Hydro's Result for the Third Quarter 2002.Business Editors OSLO, Norway--(BUSINESS WIRE)--Oct. 21, 2002 Norsk Hydro Norsk Hydro ASA (OSE: NHY, NYSE: NHY) is a Norwegian aluminium and renewable energy company, headquartered in Oslo. Hydro is the fourth largest integrated aluminium company worldwide. It has operations in some 40 countries around the world and is active on all continents. ASA Asa (ā`sə), in the Bible, king of Judah, son and successor of Abijah. He was a good king, zealous in his extirpation of idols. When Baasha of Israel took Ramah (a few miles N of Jerusalem), Asa bought the help of Benhadad of Damascus and (NYSE NYSE See: New York Stock Exchange :NHY NHY Norsk Hydro NHY Nehmé Hassan Younes ): Consolidated Results (US GAAP) (unaudited) Million, Third quarter 01.01-30.09 Year except per 2002 2002 2001 2002 2002 2001 2001 share data NOK EURO NOK NOK EURO NOK NOK Operating revenues 40 560 5 521 36 086 123 301 16 783 118 165 152 835 Operating income 3 945 537 4 741 13 845 1 884 18 251 21 083 Non-consolidated investees (356) (48) 17 (451) (61) 301 566 Interest income and other financial income 210 29 655 1 084 148 2 059 2 847 Other income, net - - 418 219 30 597 578 Earnings before interest expense and taxes (EBIT) 3 799 517 5 831 14 697 2 001 21 208 25 074 Interest expense and foreign exchange gain/ (loss) (628) (85) (250) 294 40 (2 573) (3 609) Income before taxes and minority interest 3 171 432 5 581 14 991 2 040 18 635 21 465 Income tax expense (2 701) (368) (4 213) (9 549) (1 300) (12 047) (13 750) Minority interest 43 6 (35) 43 6 160 177 Net income 513 70 1 333 5 485 746 6 748 7 892 Earnings per share (in NOK and Euro) 2.00 0.30 5.20 21.30 2.90 26.10 30.50 Financial data EBITDA - million 7 490 1 019 9 131 25 203 3 430 30 460 37 757 Investments - million 3 712 505 3 820 39 767 5 413 10 044 16 328 Net interest- bearing debt/ equity 0.43 0.43 0.24 0.43 0.43 0.24 0.28 Cash flow from operations - million 10 020 1 364 9 508 19 784 2 693 22 880 26 172 Norsk Hydro's net income in the third quarter of 2002 was NOK NOK In currencies, this is the abbreviation for the Norwegian Krone. Notes: The currency market, also known as the Foreign Exchange market, is the largest financial market in the world, with a daily average volume of over US $1 trillion. 513 million (NOK 2.00 per share), compared to NOK 1,333 million (NOK 5.20 per share) in the third quarter of 2001. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. in the third quarter of 2002 was NOK 3,945 million compared to NOK 4,741 million for the corresponding period of the prior year. The decline in net income was principally due to higher expensing of exploration costs. In the third quarter of 2002 exploration costs amounted to approximately NOK 1.3 billion (NOK 295 million) of which a little over NOK 1.1 billion is connected to activities outside of Norway. Earnings in all of Hydro's business areas were negatively impacted by the strengthening of the Norwegian Norwegian associated in some way with Norway. Norwegian buhund, Norwegian sheepdog a medium-sized (26-40 lb), spitz-type dog with a short, dense coat in wheaten, black, red or sable, sometimes with black markings on the face, ears kroner and weakening weak·en tr. & intr.v. weak·ened, weak·en·ing, weak·ens To make or become weak or weaker. weak  en·er n. of
the US dollar. Earnings were positively affected by higher oil prices
and increased oil and gas production. However, the positive factors were
largely offset by currency translation effects of oil and gas prices
when measured in Norwegian kroner. Hydro Agri maintained good earnings
in spite of in opposition to all efforts of; in defiance or contempt of; notwithstanding.See also: Spite the continued lower fertilizer fertilizer, organic or inorganic material containing one or more of the nutrients—mainly nitrogen, phosphorus, and potassium, and other essential elements required for plant growth. prices. Hydro Aluminium's results were negatively influenced by difficult market conditions. Hydro's net income for the first three quarters of 2002 was NOK 5,485 million (21.30 per share), compared to NOK 6,748 million (26.10 per share) for the corresponding period of previous year. "As a whole, the earnings we are reporting for the third quarter are not satisfactory. We can be pleased about the production growth in oil and gas, but the results of our international exploration activities are disappointing. Earnings have been negatively impacted by the weak markets in our aluminium activities. The integration and improvement program in Aluminium is being carried out according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. our plans and will be reinforced to help make earnings more robust during difficult market conditions. The positive developments in Hydro Agri continue, especially the growth outside of Europe remained strong in the quarter. I am satisfied that we have restored our strong financial