Foreløpig årsresultat

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1 Foreløpig årsresultat

2 Hovedpunkter Strategisk beslutning om å fusjonere olje og gassaktiviteter med Statoil Rekordresultater i Fjerde kvartal preget av nedskrivninger i Mexicogolfen og urealiserte effekter Sterke resultater i Aluminium Betydelig restrukturering og reposisjonering av Aluminium Fortsatt sterke markedsforhold 2

3 Resultat fra videreført virksomhet Per kvartal* Millioner kroner Nedskrivinger i Mexicogolfen Gevinst fra avhendelser Akkumulert * Automotive Castings bare rapportert som ikke videreført virksomhet i 2005 og 3

4 Resultatregnskap Millioner kroner Driftsinntekter Driftsresultat Tilknyttede selskaper Finansinntekter (kostnader), netto Andre poster Resultat før skatt og minoritetsinteresser fra videreført virksomhet Skattekostnad Minoritetsinteresser Resultat etter skatt fra videreført virksomhet Resultat etter skatt fra ikke videreført virksomhet Resultat etter skatt Resultat per aksje fra videreført virksomhet (i kroner) Resultat per aksje (37 598) (202) ,90 14, (1 889) (30 271) (118) ,40 12,50 For beregning av resultat per aksje: : aksjer og 2005: aksjer. Tidligere rapportert resultat per aksje og antall utestående aksjer er omregnet for å reflektere at Hydroaksjen ble splittet i fem 10. mai. 4

5 Resultatregnskap Millioner kroner 4. kvartal 3. kvartal 4. kvartal 2005 Driftsinntekter Driftsresultat Tilknyttede selskaper Finansinntekter (kostnader), netto Andre poster (741) (79) (579) 758 Resultat før skatt og minoritetsinteresser fra videreført virksomhet Skattekostnad Minoritetsinteresser (4 287) (9 786) (185) (6 411) 133 Resultat etter skatt fra videreført virksomhet Resultat etter skatt fra ikke videreført virksomhet Resultat etter skatt Resultat per aksje fra videreført virksomhet (i kroner) Resultat per aksje 1,00 1,10 3,90 3,90 3,30 3,40 For beregning av resultat per aksje: 4. kvartal : aksjer, 3. kvartal aksjer og 4. kvartal 2005: aksjer. Tidligere rapportert resultat per aksje og antall utestående aksjer er omregnet for å reflektere at Hydroaksjen ble splittet i fem 10. mai. 5

6 Driftsresultat Millioner kroner 4. kvartal 3. kvartal 4. kvartal 2005 Utforsking og Produksjon Energi og Oljemarkedsføring Elimineringer (556) Olje & Energi Aluminium Metal Aluminium Products Øvrige virksomheter Konsernaktiviteter og elimineringer 849 (499) 707 (2 130) (202) (1 124) (98) 34 Totalt

7 Resultat før rentekostnader, skatt og avskrivninger (justert EBITDA) Millioner kroner Akkumulert

8 Avkastning på sysselsatt kapital RoaCE 16,6% 14,9% 12,9% 8,4%

9 RoaCE per forretningsområde Olje & Energi Aluminium Metal Aluminium Products 23,4% 26,2% 16,2% 17,4% 18,7% 7,7% 7,9% 3,3% 1,7% 3,7% 3,2% 1,3%

10 Justert netto gjeldsgrad 0,50 0,38 0,31 0,22 0, Rentebærende gjeld + netto pensjonsforpliktelse (skattejustert) + forpliktelser relatert til leie og leasingavtaler (diskontert) kontanter og bankinnskudd markedsbaserte verdipapirer dividert med egenkapital + minoritetsinteresser. 10

11 Pensjoner NOK million Ytelsesplaner: Årets pensjonsopptjening etter fradrag for ansattes tilskudd Rentekostnader på pensjonsforpliktelsen Forventet avkastning på pensjonsmidlene Resultatført tap 1) Amortisering av effekt knyttet til endring i pensjonsytelsene 1) Tap knyttet til redusert opptjeningstid Netto periodisert pensjonskostnad Tilskuddsplaner Multiemployer plans Førtidspensjoner og øvrige Sum netto periodisert pensjonskostnad Sum netto pensjonsforpliktelse 2) Sum netto pensjonsforpliktelse som ikke er balanseført 3) Gjennomsnittlige økonomiske forutsetninger ved slutten av året: Diskonteringsrente Forventet avkastning Forventet lønns og pensjonsregulering (1 080) (11 750) 4,5% 5,9% 3,5% (1 003) (13 529) (8 249) 4,1% 5,6% 3,1% 1. Betydelig reduksjon i amortiseringer under IFRS i Nye regnskapsregler under US GAAP ved utgangen av : sum netto pensjonsforpliktelse er reflektert i balansen 3. Oppdatert estimat for fordeling av netto pensjonsforpliktelse: om lag 7,5 milliarder kroner forblir i nye Hydro (før skatt) 11

