Primary Metal
2009 targets
• Effectively adjust capacity to decreasing demand
• Further improve smelter average cost position
• Reduce cost in continuing operations by improved effectiveness
and fixed cost reductions
• Further develop next-generation smelter technology
2009 results
• Curtailed 26 percent of primary capacity and 22 percent of alumina capacity
• Cost per mt reduced by 30 percent due to reduced raw material costs and improvement measures
• Achieved improved effectiveness and fixed cost reductions in
continuing operations
• Verification program for HAL4e electrolysis cell technology successfully completed with main target criteria met
2010 targets
• Reduce cost per mt by USD 100, realizing 90 percent by end 2011
• Effective ramp-up of Qatalum completed during fourth quarter 2010
• Achieve measurable benefits toward cost reduction from AMPS
• Enhance value from existing alumina assets
• Assertive approach in raw materials markets
• Strong capital discipline
Ambitions going forward
Going forward, Hydro has an ambition to expand its upstream activities while maintaining a strong emphasis on sustainable cost development. We will continue to focus on lean smelter operations, operational excellence and safety. Ongoing developments of next-generation technology, HAL4e will provide a strong technological basis for continued organic growth, increased efficiency and lower emissions.
Metal Markets
2009 targets
• Effectively adjust capacity to decreasing demand
• Reduce cost in continuing operations by improved effectiveness and
fixed cost reductions
• Enhance market position
2009 results
• Utilized flexible remelt production system to adjust to sharp decline followed
by strong recovery in second half of year
• Significant reduction in fixed and variable costs
• Strengthened position in key markets
2010 targets
• Successful market entry for Qatalum's value-added metal products
• Utilize flexibility in remelting and recycling production systems to
capture opportunities
• Operational excellence and safety in plant operations
• Profitable metal sourcing and trading activities and efficient hedging operations
Ambitions going forward
Our ambition is to strengthen our relative market position as we adjust to changes in market demand, and to build new market positions outside Europe.
Rolled Products
2009 targets
• TRI improvement of 20 percent
• Decisive cost management and focus on cash flow
• Maintain high performance and margin focus in declining market environment
2009 results
• TRI improvement of 24 percent
• Positive cash flow achieved despite difficult business climate, effective cost measures implemented
• Further progress in customer-oriented performance indicators, margin level somewhat lower in difficult market environment
2010 targets
• Further TRI reduction of 20 percent
• Selective gain in market share and improvement in margins
• Improvement in operational performance with focus on customer service
• Maintain focus on cost level and benefits achieved in 2009, counterparty
risk and net operating capital
• Implementation of Rolled Products Business System in all units
Ambitions going forward
We are committed to safety and to eliminating serious accidents in our operations. We aim to increase the returns of our rolled products business, concentrating on margins, cost efficiency and operational excellence - well supported by the roll out of the Rolled Products Business System. We will stay focused on innovation and technology to sharpen our competitive edge.
Extruded Products
2009 targets
• TRI improvement of 20 percent on 2008
• Decisive cost management and focus on cash flow
• Maintain high performance and margin focus in declining market environment
• Additional turnaround measures in Automotive and Extrusion in US
• Active portfolio management in Europe and Middle East
2009 results
• TRI improvement of 26 percent
• Continued cost improvement, recovered about 80 percent of the market loss
• Automotive Structures divestment completed
• Strong rationalization accomplished in US extrusion operations
• Selected growth projects in Building Systems executed
2010 targets
• Further TRI reduction of 20 percent
• Decisive cost management and focus on cash flow
• Realize market, cost and growth ambitions in Extrusion Eurasia
• Prepare for additional growth and manage additional market challenges
Ambitions going forward
Our goal is to be the clear performance leader in Europe's extrusion and building system industries, reinforcing our leadership position through selective growth and further development of new high-performing solutions. We will focus on innovation and technology to sharpen our competitive edge. We are committed to safety and to eliminating serious accidents in our operations.
Energy
2009 targets
• Competitive energy sourcing arrangements for aluminium operations
• Operational excellence and safety of operations
2009 results
• Competitive equity energy, no new commercial agreements
• Successful power portfolio optimization and reliable power supply in spite
of outage at Suldal 1
• A tragic accident in Svandalsflona caused two fatalities
2010 targets
• Competitive energy sourcing arrangements for aluminium operations
• Operational excellence and safety of operations
• Competitive framework conditions
Ambitions going forward
Our goal is to develop equity power position and capitalize on our energy competence, supporting the sourcing of power to our smelters on a global basis.
Viability performance
2009 target
• Continue working toward our climate ambitions
2009 results
• Revised emission targets for the electrolysis process
• The electrolysis process of aluminium production emitted
1.85 t CO2e/t aluminium
2010
• The electrolysis process of aluminium production emits
1.73 t CO2e/t aluminium
• Develop a recycling strategy
Ambition
• Aluminium production emits 1.52 t CO2e/t aluminium in 2013
• Reduce specific climate gas emissions from rolling processes
by 20 percent from 2007 to 2013
• Substantially increase recycling of contaminated and post-consumer scrap