Rieber & Sons profit has been driven by efficiency gains

Rieber & Son's profit has been driven by efficiency gains

Improved efficiency at Norwegian manufacturer Rieber & Son boosted third-quarter profits as sales fell.

EBIT reached NOK128m (US$21.7m) in the third quarter, against NOK88m in the same period of last year. However, last year's figure included one-off costs of NOK29m. Earnings per share stood at NOK1.09 compared to NOK0.69 in the previous year. 

The strong profit growth came despite sales falling 12.3% to NOK1.07bn. Currency conversion effects accounted for 3.1% of the decline, while the disposals of the Soops brand, its frozen onion ring business, King Oscar and marine ingredients accounted for 8%.

Organic sales fell 1.1% when compared with the same quarter last year, although this is an improvement on the second quarter, when Rieber & Son posted a 3% organic sales drop.

The company said improvements in purchasing production and marketing under its "Our Future" platform provided "net effects" of NOK72m in the third quarter.

However, CEO Patrik Andersson highlighted concerns that prices for raw materials could increase costs in the coming months.

"The trend in raw material prices is more uncertain than ever, with increased activity from brokers trading in raw material markets. We are keeping a close watch on the development, and might need to increase our prices to customers if the development within raw material prices continues," he said.