Good morning, everyone, welcome to Q4 presentation of Orkla results. We will also, of course, go through the preliminary full year results 2017. We experienced a quite strong end of 2017, which is visible in our Q4 figures. Good organic growth, but also visible results from our cost improvement projects is visible on our bottom line. Our CFO, Jens, he will go through the details of Q4, I will focus more on the full year 2017. Let's start by looking at our financial targets that we communicated to the capital markets day in the fall of 2015. We said that we will continue with the strategy on track. We will continue to divest non-core assets and to allocate capital into acquisitions in the Branded Consumer Goods area.
By the sale of our last 50% share in Sapa, we have more or less completed the transaction from a conglomerate to a pure Branded Consumer Goods company. We have also, during 2017, done a lot of small, medium-sized acquisitions, but also some disposals, which we'll come back to. At our capital markets day 2015, we also promised that we aim to grow in line with the market growth in the markets where we operate. At that time, we anticipated market growth to be in the area of 2.5%-3%. However, we have experienced somewhat lower market growth, in the area of 1.5% for 2017. We ended up with an organic growth of 1.6%, meaning that we also have delivered on that target. We also announced an EBIT growth, in absolute figures of 6%-9%, excluding any big acquisitions and adjusted for currency effects.
After a very strong end of 2017, we managed to deliver 6.1% EBIT growth, despite much, much lower market growth than we anticipated. That means that we have done more on the cost side in order to reach that target. The last financial figure we announced, or the target we announced, was regarding dividend. We promised that during the transformation period, we'll continue to pay out a dividend of minimum NOK 2.50 per share. For the fiscal year 2016, we paid out NOK 2.60. The board will propose to pay out NOK 2.60 also for 2017. I'll also remind you that we paid out a special dividend end of last year of NOK 5 per share. After the sale of Sapa, we have a very, very strong balance sheet and our net debt at the end of the year is actually zero.
That means that we have a lot of resources to invest in acquisitions in Branded Consumer Goods area, finding attractive targets to buy, and targets that can strengthen our presence in our current markets, and also targets where we can realize synergies. During 2017, we have also done, as I mentioned, a lot of smaller acquisitions. Actually, we added NOK 1.4 billion in revenue from strategic or structural growth. That means we bought company for a revenue value of NOK 1.8 billion, and we sold companies with a revenue of NOK 0.4 billion during 2017. The average multiple we paid for those acquisitions was 0.7x sales, and we done 10x EBITDA multiple pre-synergy. We have not only acquired companies, we have also had active approach to our portfolio, and we have sold off, for instance, our mayonnaise-based salad business in Denmark.
We also have an active approach to portfolio optimization. We have been quite active also this year. Far this year, we have done 3 acquisitions. The biggest one was the Health and Sports Nutrition Group with the brand Gymgrossisten and Bodystore. With this acquisition, we get a very strong new brand within the protein category, but it also gives us very valuable insight into online sales, which will strengthen our ability to be a better partner, both for online and offline retailers. As I mentioned, with some very strong brands. We have also strengthened our presence in painting tools in the Netherlands and in Belgium during January. We have bought the producer of Paulúns breakfast cereals, Struer, in Denmark during the quarter. We still see a lot of attractive acquisition candidates out there.
We are monitoring the market closely and looking for companies that fulfill one of 3 criterias when we do acquisitions. One is that we want to find candidates where we can roll out the Orkla model, meaning strengthen our position in markets where we already have a presence to get economies of scales and to realize synergies in those markets. The second route when we're talking about M&A, is to strengthen our position in channels outside food retail. The reason for that is that we see that food retail growth is quite low, while we see much higher growth in other channels like, of course, online, specialty stores, DIY stores, pharmacy, and so on. We want to strengthen our presence in these channels. Not only because we see higher growth, but also because we see that consumer trends are changing.
