Adjusted EBIT rose to NOK 2,737 million for the full year, compared to NOK 1,297 million in 2012. Cost savings, good results from the Qatalum aluminum smelter and higher product premiums contributed to the positive development, even though aluminum prices remained at a low level.
- Adjusted EBIT of NOK 483 million
- $ 300 program completed, NOK 1.5 billion saved
- Increase in production at Alunorte, offset by ICMS taxes
- Primary Metal earnings rise as a result of insurance benefits for Qatalum
- Seasonal effects in the processing area, lower electricity generation
- Proposed dividend for 2013: NOK 0.75 per share
- Expected increase in aluminum demand in 2014: 2-4 percent outside of China
“Extensive improvement programs have strengthened our results for 2013, despite market uncertainty and low aluminum prices. Even though there is still uncertainty, 2014 will start with a positive trend as we assume that this year's aluminum demand in the world outside of China will be slightly higher than production, ”says Svein Richard Brandtzæg, CEO of Hydro.
Adjusted EBIT in the Bauxite & amp; Alumina improved in the fourth quarter thanks to higher production at the Alunorte alumina refinery in Brazil after some production interruptions in 2013. However, claims linked to ICMS taxes offset this.
“I am pleased to report that the production at Alunorte has reached the level of 2012 again, which means a stable supply of first-class alumina. A stable and good operating process at Alunorte will remain one of our top priorities in 2014, "explains Brandtzæg." Stable and predictable framework conditions are extremely important for Hydro, no matter where we operate, and a prerequisite for long-term engagement. We are in talks with the Brazilian authorities and do our utmost to ensure that this is also the case in Brazil. "
The $ 300 program for Hydro's proprietary smelters ended at the end of the year and resulted in annual improvements of NOK 1.5 million compared to 2009 cost levels.
“After four years of hard work, it is a milestone for Hydro to have completed the industry's most ambitious improvement program. We are pursuing opportunities in all parts of our work with undiminished intensity in order to further improve our robustness, "says Brandtzæg.
Adjusted earnings (EBIT) for the Primary Metal division improved in the fourth quarter compared to the third quarter, primarily due to insurance benefits related to the fire in the cooling tower at Qatalum's facility in Qatar in 2012.
Metal Markets achieved higher adjusted EBIT in the quarter thanks to higher margins and better results from procurement and trading activities.
Adjusted EBIT in the Rolled Products division decreased in the fourth quarter, mainly due to the seasonal decline in sales and more maintenance work.
Adjusted EBIT in the Energy division decreased in the fourth quarter compared to the third quarter. The main reason for this was the lower generation of electricity than in the previous quarter, when it was unusually high.
Adjusted EBIT for Sapa, the 50-50 extrusion joint venture, decreased in the fourth quarter due to a seasonally weaker quarter and costs related to inventory adjustments and trade receivables.
Cash flow from operations in the fourth quarter was NOK 2.5 billion. Cash flow for investing activities was NOK 0.9 billion. Hydro's net liquidity increased by NOK 1.2 billion and was approximately NOK 0.7 billion at the end of the fourth quarter.
Earnings before financial items and taxes in the fourth quarter were minus NOK 3 million. The reported EBIT includes unrealized losses from derivatives and negative metal effects with a total amount of NOK 151 million.
The reported result also includes a loss of NOK 69 million from the sale of a rolling mill in Malaysia, costs of NOK 392 million related to the lease for the group's headquarters, and NOK 109 million in fines Combined with a comparison of tax claims in Brazil and costs of NOK 172 million, which are mainly linked to rationalization measures at Sapa. In addition, the reported result includes gains from pension plan reductions of NOK 390 million, which are linked to the transition to defined contribution pension plans.
Hydro's Board of Directors proposes a dividend of NOK 0.75 per share for 2013, reflecting the company's goal of paying a dividend to its shareholders. The dividend reflects our 2013 operating results and the company's strong financial position, even under the uncertain market conditions.
