The Orkla Group Third quarter 2004 4 November 2004

Agenda w Highlights third quarter 2004 w Key figures w Operational development w IFRS at Orkla – Preliminary estimates of accounting consequences w Further information about Borregaard w Q&A

2

Highlights Q3-2004 w Continued improvement for Branded Consumer Goods § Margin growth at Orkla Foods § Positive trend in advertising markets § Acquisitions increase top line and improve long-term profitability

w Restructuring in non-core segments of the Chemicals business § Estimated annual EBITA savings NOK 125 million from 2006, restructuring

costs NOK 515 million § Stable results for core businesses in Chemicals

w Financial Investments § Net asset value increased by NOK 900 million in Q3 § 17.5 % return YTD

3

EBITA growth driven by Branded Consumer Goods

NOK million

128

-72 -8

1 808

Other

EBITA first nine months 2004

113 1 687

EBITA first nine months 2003

15

Currency

-55

Strike effects Foods/Brands*

Media*

* Adjusted for acquisitions and currency translation effects. Orkla Brands, Orkla Foods and Orkla Media also adjusted for strike effects 4

Chemicals*

Key figures Q3-2004 NOK million Operating revenues E B I T A ** Goodwill amortisation Other revenues and expenses EBIT Associates Portfolio gains Dividends and net financial items Ordinary profit before tax Taxes Ordinary profit after tax Gains/discontinued operations Profit for the period Earnings per share fully diluted (NOK) Earnings per share fully diluted, adjusted (NOK)*** *Adjusted for acquisitions and currency translation effects **Excl. other revenues and expenses ***Excl. goodwill amotisation and other revenues and expenses 5

Organic 1 Jul - 30 Sep 2004 2003 Change change* 7 359 5% 0% 7 736 566 3% -1 % 582 - 98 - 96 0 - 550 468 - 64 59 54 72 202 - 130 -1 469 191 - 127 - 48 342 143 383 0 725 143 3.5 0.6 4.3 3.4

19 % increase in cash flow from operations Q3-03 to Q3-04

NOK million 34

932

102

12

784

Cash flow from operating activities Q3-03

EBITDA

6

Change in net working capital

Net replacement expenditure

Cash flow from operating activities Q3-04

Balance sheet items

Total assets (NOK million) Equity to total assets ratio - Book - Incl. unrealised capital gains before tax Net interest-bearing liabilities (NOK million) Net gearing

30 Sep 2004** 41 163

Restated* 31 Dec 2003 41 424

31 Dec 2003 54 958

67.2% 70.3%

45.8%*** 49.4%***

35.9%*** 39.1%***

82 0.0

12 843 0.9

17 953 1.2

* To make the figures in 2003 comparable with the presentation o f the 2004 figures, Orkla Beverages is presented net on a single line as discontinued operation. ** The gain from the sale of Orkla’s interest in Carlsberg Breweries is recognised in 2004. *** Before additional dividend of NOK 25 per share. 7

Operational development per business unit

8

Foods – Continued improvement in NOK million Operating revenues EBITA EBITA margin

1 Jul - 30 Sep 2004 2003

Organic change*

3 112

2 973

-2 %

320

286

6%

10.3 %

9.6 %

*Adjusted for acquisitions and currency translation effects

w Broad based improvement in EBITA and EBITA margin § 7 out of 8 divisions with better EBITA than Q3-03, particularly Stabburet in Norway § Cost reduction programmes on track

w Organic top line growth represents a challenge w Increased competition from private labels and hard discounters in Sweden

9

Foods

Successful cost reduction programmes EBITA margin 12 m rolling

9.00 % 8.80 % 8.60 % 8.40 % 8.20 % 8.00 % 7.80 % 7.60 % Q1-02 Q2-02 Q3-02 Q4-02 Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04

10

Foods

Successful cost reduction programmes EBITA 12 m rolling

NOK million

1 200 1 100 1 000 900 800 700 Q102

11

Q202

Q302

Q402

Q103

Q203

Q303

Q403

Q104

Q204

Q304

Brands – Continued strong performance in NOK million Operating revenues EBITA EBITA margin

1 Jul - 30 Sep 2004 2003

Organic change*

1 102

1 146

-5 %

217

223

-4 %

19.7 %

19.5 %

*Adjusted for acquisitions and currency translation effects

w Positive effects from continuous improvement in all segments § Fixed costs reduced since Q3-03 § Margin retained

w Reduced contract production and export to Unilever reduces the top line w Increased competition from private labels for Biscuits in Sweden