Where consumer are looking for our products is changing, we have to be present in all channels where consumer expect to find our products. The last route is to strengthen or to build niche positions in some selected category in a broader geographic area. Like for instance, ice cream ingredients, where we have become the market leader in Europe, in wound care and painting tools are also example of such niche positions. That's how we are thinking about strategic or structural growth going forward and what we have done last year. Of course, we are also very focused on organic growth, and I am very happy to see that all business areas delivered organic growth in 2017, growth more or less in line with the markets where we operate. We experienced especially strong growth from confectionery and snacks and from care.
I would like just to mention that care experienced very high campaign activity in the home and personal care categories in Norway in Q4, due to price war between some of the retailers. Foods also picked up during the year after a quite slow start first half year. They had a very good end of the year. Also food ingredients ended the year with positive organic growth after a very strong Q4. How do we create organic growth? We have a saying in Orkla that we want to grow, we have to grow the core, but still also adapt for more.
By growing the core, we mean that we have to focus on the really big SKUs, our really big brands, because the most profitable thing we can do is selling more of the same stuff where we already have built the brand, we have done the innovation, and we have done the investments in production facilities. We have also experienced and we have seen a lot of good examples of very successful cross-country launches. In 2017 was a record year for our frozen pizza brand in Norway, Pizza Grandiosa. From this single brand, we sold 26 million pizzas. That means five pizzas per capita in Norway, which is quite strong. Record high sales in value and in number. We also ended the year with a market share on this single brand above 50%. Very happy about that. Another example is Smash.
Smash was actually launched in 1988 as a niche product. It's sweet, it's crunchy, and it's salt, and it is just fantastic. I guess all of you have tasted that. Actually in 2017, we reached record high sales of 4.9 million units or bags in Norway. Very strong growth and very happy to see that. Even more impressive is that we launched also Smash in Sweden in September 2017. It's the same product produced at the same factory, almost the same packaging, but under the local brand OLW in Sweden, which is our snack brand in Sweden. After just four months, we sold 1 million bags in Sweden, also with very limited marketing support. Compared to the 4.9 million in Norway, I think these figures are very strong.
Actually, Smash was the most sold chocolate bag in Sweden at the end of the year last year. One of our oldest brand is Møllers Tran, Møllers cod liver oil, and I guess at least all Norwegian know this product very well. This is cod liver oil from the purest waters outside Lofoten in Norway. It is healthy, and it's 100% natural products. If you want to keep away from illness, you should take a spoon of Møllers Tran every day. It's not only Norwegian that has learned this. Møllers Tran is now sold in 20 countries in the world, and last year we saw an export increase of Møllers Tran of 83%, which is very strong. Actually, during the two last years, we have doubled production volumes in our factory in Norway.
These are just a few examples of how we are growing the core. At the same time, we also need to look at what will be the big things in the future. We need to build a new big Grandiosa or Møllers or Smash for the next 10 years, 15 years, 20 years, and so on. When we do that, we are looking at the prevalent consumer trends that we see. One of the trends we see that is very strong is a new market for food that is really good for you, but at the same time, also good for the environment. Of course, we want to take part of that growth in the main markets. We see a consumer trend. They are demanding healthy, natural, convenient food that tastes good, of course, and produced in an ethical and environmentally friendly way.
This is a trend that is getting stronger and stronger. We have actually four brands within this area that we'll show you today. Naturli is originally a Danish brand. It's plant-based drinks, spreads, sweets, and ready meals. It's 100% natural, it's 100% vegan, and it's 100% organic. We have experienced very strong growth in Naturli, partly like for like SKUs, but also through line extensions. Anamma is another example or another brand, a Swedish brand we bought a couple of years ago, have also experienced very strong growth, vegetarian products. I will show you a very exciting example of what we're doing with Anamma brand later in my presentation, at the end of the presentation today. Paulúns is also a good for you brand, launched in Sweden in 2005, originally as breakfast cereals, but with extending the range of products into other areas as well.
It's convenient, it's all natural, it tastes fantastic, and it's loved by the consumer. Also in this area, we have seen very strong organic growth. During the last couple of years, it was also launched in Norway, Denmark, Finland, and Latvia, sometimes under the same brand, but in some cases under a local brand, but it's the same product and produced at the same factory. It's not only within food we are responding to trends. We also see a trend for more environmental-friendly cleaning products. We also have seen a trend that consumers want products produced locally with local ingredients. Klar was launched last year. It's plant-based, free from unnecessary chemicals and colorings. It was launched in Norway, and it has been very well received. It is, of course, concentrated formula, meaning that you have less packaging and 100% recycled plastic.