position so soon after our acquisition of VAW and the SDFI SDFI Secure Digital Forensic Imaging assets. Moving forward we expect that oil and gas production will continue to develop positively. There continues to be great uncertainty related to the market development for our industrial products, especially aluminium," says President and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , Eivind Reiten Eivind Kristofer Reiten (b. 1953) is a Norwegian corporate officer and a politician for the Centre Party. Since 2001 he was the Director General of Norsk Hydro. Eivind Reiten resigned from his position after accusations of corruption. . Operating income for Oil and Energy was NOK 3,170 million for the third quarter of 2002, compared with NOK 4,622 million in the corresponding period of the prior year. Hydro's production of oil and gas in the third quarter of 2002 averaged 452,000 barrels of oil equivalents per day (boed), an increase of 33,000 boed compared to the third quarter of 2001. Hydro anticipates that its oil and gas production for the fourth quarter of 2002 will be approximately 500,000 boed, and therefore, has revised its 2002 average production target to 470,000 boed. Operating income for Aluminium for the third quarter of 2002 was NOK 412 million, and has been affected by the weaker markets for processed products and a continued decline of metal prices in the third quarter of 2002. Operating income for Agri for the third quarter of 2002 was NOK 436 million, compared with NOK 207 million in the third quarter of 2001. The result was negatively influenced by continued low international fertilizer prices. However, further reductions in fixed costs fixed costs, n.pl the costs that do not change to meet fluctuations in enrollment or in use of services (e.g., salaries, rent, business license fees, and depreciation). and increased sales volumes outside Europe made a positive contribution. The provision for current and deferred taxes for the third quarter of 2002 amounted to NOK 2,701 million, approximately 85 percent of income before tax. The unusually high rate of taxation for the quarter is due primarily to a combination of high exploration costs outside of Norway, and the high marginal tax rate Marginal Tax Rate The amount of tax paid on an additional dollar of income. As income rises, so does the tax rate. Notes: Many believe this discourages business investment because you are taking away the incentive to work harder. on earnings from oil and gas operations on the Norwegian Continental Shelf The Norwegian continental shelf is the continental shelf over which Norway exercises sovereign rights as defined by the United Nations Convention on the Law of the Sea. Its major parts are the shelves of the North Sea, Norwegian Sea and Barents Sea, with the sector line in the , which accounted for a considerable portion of Hydro's income before tax.
Third quarter 2002
Non-cons. inv.,
Operating Interest & Other Depreciation
NOK million income (loss) selected fin. income and EBITDA
items amortization
Hydro Oil
and Energy 3 170 71 - 2 210 5 451
Hydro Aluminium 412 (372) - 787 827
Hydro Agri 436 (6) - 289 719
Other Activities 19 (58) - 404 365
Corporate and
Eliminations (92) 219 - 1 128
Total 3 945 (146) - 3 691 7 490
01.01-30.09. 2002 Non-cons. inv.,
Operating Interest & Other Depreciation
NOK million income (loss) selected fin. income and EBITDA
items amortization
Hydro Oil and
Energy 10 563 172 77 6 641 17 453
Hydro Aluminium 1 468 (475) - 2 025 3 018
Hydro Agri 1 998 170 166 966 3 300
Other Activities (7) (147) - 865 711
Corporate and
Eliminations (177) 913 (24) 9 721
Total 13 845 633 219 10 506 25 203
Further information about Norsk Hydro ASA and the company's third quarter results are available on the Internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the : www.hydro.com Certain statements in this press release are or may constitute "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Statements that are not in the nature of historical facts may be deemed to be forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. and may contain identifying words such as "believes", "anticipates", "plans", "expects" and similar expressions. These forward looking statements are based on Hydro's current expectations, assumptions, estimates and projections about the company and the industries in which it engages in business. All forward-looking statements involve risks and uncertainties. For a detailed description of factors that could cause Hydro's actual results to differ materially from those expressed in or implied by such statements, please refer to its annual report on Form 20-F for the year-ended December 31, 2001 and subsequent filings on Form 6-K with the U.S. Securities and Exchange Commission. Norsk Hydro ASA Bygdoy alle 2 N-0240 Oslo Norway Telephone: (+47) 22 53 81 00 Fax: (+47) 22 53 27 25 www.hydro.com |
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