- Adjusted EBIT of NOK 659 million
- Lower costs offset weaker prices for alumina and aluminum
- Low production at Alunorte after power outages
- Higher electricity generation in the Energy business area
- New joint venture Sapa founded
- Forecast for global aluminum demand in 2013: around 2 percent growth outside of China
"I am pleased to say that we are well on the way to realizing cost savings of US $ 300 per ton in our company's smelters by the end of 2013. It's a great achievement for Hydro and our organization. Our striving to achieve the best and keep getting better is a good platform for the future, ”says Hydro Svein CEO Richard Brandtzæg.
The positive development in the third quarter was partly due to a further deterioration in adjusted earnings in the Bauxite & amp; Alumina balanced. Adjusted EBIT for Bauxite & amp; Alumina declined compared to the second quarter, mainly due to lower LME prices linked to the LME and a continued weak production volume in the Alunorte alumina refinery after the power cuts in the first half of 2013.
After the power outages at Alunorte and the resulting production interruptions in the previous months, we immediately mobilized resources to stabilize and increase production in the refinery again. After stabilization, we are now experiencing that production will gradually increase again after the interruptions, albeit from a low level, ”says Brandtzæg.
The Primary Metal business area saw an increase in adjusted EBITS despite lower aluminum prices. Lower alumina and electricity costs, higher premiums and seasonal lower fixed costs had a positive impact on adjusted earnings in the quarter. Primary Metal placed about 50 percent of its expected primary aluminum production on the market in the fourth quarter of 2013, at a price of around $ 1,800 a ton.
Adjusted EBIT in the Metal Markets segment decreased compared to the previous quarter, mainly due to the seasonally lower volume and lower margins.
Compared to the second quarter, adjusted EBIT in the Rolled Products business area was stable. Sales were lower due to the season, but operating costs also decreased.
Adjusted EBIT for the Energy business area increased compared to the second quarter. This was due to higher electricity generation and spot prices, which were influenced by low rainfall.
Cash flow from operations in the third quarter was NOK 1.1 billion. Cash flow for investing activities was NOK 0.7 billion. Hydro's net debt was approximately NOK 0.5 billion at the end of the third quarter.
Reported earnings before interest and taxes in the third quarter were NOK 597 million. Reported EBIT includes unrealized gains from derivatives and negative metal effects with a total loss of NOK 80 million, gains from sales of NOK 53 million and other items with a net loss of NOK 36 million.
The Alunorte alumina refinery and the Albras smelter in Brazil have closed additional forward exchange contracts in US dollars for the second half of 2013 and 2014. The agreed average exchange rate for the futures contracts is 2.30 and 2.41 for 2013 and 2014, respectively.
More in English:
Key financial information | ||||||||
NOK million, except per share data | Third quarter 2013 |
Second & nbsp; quarter 2013 |
% change prior quarter | Third quarter 2012 |
% change prior year quarter | First 9 months 2013 |
First 9 months 2012 |
Year 2012 |
& nbsp; | ||||||||
Revenue | 16,146 | 16,053 | 1% | 14,722 | 10% | 48,309 | 48,596 | 64,181 |
& nbsp; | ||||||||
Earnings before financial items and tax (EBIT) | 597 | 375 | 59% | (232) | & gt; 100% | 1,677 | (132) | 571 |
Items excluded from underlying EBIT | 62 | 144 | (57)% | 249 | (75)% | 577 | 1,257 | 725 |
Underlying EBIT | 659 | 518 | 27% | 16 | & gt; 100% | 2,254 | 1.125 | 1,297 |
& nbsp; | ||||||||
Underlying EBIT: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Bauxite & amp; Alumina | (370) | (244) | (51)% | (386) | 4% | (678) | (718) | (791) |
Primary Metal | 337 | 237 | 42% | (4) | & gt; 100% | 938 | 277 | 335 |
Metal Markets | 111 | 147 | (24)% | 8 | & gt; 100% | 404 | 140 | 210 |
Rolled Products | 182 | 181 | 1% | 213 | (15)% | 516 | 567 | 637 |
Energy | 485 | 268 | 81% | 220 | & gt; 100% | 1,270 | 1,137 | 1,459 |
Other and eliminations | (87) | (70) | (23)% | (35) | & gt; (100)% | (195) | (278) | (553) |
Underlying EBIT | 659 | 518 | 27% | 16 | & gt; 100% | 2,254 | 1.125 | 1,297 |
& nbsp; | ||||||||
Underlying EBITDA | 1,753 | 1,624 | 8% | 1,149 | 53% | 5,541 | 4,577 | 5,827 |
& nbsp; | ||||||||
Underlying income (loss) from discontinued operations | 57 | 112 | (49)% | 16 | & gt; 100% | 220 | 49 | (5) |
& nbsp; | ||||||||
Net income (loss) | 321 | (665) | & gt; 100% | (256) | & gt; 100% | (81) | (1,418) | (1,331) |
& nbsp; | ||||||||
Underlying net income (loss) | 393 | 427 | (8)% | (44) | & gt; 100% | 1,470 | 432 | 408 |
& nbsp; | ||||||||
Earnings per share | 0.11 | (0.31) | & gt; 100% | (0.15) | & gt; 100% | (0.06) | (0.70) | (0.65) |
Underlying earnings per share | 0.14 | 0.19 | (26)% | (0.01) | & gt; 100% | 0.63 | 0.22 | 0.21 |
& nbsp; | ||||||||
Financial data: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Investments | 948 | 612 | 55% | 806 | 18% | 2,615 | 2,275 | 3,382 |
Adjusted net interest-bearing debt | & nbsp; (10,732) | (11,317) | 5% | (12,918) | 17% & nbsp; | (10,732) | (12,918) | (8,304) |
& nbsp; | ||||||||
Key operational information | ||||||||
Alumina production (kmt) | 1,316 | 1,248 | 5% | 1,441 | (9)% | 3,925 | 4,396 | 5,792 |
Primary aluminum production (kmt) | 491 | 483 | 2% | 484 | 1% | 1,452 | 1,500 | 1,985 |
Realized aluminum price LME (USD / mt) | 1,822 | 1,926 | (5)% | 2,022 | (10)% | 1,932 | 2,119 | 2,080 |
Realized aluminum price LME (NOK / mt) | 10,938 | 11,217 | (2)% | 11,856 | (8)% | 11,233 | 12,321 | 12,047 |
Realized NOK / USD exchange rate | 6.00 | 5.82 | 3% | 5.86 | 2% | 5.81 | 5.81 | 5.79 |
Metal products sales, total Hydro & nbsp; (kmt) | 792 | 789 | - | 794 | - | 2,387 | 2,522 | 3,254 |
Rolled Products sales volumes to external market (kmt) | 234 | 245 | (5%) | 228 | 3% | 715 | 683 | 909 |
Power production (GWh) | 2,838 | 2,090 | 36% | 2,157 | 32% | 7,831 | 7,860 | 10.307 & nbsp; |
& nbsp; & nbsp;
- Investor contact
Contact: Rikard Lindqvist
Cellular: +47 41751199
E-mail: & nbsp; & nbsp; Rikard.Lindqvist@hydro.com
- Media contact
Contact: Halvor Molland
Cellular: +47 92979797
E-mail: & nbsp; & nbsp; Halvor.Molland@hydro.com & nbsp;
: 23 October 2013