I think this shows how we are building new brands and also developing new products to respond to some of the consumer trends we see. In sum, our initiatives resulted in quite good organic growth in 2017 in a very competitive environment. We also have to have control of the costs. I will again show you the black over red. No, I'm sorry. It doesn't work. Oops. No. Okay. Some of the cost initiatives. I was supposed to show you my black over red graph, where the black indicates the organic growth and red development in fixed cost. I'm also very happy to see that we managed to keep a healthy gap between organic growth and fixed cost also in 2017. We have a lot of cost initiatives.
We have continued our factory footprint program, and since we started this program in 2014, we have closed down 30 factories. Average revenue per factory has increased by 45% since then. That means that each factory are getting bigger, more efficient, but that also means that they get a size where we can invest in more technology, more automation, and modern production equipment. We also set out a goal last year to reduce number of suppliers by 25%, partly because we think that being a big customer with fewer supplier means that we will get better conditions, better payment terms, but of course, also to reduce complexity in our supply chain. By the end of 2017, we had reduced number of suppliers by 13%, so I think we are according to what we planned to do.
We have also been working on reducing our working capital and reported the working capital is going the wrong way. However, underlying working capital is improving, not to the level that we would like to see, but we see an underlying improvement, but that is hampered partly by M&A and partly by the restructuring projects we are doing, closing down factories, then we need to build stock in the warehouse in order to have a high service level in the transition period. We are also doing quite a lot when it comes to SG&A by simplifying our organizational structure and by reducing complexity in our back office functions. We have been merging businesses in three countries, and we have, of course, integrated acquisitions and taken out synergies from the companies we have bought.
I would also like to mention that, as I think most of you know, since Orkla is a result of a lot of acquisitions over many years and due to our multi-local model that we used to have, where each company was operating as a separate unit, we also have a situation today where we have 28 different ERP systems. That is not exactly supporting working as One Orkla and realizing synergies across the business units, business areas, across countries, and so on. We have now started a project, we call it Project One, where we aim to roll out one common ERP platform in the whole of Orkla. This will take some years. The project has just started, and you can imagine it's quite a big project.
It will be rolled out in the next coming years, and it will eventually help us to realize more synergies, both top line and also bottom line in the years to come. This will also require investments. In a period, we will see higher IT cost investments earlier than we would otherwise have done if we had just kept on with our current systems. The total investment will be more or less the same. Of course, it will require a lot of internal resources from our people to develop and implement this system. I'm very happy to see in total that improvement in fixed cost more than offset the negative development we have experienced in 2017 from increased raw material prices. All these actions take us then to an EBIT growth of 6.1%, adjusted for large M&A and currency.
This is within the targeted range of 6%-9%. Of course, I would have liked to see it closer to nine than to six, but if you think about the fact that the market growth has been substantially lower than what we anticipated, I think this is a quite good achievement. I'm also looking at the EBIT margin. I'm also very glad to see that also in the reported margin, we see that the initiatives we do, both on cost and on pricing, are giving reported margin increase for 2017. We said during Q2, Q3, that we experienced substantially higher raw material prices. We also said that we counteract this by price increases, and we did several price increases during 2017, and eventually during last quarter, we see that coming through.
Of course, needless to say, we will continue our cost actions going forward to continue to deliver EBIT growth also 2018 and the years to come. Jens will go through the details of Q4.
Thank you, Peter. As Peter mentioned, we saw solid progress both within the Branded Consumer Goods area as well as Hydropower this quarter. I'll start with some headlines. Organic growth came in strong at 2.8%, and it's positive to see that volume growth accounted for more than half of the growth. All business areas contributed to solid growth, but Care standing out with 6.3%. As Peter mentioned, several price campaigns on HPC products among the Norwegian retailers explain the parts of this growth in Care. As mentioned in the last quarters, we have struggled with sharp increases on input costs, and I'm pleased to see that in Q4, we have catched up with pricing actions. With a better price balance, the underlying margin improvements becomes more visible in the reported figures.