12 Olje & Energi hovedpunkter Realisert oljepris: 57,8 USD per fat i 4. kvartal Olje og gassproduksjon: foe i 4. kvartal, foe i 5 nye funn i 4. kvartal Ormen Lange/Langeled i rute 91 prosent ferdigstilt ved utgangen av Nedskrivning i Mexicogolfen på 3,4 milliarder kroner etter skatt 12

13 Olje & Energi nøkkeltall Operasjonelle data 4. kvartal 4. kvartal 2005 Olje og gassproduksjon (1 000 foed) Realisert oljepris, USD/fat Realisert oljepris, NOK/fat Realisert gasspris, NOK/Sm³ Utforsking kostnadsført, millioner kroner ,10 404,00 1, ,80 369,20 1, ,60 368,80 1, Driftsresultat, millioner kroner 4. kvartal 4. kvartal 2005 Utforsking og Produksjon Energi og Oljemarkedsføring Elimineringer (556) Olje & Energi

14 Olje og gassproduksjon per kvartal foed Olje Gass Gjennomsnitt

15 Produksjonskostnader per fat Kroner/foe 32,2 7,9 25,3 20,7 20,7 5,4 24,3 20,0 2,8 17,9 19,9 Produksjon i millioner foe

16 Påviste olje og gassreserver SECdefinisjon Reserver 31. desember 2005 millioner foe Endring av tidligere anslag Nye reserver Produksjon i Reserver 31. desember million foe (209) Reserveerstatning og reserveliv Reserveerstatning i Reserveerstatning 3års gjennomsnitt Reserveliv Olje Gass 38% 40% 9 år 5 år 17 år 16

17 Høy utforskingsaktivitet i 51 brønner ferdigstilt 26 funn Norge: 6, Mexicogolfen: 8, Libya: 7, øvrige: 5 5 brønner under boring ved utgangen av året Leteaktivitet på 5,9 milliarder kroner 17

18 Olje & Energi utsikter 2007produksjonsmål: foed Ormen Langeoppstart Peregrino: plan for utbygging og drift første halvår 2007 Høy utforskingsaktivitet Foreslått fusjon av Hydros olje og gassaktiviteter med Statoil 18

19 Aluminiumaktiviteter nøkkeltall Operasjonelle data 4. kvartal 4. kvartal 2005 Realisert aluminiumpris, USD/tonn Realisert aluminiumpris NOK/tonn Produksjon primæraluminium, tonn Driftsresultat, millioner kroner 4. kvartal 4. kvartal 2005 Aluminium Metal Aluminium Products Elimineringer (83) (98) 849 (499) (1 124) 13 Aluminium (1 099) Spesielle effekter Aluminium justert driftsresultat

20 Aluminium Metal hovedpunkter Resultater på rekordnivå i EBITDA 9,1 milliarder kroner Driftsresultat 6,4 milliarder kroner RoaCE 18,7 prosent Økte råvare og energikostnader Realisert aluminiumpris US dollar per tonn i 4. kvartal 4. kvartal negativt påvirket av urealiserte effekter på LME og kraftkontrakter 20

21 Aluminiumprisen fortsatt historisk høy US dollar per tonn LME (3måneders snitt) LME forward Primæraluminium LME US dollar/tonn kvartal gjennomsnitt 4. kvartal slutt kvartal gjennomsnitt 3. kvartal slutt kvartal gjennomsnitt 2. kvartal slutt kvartal gjennomsnitt 1. kvartal slutt Per 16. februar 2007, ukentlig gjennomsnitt Gjennomsnitt Gjennomsnitt

22 Aluminium Metal driftsresultat Justert for spesielle effekter Millioner kroner Justert driftsresultat Rapportert driftsresultat

23 Aluminium Metal utsikter Fortsatt høye aluminiumpriser 80 prosent av forventet produksjon i første kvartal solgt til USD per tonn Inkludert full effekt av strategiske sikringsprogrammer God fremdrift i Qatalum planlegging investeringsbeslutning i midten av

24 Aluminium Products hovedpunkter Svake resultater, restrukturering fortsetter Pågående salgsprosess for automotivevirksomhet Avhendelse av Castings og Meridian signert Salgsprosess for Structures fortsetter Nedstengingskostnader for Magnesium på 384 millioner kroner i fjerde kvartal Forbedrede volumer og marginer i Rolled Products og Extrusion 24

