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2015-04-29

Norsk Hydro : First quarter 2015: Record results on higher sales and currency tailwinds

Hydro's underlying earnings before financial items and tax increased to NOK
3,208 million in the first quarter, up from NOK 2,886 million in the fourth
quarter of 2014. The results reflect higher sales across the value chain and
a stronger US dollar.

· Record-high quarterly underlying EBIT of NOK 3 208
million
· Higher sales throughout the value chain
· Positive currency developments
· Acquisition of advanced sorting technology in Germany
· Reduced market tightness due to Chinese semis exports

"I am pleased that we for the second quarter in a row can present record
quarterly results since Hydro became a pure aluminium company in 2007. We
will continue to deliver on the improvement programs, while looking for
additional measures to expand the efforts already in scope," says President
and CEO Svein Richard Brandtzæg.

Underlying EBIT for Bauxite and Alumina further improved in the first quarter
reflecting higher alumina sales volumes and the strengthening USD. Results
were also supported by cost and revenue improvements relating to the "From B
to A" improvement program. Negative effects of lower LME-linked alumina
prices were partly offset by an increase in alumina index based sales
volumes. The extended maintenance at the Paragominas ball mill is completed
and the bauxite mine is now back in full production.

Primary Metal underlying EBIT improved slightly in the first quarter
influenced by a further increase in realized aluminium prices and premiums
measured in Norwegian kroner. Positive developments were partly offset by
higher costs for alumina and power, reflecting higher prices, and negative
currency effects.

"We are operating in a highly competitive market, underlining the importance
of our efforts to strengthen our position. We continue to high-grade our
portfolio, including the acquisition of the world's most advanced sorting
technology, the construction of a used beverage can recycling facility and a
new automotive line in Germany, taking a lead in growing European markets,"
says Brandtzæg.

For Metal Markets, underlying EBIT declined substantially compared to the
fourth quarter. Results were impacted by negative results from sourcing and
trading activities as a result of a decline in standard ingot premiums. The
negative results were partly offset by improved results from remelt
operations due to higher product premiums and seasonally higher sales volumes
in Europe.

Rolled Products delivered higher underlying EBIT compared with the fourth
quarter of 2014, mainly due to seasonally higher sales volumes, higher
operating margins and currency gains on export sales.

Underlying EBIT for Energy increased slightly compared to the fourth quarter
due to higher production, partly offset by lower prices and increased
production costs.

Underlying EBIT for Sapa increased compared to the previous quarter, due to
higher seasonal demand, continued strong growth in North America and the
positive effects of improvement programs.

Operating cash flow amounted to NOK 1.4 billion for the first quarter. Cash
used for investment activities amounted to NOK 0.9 billion. Hydro's net debt
position amounted to NOK 0.3 billion at the end of the first quarter also
affected by currency translation effects of around NOK 0.7 billion mainly due
to the strengthening USD compared to NOK.

Reported earnings before financial items and tax amounted to NOK 3,206 million
in the first quarter. In addition to the factors discussed above, reported
EBIT included net unrealized derivative gains and positive metal effects of
NOK 72 million in total. Reported earnings also included a charge of NOK 74
million (Hydro's share) for Sapa mainly relating to unrealized derivative
losses.

In the previous quarter reported earnings before financial items and tax
amounted to NOK 2,295 million including 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.

Net income amounted to NOK 1,072 million in the first quarter including a net
foreign exchange loss of NOK 1,587 million mainly due to the strengthening of
the USD. In the previous quarter, Hydro incurred a net loss amounting to NOK
168 million including a net foreign exchange loss of NOK 2,252 million.

----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| Key financial information First quarter 2015 Fourth quarter 2014 % change prior quarter First quarter 2014 % change prior year quarter Year 2014 |
| |
|NOK million, except per share data |
| |
| Revenue 23,290 21,656 8 % 18,282 27 % 77,907 |
| |
| Earnings before financial items and tax (EBIT) 3,206 2,295 40 % 822 >100 % 5,674 |
| Items excluded from underlying EBIT 2 591 >(100) % (50) >100 % 18 |
| Underlying EBIT 3,208 2,886 11 % 772 >100 % 5,692 |
| |
| Underlying EBIT: |
| Bauxite&Alumina 780 528 48 % (288) >100 % (55) |
| Primary Metal 2,012 1,989 1 % 312 >100 % 3,937 |
| Metal Markets 24 221 (89) % 141 (83) % 634 |
| Rolled Products 292 96 >100 % 181 62 % 698 |
| Energy 382 360 6 % 435 (12) % 1,197 |
| Other and eliminations (281) (308) 9 % (8) >(100) % (717) |
| Underlying EBIT 3,208 2,886 11 % 772 >100 % 5,692 |
| |
| Underlying EBITDA 4,437 4,170 6 % 1,861 >100 % 10,299 |
| |
| Net income (loss) 1,072 (168) >100 % 462 >100 % 1,228 |
| Underlying net income (loss) 2,206 1,979 11 % 388 >100 % 3,728 |
| |
| Earnings per share 0.46 (0.18) >100 % 0.19 >100 % 0.39 |
| Underlying earnings per share 0.95 0.83 14 % 0.16 >100 % 1.55 |
| |
| Financial data: |
| Investments 802 1,449 (45) % 546 47 % 3,625 |
| Adjusted net interest-bearing debt (13,478) (13,587) 1 % (11,230) (20) % (13,587) |
| |
| |
| Key Operational information |
| |
| Alumina production (kmt) 1,451 1,501 (3) % 1,428 2 % 5,933 |<...

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