Our cost programs, together with some timing effects on advertising, resulted in 100 bps of underlying margin expansion. Reported margin also increased by 80 bps in Q4. A continued challenging market situation for Jotun partly offset the progress that we see in Branded Consumer Goods. EPS growth for continued operations was 5.5% for the quarter. Let's now take a look at the more details in the P&L. Adjusted EBIT for the group grew by 10% in Q4 and 8% for the full year. That's largely related to a solid progress in the Branded Consumer Goods area. Hydropower also reported a record high quarter this year, driven by higher volumes. Other income and expenses ended around zero compared in Q4 and minus NOK 200 for the full year. Like in the third quarter, we saw in Q4 also profit from sale of assets.
Going forward, we will continue to have costs on this line item due to restructuring and M&A activity. As I mentioned, Jotun experiences challenging market situations, and profits from associates was negative, NOK 78 million in Q4. I'll revert to more details on Jotun later on. Our interest costs is coming down as a result of lower debt post Sapa transaction. We have zero net debt, but we still hold some gross debt. As a result of that, we will still continue to have interest costs. Looking at the situation today, we will carry interest costs of around NOK 120 million per year going forward. Tax expenses increased, but that is a result of higher operating profits and some positive one-offs last year. Looking at the underlying tax cost or tax rate, it has come down over the last couple of years and is now 23%.
As I said, EPS from continued operations grew by 5.5% in the quarter and 4% for the year. Let's look at the performance in Branded Consumer Goods area more in specific, and then as always, we start with the top-line delta. This quarter, we lifted revenues in Branded Consumer Goods by almost 9%. As I mentioned, organic growth was 2.8% with growth in all business areas. In Q4, the Norwegian krone was significantly weaker than in 2016 against both the EUR and Swedish krone. This gives a positive translation effect of around 4.6% in the quarter with positive translation effects in all business areas. On the other hand, these positive translation effects give a negative real effect, because a weaker krone implies then higher costs for imported raw materials and finished goods.
M&A contributed with 1.4%, mainly related to the Riemann acquisition in care and some acquisitions that we've done in food ingredients. That's add-ons. Before we look at each business area, I'd like to give some more details on the development on the margin side. As I mentioned earlier, we finally report a strong underlying and reported margin growth in fourth quarter. We continue to deliver in accordance to our ambitions on the cost programs within supply chain and SG&A. We also had lower advertising spend in Q4. That's mostly related to timing effects. With a better balance in pricing in Q4, this gives us 100 basis points of underlying margin growth with a split of roughly 50/50 between cost improvements and advertising. As several of our acquisitions have a seasonally low Q4, like for instance, the Riemann P20, the dilutive effect of acquisitions is around 30 basis points.
Despite this, we deliver 80 basis points of reported margin progress. Looking at the full year, we deliver roughly according to the ambitious cost improvements. However, the negative balance from the three first quarters impact the total, resulting in a somewhat soft 40 basis points of underlying improvements. Going into 2018, we will continue to see a slight dilutive effect from M&A and currency movements will put further pressure on input costs. Active price management going into 2018 will also be very important. Let's look at each business area and then start with the largest one, namely foods. As we mentioned, over the last couple of quarters, foods has for some time struggled with significantly increased input costs and a time lag for compensating this through price increases, especially Sweden and Czech Republic have had a challenging situation.
Price increases, as you know, have been gradually implemented during the year and in Q4, they compensate for increased costs. EBIT in the quarter was strong, driven by improved price balance in combination with cost improvements and some lower advertising spend due to timing effects. In total, this drove 100 basis points of margin improvement or growth, and the year was on par. Moving on to confectionery and snacks. After slight weaker Q3, confectionery and snacks delivered a solid Q4 with almost 4% organic growth, especially Finland, Sweden and Estonia delivered strong revenue growth in the quarter. While the largest market, Norway, had a flat development due to a front-loaded campaign program in 2017. We talked about this in earlier presentations. Finland celebrated its 100 years of independence in 2017, a celebration that culminated in December.