12

Brands

Brands EBITA margin 12 m rolling 22,0 % 20,0 % 18,0 % 16,0 % 14,0 % 12,0 % 10,0 % Q1- Q2- Q300 00 00

Q400

Q101

Q2- Q3- Q401 01 01

Q102

Q202

Q3- Q4- Q102 02 03

w Steady growth in EBITA margin due to § Innovations § Continuous improvement § Purchasing effectiveness

13

Q203

Q303

Q4- Q1- Q203 04 04

Q304

Media – Growth in advertising markets in NOK million

1 Jul - 30 Sep Organic 2004 2003 change*

Operating revenues

1 966

1 799

4%

43

33

33 %

2.2 %

1.8 %

EBITA EBITA margin

*Adjusted for acquisitions and currency translation effects

w Third quarter is a seasonally low quarter w Continued growth in advertising revenues and profit § Improvement for Berlingske and Newspapers in Norway § Contribution from cost reduction programmes

w Increased competition in Denmark and Poland

14

Change in advertising revenues for Orkla Media Change in advertising revenues, compared with same quarter previous year (NOK million) 42 9

32*

29

7

-3 -23

-25

-20

-40 -53

-65

-60

-112 -152 Q1-01 Q2-01 Q3-01 Q4-01 Q1-02 Q2-02 Q3-02 Q4-02 Q1-03 Q2-03 Q3-03 Q4-03 Q1-04 Q2-04 Q3-04

* NOK 10 million loss in advertising revenues due to the journalists’ strike in Norway 15

Orkla Media

Berlingske EBITA 12 m rolling

-

-40

-80

-120

-160 Q2-02

Q3-02

Q4-02

Q1-03

Q2-03

Q3-03

Q4-03

Q1-04

Q2-04

Q3-04

w Third straight quarter with advertising revenue growth (+6 % ytd) w Circulation figures (excl. free sheets) still falling w National distribution of the free newspaper Urban

16

Chemicals – Improvement in core business, poor performance in non-core in NOK million Operating revenues EBITA EBITA margin

1 Jul - 30 sep 2004 2003

Organic change*

1 543

1 439

6%

45

55

-24 %

2.9 %

3.8 %

*Adjusted for acquisitions and currency translation effects

w Core business § Improved results for Speciality Cellulose § Due to improved mix and price

w Non-core business § Poor crushing margin and weaker markets for oils and fats (Denofa) § Continued negative trend for Fine Chemicals outside Norway § Significant write-downs and restructuring measures initiated at Denofa and

Fine Chemicals businesses outside Norway 17

Financial Investments

Portfolio performance Change in Net Asset Value

Return (%) Orkla's portfolio

1 Jan - 30 Sep 04 NOK million

Oslo Stock Exchange

2 563

28.3

17.5

1 350

14.2 11.7

10.6 8.5

574

677

-38 1 Jan 04 30 Sep 04

Annual average 1 Oct 01 1 Jan 94 30 Sep 04 30 Sep 04

18

Unrealised gains

Realised gains

Dividends received

Other revenues and expenses

Change in net asset value

Financial Investments

Portfolio key figures

in NOK million

Market value Net asset value Unrealised gains before tax Share of portfolio invested outside Norway in listed companies

19

30 Sep 04 16 823 16 199 4 260

31 Dec 03 14 682 13 636 2 910

Change 04 2 141 2 563 1 350

32 % 86 %

31 % 82 %

+1 %-p + 4 %-p

Financial Investments

Portfolio as of 30 September 2004 Principal holdings Elkem Storebrand DNB NOR Rieber & Søn Telenor Norsk Hydro 1 Industri Kapital 2000 Steen & Strøm SCA B Capio Total principal holdings

Industry Metals Insurance Bank Food Telecommunication Energy Investment Real estate Materials Health care

Market value of entire portfolio 1)

Unlisted

20

Market value Share of Share of (NOK million) portfolio (%) equity (%) 27.1 39.8 4 556 8.3 9.9 1 403 6.5 1.6 1 099 3.8 14.3 632 3.5 0.7 597 2.8 0.4 463 2.7 3.6 446 2.5 11.3 427 2.5 0.8 416 2.3 7.8 395 10 434 62.0 16 823

IFRS at Orkla – Preliminary estimates of accounting consequences No significant net effect on EBITA Expected NOK 2-3 increase in earnings per share (compared with 2004 NGAAP figures) + Reduced amortisation on historical goodwill + Elkem’s associate status will result in higher profit contribution

Increased volatility from investment portfolio The portfolio principle does not apply under IFRS and if individual shares have a lower value than book value, they must be written down in the P/L

