OSLO, NORWAY--(Marketwire - Oct 23, 2012) - Hydro's underlying earnings before financial
items and tax fell to NOK 8 million
in the third quarter from NOK 549 million in the previous quarter. Low
realized
alumina and aluminium prices weighed heavily on underlying results for
Hydro's
upstream operations for the quarter while cost improvement programs
proceeded
with full force to meet the challenging market situation.
* Underlying EBIT NOK 8 million
* Sharp decline in alumina and aluminium prices
* Record-high bauxite production
* Reduced downstream sales volume, partly offset by lower operating cost
* Lower power prices and production in Energy
"Realized alumina and aluminium prices for the quarter clearly reflect
market
and macro-economic uncertainty, hitting our weak quarterly results. Hydro's
response is to focus our attention on operational performance, portfolio
management and capital discipline," Hydro's President and CEO Svein Richard
Brandtzæg said.
"The planned transaction with Orkla to form the world's leading aluminium
solution provider is strengthening Hydro as a world-leading, resource-rich
aluminium company as well as our extusion business. Most of our extrusion
markets continue to be demanding and the new company will be better
positioned
to meet these challenges and to capture the longer-term growth perspectives
for
aluminium products,"said Brandtzæg.
Underlying EBIT for Bauxite & Alumina declined further from a weak result
in the
previous quarter mainly due to lower realized alumina prices and lower
sales
volumes.
Underlying EBIT for Primary Metal fell compared to the second quarter also
impacted by lower realized prices. Lower operating costs partly offset the
negative market effects. Underlying results for Qatalum declined compared
to the
second quarter which included the final insurance settlement relating to
the
power outage in 2010.
Excluding inventory and currency effects, underlying results for Hydro's
midstream operations were stable during the quarter.
Lower operating costs for Hydro's downstream businesses had a positive
impact on
underlying EBIT for the quarter. However, underlying results for Extruded
Products declined, affected by seasonally lower volumes and a further
weakening
in market demand. Results for the quarter continued to be impacted by
difficult
economic conditions in Europe.
Energy delivered lower underlying EBIT in the third quarter compared to the
previous quarter due to lower production and lower prices.
Operating cash flow was NOK 1.1 billion for the quarter. Net cash used for
investment activities amounted to NOK 1 billion. Hydro's net debt position
was
around zero at the end of the third quarter.
Hydro incurred a reported loss before financial items and tax of NOK 414
million
in the third quarter including net unrealized derivative losses and
negative
metal effects of NOK 108 million and other items amounting to NOK 314
million.
Other items included a loss on the disposal of Portalex of NOK 144 million
and
impairments of other assets of NOK 163 million. Other also included
rationalization charges and closure costs of NOK 75 million relating to
Extruded
Products and Kurri Kurri and a gain of NOK 68 million relating to pensions.
In the previous quarter, Hydro incurred a reported loss before financial
items
and tax of NOK 720 million including net unrealized derivative gains of NOK
300
million, rationalization and closure costs of NOK 408 million, impairment
charges amounting to NOK 1,175 million and positive metal effects of NOK 9
million.
Hydro incurred a net loss of NOK 231 million in the third quarter including
net
foreign exchange gains of NOK 283 million. In the previous quarter, Hydro
incurred a net loss of NOK 1,712 million including net foreign exchange
losses
of NOK 883 million.