With our loved local brands in Finland, we had a strong volume growth this year, this then culminated in December. Strong revenue growth and continued contribution from improvement programs delivered a solid 130 basis points of margin growth in Q4. Let's look at Care. Orkla Care delivered a very strong organic growth in the quarter of more than 6% growth. Total revenue growth ended at close to 12%, while EBIT growth came in at 22%. Five out of six business units delivered organic growth in the quarter, and I'm glad to see increased performance of the two largest areas or business units, Home and Personal Care and Health. HPC sales have seen strong market development for the last several quarters. On top of that, Q4 was boosted by high campaign activity and strong price competition in Norwegian food retail, as Peter mentioned.
Health delivered strong growth in both the home market and through exports, partly explained by strong omega-3 sales, as Peter talked about also earlier. Margin improvement of 100 basis points in the quarter is solid despite negative dilutive effects from M&A, higher input costs, and unsatisfactory performance in House Care UK, the Harris acquisition. Strong sales growth and cost improvements delivered margin expansion. Further, we are comparing it to a somewhat weak Q4 2016 due to significant advertising investments in that quarter last year. Dilution from M&A is mainly related to Riemann. That contributed with a seasonally low margin in Q4, of course. The Riemann acquisition has so far been very successful. Both raw material prices and currency effects moved in the wrong direction during the quarter and will continue to put pressure on input costs going into 2018. Lastly, let's look at the Food Ingredients area.
Food Ingredients delivered a 3.4% organic growth in Q4 after several quarters hampered both by lost and exited contracts, as well as raw material deflation. Price increases, volume growth in the bakery segment, and continued growth for the vegan brand Naturli' are the main drivers behind the growth. The turnaround that we talked about earlier in Romania and Finland show positive impact on the margin. Strong organic improvement as well as contribution from M&A resulted in 21% EBIT growth in Q4. That concludes the walkthrough of the Branded Consumer Goods. To sum up, this has been a solid Q4. Let's now look at the investment area. The sale of Sapa is now fully completed with an additional accounting gain in Q4. As I said earlier, Hydropower had a record high Q4 due to high volumes. EBIT ended at NOK 103 million for the quarter.
For the first time ever, EBIT for the full year passed NOK 300 million. For the full year, it was both price and volume driven. In real estate, there's only been minor transaction activity this quarter, and we are comparing to fourth quarter in 2016, where we had a larger gain from the sale of Attisholz real estate in Switzerland. Jotun, on the other hand, have seen a challenging quarter. Jotun continues to deliver volume-driven sales growth, driven by good performance in the decorative paints area. However, the shipping and offshore markets remain challenging with lower new build activity, especially in an important market, Northeast Asia. In addition, significant increase in raw material prices hampered profitability in Q4. For the year, raw material prices was up around 20%. Raw material prices and costs have a significant impact on the year-to-date profitability.
Raw material costs are expected to increase going into 2018. To counter this, price increases have been implemented in Jotun. They are still very focused on strong cost control. Let's look at the cash flow and net debt development. Here you see the main drivers behind the operating cash flow development, excluding financial investments. You can see all levers contribute to a rather strong cash flow in 2017. I'm glad to see that we post a positive net working capital effect while growing organically. As Peter mentioned, we have increased payable days by 25% over the last two years. With the ambition to further reduce the number of suppliers, we aim to improve this also going forward.
On the opposite side, that also Peter talked about, the supply chain restructuring within factory and warehousing consolidation requires some additional capital in the process that we are in right now. In the long run, this restructuring should contribute to our improved working capital position. The restructuring program also requires somewhat more CapEx in the period compared to historical levels. The level of CapEx will, of course, vary from year to year. In 2017, the level was below the 2016 level, further fueling a strong cash flow for this year. Let's look at the changes in net debt. Sapa contributed with NOK 13.5 billion to the cash flow in 2017. This is a combination of sales proceeds and dividend received during 2017. We paid out approximately NOK 7.7 billion in ordinary and special dividend during 2017.