Strengthen balance sheet – book equity may increase by NOK 2-3 billion + New associates (Elkem) will be capitalized in the balance sheet at Orkla’s share of the company’s equity + Unrealised gains (excl. Elkem) and the added value of forest properties after tax will be posted in the balance sheet and increase equity accordingly - Unamortized differences from plan/assumptions for pensions as of 1 January 2004 will be charged directly against equity

21

Further information about Borregaard

22

Chemicals

Restructuring in non-core businesses

Share of revenues Borregaard total YTD 2004

w Restructuring measures to be taken in Denofa and Fine Chemicals outside Norway §

Core 64 %

§ §

Non-core 36 % Specialty Chemicals, Fine Chemicals Norway, Energy Denofa, Fine Chemicals outside Norway, NEA

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NOK -515 million Measures include sale or closure of plants or joint solutions with other players Approx. half is cash related

w Estimated annual EBITA impact § §

NOK 125 million improvement from 2006 Most of which in Denofa, but also significant improvement in Fine Chemicals

Chemicals

Stable performance within core businesses EBITA 12 m rolling 600 Core

400

Borregaard total

200 0 Q1- Q2- Q3- Q4- Q1- Q2- Q3- Q4- Q1- Q2- Q302 02 02 02 03 03 03 03 04 04 04

w A period of mixed market conditions § Weak markets in Cellulose and Fine Chemicals § Reasonable markets for Lignin § Stable performance from Energy

w Improvement programmes and currency hedging have largely compensated for weakening USD in this period 24

Chemicals

Improved product mix within cellulose Average price index (Nfob NOK/ton excl. hedging)

Volume distribution 100 %

120 %

80 %

115 % 110 %

60 %

105 % 40 %

100 %

20 %

95 %

0%

90 % Q3-03

Q3-04

Speciality cell

Dissolving cell

Q1-03

Q2-03

Q3-03

Q4-03

Q1-04

Paper cell

w Increased share of Speciality and Dissolving cellulose w Higher prices for Dissolving cellulose w US cellulose producers continue to benefit from weak USD

25

Q2-04

Q3-04

Chemicals

USD exposure and sensitivity

w Total annual exposure (excl. hedging) is USD 180-200 million § Change in NOK/USD rate of NOK 1 will affect EBITA by NOK 180-200 million per

year, assuming no change in other parameters

w Total currency hedging volumes and rates: § 2004: USD 110 million @ 8.65 NOK/USD § 2005: USD 80 million @ 8.05 NOK/USD § 2006: USD 12 million @ 8.00 NOK/USD

w Assuming a NOK/USD rate at the 6.40 level in 2005, the net impact on EBITA compared to 2004 will be approx. NOK 150 million

26

Chemicals

Improvement programmes and external factors Sarpsborg programme 2003-2005

w Ongoing improvement programme in Sarpsborg, Norway §

Target 2005: NOK 100 million compared with 2004

w New programme being planned at Borregaard Schweiz §

Includes both cellulose and yeast

w External factors § §

Raw material, energy and transportation costs Product prices

240

200

90

160

Total NOK 240 million* =

120

75

80

140 million in 2004 + 100 million in 2005

75

40

0 Infrastructure

Fixed costs

* Compared to 2003 27

Productivity/Purchase

Chemicals

A more focused Borregaard Concentration on wood-based chemicals Share of revenues core businesses YTD 2004 Synthesis 15 %

Energy 8%

LignoTech 37 %

ChemCell 40 %

w

ChemCell § §

w

LignoTech §

w

Further specialization capacity and potential Improvement programmes both in cellulose and yeast businesses

Stable performance, but growth capacity and potential

Synthesis and Energy §

Overall stable performance expected 28

29

Enclosures

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Cash Flow Statement - key figures 1 Jan - 30 Sep 2004 2003

in NOK million Industry division: Operating profit Depreciation and write-downs Change in net working capital Net replacement expenditure Financial items, net Cash flow Industry Cash flow Financial Investments Taxes paid and miscellaneous Cash flow before capital transactions Dividends paid and share buy-back Cash flow before expansion Net expansion Net purchases/sales portfolio investments Net cash flow Currency translation differences Change in net interest-bearing liabilities Net interest-bearing liabilities

31

662 1 430 392 - 694 -194 1 596 777 - 543 1 830 -6 161 -4 331 16 953 191 12 813 - 52 -12 761

1 340 1 205 -45 - 708 -440 1 352 182 - 362 1 172 - 987 185 861 853 1 899 - 651 -1 248

82

13 124

1 Jul - 30 Sep 2004 2003 - 58 633 580 - 223 -68 864 -7 - 74 783 - 521 262 - 133 282 411 46 - 457

467 406 168 - 257 -123 661 32 - 113 580 -4 576 70 - 409 237 16 - 253

Balance Sheet - some key figures in NOK million

Restated 30 Sep 04 31 Dec 03

Long-term assets Portfolio investments etc.

