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On the top line, revenues ended at NOK 53.6 billion in the second quarter of the year, compared to NOK 64.8 billion in the same period last year.
In advance, a turnover of NOK 48.4 billion was expected, according to analyst estimates obtained by Bloomberg.
In the recent report, it appears that the result before tax has halved compared to the second quarter of last year. Hydro’s profit before tax was NOK 6.9 billion in the quarter, compared to NOK 14.1 billion last year.
– The results reflect a weaker market, but also the effect of the continuous improvement work in the organisation. These improvement measures are crucial to ensure a robust business and strengthen the company’s value creation when the market falls, says CEO Hilde Merete Aasheim.
Adjusted gross operating profit (ebitda) ended at NOK 7.1 billion.
On Oslo Børs, Hydro was among the most traded shares on Friday morning, and the share fell by nearly three per cent.
The article continues under the advertisement Norsk Hydro asa, result per 2nd quarter (in NOK MNOK) 2023 2022 Change Revenue 105 113.5 -7.5% Operating profit (ebit) 12.2 21.6 -43.8% Profit before tax 9 22.5 -60%
Lower sales prices
In Friday’s report, Aasheim points out that the decline in profits is due to lower sales prices for aluminum and alumina, but some of this was offset by positive currency effects and lower costs.
Hydro is making progress towards achieving overall improvements and commercial targets of NOK 14 billion by 2027, the report points out.
– We continue to reap benefits from our strong commercial position, which makes our margins more robust in a period where we see a large decline in volumes across Europe and North America, says Aasheim.
During the second quarter, the company had a review of the investment portfolio for the current year – and has increased the investment target to NOK 20.5 billion from NOK 16.5 billion. The upward adjustment is driven by currency conversion effects and inflation, in addition NOK 1.5 billion comes from the adjusted bid for Alumetal and other current investments the company has made, it is stated.
Transactions for NOK 16 billion
During the second quarter, the company entered into several agreements.
It sold 30 percent of an alumina refinery in Brazil as part of a comprehensive agreement with Glencore, worth NOK 12 billion including debt. The refinery, named Alunorte, has occasionally created major challenges for Hydro, where a heavy downpour in 2018 led to accusations of discharge of waste substances and pollution of a nearby river. Among other things, Hydro was forced by local environmental authorities to temporarily halve production, but this order was lifted some ten months later.
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Measures related to clean-up and limited production have cost Hydro several billions, and the company is still involved in a civil lawsuit in the Netherlands related to the plant.
At the end of June, it also became known that Hydro increased the bid for the purchase in the tender process for 100 percent of the shares in the Polish company Alumetal to PLN 82.00 per share. Over 80 percent of the shares in Alumetal have already been subscribed to in Hydro’s offer.
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Hydro stated at the beginning of July that it ended up buying 97 per cent of the shares, and would continue the process of buying all the shares. (Terms) Copyright Dagens Næringsliv AS and/or our suppliers. We would like you to share our cases using links, which lead directly to our pages. Copying or other forms of use of all or part of the content may only take place with written permission or as permitted by law. For further terms see here.
2023-07-21 08:15:00
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