Despite this, net interest-bearing debt was around zero at year-end. It's fair to say that we have a very strong financial position going into 2018. Now I'll hand the floor back to Peter, who will talk a little bit more about the focus areas for 2018 and how we intend to utilize this strong financial position.
Well, thank you, Jens. Let's first sum up some of the key takeaways from 2017. You have seen we have experienced a very strong end of 2017. Q4 was a very good and strong quarter, where we see very visibly the results of both price increases, also a lot of cost actions we have taken during the year. Organic growth ended 1.6% up, in line with the market growth in the markets where we operate. All four business areas had reported organic growth for the full year. We reached our financial targets of 6%-9% EBIT growth with 6.1% EBIT growth, excluding big M&As and currency effects.
As we have shown you, we continue the restructuring, going from a conglomerate to a pure Branded Consumer Goods company, the sale of Sapa during 2017 is one good example of how we are transforming from our old model into a focused Branded Consumer Goods company. We have done a number of smaller acquisitions during 2017, value-adding acquisitions, and we will continue to do that also going forward. Looking into 2018, we expect markets to be quite soft. We don't expect to see a dramatic increase on the demand side, rather more or less the same pace as we have seen the last couple of years. 1st of January 2017, we were also impacted by a sharp increase in sugar tax in Norway, an increase of 83%.
There is obviously uncertainty how this will impact sale of confectionery in Norway, one thing is for sure, it will not be positive. We expect continued volatility in raw material prices and also in currencies now, also in 2018. We will continue our One Orkla agenda, sharing best practices, taking successes from one market to another, working much more as One Orkla to utilize our strength, our competencies, and all our capabilities in order both to create top line and, of course, also to realize cost synergies throughout the group. I also mentioned this common ERP project that we have started that will require a lot from our organization going forward, but that will eventually really be a very good enabler for us to realize more synergies, both top line and on the cost side going forward. We will continue our M&A strategy.
That's what we have promised, that we will take proceeds from non-core assets and invest in attractive assets we find in the market, assets that fits with our strategy and where we can realize synergies and, of course, where the price or the multiple we pay is acceptable and gives us value-adding acquisitions. We do that in three ways, partly by rolling out the Orkla model, getting stronger in markets where we already have a presence, realizing synergies. Secondly, growing outside traditional food retail in channels with higher growth, building attractive niches across several geographies in some selected categories like ice cream ingredients, wound care, and painting tools. Before we go to Q&A, I would like to show you some examples of our most recent innovations.
I promised you when I talked about Anamma that I will show you one very exciting project, that is the launch of Anamma vegetarian burger together with McDonald's. This has been so far, just started in December, very successful cooperation between McDonald's and Anamma. This is also responding to the consumer trend where we see people want to eat more plant-based food, partly because of health reasons, but also because of environmental reasons. Less climate impact than a regular burger made of meat. Far, it's been launched in selected McDonald's restaurants in Finland and in Sweden, during one month, we have sold 150,000 vegetarian burgers, McVegan burgers, in those restaurants. That is quite a good start of a very exciting cooperation with McDonald's. This has actually also received a lot of attention worldwide.
This is a trend, of course, not only in the Nordics. We see the same trend, very strong also in U.S., for example. We continue to deliver on the trends. We just, in these days, are also launching a new confectionery brand, Vill in Norwegian, directly translated to English, it's Wild. Launched in Norway these days. It also responds to the consumer trend of more healthier, more natural products with local ingredients, local products, for the confectionery lover. This is dark milk chocolate made with more cocoa and with less sugar, of course, with local milk from Norwegian cows. It's soft fruit centers covered in dark chocolate in two variants, blueberry and raspberry. We have also launched a bar under the same brand that tastes fantastic. After eating chocolate, it is important that you take care of your teeth.
We are taking now a really brave step. We are taking our very strong toothpaste brand in Norway, Solidox, into a new category, into chewing gum, and you see it here on the stage, and you can take some samples and try it. Why are we doing this? Well, first of all, we want to be a full assortment provider of confectionery in the market. As you know, we have been distributor of Wrigley chewing gum in Norway since 1988. We announced last year that we unfortunately lost that distribution agreement. We have been responsible for selling and marketing Wrigley chewing gum in Norway since 1988. When we took over that responsibility, the market share of Wrigley was 15%, 16%. In 2007, the market share was 86%.
