Hydro is enjoying continued profitability at a high level, although economic conditions in the US and Europe affected second quarter earnings. Results for the year so far are the best ever first-half results.
Net income in the second quarter was NOK 2,180 million, which is NOK 595 million lower than the corresponding period in 2000. This is due to unfavorable market conditions and write-offs relating to downsizing and other rationalization programs.
First half earnings NOK 5,415 million - an increase of NOK 189 million over the corresponding period in 2000 - representing a new record in first-half results.
"I am pleased that Hydro can deliver its best first-half earnings ever and that the second quarter earnings are also at a high level. But the weak economic conditions in the US are affecting our markets, and these effects are also being felt in Europe," says President and CEO Eivind Reiten.
"Improvement programs in our operations have produced results that partially offset these effects, but more initiatives are necessary if we are to reach our ambitious profitability goals.
"The confirmation in the second quarter of Hydro's share of 30 percent - and our role in providing technical assistance - in Block 34 offshore Angola, as well as our acquisition of a share of Block 25, have been important steps in the development of our international oil activities.
"The decision to build a large new aluminium plant in Sunndalsøra, Norway, which will deliver a top level of productivity, will strengthen Hydro's position as a leading player in this industry."
Operating income for the second quarter was NOK 6,065 million, which is NOK 967 million lower than the corresponding period in 2000. The second quarter result contains write-offs for non-recurring items relating to these programs totaling NOK 865 million.
Earnings per share were NOK 8.40 in the second quarter, compared to NOK 10.60 in the corresponding period in 2000.