In This Article:
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EBITA: NOK 7.4 billion for Q3 2024.
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Free Cash Flow: NOK 1.7 billion for Q3 2024.
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Revenue: Increased by approximately 23% year-over-year to NOK 50 billion for Q3 2024.
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Net Income: NOK 1.4 billion for Q3 2024.
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Adjusted Net Income: NOK 3.5 billion for Q3 2024.
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Adjusted EPS: NOK 1.49 per share for Q3 2024.
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Alumina Prices: Averaged $507 per ton in Q3 2024, a 17% increase from Q2 2024.
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Aluminium Prices: Trading above $2,600 per metric ton during Q3 2024.
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Net Debt: Decreased by NOK 1.5 billion since Q2 2024, ending at NOK 25 billion.
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Sales Volumes: Declined 8% in Q3 2024 year-over-year.
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Impairment Charges: Approximately NOK 1 billion related to investments in Alunorte.
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Raw Material Costs: Increased by approximately NOK 340 million in Q3 2024.
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Fixed Costs: Lower by NOK 300 million in Q3 2024.
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CO2 Compensation: Approximately NOK 800 million for Q3 2024.
Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Norsk Hydro ASA (NHYDY) reported a strong EBITA of NOK 7.4 billion for the third quarter, with a free cash flow generation of NOK 1.7 billion.
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The company is ahead of schedule on its 2024 improvement targets, positioning well towards the 2030 target of NOK 14 billion.
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Norsk Hydro ASA (NHYDY) is progressing on its renewable energy ambitions, with the Illvatn pump storage project passing the investment decision.
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The company has made significant strides in sustainability, with the Olen to fuel switch project nearing completion, expected to yield substantial cost savings and carbon emission reductions.
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Norsk Hydro ASA (NHYDY) has strengthened its strategic partnership with Mercedes Benz, focusing on sustainable development and low-carbon value chains.
Negative Points
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The company reported continued pressure on downstream activities, particularly in recycling and extrusions, due to weaker core markets.
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Norsk Hydro ASA (NHYDY) faced a challenging market for battery materials, leading to a reduction in ownership in Viana and no further capital allocation.
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Recycling margins are under pressure due to low scrap availability and high scrap prices, impacting profitability.
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The company experienced a negative impact from increased raw material costs, particularly aluminum, which is expected to continue into the next quarter.
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Fixed costs are expected to increase in the fourth quarter due to postponed spending and seasonally higher maintenance costs.
Q & A Highlights
Q: Recycling EBITA was negative in Q3. How should we think about the roadmap to improving profitability here? A: Eivind Kallevik, President & CEO: The improvement in recycling profitability depends on two main factors: the price of scrap, which is influenced by economic activity, and stronger premiums for extrusions. As economic activity increases, scrap generation and availability should improve, and we will continue to streamline operations and optimize production.