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| Key financial information | |||||||
| NOK million, except per share data | Fourth quarter 2013 |
Third quarter 2013 |
% change prior quarter | Fourth quarter 2012 |
% change prior year quarter | Year 2013 |
Year 2012 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Revenue | 16,571 | 16.146 | 3% | 15,585 | 6% | 64,880 | 64,181 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Earnings before financial items and tax (EBIT) | (3) | 597 | & gt; (100)% | 704 | & gt; (100)% | 1,674 | 571 |
| Items excluded from underlying EBIT | 485 | 62 | & gt; 100% | (532) | & gt; 100% | 1,063 | 725 |
| Underlying EBIT | 483 | 659 | (27)% | 172 | & gt; 100% | 2,737 | 1,297 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Underlying EBIT: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Bauxite & amp; Alumina | (379) | (370) | (2)% | (73) | & gt; (100)% | (1,057) | (791) |
| Primary Metal | 484 | 337 | 44% | 58 | & gt; 100% | 1,422 | 335 |
| Metal Markets | 190 | 111 | 70% | 70 | & gt; 100% | 594 | 210 |
| Rolled Products | 111 | 182 | (39)% | 70 | 59% | 627 | 637 |
| Energy | 383 | 485 | (21)% | 322 | 19% | 1,653 | 1,459 |
| Other and eliminations | (306) | (87) | & gt; (100)% | (275) | (11)% | (502) | (553) |
| Underlying EBIT | 483 | 659 | (27)% | 172 | & gt; 100% | 2,737 | 1,297 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Underlying EBITDA | 1,578 | 1,753 | (10)% | 1,250 | 26% | 7,119 | 5,827 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | |
| Underlying income (loss) from discontinued operations | - | 57 | (100)% | (54) | 100% | 220 | (5) |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Net income (loss) | (758) | 321 | & gt; (100)% | 87 | & gt; (100)% | (839) | (1,331) |
| Underlying net incomme (loss) | 140 | 393 | (64)% | (24) | & gt; 100% | 1,610 | 408 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
| Earnings per share | (0.39) & nbsp; | 0.11 & nbsp; | & gt; (100)% & nbsp; | 0.06 & nbsp; | & gt; (100)% & nbsp; & nbsp; | (0.45) | (0.65) & nbsp; |
| Underlying earnings per share | 0.02 | 0.14 | (83)% | (0.01) | & gt; 100% | 0.65 | 0.21 |
| & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | |
| Financial data: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | |
| Investments | 971 | 948 | 2% | 1.107 | (12)% | 3,586 | 3,382 |
| Adjusted net interest-bearing debt | (9,503) | (10,732) | 11% | (8,304) | (14)% | (9,503) | (8,304) |
| Key operational information | |||||||
| Alumina production (kmt) | 1,452 | 1,316 | 10% | 1,397 | 4% | 5,377 | 5,792 |
| Primary aluminum production (kmt) | 492 | 491 | - | 485 | 2% | 1,944 | 1,985 |
| Realized aluminum price LME (USD / mt) | 1,802 | 1,822 | (1)% | 1,940 | (7)% | 1,902 | 2,080 |
| Realized aluminum price LME (NOK / mt) | 10,916 | 10,938 | - | 11,069 | (1)% | 11,160 | 12,047 |
| Realized NOK / USD exchange rate | 6.06 | 6.00 | 1% | 5.71 | 6% | 5.87 | 5.79 |
| Metal products sales, total Hydro & nbsp; (kmt) | 777 | 792 | (2)% | 731 | 6% | 3,164 | 3,254 |
| Rolled Products sales volumes to external market (kmt) | 226 | 234 | (3)% | 226 | - | 941 | 909 |
| Power production (GWh) | 2,411 | 2,838 | (15)% | 2,448 | (1)% | 10,243 | 10.307 |
Published: 12 February 2014