25 Aluminium Products driftsresultat Justert for spesielle effekter Millioner kroner Rolled Products Forbedrede volumer, sesongmessig nedgang fra 3. kvartal til 4. kvartal Liten økning i marginer Extrusion Margin og volumforbedring Justert driftsresultat 663 (77) 2005 Rapportert driftsresultat (370) 981 (83) Automotive Fortsatt svake marginer og volumer Ekskludert Castings (ikkevidereført virksomhet) Fokus på kontantinntjening EBITDA millioner kroner Investeringer millioner kroner 25

26 Aluminium Products utsikter Restrukturering gjennomført innen utgangen av 2007 Fortsatt sterke marginer i Extrusion Forbedrede marginer i Rolled Products Fortsatt sterkt marked i Europa for Rolled Products, Extrusion og Building Systems 26

27 Sterke resultater for nye Hydrovirksomheter i Milliarder kroner Driftsinntekter Justert EBITDA Avskrivninger Driftsresultat Investeringer Aluminium Metal 68,4 9,1 (1,7) 6,4 2,0 Aluminium Products 49,8 1,7 (1,7) (0,1) 1,3 Kraft 10,8 1,3 (0,1) 1,2 0,04 Polymers 6,9 1,5 (0,4) 1,0 0,5 27

28 Hydro prioriteringer Gjennomføre foreslått fisjon av olje og gassaktiviteter og sikre vellykket integrasjonsplanlegging med Statoil Lansere nye Hydro Sterk kapitalavkastning Solid drift Investeringsbeslutning for Qatalum i midten av 2007 Sterk finansiell posisjon 28

29 Cautionary note in relation to certain forwardlooking statements Certain statements contained in this announcement constitute forwardlooking information within the meaning of Section 27A of the US Securities Act of 1933, as amended, and Section 21E of the US Securities Exchange Act of 1934, as amended. In order to utilize the safe harbors within these provisions, Hydro is providing the following cautionary statement. Certain statements included within this announcement contain (and oral communications made by or on behalf of Hydro may contain) forwardlooking 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, drilling activity or other projects, (c) targeted production volumes and costs, capacities or rates, startup 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 Hydro believes that the expectations reflected in such forwardlooking statements are reasonable, these forwardlooking statements are based on a number of assumptions and forecasts that, by their nature, involve risk and uncertainty. Various factors could cause Hydro s actual results to differ materially from those projected in a forwardlooking statement or affect the extent to which a particular projection is realized. Factors that could cause these differences include, but are not limited to, world economic growth and other economic indicators, including rates of inflation and industrial production, trends in Hydro s key markets, and global oil and gas and aluminium supply and demand conditions. For a detailed description of factors that could cause Hydro s results to differ materially from those expressed or implied by such statements, please refer to the risk factors specified under Risk, Regulation and Other Information Risk Factors on page 92 of Hydro s Annual Report and Form 20F 2005 and subsequent filings on Form 6K with the US Securities and Exchange Commission. No assurance can be given that such expectations will prove to have been correct. Hydro disclaims any obligation to update or revise any forwardlooking statements, whether as a result of new information, future events or otherwise. 29

30 Use of nongaap financial measures/ Cautionary note in relation to oil and gas reserves With respect to each nongaap financial measure Hydro uses in connection with its financial reporting and other public communications, Hydro provides a presentation of what Hydro believes to be the most directly comparable GAAP financial measure and a reconciliation between the nongaap and GAAP measures. This information can be found in Hydro's earnings press releases, quarterly reports and other written communications, all of which have been posted to Hydro's website ( The United States Securities and Exchange Commission permits oil and gas companies, in their filings with the SEC, to disclose only proved reserves that a company has demonstrated by actual production or conclusive formation tests to be economically and legally producible under existing economic and operating conditions. We use certain terms in this presentation material, such as expected recoverable resources, that the SEC s guidelines strictly prohibit us from including in filings with the SEC. Investors are urged to consider closely the disclosure in our Form 20F, SEC File No , available from us at our Corporate Headquarter: Norsk Hydro, N0240 Oslo, Norway. You can also obtain this form from the SEC by calling 1800SEC

31 Additional information 31

32 Adjusted income Q4 NOK million Reported income Adjustments Adjusted income Exploration and Production Energy and Oil Marketing Eliminations (540) Oil & Energy Aluminium Metal Aluminium Products Other activities Corporate and eliminations 849 (499) 707 (2 130) (591) (191) Total operating income Nonconsolidated investees Financial income (expense), net Other income (loss), net (714) (53) Income continuing operations before tax and minority interest Income tax expense Minority interest (4 287) *(3 720) (8 007) 22 Income from continuing operations * Estimated tax effect on income statement adjustments using a marginal tax rate of 51.2 %. For the year as a whole an estimated actual marginal tax rate of 36.4% has been used. Q4 includes an adjustment from the marginal tax rate in prior quarters to the estimated actual marginal tax rate for the year. 32