Key financial
information
% change First
NOK million, Third Second % change Third prior First 9 9
except per quarter quarter prior quarter year months months Year
share data 2012 2012 quarter 2011 quarter 2012 2011 2011
---------------------------------------------------------------------------
Revenue 19 004 21 604 (12) % 23 829 (20) % 62 355 69 695 91
444
Earnings
before
financial
items and tax
(EBIT) (414) (720) 42 % 2 222 >(100) % (469) 10 189 9 827
Items
excluded from
underlying (5 (3
EBIT 422 1 269 (67) % (576) >100 % 1 583 189) 694)
---------------------------------------------------------------------------
Underlying
EBIT 8 549 (98) % 1 646 (99) % 1 115 5 000 6 133
---------------------------------------------------------------------------
Underlying
EBIT :
Bauxite &
Alumina (386) (188) >(100) % 302 >(100) % (718) 729 887
Primary Metal (10) 240 >(100) % 653 >(100) % 261 2 002 2 486
Metal Markets 7 44 (83) % 93 (92) % 139 480 441
Rolled
Products 214 204 5 % 124 72 % 569 588 673
Extruded
Products 27 53 (49) % 40 (33) % 95 241 151
Energy 220 362 (39) % 506 (57) % 1 137 1 442 1 883
Other and
eliminations (64) (166) 61 % (73) 12 % (368) (482) (389)
---------------------------------------------------------------------------
Underlying
EBIT 8 549 (98) % 1 646 (99) % 1 115 5 000 6 133
---------------------------------------------------------------------------
Underlying
EBITDA 1 265 1 777 (29) % 2 985 (58) % 4 913 8 628 11
152
---------------------------------------------------------------------------
Net income
(loss) (231) (1 712) 86 % 797 >(100) % (1 359) 7 498 6 749
---------------------------------------------------------------------------
Underlying
net income
(loss) (20) 268 >(100) % 1 071 >(100) % 505 3 071 3 947
---------------------------------------------------------------------------
Earnings per
share (0.14) (0.78) 83 % 0.49 >(100) % (0.68) 3.84 3.41
---------------------------------------------------------------------------
Underlying
earnings per
share 0.00 0.12 (97) % 0.50 (99) % 0.25 1.47 1.89
---------------------------------------------------------------------------
Financial
data:
---------------------------------------------------------------------------
Investments 965 777 24 % 1 125 (14) % 2 639 43 836 48 025
---------------------------------------------------------------------------
Key
Operational
information
---------------------------------------------------------------------------
Alumina
production
(kmt) 1 441 1 491 (3) % 1 553 (7) % 4 396 3 773 5 264
Primary
aluminium
production
(kmt) 484 502 (3) % 522 (7) % 1 500 1 443 1 982
Realized
aluminium
price LME
(USD/mt) 2022 2 167 (7) % 2 592 (22) % 2119 2 494 2 480
Realized
aluminium
price LME
(NOK/mt) 11856 12 637 (6) % 14 225 (17) % 12321 13 906 13 884
Realized
NOK/USD
exchange rate 5.86 5.83 1 % 5.49 7 % 5.81 5.58 5.60
Metal
products
sales, total
Hydro (kmt) 794 857 (7) % 850 (7) % 2522 2 499 3 303
Rolled
Products
sales volumes
to external
market (kmt) 228 228 - 228 - 683 714 929
Extruded
Products
sales volumes
to external
market (kmt) 125 137 (9) % 137 (9) % 395 415 536
Power
production
(GWh) 2 157 2 513 (14) % 2 737 (21) % 7 860 6 875 9 582
---------------------------------------------------------------------------
Certain statements included within this announcement contain
forward-looking information, including, without limitation, those relating
to (a) forecasts,
projections and estimates, (b) statements of management's plans, objectives
and
strategies for Hydro, such as planned expansions, investments or other
projects,
(c) targeted production volumes and costs, capacities or rates, start-up
costs,
cost reductions and profit objectives, (d) various expectations about
future
developments in Hydro's markets, particularly prices, supply and demand and
competition, (e) results of operations, (f) margins, (g) growth rates, (h)
risk
management, as well as (i) statements preceded by "expected", "scheduled",
"targeted", "planned", "proposed", "intended" or similar statements.
Although we believe that the expectations reflected in such forward-looking
statements are reasonable, these forward-looking statements are based on a
number of assumptions and forecasts that, by their nature, involve risk and
uncertainty. Various factors could cause our actual results to differ
materially from those projected in a forward-looking statement or affect
the
extent to which a particular projection is realized. Factors that could
cause
these differences include, but are not limited to: our continued ability to
reposition and restructure our upstream and downstream aluminium business;
changes in availability and cost of energy and raw materials; global supply
and
demand for aluminium and aluminium products; world economic growth,
including
rates of inflation and industrial production; changes in the relative value
of
currencies and the value of commodity contracts; trends in Hydro's key
markets
and competition; and legislative, regulatory and political factors.
No assurance can be given that such expectations will prove to have been
correct. Hydro disclaims any obligation to update or revise any
forward-looking
statements, whether as a result of new information, future events or
otherwise.Error: Reference source not found
This information is subject of the disclosure requirements pursuant to
section
5-12 of the Norwegian Securities Trading Act.
Q3 report:
http://hugin.info/106/R/1651178/532619.pdf
Q3 presentation:
http://hugin.info/106/R/1651178/532620.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Norsk Hydro via Thomson Reuters ONE
[HUG#1651178]