- Adjusted EBIT of NOK 8 million
- Substantial drop in prices for alumina and aluminum
- Record bauxite mining
- Lower sales in the downstream area, partly offset by lower operating costs
- Lower electricity prices and production in the Energy business area
“The quarterly prices for alumina and aluminum clearly reflect the uncertainty in the markets and in the global economy and have had a major impact on our weak quarterly results. Hydro responds to this by focusing on operational performance, portfolio management and capital discipline, "said CEO Svein Richard Brandtzæg.
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" The proposed transaction with Orkla to form a global leader of aluminum solutions, Hydro strengthens as a global, resource-rich aluminum company, and also our extrusion business. & nbsp; Most of the markets for extruded products remain difficult, and the new company will be better positioned to meet these challenges and take advantage of long-term growth prospects for aluminum products, ”said Brandtzæg.
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Adjusted EBIT in Bauxite & amp; Alumina continued to decline compared to the weak earnings in the previous quarter, mainly due to the lower prices for alumina and lower sales.
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Adjusted EBIT in the Primary Metal division fell compared to the second quarter, and was also influenced by lower prices. Lower operating costs partially offset the negative market impact. Adjusted earnings for Qatalum were weaker than in the second quarter, which included a final insurance benefit linked to the 2010 power outage.
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Excluding inventory and currency effects Hydro's adjusted midstream business was stable in the quarter.
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Lower operating costs in Hydro's downstream business had a positive impact on adjusted earnings for the quarter. However, adjusted earnings for Extruded Products declined as lower seasonal sales and demand continued to decrease. & Nbsp; Quarterly results continue to be impacted by difficult economic conditions in Europe.
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Energy posted lower adjusted EBIT in the third quarter than in the previous quarter due to lower production and lower prices.
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Cash flow from operating activities was NOK 1.1 billion in the quarter. Cash flow for investing activities was NOK 1 billion. Hydro's net debt was approximately zero at the end of the third quarter.
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Hydro recorded a reported loss before financial items and taxes of NOK 414 million in the third quarter, which includes unrealized losses from derivatives and negative metal effects of NOK 108 million and other items in NOK 314 million. Other items include a loss from the sale of Portalex of NOK 144 million and from depreciation of other assets of NOK 163 million. Other items also include NOK 75 million in rationalization and closure costs related to Extruded Products and Kurri Kurri, and NOK 68 million in pension benefits.
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Hydro recorded a reported pre-tax loss and tax loss of NOK 720 million in the last quarter, which included unrealized gains on derivative financial instruments of NOK 300 million, cost of rationalization and closings of 408 million NOK, depreciation of NOK 1,175 million and positive metal effects of NOK 9 million.
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Hydro reported a net loss of NOK 231 million in the third quarter, which includes a currency gain of NOK 283 million. & nbsp; Hydro reported a net loss of NOK 1,712 million in the previous quarter, which included a currency loss of NOK 883 million.
In English:
Key financial information | ||||||||
NOK million, except per share data | Third quarter 2012 |
Second & nbsp; quarter 2012 |
% change prior quarter | Third quarter 2011 |
% change prior year quarter | First 9 months 2012 |
First 9 months 2011 |
Year 2011 |
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& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Revenue | 19.004 | 21.604 | (12)% | 23,829 | (20)% | 62,355 | 69,695 | 91,444 |
& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | |
Earnings before financial items and tax (EBIT) | (414) | (720) | 42% | 2,222 | & gt; (100)% | (469) | 10,189 | 9,827 |
Items excluded from underlying EBIT | 422 | 1,269 | (67)% | (576) | & gt; 100% | 1,583 | (5,189) | (3,694) |
Underlying EBIT | 8 | 549 | (98)% | 1,646 | (99)% | 1,115 | 5,000 | 6.133 |
& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Underlying EBIT: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | |
Bauxite & amp; Alumina | (386) | (188) | & gt; (100)% | 302 | & gt; (100)% | (718) | 729 | 887 |
Primary Metal | (10) | 240 | & gt; (100)% | 653 | & gt; (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 |
& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Underlying EBITDA | 1,265 | 1,777 | (29)% | 2,985 | (58)% | 4,913 | 8,628 | 11,152 |
& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | ||
Net income (loss) | (231) | (1,712) | 86% | 797 | & gt; (100)% | (1,359) | 7,498 | 6,749 |
Underlying net income (loss) | (20) | 268 | & gt; (100)% | 1,071 | & gt; (100)% | 505 | 3,071 | 3,947 |
& nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Earnings per share | (0.14) | (0.78) | 83% | 0.49 | & gt; (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 |
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Financial data: | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; | & nbsp; |
Investments | 965 | 777 | 24% | 1.125 | (14)% | 2,639 | 43,836 | 48,025 |
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Key operational information | ||||||||
Alumina production (kmt) | 1,441 | 1,491 | (3)% | 1,553 | (7)% | 4,396 | 3,773 | 5,264 |
Primary aluminum production (kmt) | 484 | 502 | (3)% | 522 | (7)% | 1,500 | 1,443 | 1,982 |
Realized aluminum price LME (USD / mt) | 2,022 | 2,167 | (7)% | 2,592 | (22)% | 2,119 | 2,494 | 2,480 |
Realized aluminum price LME (NOK / mt) | 11,856 | 12.637 | (6)% | 14,225 | (17)% | 12,321 | 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 & nbsp; (kmt) | 794 | 857 | (7)% | 850 | (7)% | 2,522 | 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 |
: 23 October 2012