33 Special items impacting income statement Q4 Unrealized (gains)/losses on oil and gas derivatives, Spinnaker Impairment loss Gulf of Mexico Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on power contracts Unrealized (gains)/losses on gas and power contracts Closure costs Unrealized (gains)/losses on LME contracts Unrealized (gains)/losses on power contracts Inventory (gains)/losses Rationalization costs UK and US Closure costs Magnesium Impairment losses Rationalization costs Unrealized (gains)/losses on LME contracts Unrealized (gains)/losses on power contracts in Polymers Reversal of insurance loss provision Unrealized (gains)/losses on power and NGL contracts Net impact operating income Exploration & Production Exploration & Production Exploration & Production Energy and Oil Marketing Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Aluminium Metal Aluminium Metal Rolled Products Extrusion Automotive Automotive Automotive Other and Eliminations Other Activities Other Activities Corporate and Eliminations Hydro NOK million 5 5, (540) (47) (380) (211)

34 Special items impacting income statement Q4 Net impact operating income Noncons. investees unrealized currency (gains)/losses Alunorte Noncons. investees unrealized (gains)/losses on LME contracts Alunorte Noncons. investees unrealized (gains)/losses power contracts Noncons investees writedown Cires Other income gains on divestments Net foreign exchange (gains)/losses Net impact on income continuing operations before tax and minority interest Marginal tax rate Calculated tax Total effect income from continuing operations Hydro Aluminium Metal Aluminium Metal Aluminium Metal Other Activities Other Activities Hydro Hydro Hydro Hydro Hydro NOK million (15) (53) (714) % *(3 720) * Estimated tax effect on income statement adjustments using a marginal tax rate of 51.2 %. For the year as a whole an estimated actual marginal tax rate of 36.4 % has been used. Q4 includes an adjustment from the marginal tax rate in prior quarters to the estimated actual marginal tax rate for the year. 34

35 Adjusted income Q NOK million Reported income Adjustments Adjusted income Exploration and Production Energy and Oil Marketing Eliminations (556) 591 (377) Oil & Energy Aluminium Metal Aluminium Products Other activities Corporate and eliminations 12 (1 124) (98) (318) (67) (24) (284) Total operating income Nonconsolidated investees Financial income (expense), net Other income (loss), net (79) (579) (758) 9 22 Income continuing operations before tax and minority interest Income tax expense Minority interest (6 411) *(478) (6 889) 133 Income from continuing operations * Estimated tax effect on income statement adjustments using a marginal tax rate of 18.1 %. For the year as a whole an estimated actual marginal tax rate of 31.0 % has been used. Q4 includes an adjustment from the marginal tax rate in prior quarters to the estimated actual marginal tax rate for the year. 35

36 Special items impacting income statement Q Unrealized (gains)/losses on oil and gas derivatives, Spinnaker Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas and power contracts Unrealized (gains)/losses on LME contracts Inventory (gains)/losses Writedown Spanish rolled products plant Rationalization and demanning Leeds Impairment loss magnesium operation Unrealized (gains)/losses on LME contracts Insurance loss provision Unrealized (gains)/losses on power contracts Net impact operating income Noncons. investees unrealized currency (gains)/losses Alunorte Noncons. investees unrealized (gains)/losses on LME contracts Alunorte Other income gains on divestments Other income gains on divestments Net foreign exchange (gains)/losses Net impact on income continuing operations before tax and minority interest Marginal tax rate Calculated tax Total effect income from continuing operations Exploration & Production Exploration & Production Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Rolled Products Rolled Products Automotive Automotive Other and Eliminations Other Activities Corporate and Eliminations Hydro Aluminium Metal Aluminium Metal Energy and Oil Marketing Other Activities Hydro Hydro Hydro Hydro Hydro NOK million (377) (90) (112) 74 (318) (65) (693) % *(478) * Estimated tax effect on income statement adjustments using a marginal tax rate of 18.1 %. For the year as a whole an estimated actual marginal tax rate of 31.0 % has been used. Q4 includes an adjustment from the marginal tax rate in prior quarters to the estimated actual marginal tax rate for the year. 36

37 Adjusted income NOK million Reported income Adjustments Adjusted income Exploration and Production Energy and Oil Marketing Eliminations (1 323) Oil & Energy Aluminium Metal Aluminium Products Other activities Corporate and eliminations (83) (1 584) (591) (1 348) Total operating income Nonconsolidated investees Financial income (expense), net Other income (loss), net (1 057) (53) Income continuing operations before tax and minority interest Income tax expense Minority interest (37 598) (202) *(1 422) (39 020) (202) Income from continuing operations * Estimated actual tax effect on income statement adjustments using a tax rate of 36.4 % 37