I mean, that really shows the strength of our go-to-market organization and our ability to create strong brands and strong market positions in the markets where we operate. We are introducing Solidox chewing gum. A chewing gum with functional benefits that makes your teeth whiter, cleaner, and your breath fresher. Once again, I think this also shows our ability to react quickly to compensate for, in this case, lost sales from a distribution agreement. This is launched in these days, so it's very early. Of course, I cannot tell anything about how this is going to be, we will see in a year's time how this is received in the market. We also have done this before, not with chewing gum, of course, but in the care area.
We lost distribution agreement of five Unilever brands a couple of years ago. We turned around quickly, and we launched a series of personal care products under the well-known Norwegian brand, Dr Greve. Actually, after only one year in the market, we became market leader in a lot of those categories we lost. That shows that we have the ability to react fast, to turn around, and to utilize our strength, our consumer insight, and our go-to-market organization to build strong positions. With that, we will go over to Q&A. Yeah. There's a question up here.
Preben Aas-Olsen, Carnegie. Two questions, if I may. Start with you, I guess, Peter. You are talking a lot about the products that were selling good in 2017. Can you give some examples of products or categories that were selling bad in 2017, where you see that consumers are turning away?
I don't think I can give you any concrete examples. It's quite obvious that we have an organic growth of 1.6%. I have shown you some of the great successes. I also have to mention that frozen pizza is obviously a very big category that really makes a difference on the top line. While others products that I have shown you are quite small, percentage increases are high, but it doesn't really make a big difference, each single of them, on our top line. Of course, we also have categories or products with below average performance and below acceptable performance.
I am not able to give you any concrete examples of that right now, except for instance, the chips category in Norway, where we lost, unfortunately, listing in REMA 1000 due to their change in listing strategy and purchasing strategy, which is, of course, hampering our sales of snacks in Norway. We have plenty of examples of that as well.
Thank you. Just one more. It seems like the price war on personal care products in Norway have lifted your sales in Q4, but can this hit back going into 2018 through both lower prices demanded from the retailers and also lower sales, in Q1?
Well, when it comes to HPC products, when there are price wars or promotions, there is a tendency to stocking in people's homes. And of course, you don't wash very much more, even if you have a lot of detergents in your closet, or in your locker. Of course, this will probably have an impact to some degree in 2018. I think important to mention when it comes to especially home care, is that we have taken substantial market shares in retail in Norway during 2017. Really substantial market shares. This is not only prioritization of sales, but it's also really gaining market shares in those big categories.
Yes. I have a couple of questions from John Ennis at Goldman Sachs. First on Jotun. Do you think we will see a recovery in 2018, or should we expect a further deterioration, as end market demand seems challenged, and you will still have the negative impact from higher input costs?
We believe to see at least a challenging first half of 2018 in Jotun, explained by increased raw material prices also going into 2018. They are doing a lot to counter-effect this. As I said, they have implemented price increases and will also be active on price management going into 2018. They also counteracted some of these negative effects by cutting costs and they will, of course, do so going into 2018 as well. To sum up, we expect 2018 to be somewhat challenging.
The second question is on the cost-saving initiative. Johan Clarin said at the Investor Day that fixed costs have reduced by 140 basis points since 2014, and he felt you were one third of the way through the potential. Post full year 2017, have you now delivered a 200 basis points reduction in fixed costs? Is there anything more you can say regarding the speed of delivery in this program?
During the last three years, we have delivered an underlying, call it, margin improvement due to cost programs. 2015, around 60 basis points. 2016, around 50, and this year around 40. The majority of these cost programs is in connection with cost efficiency in the supply chain and SG&A.
We will continue.
We will continue, of course.
There is more potential.
Yeah.
Okay. No further questions? Okay. Thank you so much for joining us this morning, and please make sure to try our new chewing gum when you leave the presentation. It's great.