Norsk Hydro : Fourth quarter 2014: Record results on improved markets and performance
(Thomson Reuters ONE) -
Norsk Hydro ASA's underlying earnings before financial items and tax (EBIT)
increased to NOK 2,886 million in the fourth quarter, up from NOK 1,490 million
in the third quarter of 2014. Bauxite & Alumina and Primary Metal delivered
their highest quarterly results since 2007.
* Record high quarterly underlying EBIT of NOK 2,886 million
* Proposed 2014 dividend NOK 1 per share
* Revised dividend policy: 40 % of net income over the cycle
* Higher realized all-in metal and alumina prices, supported by currency
movements
* Improved operating performance at Alunorte and Paragominas
* Karmøy technology pilot investment decision made
Higher realized aluminium prices, product premiums and realized alumina prices
had significant positive impact on the quarter together with the substantial
strengthening of the US dollar compared to the NOK and BRL.
Underlying EBIT for Bauxite and Alumina improved significantly in the fourth
quarter reflecting higher realized alumina prices, higher sales volumes and
lower operating costs at Alunorte together with positive currency developments.
Bauxite production increased in the quarter reaching 10.2 million mt on an
annualized basis.
"I am pleased to see the highest quarterly results we have reported since we
became a pure play aluminium company in 2007. For the second quarter in a row,
we also see a solid improvement in operating costs at Alunorte and Paragominas,
as well as increased production levels, reflecting robust operations," says
President and CEO, Svein Richard Brandtzæg. "In line with our commitment to
return cash to our shareholders, the Board of Directors proposed to raise the
annual dividend from NOK 0.75 per share to NOK 1 per share, and at the same time
revised the dividend policy from 30% to 40% of net income over the cycle"
Brandtzæg continues.
Underlying EBIT for Primary Metal improved substantially in the fourth quarter
influenced by a further increase in realized aluminium prices and product
premiums. The strengthening USD compared to the NOK and BRL also had a
significant positive impact on underlying results for the quarter.
"I am very pleased that we have decided to go ahead with the Karmøy technology
pilot project, following the approval from ESA last week. The technology pilot
will demonstrate Hydro's next generation technology aiming to produce aluminium
at the world's lowest energy consumption and CO(2) footprint per tonne of
metal," says Brandtzæg.
"We will continue our improvement efforts in 2015, both on the commercial and
operational side. As earnings outlook has improved, now is the time to really
show the strength of our improvement culture," says Brandtzæg.
Metal Markets delivered higher underlying EBIT compared to the previous quarter
influenced by positive currency effects and improved results from remelt
operations, partly offset by lower results from sourcing and trading activities.
Underlying EBIT for Rolled Products declined compared with the third quarter of
2014 mainly due to seasonally lower sales volumes. Margin pressure continued,
however, this was mostly offset by currency gains on export sales. Positive
contributions from the Rheinwerk smelter due to higher all-in metal1) prices had
a positive effect on underlying results for the quarter.
Compared to the third quarter, underlying EBIT for Energy increased due to
higher production.
Underlying EBIT for Sapa declined compared to the third quarter, mainly due to
seasonally lower demand.
Operating cash flow amounted to NOK 4.4 billion for the fourth quarter. Cash
used for investment activities amounted to NOK 0.8 billion net of sales
proceeds. Hydro's net debt position amounted to NOK 0.1 billion at the end of
the fourth quarter also influenced by unrealized currency losses, payment of
dividends to minority interests and a payment to Vale representing the first of
two tranches for the remaining Paragominas shares.
For the full year, underlying EBIT more than doubled to NOK 5,692 million
compared with NOK 2,725 million in 2013 influenced by the significant increase
in all-in metal prices1) together with the strengthening US dollar compared to
the NOK and BRL. Following several years of challenging market conditions, the
global aluminium market has improved with substantially higher all-in metal
prices together with a better demand and supply balance for primary aluminium
with a market deficit of around one million mt in the world outside China.
Significant operational and commercial improvements implemented throughout the
value chain have strengthened Hydro's ability to create value in an environment
of improving market fundamentals.
Hydro's Board of Directors proposes to pay a dividend of NOK 1 per share for
2014 reflecting the company's commitment to provide a cash return to its
shareholders. The dividend reflects our operational performance for 2014, strong
financial position and improved earnings outlook for 2015. Hydro's Board of
Directors has revised the company's dividend policy from an average of 30
percent to 40 percent of net income over the cycle to our shareholders.
Reported earnings before financial items and tax amounted to NOK 2,295 million
in the fourth quarter. In addition to the factors discussed above, reported EBIT
included net unrealized derivative losses and positive metal effects of negative
NOK 72 million in total. Reported earnings also included impairment charges of
NOK 145 million related to the rolling mill in Slim, Italy. In addition,
reported EBIT included NOK 337 million (Hydro's share) relating to Sapa mainly
for impairment and restructuring charges, and net other charges of NOK 36
million.
In the previous quarter reported earnings before financial items and tax
amounted to NOK 1,937 million including net unrealized derivative gains and
positive metal effects of NOK 476 million in total. Reported earnings also
included other charges of NOK 30 million.
Loss from continuing operations amounted to NOK 168 million in the fourth
quarter including a net foreign exchange loss of NOK 2,252 million. In the
previous quarter, income from continuing operations amounted to NOK 665 million
including a net foreign exchange loss of NOK 1,001 million.
1) The all-in metal price refers to the LME aluminium price plus premiums.
