Ladies and gentlemen, welcome to our 2019 third quarter results call. I'm Kesko's President and CEO, Mikko Helander. Together with me, I have our CFO, Jukka Erlund, and Vice President of Investor Relations, Hanna Jaakkola, appointed in September. I will first give a brief overview of our business performance, and thereafter, we will be happy to take questions. In the third quarter, Kesko again recorded its all-time best result. Our net sales increased by 6.1%. The development in grocery trade was especially strong in K-Citymarket, and the market share was further strengthened. In the building and technical trade division, the growth continued and profitability improved, especially in the Nordic countries. As a sign of our long-term commitment to corporate responsibility and efforts to combat the climate change, Kesko was again included in the Dow Jones Sustainability Indices in September.
As a result of strong strategy execution, profitability growth continued during the third quarter. Operating profit was our all-time best quarter, result EUR 152 million, and operating margin went up to 5.4%. As just said, net sales grew by 6.1%, and comparable growth was 2.9%. The quarter's basic earnings per share amounted to EUR 1.01. The net sales for Kesko's continuing operations in July and September totaled EUR 2.804 billion, up to 6.1%, thanks to our strong growth strategy execution. Net sales increased in all our three divisions. Kesko's comparable operating profit for continuing operations for the third quarter was record high, EUR 152 million, up by EUR 15 million. Profitability improved to 5.4%. Despite the acquisitions and the investments carried out this year, our financial position is strong. At the end of September, our liquid assets totaled EUR 172 million.
To further enhance the liquidity, in October, the company signed financing agreements totaling EUR 700 million, where the interest margin will increase or decrease depending on our ability to meet set sustainability targets. Interest-bearing net debt, excluding lease liabilities, was EUR 465 million and the corresponding net debt to EBITDA ratio was 1.0. Our growth strategy execution continues, and during the first three quarters of the year, our investments totaled around EUR 600 million. The most significant acquisitions include the Fresks building and home improvement store chain in Sweden and Volkswagen Audi sale businesses from Laakkonen, LänsiAuto, and Huittisten Laatuauto. Return on capital employed, one of our financial targets, was at the level of 9.6%. It improved in the grocery trade. The slides I just went through highlighted the fact that the chosen strategy works and brings results.
The good performance is the result of strong implementation of our growth strategy. Next, we take a closer look at each of the divisions. First, grocery trade. Net sales totaled EUR 1.4 billion and grew comparably 4.7%. Net sales grew in all food store chains and Kespro. Comparable operating profit increased by EUR 12.2 million and was EUR 93.5 million. Profitability in the grocery trade improved due to good sales development and improved operational efficiency. K Group's grocery sales increased by 3.3%, which outpaced the market growth rate of 2.5%. The quarter had one more wholesale day than the year before. Price inflation was approximately 1.7%. Sales grew and profitability improved in all chains. Finnish Competition and Consumer Authority extended the time limit for the investigation into Kesko's acquisition of Heinon Tukku. Finnish grocery market is changing, thanks to our strong strategy implementation.
To go a little bit deeper into changes we see in the grocery trade, today, major trends are ease of shopping, individuality and diversity of customer needs, experiences and inspiration, sustainability and local food, healthy food, especially vegetarian diet. We see that one of the reasons why the market is changing is our actions, as I stated. Our strategy is working in this changing market. Kesko and K Food retailers have been forerunners in modernizing Finnish grocery store selections. Store-specific business ideas and an agile operating model enable us to provide sustainable, inspiring, high-quality tailored selections, ease and convenience, advanced digital services, and online sales. We have redesigned the whole store network and own chain brands. Competitive prices and more extensive private label Pirkka selection are important. A strong strategy execution has resulted in K Group's strengthened role as a forerunner, increased customer satisfaction, and good market share growth.
Next, Building and Technical Trade where sales through and profit is strengthened, led by Finland, Sweden, and Norway. Net sales, excluding the specialty goods trade, grew significantly by 9.8% to EUR 1,074 million. Net sales grew in comparable terms in Finland, the Baltic countries, and Belarus. In Norway and Sweden, net sales increased due to the recent acquisitions. Comparable operating profit increased by EUR 6.4 million to EUR 54.5 million. The profitability improved and was 5.1%. To the building and technical trade market, the new building volumes in the construction market have been normalizing after peak years, and there is steady growth in renovation and infrastructure construction. Kesko's profitability improved, especially due to good development in K-Rauta Finland, Onninen, and K-Bygg in Sweden. Profitable growth is at the core of strategy execution, and we are on the right track. Increased country focus in our strategy execution is working.
Sales and profit are up. Our market position in B2B has strengthened, and our foothold geographically is balanced. Operations outside Finland account already for 56% of net sales. Next, the car trade. Net sales in the car trade increased by 11.3%, supported by acquisitions. The market remained challenging and comparable growth decreased by 5.9%. Comparable operating profit was EUR 5 million despite the market disturbances. We have also carried out extensive efficiency measures during the quarter. Car trade market in Europe, in general, is clearly below normal levels. The uncertainty among consumers continues due to taxation discussions and debate over multi-power choices. Performance in car trade was softer than anticipated, but did pick up towards the end of the quarter. Going forwards, we see that our competitiveness strengthens. The range of new cars is expanding. It includes, for example, several plug-in hybrids and fully electric cars.
