Norsk Hydro first quarter 2012: Lower aluminium prices, strong Energy result
(Thomson Reuters ONE) -
Hydro's underlying earnings before financial items and tax amounted to NOK 557
million in the first quarter, down from NOK 1,133 million in the previous
quarter. Lower realized aluminium prices and continued weak markets, in
particular for European extrusion operations, weighed down underlying results.
Hydro's Energy business posted solid results along with power production at
record levels.
* Underlying EBIT NOK 557 million
* Lower alumina and aluminium prices
* Solid production performance
* Strong Energy result, record production level
* Aluminium sales volumes up on seasonal effects, alumina sales down
* 2012 aluminium demand growth outlook around 3 percent outside China
"Continued weak demand and low aluminium prices weigh down first-quarter
results. We will continue our restructuring efforts, reduce costs and take firm
actions required to keep a steady course," Hydro's President and CEO Svein
Richard Brandtzæg said. "Dependent on the further macro-economic development in
Europe, we expect global aluminium demand growth outside China at around 3
percent in 2012," he said.
"I am pleased to see strong production performance, particularly in the
strategically important assets Qatalum, Paragominas and Alunorte, providing a
firm foundation for progress when markets pick up. Effective and forceful
improvement programs in our fully owned smelters are proceeding according to
plan, also contributing to a solid platform for the future," Brandtzæg said.
Underlying EBIT for Bauxite & Alumina fell from the fourth quarter, mainly due
to lower realized alumina prices and lower sales volumes. Bauxite and alumina
production was stable.
Lower realized aluminium prices and lower premiums had a substantial negative
effect on underlying EBIT for Primary Metal in the quarter, partly offset by
higher sales volumes and lower raw material costs. Production volumes declined
mainly due to the curtailment of one production line at the Kurri Kurri smelter
in Australia.
Underlying results for Hydro's midstream operations rose from the fourth quarter
which included significant negative currency effects. Underlying EBIT excluding
currency effects increased in the first quarter, mainly due to higher volumes in
the remelt operations.
Underlying EBIT for Hydro's downstream business, Rolled Products and Extruded
Products, improved from the fourth quarter result which was hit by seasonal
declines and poor market developments in Europe. Demand remained weak for
Hydro's European extrusion business and Building Systems in particular.
The Energy business area continued to deliver solid underlying results for the
quarter along with power production at record levels.
Operating cash flow amounted to NOK 0.6 billion for the quarter. Net cash used
for investment activities amounted to NOK 0.9 billion. Hydro's net cash position
was NOK 1.5 billion at the end of the first quarter.
Reported earnings before financial items and tax amounted to NOK 665 million in
the first quarter including net unrealized derivative gains of NOK 307 million,
negative metal effects of NOK 60 million and rationalization and closure costs
of NOK 132 million. Amounts relating to other items of a special or infrequent
nature were not significant for the first quarter.
Hydro had net income of NOK 585 million for the first quarter including net
foreign exchange gains of NOK 410 million. In the fourth quarter, Hydro incurred
a net loss amounting to NOK 749 million including net foreign exchange losses of
NOK 28 million.
Key financial
information
% change
NOK million, First Fourth % change First prior
except per quarter quarter prior quarter year Year
share data 2012 2011 quarter 2011 quarter 2011
-------------------------------------------------------------------------------
Revenue 21 748 21 749 - 21 138 3 % 91 444
Earnings before
financial items
and tax (EBIT) 665 (362) >100 % 5 855 (89) % 9 827
Items excluded
from underlying
EBIT (108) 1 494 >(100) % (4 408) 98 % (3 694)
-------------------------------------------------------------------------------
Underlying EBIT 557 1 133 (51) % 1 448 (62) % 6 133
-------------------------------------------------------------------------------
Underlying EBIT
:
Bauxite &
Alumina (144) 159 >(100) % 155 >(100)% 887
Primary Metal 30 484 (94) % 583 (95) % 2 486
Metal Markets 87 (39) >100 % 143 (39) % 441
Rolled Products 151 86 76 % 232 (35) % 673
Extruded
Products 14 (90) >100 % 105 (86) % 151
Energy 556 441 26 % 573 (3) % 1 883
Other and
eliminations (137) 92 >(100) % (344) 60 % (389)
-------------------------------------------------------------------------------
Underlying EBIT 557 1 133 (51) % 1 448 (62) % 6 133
-------------------------------------------------------------------------------
Underlying
EBITDA 1 870 2 524 (26) % 2 415 (23) % 11152
-------------------------------------------------------------------------------
Net income
(loss) 585 (749) >100 % 5 154 (89) % 6 749
-------------------------------------------------------------------------------
Underlying net
income (loss) 256 876 (71) % 834 (69) % 3 947
-------------------------------------------------------------------------------
Earnings per
share 0.25 (0.36) >100 % 2.89 (92) % 3.41
-------------------------------------------------------------------------------
Underlying
earnings per
share 0.13 0.42 (70) % 0.45 (72) % 1.89
-------------------------------------------------------------------------------
Financial data:
-------------------------------------------------------------------------------
Investments 898 4 190 (79) % 41 625 (98) % 48025
Adjusted net
interest-
bearing debt (19231) (19895) 3 % (20490) 6 % (19895)
-------------------------------------------------------------------------------
Key Operational
information
Alumina
production
(kmt) 1 464 1 490 (2) % 773 89 % 5 264
Primary
aluminium
production
(kmt) 514 539 (5) % 415 24 % 1 982
Realized
aluminium price
LME (USD/mt) 2155 2439 (12) % 2358 (9) % 2480
Realized
aluminium price
LME (NOK/mt) 12404 13834 (10) % 13607 (9) % 13884
Realized
NOK/USD
exchange rate 5.75 5.67 1 % 5.77 - 5.60
Metal Markets
sales volumes
to external
market (kmt) 591 564 5 % 467 27 % 2091
Rolled Products
sales volumes
to external
market (kmt) 227 215 6 % 245 (7) % 929
Extruded
Products sales
volumes to
external market
(kmt) 133 121 10 % 136 (2) % 536
Power
production
(GWh) 3 190 2 706 18 % 2 308 38 % 9 582
-------------------------------------------------------------------------------
Investor contact
Contact Rikard Lindqvist
Cellular +47 41751199
E-mail Rikard.Lindqvist(at)hydro.com
Press contact
Contact Halvor Molland
Cellular +47 92979797
E-mail Halvor.Molland(at)hydro.com
*********
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.
This information is subject of the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
Q1 Presentation:
http://hugin.info/106/R/1606521/509333.pdf
Q1 Report:
http://hugin.info/106/R/1606521/509332.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#1606521]
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Datum: 27.04.2012 - 01:02 Uhr
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