19 532 12 640

20 515 11 867

Short-term assets Total assets

8 991 41 163

9 042 41 424

Equity to total assets ratio - Book - Incl. unrealised capital gains before tax

67.2 % 70.3 %

45.8%* 49.4%*

Net interest-bearing liabilities

82

12 843

Net gearing

0.0

0.9

* Adjusted for additional dividend of NOK 25 per share 32

Currency translation effects in Q3-2004

in NOK million

Foods Brands Media Chemicals Total

Revenues 34 5 19 3 61

The above figures show translation effects only

33

EBITA 3 1 0 1 5

Goodwill amortisation in Q3-2004

in NOK million

Goodwill EBITA amortisation

EBIT*

Foods

320

-49

271

Brands

217

-11

206

Media

43

-33

10

Chemicals

45

-2

43

* Before other revenues and expenses

34

Changeover to IFRS from 2005 w First quarter 2005 – first report according to the International Financial Reporting Standards (IFRS) w The annual accounts for 2004 will be presented according to the current Norwegian accounting standards w The annual report for 2004 will contain a general explanation of how Orkla will apply IFRS and a description of the most important changes w The annual accounts and quarterly figures for 2004 will be restated according to IFRS afterwards and presented a reasonable time before publication of the figures for the first quarter of 2005 (28 April)

35

Operating profit before goodwill amortisation (EBITA) w

In general, accounting for Orkla’s Industry division is uncomplicated and the overall effect of the transition to IFRS on EBITA will be insignificant.

w

Special accounting problems in connection with the transition to IFRS § §

§

§ §

According to IFRS, options must be charged against income over the vesting period, calculated on the basis of the fair value on the date of issue. Entails higher expenses. Depreciation of tangible assets will be affected by stricter requirements for decomposition and greater significance of scrap value when the amount of depreciation is calculated. For buildings in particular, depreciation is expected to be lower. Requirements for reporting currency hedging will entail more documentation and far more work. However, Orkla aims to mainly continue the current practice as regards hedge accounting. The final rules for treatment of joint ventures according to IFRS are unlikely to be completed until 2006/07 at the earliest, and Orkla will continue its current accounting practice until then. After the transition to the defined contribution pension system in Norway, pensions are not expected to entail significant changes in the transition to IFRS. Unamortised differences from plan/assumptions as of 1 January 2004 will be charged against equity in connection with the transition to IFRS

36

Business combinations w

Historical goodwill §

w

Goodwill amortisation is no longer required. Historical goodwill can remain at the value as of 31 December 2003. This will improve annual profit by almost NOK 400 million.

New acquisitions § §

§ § §

All acquisitions are accounted for at fair value, pooling of interests will no longer be permitted. Stricter requirements for the identification of intangible assets § Goodwill relatively lower than before (not amortised) § Partially replaced by brands/trademarks and possibly other intangible assets Brands/trademarks with indefinite useful lives must not be amortised Other intangible assets are amortised over their anticipated useful life, which will normally be shorter than the current goodwill amortisation period. It will not be permitted to make provisions for restructuring that has not begun in the company that has been acquired. This type of restructuring will probably become an expense at the time of acquisition.

37

Financial Investments division w

The share portfolio §

§ § § §

w

Elkem will be presented as an associate, other items with a shareholding >20 % will most likely be presented as market-to-market § Increases current profit by the difference between our share of profit after tax and dividends received § When the accounts are restated, the value in the balance sheet will be set at Orkla’s share of Elkem’s equity The portfolio is presented at fair value in the balance sheet § Increases book equity by unrealised gains after tax The portfolio is presented as ”available for sale” and changes in market value are temporarily charged against equity There will be no effect on profit until the shares are sold The portfolio principle does not apply to write-downs, and individual shares with a lasting or significantly lower value than book value must be written down in the P/L. The write-down will not be reversed if the value subsequently rises, so this will not affect profit until the share is realised. This will lead to increased volatility, especially in declining markets.

Forest properties • •

Forest properties will be presented at fair value as biological assets, and changes in fair value will be posted in the P/L The effect on profit is expected to be neutral, while the fair value of forest properties will increase equity.

38

Summary – Preliminary estimates on accounting consequences No significant net effect on EBITA -

Fair value of options must be charged against income over the vesting period. Entails higher expenses. Today’s options programme in Orkla represents about 1 % of total outstanding shares and the increased costs amount to