Norsk Hydro : Norsk Hydro fourth quarter 2012: Improved result on lower input
Hydro's underlying earnings before financial items and tax improved to NOK 138
million in the fourth quarter 2012 from an underlying loss of NOK 19 million
in the previous quarter. Lower energy costs in Bauxite & Alumina, lower
variable costs in Primary Metal and improved results for the Qatalum aluminum
plant contributed to underlying results.
*Underlying EBIT NOK 138 million
*Lower raw material costs
*Lower realized aluminium prices, higher alumina prices
*Higher power prices and production in Energy
*2013 aluminium demand growth outlook 2-4 % in world outside China
*Proposed 2012 dividend NOK0.75 per share
"On the back of continuing challenging markets, our focus remains on improving
performance across our value chain. The ambitious USD 300 program is expected
to be completed at the end of 2013, strengthening Hydro's industry position.
Our improvement efforts will continue, including plans to optimize production
and performance in our bauxite and alumina operations in Brazil," Hydro's
President and CEO Svein Richard Brandtzæg said.
Bauxite & Alumina's underlying EBIT improved compared to the third quarter,
due to higher alumina prices and lower energy costs for Alunorte, together
with higher results from commercial operations.
Underlying EBIT for Primary Metal improved compared to the third quarter,
mainly due to better results in Qatalum. Lower realized aluminium prices
negatively affected underlying EBIT, partly offset by lower operating costs.
Savings targeted for Hydro's cost improvement program were achieved for the
Excluding inventory and currency effects, underlying results for Hydro's Metal
Markets operations declined, mainly due to lower volumes and margins together
with lower results from sourcing and trading operations.
Underlying EBIT for Rolled Products declined compared with the third quarter,
impacted by lower margins and seasonally higher maintenance costs.
Underlying EBIT for Energy increased in the quarter due to seasonally higher
production and prices.
Other and eliminations includes a significant negative charge related to
elimination of unrealized gains and losses on internal inventories.
Operating cash flow was NOK 2.8 billion for the quarter. Net cash used for
investment activities amounted to NOK 1.0 billion. Hydro's net cash position
was around NOK 1.7 billion at the end of the fourth quarter.
For the full year 2012, underlying EBIT declined substantially to NOK 1,158
million from NOK 5,982 million in 2011. Lower aluminium prices and alumina
prices had a significant effect on underlying results for the year. Ongoing
efforts to reduce costs and improve operations partly offset the negative
On October 15 Hydro announced an agreement with Orkla ASA to combine their
respective extrusion profile, building systems and tubing businesses in a new
joint venture company to be named Sapa. Completion of the transaction is
expected to take place in the first half of 2013, following approval by the
relevant competition authorities. Following the agreement, operating results
for Hydro's Extruded Products are presented net of financial items and tax as
Income (loss) from discontinued operations and excluded from reported EBIT and
Hydro's Board of Directors proposes to pay a dividend of NOK 0.75 per share
for 2012, reflecting the company's strong commitment to provide a cash return
to its shareholders. The dividend reflects our operational performance for
2012 and a strong financial position, also taking into consideration the
uncertain market outlook.
Earnings before financial items and tax amounted to NOK 669 million in the
fourth quarter, including net unrealized derivative gains and positive metal
effects of NOK 555 million and other items amounting to negative NOK 23
In the previous quarter, Hydro incurred a reported loss before financial items
and tax of NOK 267 million, including net unrealized derivative losses and
negative metal effects of NOK 137 million and other items amounting to
negative NOK 112 million. Other items included impairments of non current
assets of NOK 140 million and a gain of NOK 68 million relating to pensions.
Income from continuing operations amounted to NOK 364 million in the fourth
quarter including net foreign exchange loss of NOK 102 million. In the
previous quarter, Hydro incurred a net loss from continuing operations of NOK
64 million, including net foreign exchange gains of NOK 282 million.
Loss from discontinued operations amounted to NOK 251 million in the quarter,
including rationalization and closure costs of NOK 174 million. In the third
quarter, loss from discontinued operations amounted to NOK 167 million,
including rationalization and closure costs of NOK 43 million and a loss on
disposal of Portalex amounting to NOK 144 million.
NOK million, Fourth Third % change Fourth prior
except per share quarter quarter prior quarter year Year Year
data 2012 2012 quarter 2011 quarter 2012 2011
Revenue 15585 14722 6 % 17157 (9) % 64181 71500
and tax (EBIT) 669 (267) >100 % 46 >100 % 432 10068
EBIT (532) 249 >(100) % 1176 >(100) % 725 (4086)
Underlying EBIT 138 (19) >100 % 1223 (89) % 1158 5982
Underlying EBIT :
Bauxite & Alumina (73) (386) 81 % 159 >(100) % (791) 887
Primary Metal 53 (10) >100 % 484 (89) % 314 2486
Metal Markets 69 7 >100 % (39) >100 % 208 441
Rolled Products 71 214 (67) % 86 (17) % 640 673
Energy 322 220 47 % 441 (27) % 1459 1883
eliminations (305) (64) >(100) % 92 >(100) % (672) (389)
Underlying EBIT 138 (19) >100 % 1223 (89) % 1158 5982
Underlying EBITDA 1216 1114 9 % 2493 (51) % 5687 10497
operations 58 (37) >100 % 1035 (94) % 509 3947
operations (59) 17 >(100) % (159) 63 % (5) (1)
income (loss) 0 (20) 100 % 876 (100) % 504 3947
earnings per share 0,00 0,00 - 0,42 (100) % 0,26 1,89
Net income (loss) 113 (231) >100 % (749) >100 % (1246) 6749
Earnings per share 0,07 (0,14) >100 % (0,36) >100 % (0,61) 3,41
Investments 1107 806 37 % 3907 (72) % 3382 47510
debt (8271) (13678) 40 % (19895) 58 % (8271) (19895)
(kmt) 1397 1441 (3) % 1490 (6) % 5792 5264
production (kmt) 485 484 - 539 (10) % 1985 1982
price LME (USD/mt) 1940 2022 (4) % 2439 (20) % 2080 2480
price LME (NOK/mt) 11069 11856 (7) % 13834 (20) % 12047 13884
exchange rate 5,71 5,86 (3) % 5,67 1 % 5,79 5,60
sales, total Hydro
(kmt) 731 794 (8) % 804 (9) % 3254 3303
sales volumes to
(kmt) 226 228 (1) % 215 5 % 909 929
(GWh) 2448 2157 13 % 2706 (10) % 10307 9582
Contact Rikard Lindqvist
Cellular +47 41751199
Contact Halvor Molland
Cellular +47 92979797
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
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.
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
This announcement is distributed by Thomson Reuters on behalf of Thomson
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
information contained therein.
Source: Norsk Hydro via Thomson Reuters ONE
Press spacebar to pause and continue. Press esc to stop.