38 Special items impacting income statement Unrealized (gains)/losses on oil and gas derivatives, Spinnaker Impairment loss Gulf of Mexico Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on power contracts Business combination acquisition cost adjustment Unrealized (gains)/losses on gas and power contracts Closure costs Unrealized (gains)/losses on LME contracts Unrealized (gains)/losses on power contracts Inventory (gains)/losses UK defined pension plan Impairment loss Extrusion Ellenville operations UK defined pension plan Rationalization costs UK and US Closure costs Magnesium UK defined pension plan Impairment losses Rationalization costs Unrealized (gains)/losses on LME contracts Unrealized (gains)/losses on power contracts in Polymers Reversal of insurance loss provision Unrealized (gains)/losses on power and NGL contracts Elimination of demanning costs Magnesium operations Porsgrunn Elimination of UK defined pension plan Net impact operating income Exploration & Production Exploration & Production Exploration & Production Energy and Oil Marketing Energy and Oil Marketing Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Aluminium Metal Aluminium Metal Rolled Products Rolled Products Extrusion Extrusion Extrusion Automotive Automotive Automotive Automotive Other and Eliminations Other Activities Other Activities Corporate and Eliminations Corporate and Eliminations Corporate and Eliminations Hydro NOK million (222) (25) (137) 257 (70) (1 323) 559 (597) 270 (261) (380) (211) 681 (65) (380)

39 Special items impacting income statement Net impact operating income Noncons. investees unrealized currency (gains)/losses Alunorte Noncons. investees unrealized (gains)/losses on LME contracts Alunorte Noncons. investees unrealized (gains)/losses power contracts Noncons investees writedown Meridian Technologies Inc Noncons investees writedown Cires Other income gains on divestments Net foreign exchange (gains)/losses Net impact on income continuing operations before tax and minority interest Marginal tax rate Calculated tax Total effect income from continuing operations Hydro Aluminium Metal Aluminium Metal Aluminium Metal Automotive Other Activities Other Activities Hydro Hydro Hydro Hydro Hydro NOK million (94) (53) (1 057) % *(1 422) * Estimated actual tax effect on income statement adjustments using a tax rate of 36.4 % 39

40 Adjusted income 2005 NOK million Reported income Adjustments Adjusted income Exploration and Production Energy and Oil Marketing Eliminations (719) Oil & Energy Aluminium Metal Aluminium Products Other activities Corporate and eliminations (370) (2) (1 545) (1 081) Total operating income Nonconsolidated investees Financial income (expense), net Other income (loss), net 593 (1 889) (990) Income continuing operations before tax and minority interest Income tax expense Minority interest (30 271) (118) (1 101) (31 372) (118) Income from continuing operations * Estimated actual tax effect on income statement adjustments using a tax rate of 31.0 % 40

41 Special items impacting income statement 2005 Unrealized (gains)/losses on oil and gas derivatives, Spinnaker Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas contracts Unrealized (gains)/losses on gas and power contracts Rationalization and demanning costs Unrealized (gains)/losses on LME contracts Inventory (gains)/losses Reversal inventory provision Settlement Malaysia Writedown Spanish rolled products plant Rationalization and demanning Leeds Pension charge Leeds Rationalization cost Impairment loss magnesium operation Unrealized (gains)/losses on LME contracts Insurance loss provision Unrealized (gains)/losses on power contracts Elimination of pension charge Leeds Net impact operating income Exploration & Production Exploration & Production Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Aluminium Metal Rolled Products Rolled Products Rolled Products Rolled Products Automotive Automotive Extrusion Automotive Other and Eliminations Other Activities Corporate and Eliminations Corporate and Eliminations Hydro NOK million (138) (116) (40) (173) 242 (1 391) (154)

42 Special items impacting income statement 2005 Net impact operating income Noncons. investees unrealized currency (gains)/losses Alunorte Noncons. investees unrealized (gains)/losses on LME contracts Alunorte Noncons. investees closure costs Other income gains on divestments Other income gains on divestments Net foreign exchange (gains)/losses Net impact on income continuing operations before tax and minority interest Marginal tax rate Calculated tax Total effect income from continuing operations Hydro Aluminium Metal Aluminium Metal Aluminium Metal Energy and Oil Marketing Other Activities Hydro Hydro Hydro Hydro Hydro NOK million (106) (65) (926) % *(1 101) * Estimated actual tax effect on income statement adjustments using a tax rate of 31.0 % 42