The availability is also increasing. Our own operations are more efficient, and the dealer network has been enhanced according to the strategy. Finally, I will summarize the priorities and outlook. In the grocery trade, our priorities are growing our sales and profitability further in the changing market by utilizing our strategic strengths in everything we do. In the Building and Technical Trade, our priorities include further growing our sales and profitability country by country, including continuous improvement of processes and well-executed acquisitions. In the car trade, our priorities are returning sales and profitability to a good level and further improvement through maximum utilization of the Volkswagen Group's improved and more extensive range of new models. We want to maximize utilization of data and new technologies across K Group. We prioritize constant improvement in operational efficiency and competitiveness, preparing for the slowdown of economic growth.
Last but not least, even strong focus on visibility for sustainability in all actions by 1,800 K stores. Kesko continues to determine a customer-oriented transformation of its business and execution of its strategy. In comparable terms, the net sales for continuing operations for the next 12 months are expected to exceed the level of the previous 12 months. The comparable operating profit for continuing operations for the next 12-month period is expected to exceed the level of the preceding 12 months. Now, it is time for questions for the conference call lines or via chat. If you have questions afterwards, please don't hesitate contacting Hanna.
Thank you. Ladies and gentlemen, if you do have a question for the speaker, please press 01 on your telephone keypad now. Once again, for questions, please press 01 on your telephone keypad, and if you would like to withdraw your question, that would be 02. There will be a brief pause while any questions are being registered. Our first question comes from the line of Niklas Göke from Handelsbanken. Please go ahead. Your line is now open. Okay, we seem to have lost Niklas. Niklas, can you hear us?
Yes.
Okay, perfect. We can hear you now as well.
Okay.
Please go ahead and ask your question.
Yes. I'm wondering if you're able to provide some more detail on the various contributors to operating profit within the B&T segment from the acquisitions and divestments. You've given a total number here, but I was keen to see how much Fresks contributed with and how much the divestment of Onninen helped, which I assume it did, and a couple of other things. Are you able to do that?
Yes. Hi, Niklas. Happy to hear from you. We have opened up in the Building and Technical Trade sort of paragraph, the operating profit quite a bit, actually. As you can see from that one, the comparable operating profit grew in Finland, Sweden, Norway, and Belarus. In Finland, we were happy with both K-Rauta's profitability development as well as Onninen's as well. In Sweden, K-Bygg was the biggest contributor of the profitability, and K-Bygg was also the biggest contributor for the whole sort of M&A-related operating profit increase. Also, Norway increased their operating profit mainly due to the acquisitions we made there. Belarus also increased their profitability, and that's comparable.
When it comes to the Baltic countries, there the operating profit was somewhat down compared to the last year, and we had a good sales growth there, but the margin was somewhat lower, and also the cost inflation was somewhat higher, so that affected somewhat our Baltics operations. Altogether, we are happy with the development with operating profit in Building and Technical Trade division, and that both the building materials side and so on, and then technical trade side as well, both increased their profitability, but also the specialty goods trade. Altogether sort of solid package.
Okay. In Norway, for example, do you have underlying growth adjusted for the acquisitions in profit?
Like I said, the growth came from the acquisitions in Norway. That's the sort of pathway it has contributed to profitability increase in Norway.
If you can remember that clear majority is now our own retailing operations in Norway as well, so in that sense. It's a really big part of the business now in Norway, our own retailing.
What's the outlook for the Baltic countries?
Outlook in Baltic countries, okay. Of course, everywhere in Europe, we have concerns regarding economic growth as well as also in Baltic countries. Business environment, at least for time being, is favorable, and we are progressing in all three Baltic countries. Price competition was quite tough in the third quarter, but despite that, we are progressing, and outlook is positive.
Yeah, if I may add a little bit to Mikko's comment, we were happy with the top-line growth there. We clearly took market share in that market. In that sense, that's a good and positive thing. At the same time, we actually invested quite a bit to the e-commerce capabilities in Baltic countries as well. As you know, we bought one company there last year. We are building multi-channel operations in the Baltic countries, it's also about long-term investment.
Mm-hmm. They're going to continue in Q4?
Let's come back to the Q4 a bit later and so on, but we continue strategy, and we'll see if the market development, we'll see how that develops during the third quarters. Altogether, the market as such is quite solid, so in that sense, nothing really dramatic.
Please remember our outlook. Our outlook is very positive. We are expecting comparable sales growth. We are expecting that comparable operating profit will develop positively.
Yep. Are you seeing this renovation market picking up the slack from new build market weakening in Finland and Sweden?
Yeah. Absolutely. Also we should remember that also new construction is developing, and we don't see signs that people and companies will stop new constructions. Anyhow, we can see very strong development in refurbishing and renovation side, as well as infra construction everywhere in Europe, including also Northern Europe. Lot of heavy infra investments, and we believe that this trend will continue also in future.
To look into that one more segment [audio distortion] , is the investment of industries.
Construction.
Yes. Absolutely.
Yeah.
Those were all my questions, I think. Thank you very much.
Thank you. Once again, ladies and gentlemen, if you do have any questions, it would be zero one on your telephone keypad to register, and there will be a brief pause for any further questions to be registered. As there are no more questions registered, and I'll hand back to our speakers for any closing comments.
Okay, Hanna, do we have on chat?
No, we don't actually have any questions there. I think we will just round up this discussion. If you have any further questions, don't hesitate calling me or sending me an email. I'll answer your questions.
Exactly. Thank you. Thank you everybody for participation. To you all, three wish you a very pleasant afternoon and evening. Thank you. Bye-bye.
Thank you. Bye.
Thank you.
This now concludes our conference. Thank you all for attending, and you may now disconnect.