 1.6 billion)

– Following the equity rights issue:• Average cost NOK 33.99 per share

• Book value per Q1-10 NOK 22.48 per share

Reference is made to www.recgroup.com

Amounts in NOK million

REC Q1 2010 Q1 2009 ChangeRevenues 2 360 1 936 22 %EBITDA 415 510 -19 %EBIT -125 298Profit/loss before tax 730 650 12 %

First quarter results 201012

Orkla Associates – Jotun (42.5%)

• Tertial reporting

• Satisfactory start to the year– Moderate increase in volume

and results

• Weaker results expected within shipbuilding and property going forward

Sales (including shares in joint ventures)Figures in NOK million

2001 2002 2003 2006

6,710

2005 2009

8,872

5,815 6,075

10,442

2007

5,580

2004 2008

7,733

5,476

11,219

First quarter results 201013

Orkla Aluminium SolutionsBjørn Wiggen

13

First quarter results 201014

762 764

676

537508 519 526

550546

400

500

600

700

800

900

Q1 Q2 Q3 Q4

North America Extrusion Apparent Consumption European Extrusion Apparent Consumption

Source: European Aluminium Association, Aluminum Association, CRU Monitor

The market is recovering in several segments, although from historically low levels

2008 full year consumption -10%

2009 full year consumption -19%

Thousa

nd T

ons

Thousa

nd T

ons

411 415

388

293292

343325

266

315

200

250

300

350

400

450

500

Q1 Q2 Q3 Q4

2008 full year consumption -11%

2009 full year consumption -19%

-35%

2008 2009 2010

-33% -32%-30% -22%-12% +11% +2%

+20% +7%

First quarter results 201015

EBITA improvement continues

343364

92

-102

-342

-148

29

117 129

Q1-08 Q2-08 Q3-08 Q4-08 Q1-09 Q2-09 Q3-09 Q4-09 Q1-10

First quarter results 201016

Continued positive impact from cost efficiency programmes

• Slight market growth although from historically low levels, however the Building and Construction markets remain weak

• Targeting sustainable cost reduction effects of NOK 500 million in 2010

• The integration of Indalex was finalised and has surpassed anticipated synergies

• Heat Transfer Shanghai doubling the capacity in 2010

Operating Revenues in NOK million Q1 2010 Q1 2009 Change

Orkla Aluminium Solutions 6 120 4 883 25 % Sapa Profiles 4 827 3 780 28 % Sapa HT and BS 1 481 1 290 15 % Eliminations - 188 - 187

EBITA in NOK million Q1 2010 Q1 2009 Change

Orkla Aluminium Solutions 129 - 342 Sapa Profiles 43 - 313 Sapa HT and BS 86 - 29

EBITA margin (%) 2,1 -7,0

First quarter results 201017

Orkla Materials

17

First quarter results 201018

Positive underlying trend for the silicon-related operations

• Increased demand and higher prices for Elkem Silicon-related – Positive one-off effects

NOK 90 million

• Increased capacity utilisation – Average capacity utilisation 84%

• Mixed performance for Borregaard– Weak results in Fine Chemicals due

to challenging market conditions

– Stronger results for lignin, ingredients and speciality cellulose

• Extraordinarily low production in Sauda

Operating revenues in NOK million Q1 2010 Q1 2009 Change

Orkla Materials 2 890 2 770 4 %

Elkem Siliconrelated 1 934 1 456 33 %Borregaard Chemicals 913 987 -7 %Orkla Materials Energy 99 382 -74 %Elimination Orkla Materials - 56 - 55

EBITA in NOK million Q1 2010 Q1 2009 Change

Orkla Materials 60 138 -57 %

Elkem Siliconrelated excl. Solar 228 25Elkem Solar - 184 - 159 -16 %Borregaard Chemicals 30 38 -21 %Orkla Materials Energy - 14 234

EBITA-margin (%) 2,1 5,0

First quarter results 201019

Hydropower in Sauda - Extraordinarily low reservoir levels and production

• Sauda with annual production capacity of approx. 1.9 TWh

• Production significantly lower than normal Q1 -level

• Committed volume for delivery higher than actual production

• Leased production volume higher than actual production

• Weak results expected in Q2-10 due to low reservoir and snow levels– Normal EBITA level of NOK 200-

250 million for Sauda will not be reached in 2010

Water and snow reservoir

Q1-10 Normal levels

See appendix for more information

Production in GWh

203

500

Q1-10 Normal production Q1

First quarter results 201020

Elkem Solar

20

First quarter results 201021

Broadening customer base confirms product quality

• New contract with leading solar energy company– Volume: Up to 1,000 MT in 2010

• Contract with CaliSolar announced Q4– Volume: Up to 500 MT 2010, 1,000 MT 2011-12