43 Adjusted EBITDA Operating income Adjusted EBIT Adjusted EBITDA Fourth quarter NOK million Exploration and Production Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Aluminium Products Other activities Corporate and eliminations Total Adjusted EBITDA NOK million Exploration and Production Energy and Oil Marketing Eliminations Oil & Energy Aluminium Metal Aluminium Products Other Activities Corporate and eliminations Total Operating income (499) 707 (2 129) Noncons. investees 1 42 (0) 42 (20) Interest income Q (1 885) Selecte d fin. items (6) Other income Adjusted EBIT (482) 802 (1 887) Q Depr. and amort Adjusted EBITDA (1 885) Q (556)

44 Variance analysis Hydro NOK million 2005 Variance adjusted EBITDA Prices and currency, Exploration and Production (E&P) Margin incl. currency effects ¹ ) Volume Fixed costs Depreciation Production and exploration costs, E&P Trading and unrealized LME effects, Aluminium Infrequent items New / disposed business Other Variance operating income Nonconsolidated investees Interest income and other Other income Depreciation and amortization Variance adjusted EBITDA (1 300) (2 550) (4 300) 355 (5 230) (45) (937) Q (1 823) 490 (360) 30 (795) (730) (970) 405 (4 530) (35) 705 (5 787) (704) (1 823) 1) Including negative variance for elimination of unrealized gain/loss on electricity contracts of NOK million year to date and NOK million for the quarter and positive variance for elimination of the gain/loss on gas contracts of NOK million year to date and NOK million for the quarter. 44

45 Consolidated balance sheets NOK million 31 December 30 September 31 December 2005 Cash and cash equivalents Shortterm investments Receivables and other current assets Inventories Current assets held for sale Noncurrent assets Total assets Shortterm interestbearing debt Current portion of longterm debt Other current liabilities Current liabilities in disposal group Longterm interestbearing debt Other longterm liabilities Deferred tax liabilities Longterm liabilities in disposal group Minority interest Shareholders' equity Total liabilities and shareholders' equity

46 Statement of cash flows NOK million Operating activities: Net income Depreciation, depletion and amortization Other adjustments Net cash provided by operating activities Investing activities: Purchases of property, plant and equipment Purchases of other longterm investments Purchases of shortterm investments Proceeds from sales of property, plant and equipment Proceeds from sales of other longterm investments Proceeds from sales of shortterm investments Net cash used in investing activities Financing activities: Loan proceeds Principal repayments Ordinary shares purchased Ordinary shares issued Dividend paid Net cash used in financing activities Foreign currency effect on cash Net cash provided by discontinued operations Net increase (decrease) in cash and cash equivalents Cash and cash equivalents reclassified to assets held for sale Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period (828) (18 580) (4 060) (22 650) (31 727) 85 (1 841) (3 949) 59 (5 506) (11 152) (3 656) (47) (4 382) (17 270) (17 259) (15 162) (24 062) (2 102) (1 589) 71 (5 021) (6 797) (172) 120 (3 903)

47 High oil price driven by supply concerns OPEC spare capacity at low levels, but increasing Million bbl/day USD per bbl Sources: Pira, Reuters, Platts OPEC spare capacity Brent dated Brent forward 47

48 Oil & Energy operating income NOK million Eliminations Energy and Oil Marketing Exploration and Production Accumulated

49 Oil & Energy adjusted EBITDA NOK million Eliminations Energy and Oil Marketing Exploration and Production Accumulated

50 Average realized gas prices NOK/Sm

51 Average prices and exchange rates Oil Oil Gas 450 NOK/boe USD/boe 80 USD/boe NOK/boe NOK/USD NOK/Sm Q Q Q Q Ave Q1 Q2 Q3 Q4 Ave , ,

52 Operating costs per boe 160 NOK/boe excl HGoM Exploration Net transportation Other cost/income Deprec.& aband Gas for injection Prod. cost Production million boe

53 Oil production per field Q4 Boed oil and NGL/condensate Grane Oseberg incl C Snorre Ekofisk Oseberg South Troll Åsgard Gullfaks inclu. Sat Kristin Kvitebjørn Girassol/Jasmim Fram Hibernia Vigdis US Gulf of Mexico Visund Terra Nova Sleipner Area Kharyaga Urd Norne Njord Brage Other fields Total oil Gas Total oil and gas Share % % % % % 9.78 % 9.61 % 9.00 % % % % % 5.00 % % % % % % % 8.10 % % % Q Q

54 Gas production per field Q4 Boed Troll Sleipner Area Oseberg incl C Tune Åsgard US Gulf of Mexico Kvitebjørn Kristin Visund Gullfaks inclu. Sat Oseberg South Ekofisk Mikkel Other Total gas Oil Total oil and gas Share 9.78 % % % % 9.61 % % % % 9.00 % % % % Q Q

