Adjusted for positive currency effects, Jotun recorded sales growth of one per cent. The modest growth was supported by strong sales in the ship maintenance market, where activity remains high despite the pandemic. Sales of protective coatings were on level with last year, while sales of decorative paints and powder coatings declined, especially in the Middle East and South East Asia. Operating profit is up 25 per cent compared to the same period last year, due to positive currency effects and improved margins.
The coronavirus pandemic resulted in the temporary shut-down of production facilities in a number of countries. Other restrictions put in place by government authorities to contain the virus have also led to lower activity in several important markets.
According to Jotun’s President and CEO Morten Fon, the company has moved quickly to manage the issue. “Our priority has been to secure the well-being of our employees,” he says. “We introduced a number of measures to limit risk of infection at our factories to ensure we could continue to operate safely. Thanks to these efforts, we have managed to continue producing paints and coatings in all countries where we were not required to close.”
All affected production facilities have now resumed operations.
Fon acknowledges that the pandemic will likely impact results going forward. “As government authorities in different markets implement strict measures to manage outbreaks, we anticipate lower sales for some time,” he says. “In addition, the pandemic has created financial uncertainties which may affect demand for paints and coatings in some markets.”
Jotun has a solid financial position, with high equity and good cash flow. Measures have also been taken to ensure access to increased liquidity, if required. “Jotun's strategy remains unchanged,” says Fon.
“We have a global presence and are active in four paints and coatings segments, creating a diversified business model that has proven to be resilient over time. We are confident that the company will manage through this challenging period in a good way”.
|Financial key figures (NOK million)
|Profit before tax
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Asne Vitterso Kvamme, Group Communications Director, +47 99244648, email@example.com