Good afternoon to all you in Europe. Good morning to you in the U.S. Welcome to this telephone conference regarding today's announcement, appointment of new acting CEO in Orkla. To participate on this conference, we have Acting CEO of Orkla, Mr. Åge Korsvold, CFO, Terje Andersen, VP IR, Siv Skårpenbrekke. My name is Rune Helland, and I am the Head of Investor Relations. As you all know from today's announcement, Mr. Åge Korsvold has been appointed as Acting President and CEO in Orkla. Up until today, Mr. Korsvold was the Deputy Chair of the Board of Directors in Orkla. Mr. Korsvold will start this conference with a short brief regarding today's announcement and his role as Acting CEO. He will be available for questions. Before I give the word to Mr.
Korsvold, I would like to remind you that we will be releasing our actual first quarter figures on Thursday at 7:00 A.M., CET. There will be a presentation of the Q1 results at the Vika Conference Center in Oslo at 8:00 A.M., CET. The presentation will be webcasted on Orkla's website. Now, over to Mr. Korsvold, please.
Yeah. Thank you. I will start by stating that this change does not mean that there is a change in strategy. In Orkla, or the board of Orkla, we decided on a more focused company last September, and there's no change to that strategy. We intend to, over time, disinvest non-core activities, and we intend to build and to continue to build on the strong brand activities that we have. I think that the good news is that Orkla has a portfolio of companies that are strong, have strong brands, and have strong market positions. I think the agenda ahead is to ensure that that position is enhanced and that we can build on that position, both through internal growth and to some extent, also on acquired growth.
The competitive environment that we see means that there is intense competition. The markets change every day. I think a more focused Orkla going forward is also a company that would better be able to meet those challenges. Specifically, we will, over the next few months, reconfigure the group corporate center to better reflect the challenges ahead. We need to maybe have some new skill sets in that organization, and we need to calibrate and ensure that we have the right cost base. I also think that there are some opportunities to make some adjustments to business models to ensure innovation, growth, and cost control. Most importantly, I think that we agreed on a strategy in September.
All of the processes that I see, Orkla focusing on in the next six to nine months, are processes that are already in motion. What we now need to ensure is that we execute timely and efficiently on that strategy. That is, that is the mandate that I feel that I have in this period. I will also say that we have started a process to find a permanent group CEO, and we expect to have a person in place sometimes in the second half of this year.
Now over to the Q&A.
To queue for questions, please press star one. I repeat, star one if questions. First question?
Markus Iwar, Goldman Sachs.
Go ahead, please.
Good afternoon, and thank you for taking my question. I have a rather overview question in terms of the transformation of Orkla towards becoming a pure play branded consumer company. Do you expect this kind of transformation to be a little bit quicker or a little bit slower in light of a new CEO coming in place? Thank you.
Well, first of all, I think that if you look to non-core activities, we hope to be able to execute on an IPO or a buyer core in the second half of this year. At that point, certainly in economic terms. What remains is the Sapa. I think as long as we see positive effects of the change game going on there, I think that it would be very evident to everyone that the focus here is to grow the grow the brand and consumer goods part of the business.
Okay, the, you don't expect the transformation to go any quicker than you have been communicating, let's say, over the last six months or so, that the roadmap is still very much the same as you foresee it, let's say, four months ago? Thank you.
I think what I indicated, initially was that I, you know, I think it is very important that we ensure that the very strong platform that we have, that operates efficiently, and that we are able to you know, take out the growth opportunities, we and the cost efficiencies that we have in our own operation. I think in terms of the quiet growth, I think that to some extent, that has to be opportunistic. I do think that there is a scope for somewhat increased deal flow in the years to come.
As, as you know, we don't control, and I think it's also very important that we are disciplined in our approach to that part of the business. I to me, the focus is on improving what we have, and then we know that there is that there are opportunities out there, and we will certainly ensure that we also have the ability to look at that deal flow.
Thank you. Next?
Svein Hogset, DPG Iso.
Hello.
Hi, everyone. Quick, sort of quick in the instance of the, you know, down the similar track that the last question came on. Can you talk a little bit to us about the, you know, the profile of the CEO that you're looking for? You're looking for what kind of person are you looking to hire, if you get, you know, Orkla over the last 20 years, have typically recruited CEOs internally. Say something about that process and, you know, where the board sort of wants to end up?
Well, first of all, the most important criteria is that we want someone with highly credible consumer brand goods credentials. In other words, we think that the person we're looking for will have wealth of experience from managing brand goods. I think ideally, we want someone with also the capital markets and M&A experience. I also think that this will be a person with a Scandinavian origin, with experience from some of the global, the big global consumer brands companies. I think that, at this time, it is likely that we will go outside for our new group CEO.
Simply because I think there is a change in scope here that fresh eyes and maybe some user culture input, we leverage off the, I think, the strong team that we already have.
Just a follow-up question to that. You're saying that you're aiming to get that person in place at some stage during the second half of next or this year, so probably after the summer at some stage then. Your interim CEO, during, you know, the period up until then, is it sort of your objective to deliver on some of the big, you know, blocks in the simplification strategy that the board has outlined, you know, during your tenure as CEO?
I would say that in my mind, there are restrictions on what I can do, so, I'm not gonna sit around and wait for someone to arrive. If that is the opportunity.
Thank you.
If further questions, please press star one.
... Hi, there. I just a question regarding the processes around the Sapa. You said earlier that Sapa is scheduled for its own basis, that's why when reached a new date of 6%. Does the changes that you are doing have any impact on such a schedule? Would you consider, for instance, to give it an out Sapa now as it is, and wait for the target to be reached?
Well, I would say that the, I think, yeah, the swing factor evaluation is substantial. I think the, I think the most important thing is that we see the effects of the change processes that are going on in SAP are coming through. After that, I think it's more of, it's a relative game, really, you know, in terms of timing, there's a, there's a trade-off between how much value we can get and how fast we need to or want to move towards a completely pure, branded goods company.
I think it's a trade-off there that the board will that will revisit from time to time, and I think as we go forward, we will try to be, I think that as we go forward, we will try to be quite open about our evaluation of that process.
At this time, no further questions. Hold on, we got one more. Next?
Ole Martin Westgaard, DNB.
Go ahead, please.
Yeah, I have two questions. For me, one with regard to the focus, where you search for in terms of brands. As far as I understand, the Nordic has been very much the focus with previous management. Is that still the case? Secondly, along the same lines, is there any changes to the capital allocation criteria?
To the first question, my view is, again, that while one should at all times be, I think, open-minded, given that our strong positions are in the Nordic area, it follows that what makes most sense is to build out those strong positions and focus on the Nordics. I think there's no change there in terms of capital allocation. Maybe Mr. Andersen would like to do that.
Yes, we haven't really decided on that. The overall strategy gives more or less that. We have said that we would like to free up capital for non-core assets, and we would like to allocate to brands, and we would like to allocate to value the creative projects in brands. That's why we probably have shown some discipline in this area over the last years. We have looked at several projects, we haven't been able to close anything, mainly because of the price expectation. The capital allocation will follow the strategy that Åge outlined, that we will free up capital and we'll work hard to find attractive projects within brand.
Okay, thank you.