55 Oil production per field Boed oil and NGL/condensate Grane Oseberg incl C Snorre Oseberg South Ekofisk Troll Åsgard Gullfaks inclu. Sat Girassol/Jasmim Kristin Kvitebjørn Vigdis Hibernia US Gulf of Mexico Fram Norne Sleipner Area Terra Nova Kharyaga Visund Urd Njord Tordis Other fields Total oil Gas Total oil and gas Share % % % % % 9.78 % 9.61 % 9.00 % % % % % 5.00 % % 8.10 % % % % % % % %

56 Gas production per field Boed Troll Sleipner Area Oseberg incl C Tune Åsgard Kvitebjørn US Gulf of Mexico Gullfaks inclu. Sat Kristin Oseberg South Ekofisk Visund Mikkel Other Total gas Oil Total oil and gas Share 9.78 % % % % 9.61 % % 9.00 % % % % % %

57 New fields on stream Start year Field name Hydro share at peak rate Country Type Operator 2007 Ormen Lange 70,000 Norway Gas/Cond Hydro Rosa 14,000 Angola Oil Total Independence Hub Area 12,500 US GoM Gas Hydro, Dominion, Anadarko Vilje 10,000 Norway Oil Hydro Njord Gas 7,800 Norway Gas Hydro Volve 6,000 Norway Oil/Gas Statoil Rimfaks/Skinfaks 3,000 Norway Oil/Gas Statoil Murzuk NC186: B & H field TBD Libya Oil Repsol 2008 Oseberg Delta 13,200 Norway Oil/Gas Hydro Gimboa 5,500 Angola Oil Sonangol/Hydro technical Oseberg East Drilling 5,600 Norway Oil Hydro Tune South 4,500 Norway Oil/Gas Hydro Alve 3,000 Norway Gas/Cond Statoil 2009 Tyrihans 14,000 Norway Oil Statoil Thunder Hawk 9,400 US GoM Oil Murphy 2010 Vega 18,000 Norway Gas/Oil Hydro 57

58 Exploration activity and cost NOK million Expensed Expensed old wells Refund insurance Iran Seismic Spinnaker Acquisition costs Expensed share Capitalized share 58

59 UK gas prices NBP forward curves Pence/th End Q End Q1 End Q2 End Q3 End Q4 59

60 Nordic power market forward curves NOK/MWh End Q End Q1 End Q2 End Q3 End Q4 60

61 Variance analysis Oil & Energy NOK million 2005 Variance adjusted EBITDA Prices and currency Oil Gas Currency Options (415) (475) 420 Q (236) 490 Margin Volume Fixed costs Depreciation Production costs Exploration costs Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Other income Depreciation and amortization Variance adjusted EBITDA (375) (335) (2 780) (1 515) (2 785) (5 240) (12) (540) (110) (760) (330) (640) (5 240) 415 (5 890) 54 (16) (12) (236) 61

62 Variance analysis Exploration and Production NOK million 2005 Variance adjusted EBITDA Q (727) Prices and currency Oil Gas Currency Options (415) (475) Volume Depreciation Production costs Exploration costs Infrequent items Other 190 (2 575) (1 515) (2 785) (5 240) 170 (270) (600) (330) (640) (5 240) 420 Variance operating income 757 (6 172) Nonconsolidated investees Interest income and other Depreciation and amortization (11) (4) (31) Variance adjusted EBITDA (726) 62

63 Variance analysis Energy and Oil Marketing NOK million 2005 Variance adjusted EBITDA Q (605) Margin Volume Fixed costs Depreciation Other (565) (335) (200) 10 (275) (270) (110) (155) Variance operating income Nonconsolidated investees Interest income and other Other income Depreciation and amortization Variance adjusted EBITDA (12) (814) (12) 146 (605) 63

64 Primary aluminium production per quarter tons Slovalco consolidated from Q

65 Primary aluminium market USD per ton Aluminium inventories (days of consumption) Aluminium price (LME 3month) days

66 Current position German power market EEX Power market development. Baseload contract one year ahead. Avg. spot prices for the year. Eur/Mwh Current prices slightly lower due to mild weather, low consumption and falling fuel prices Price might increase if consumption picks up Increase in CO2 price from 2007 to 2008 (the first Kyoto period starting in 2008). This will influence the forward power prices jan. 02 mai. 02 sep. 02 jan. 03 mai. 03 sep. 03 jan. 04 mai. 04 sep. 04 jan. 05 mai. 05 sep. 05 jan. 06 mai. 06 sep. 06 dec Avg. spot price * Grid cost & taxes come in addition: Smelters: +23 /Mwh 66