• Other potential customers in process of qualifying ESS®

• Renegotiations of existing contracts in progress

First quarter results 201022

Elkem Solar in ramp-up phase

• Ambitions to take a leading cost position– mid USD 20 per kg*

• Production Q1-10: 400 MT

• Characteristics for ramp-up phase– High fixed costs – Periodic production stops– Production will not be linear

• Expected periodic production stops in Q2 to perform modifications and improvements

* USD/NOK 6.50

First quarter results 201023

Orkla Brands

23

Torkild Nordberg

First quarter results 201024

Stable long-term profit trend

12 months rolling EBITA

in NOK million

1 200

1 400

1 600

1 800

2 000

2 200

2 400

2 600

2 800

3 000

Q1-03 Q1-04 Q1-05 Q1-06 Q1-07 Q1-08 Q1-09 Q1-10

First quarter results 201025

• EBITA +20% and EBITA% +1.8%-p compared with Q1 last year– Positive effects from Easter– Weak start last year

• Volume/mix growth despite demanding markets within out of home channel and in Russia and the Baltics

• Improved innovation programme

• Structural growth in branded consumer goods and B2B

• Bakers; further volume losses from Q2-10

Broad-based profit growth in Q1Operating revenues in NOK million Q1 2010 Q1 2009 Change

Orkla Brands 5 403 5 398 0 % Orkla Foods Nordic 2 190 2 283 -4 % Orkla Brands Nordic 1 949 1 870 4 % Orkla Brands International 412 430 -4 % Orkla Food Ingredients 916 898 2 %

Eliminations Orkla Brands - 64 - 83

Operating profit - EBITA in NOK million Q1 2010 Q1 2009 Change

Orkla Brands 624 522 20 % Orkla Foods Nordic 194 171 13 % Orkla Brands Nordic 385 327 18 % Orkla Brands International 0 - 3

Orkla Food Ingredients 45 27 67 %

EBITA margin (%) 11,5 9,7

First quarter results 201026

Going forward: Focusing on growth

• Clear growth directions in all business units

• Focus on both organic and structural growth

• Innovation most important organic lever

First quarter results 201027

Recent examples of organic growth

First quarter results 201028

DOTS (Norway)

Biggest Norwegian biscuits brand

8.9% value share, 8 weeks after launch

0 0 ,2

4 ,5

00 ,3

4 ,7

4 ,5

4 ,2

0

1

2

3

4

5

6

7

8

9

1 0

4U 0 30110 4U W 31 0110 4U W 280 210 4 U W 2803 10

0 ,0

2 ,0

4 ,0

6 ,0

8 ,0

10 ,0

12 ,0

14 ,0

16 ,0

w 4909 w 5309 w 0410 w 0810 w 1210 w 1610

Ba lle rina orig ina l

Ba lle rina øvrige va ra nte r

BALLERINA KLADDKAKA (Sweden)

Biggest biscuit variant in the Swedish market

7.4% valueshare latest12 weeks

Dots / Ballerina Kladdkaka

First quarter results 201029

Grandiosa “X-tra allt Hämtpizza”

• New launch in Q1 – Sweden (Procordia)

• Larger than most frozen pizzas (550 grams vs. 350 grams)

• More topping (“X-tra allt”)

• New packaging inspired from take-away pizza

• Sold 2/3 of annual sales ambition after 12 weeks

First quarter results 201030

• Established in 1806, today’s brand in use since 1948

• Leading confectionery company in Estonia, with main focus on chocolate and sugar confectionery

• Modern factory in Jüri (outside Tallinn)

• Annual net sales of NOK 220 million

• Employs 386 people

Chocolates

Flour mixes

Biscuits

Sugar confectionery

Kalev Chocolate Factory

First quarter results 201031

Peterhof

• Number one in chocolate spread (national market share of 31%)

– Biscuits – regional player

• New factory commissioned in 2008 in Lomonosovregion 12,300 sq meters

• NSV 2009 was approximately approx. NOK 85 million

• Employs approximately 450 people

• Can accommodate Pekar wafer cake production acquired last year

Chocolate Paste

Biscuits

Instant Porridge

First quarter results 201032

Sonneveld

• Market leader in bread improvers in the Benelux countries

• Strengthens OFI's capabilities in key product area, industrial segment and innovation

• Modern and flexible production facility

• Based in Papendrecht in the Netherlands

• Established in 1956

• Revenues of NOK 440 million

• 140 employees

First quarter results 201033 Q4 and full-year results 200933

Q&A

Dag J. Opedal, CEO

Roar Engeland

Bjørn Wiggen

Torkild Nordberg

Terje Andersen, CFO

First quarter results 201034

Appendix

First quarter results 201035

Financial calendar

21 July 2010 - Second quarter 2010

28 October 2010 - Third quarter 2010

First quarter results 201036

Cash flow as of 31 March 2010

NOK million 1.1-31.3.2010 1.1-31.3.2009

Industry division: Operating profit 760 204 Amortisations, depreciations and write-downs 623 658 Changes in net working capital -1 133 - 282 Net replacement expenditure - 300 - 325

