Lower prices for Hydro's main products - aluminium, oil and fertilizer - contributed to a 34 percent decline in earnings in the first quarter of 2002.
Net income in the first quarter of 2002 was NOK 2,132 million (NOK 8.30 per share) compared with NOK 3,235 million (NOK 12.40 per share) in the same period last year.
EBITDA (earnings before interest, taxes, depreciation and amortization) was NOK 8,588 million in the first quarter, compared to NOK 11,359 million in the same quarter last year.
The decline is mainly due to lower prices for oil, gas and aluminium.
For Aluminium, EBITDA was NOK 899 million, compared to NOK 1,430 million in the first quarter last year, primarily as a result of the significant economic downturn experienced during the second half of 2001.
Hydro took over the German aluminium company VAW on March 15, 2002, so VAW operations are only included for the last two weeks of the quarter.
Reorganization processes and the integration with VAW have resulted in a new segment structure. The figures from previous periods have been altered in the table to show comparable information.
For the Oil and Energy sector, EBITDA was NOK 5,847 million for the first quarter, compared to NOK 7,894 million in the corresponding period last year.
Hydro's oil and gas production was somewhat higher than last year, particularly internationally, as the Girassol field in Angola and Terra Nova in Canada came on stream at the beginning of the year. Oil production in Norway has, as forecast, been hit by the production constraints imposed by the Norwegian authorities (these are to expire at the end of the next quarter).
Hydro signed an agreement in the first quarter on the acquisition of state ownership (SDFI) interests in important fields on the Norwegian continental shelf where Hydro is operator. The agreement will not affect the accounts and production figures until after completion, which is expected at the end of the first half year.
The average crude oil price in the first quarter of 2002 was USD 21.10 per barrel, compared with USD 26.3 per barrel in the same period of the previous year. Measured in Norwegian kroner, the oil price declined by approximately 19 percent.
EBITDA for Agri was NOK 1,383 million in the first quarter of 2002, compared to NOK 1,570 million in the first quarter of 2001.
A considerable reduction in fertilizer prices has been offset by increased volumes, cost reductions and other improvement measures.
EBITDA for Petrochemicals was NOK 28 million in the first quarter of 2002, compared to NOK 109 million the same period last year. The lower results were mainly due to a reduction in the price of S-PVC of approximately 22 percent compared with the same period of the prior year. The negative effect was partly offset by lower raw materials costs.