67 Aluminium Metal hedge programs 1) program volume ton 2) 2008 program LME price USD/ton program (Sunndal) volume ton 3) program (Sunndal) LME price USD/ton program (Sunndal) LME price NOK/ton Hedged volume in percent of primary aluminium production volume 13 % 16 % n.a 1) All hedges are designated as cash flow hedges of forecasted sales of primary metal production. Realized gains and losses on the hedges are recognized in earnings when the actual sales are made. All unrealized gains and losses on the hedges are booked directly to shareholders equity. 2) Volumes are spread evenly throughout the year, except for when the volumes are spread from second to fourth quarter. The hedge program is aimed at mitigating the effects of higher power prices. 3) Volumes are spread evenly throughout the year. The Sunndal hedge program was implemented in connection with the Sunndal metal plant expansion which was completed in amount is tons in each of the three first quarters, down to tons in the fourth quarter. 67

68 Aluminium operational data Volumes and prices * Q4 Q3 Q2 Q1 Q Q Q Q Primary production (1 000 tons) LME 3 month average LME realized (USD/ton) including hedges NOK/USD realized including hedges ** LME realized (NOK/ton) including hedges LME realized (USD/ton) excluding hedges NOK/USD realized excluding hedges ** LME realized (NOK/ton) excluding hedges Total metal products sales excluding trading (1 000 tons) Rolled Products external shipment (1 000 tons) Extrusion order intake (indexed, 1996=100) * Certain historical figures have been adjusted to be consistent with the Q3 figures ** Difference between realized exchange rate and spot rate at the transaction date is reported as currency gain/loss and not included in EBITDA (except currency hedges where hedge accounting is applied) 68

69 Aluminium Metal operating income NOK million Sourcing & Trading (S&T) Unrealized LME effects Alu Metal (excl. unrealized LME and S&T) 1,721 1, , , (167) (127) (149) (91) (288) (375) (1 120) Accumulated Q4 comments: Primary production tons High aluminium prices Increased raw material and energy costs Rationalization charges related to plant closures NOK 36 million in Q4 NOK 14 million in Q3 NOK 309 million in Q2 NOK 200 million in Q1 Unrealized effects on power contracts: NOK 303 million negative in Q4 NOK 60 million positive in Q3 NOK 91 million negative in Q2 NOK 60 million positive in Q1 Negative unrealized effect on LME contracts of NOK 288 million in Q4 69

70 Aluminium Products operating income NOK million Rolled Products Automotive Extrusion Other and eliminations Q4 comments: Rolled Products NOK 36 million Volumes improving, seasonal reduction in Q4 compared to Q3 Somewhat increased margins Negative metal effect NOK 164 million in Q4 Extrusion NOK 71 million Margin and volume improvement Rationalization costs in UK and US NOK 81 million (499) Automotive NOK (661 million) Continued weak margin and volumes Closure costs Magnesium NOK 384 million Impairment losses NOK 86 million 1 124* 2005 Accumulated (370) (83) Unrealized LME gains NOK 47 million Focus on cash generation EBITDA NOK million Investments NOK million * Impairment of assets of NOK million 70

71 Variance analysis Aluminium NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Trading and hedging ¹ ) Unrealized LME effects Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (900) 275 (1 175) (285) (966) Q (640) 75 (365) (36) (1 167) 390 1) Includes realized effects from the strategic hedge programs 71

72 Variance analysis Aluminium Metal NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Trading & price hedging ¹ ) Unrealized LME effects Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (270) (40) (1 175) (495) Q (360) (60) (365) (31) ) Includes realized effects from the strategic hedge programs 72

73 Variance analysis Aluminium Products NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Unrealized LME effects Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (955) (130) 845 (630) 315 (270) 210 (55) 287 (225) (8) (1 007) (955) Q (616) (130) 255 (280) 140 (60) 710 (10) 625 (10) (5) (1 226) (616) 73

74 Variance analysis Rolled Products NOK million 2005 Variance adjusted EBITDA (211) Q (185) Margin Volume Fixed costs Depreciation Infrequent items (630) (120) 105 (180) Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (4) (258) (211) 1 8 (195) (185) 74

75 Variance analysis Extrusion NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (195) 70 (535) (35) (44) 1 (4) Q (190) 45 (60) (10) 36 (4) (5) (24) 3 75

76 Variance analysis Automotive NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Infrequent items Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (436) 67 (503) (520) (10) 573 (250) (1) (825) (503) Q4 (442) (66) (376) (180) (15) (1) (1 012) (376) 76

77 Variance analysis Hydro Polymers NOK million 2005 Variance adjusted EBITDA Margin Volume Fixed costs Depreciation Other Variance operating income Nonconsolidated investees Interest income and other Depreciation and amortization Variance adjusted EBITDA (65) (60) (84) Q (45) (45) (8)

78 Investor Relations in Hydro Ada Christiane Rieker Vice President t: m: e: Gudmund Isfeldt Investor Relations Officer t: m: e: Stefan Solberg Investor Relations Officer t: m: e: Irene Raposo Investor Relations Secretary t: m: e: For more information: 78