Key financial
information %
change
NOK million, Fourth Third Fourth prior
except per quarter quarter % change quarter year Year Year
share data 2014 2014 prior quarter 2013 quarter 2014 2013
-------------------------------------------------------------------------------
Revenue 21656 19698 10 % 16570 31 % 77907 64877
Earnings
before
financial
items and tax
(EBIT) 2295 1937 19 % (14) >100 % 5674 1663
Items
excluded from
underlying
EBIT 591 (447) >100 % 485 22 % 18 1063
-------------------------------------------------------------------------------
Underlying
EBIT 2886 1490 94 % 471 >100 % 5692 2725
-------------------------------------------------------------------------------
Underlying
EBIT :
Bauxite &
Alumina 528 (26) >100 % (379) >100 % (55) (1057)
Primary Metal 1989 1216 64 % 484 >100 % 3937 1422
Metal Markets 221 171 29 % 190 17 % 634 594
Rolled
Products 96 243 (60) % 100 (3) % 698 615
Energy 360 234 54 % 383 (6) % 1197 1653
Other and
eliminations (308) (349) 12 % (306) (1) % (717) (502)
-------------------------------------------------------------------------------
Underlying
EBIT 2886 1490 94 % 471 >100 % 5692 2725
-------------------------------------------------------------------------------
Underlying
EBITDA 4170 2615 59 % 1619 >100 % 10299 7306
-------------------------------------------------------------------------------
Underlying
income (loss)
from
discontinued
operations - - - - - - 220
-------------------------------------------------------------------------------
Net income
(loss) (168) 665 >(100) % (758) 78 % 1228 (839)
Underlying
net income
(loss) 1979 1043 90 % 140 >100 % 3728 1610
-------------------------------------------------------------------------------
Earnings per
share (0.18) 0.29 >(100) % (0.39) 53 % 0.39 (0.45)
Underlying
earnings per
share 0.83 0.43 96 % 0.02 >100 % 1.55 0.65
-------------------------------------------------------------------------------
Financial
data:
-------------------------------------------------------------------------------
Investments 1449 889 63 % 1057 37 % 3625 3761
Adjusted net
interest-
bearing debt (13587) (14061) 3 % (10128) (34) % (13587) (10128)
-------------------------------------------------------------------------------
Key
Operational
information
-------------------------------------------------------------------------------
Alumina
production
(kmt) 1501 1478 2 % 1452 3 % 5933 5377
Primary
aluminium
production
(kmt) 499 487 2 % 492 1 % 1958 1944
Realized
aluminium
price LME
(USD/mt) 1997 1906 5 % 1802 11 % 1850 1902
Realized
aluminium
price LME
(NOK/mt) 13355 11909 12 % 10916 22 % 11624 11160
Realized
NOK/USD
exchange rate 6.69 6.25 7 % 6.06 10 % 6.28 5.87
Metal
products
sales, total
Hydro (kmt) 780 811 (4) % 777 - 3305 3164
Rolled
Products
sales volumes
to external
market (kmt) 213 244 (13) % 226 (5) % 946 941
Power
production
(GWh) 2823 2170 30 % 2411 17 % 10206 10243
-------------------------------------------------------------------------------
Investor contact
Contact Pål Kildemo
Cellular +47 97096711
E-mail Pal.Kildemo(at)hydro.com
Press contact
Contact Halvor Molland
Cellular +47 92979797
E-mail Halvor.Molland(at)hydro.com
Certain statements included within this announcement contain forward-looking
information, including, without limitation, those relating to (a) forecasts,
projections and estimates, (b) statements of management's plans, objectives and
strategies for Hydro, such as planned expansions, investments or other projects,
(c) targeted production volumes and costs, capacities or rates, start up costs,
cost reductions and profit objectives, (d) various expectations about future
developments in Hydro's markets, particularly prices, supply and demand and
competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk
management, as well as (i) statements preceded by "expected", "scheduled",
"targeted", "planned", "proposed", "intended" or similar statements.
Although we believe that the expectations reflected in such forward-looking
statements are reasonable, these forward-looking statements are based on a
number of assumptions and forecasts that, by their nature, involve risk and
uncertainty. Various factors could cause our actual results to differ materially
from those projected in a forward-looking statement or affect the extent to
which a particular projection is realized. Factors that could cause these
differences include, but are not limited to: our continued ability to reposition
and restructure our upstream and downstream aluminium business; changes in
availability and cost of energy and raw materials; global supply and demand for
aluminium and aluminium products; world economic growth, including rates of
inflation and industrial production; changes in the relative value of currencies
and the value of commodity contracts; trends in Hydro's key markets and
competition; and legislative, regulatory and political factors.
No assurance can be given that such expectations will prove to have been
correct. Hydro disclaims any obligation to update or revise any forward looking
statements, whether as a result of new information, future events or otherwise.
This information is subject to the disclosure requirements pursuant to section
5-12 of the Norwegian Securities Trading Act.
Q4 Presentation:
http://hugin.info/106/R/1893442/670934.pdf
Q4 Report:
http://hugin.info/106/R/1893442/670933.pdf
This announcement is distributed by GlobeNewswire on behalf of
GlobeNewswire clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Norsk Hydro via GlobeNewswire
[HUG#1893442]
Unternehmensinformation / Kurzprofil:
Datum: 11.02.2015 - 07:00 Uhr
Sprache: Deutsch
News-ID 370708
Anzahl Zeichen: 15390
contact information:
Town:
Oslo
Kategorie:
Business News
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