Cash flow from operations - 50 255 Financial items, net - 183 - 506

Cash flow from Industry division - 233 - 251Cash flow from Financial Investments 257 471Taxes paid - 175 - 456Other payments 15 55Cash flow before capital transactions - 136 - 181Paid dividends - 2 - 1Net purchases of Orkla shares 10 0Cash flow before expansion - 128 - 182Expansion investment in Industry division - 133 - 614Purchase of companies/share of companies - 103 - 67Net purchases/sale of portfolio investments 389 362

Net cash flow 25 - 501

Currency effects of net interest-bearing liabilities - 38 1 337Change in net interest-bearing liabilities 13 - 836

Net interest-bearing liabilitites 19 861 26 588

First quarter results 201037

Balance sheet as of 31 March 2010

NOK million 31.3.2010 31.12.2009

Intangible assets 14 724 14 731Property, plant and equipment 24 587 24 694Financial assets 10 762 15 922Non-Current assets 50 073 55 347Inventories 8 043 7 531Receivables 13 300 16 568Share Portfolio etc. 11 740 11 087Cash and cash equivalents 3 546 4 153Current assets 36 629 39 339Total assets 86 702 94 686Paid-in equity 1 995 1 995Earned equity 43 474 46 560Minority interests 373 370Equity 45 842 48 925Provisions 4 134 4 339Non-current interest-bearing liabilities 22 549 29 042Current interest-bearing liabilities 2 764 1 746Other current liabilities 11 413 10 634Equity and liabilities 86 702 94 686

Equity to total assets ratio 52.9% 51.7%

Net gearing 0,43 0,41

First quarter results 201038

Currency translation effects

Revenues in NOK million Q1-10

Orkla Brands -152Orkla Aluminium Solutions -629Elkem -44Borregaard -21Total -846

EBITA in NOK million Q1-10

Orkla Brands -8Orkla Aluminium Solutions -16Elkem -1Borregaard 1Total -24

First quarter results 201039

Largest holdings in the Share Portfolioper 31 Mar 2010

Principal holdings Industry Market valueShare of

portfolio (%)Share of

equity (%)

Tomra Systems Industrials 667 6 % 15,3 %Rieber & Søn Food & Beverage 526 4 % 16,0 %Amer Sports Consumer Discretionary 473 4 % 5,6 %Elekta B Health Care Equipment 400 3 % 2,6 %

Kongsberg Gruppen Aerospace & Defence 326 3 % 2,5 %

Telenor ASA Telecom operators 303 3 % 0,2 %

Enter Select Mutual Fund 302 3 % 0,0 %

Nokia A Information Technology 282 2 % 0,1 %

XXL Holding AS Retail 271 2 % 15,5 %

Schibsted Consumer Discretionary 269 2 % 1,7 %

Total principal holdings 3 818 31,9 %

Market value of entire portfolio 11 727

First quarter results 201040

Orkla Materials Energy –Additional information about Sauda• Production capacity: approx. 1.9 TWh annually

• Fixed obligations:– 2010: Obligations to deliver approx. 250 GWh per quarter at

long term fixed price. Obligations to pay for a fixed volume approx. 206 GWh per quarter at partly fixed prices.

– 2011 - 2030: Obligation to deliver approx. 150 GWh per quarter at long term fixed price. Obligation to pay for a fixed volume (approx. 270 GWh per quarter) at partly fixed prices.

• Remaining production selling at market price

• Depreciation costs: approx. NOK 40 million per year

First quarter results 201041

Appendix: Financial items

First quarter results 201042

Net financial items

Key figures in NOK million

1.1-31.12 1.1-31.12 Full year2010 2009 2009

Net interest expenses -97 -321 -883Currency gain/loss -2 -22 15Other financial items, net -37 - 20 - 84Net financial items -136 -363 -952

First quarter results 201043

Debt maturity profile

NOK millionAverage maturity

4.2 years

0

1 000

2 000

3 000

4 000

5 000

6 000

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2021

Drawn amounts Unutilised credit facilities

First quarter results 201044

-606

121824303642485460

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 10 -0,2

0,0

0,2

0,4

0,6

0,8

1,0

1,2

1,4

Equity Net interest-bearing liabilities Net gearing

Net gearing 0.43 as of Q1-10

NOK billion Net gearing

First quarter results 201045

Funding Sources

10.010.0

11.8

Bonds and CP 31%

Banks 37%

Unutilised credit facilities 32%

Figures in NOK billion

First quarter results 201046