Latest news with #TrondOlafChristophersen
Yahoo
3 days ago
- Business
- Yahoo
Norsk Hydro: Successful placement of inaugural European Green Bond
Norsk Hydro ASA has successfully issued EUR 500 million of senior unsecured European Green Bonds (EuGB) under its Euro Medium Term Note (EMTN) Programme. The new bond has a tenor of 8 years and a fixed annual coupon of 3.75 percent (3.779 percent reoffer yield). "We are delighted to have completed such a successful placement and issued our inaugural EuGB. The strong interest confirms that Hydro is considered an attractive investment for bond investors supporting our strategy of pioneering the green aluminium transition, powered by renewable energy. We are pleased to have achieved highly competitive terms," says Chief Financial Officer, Trond Olaf Christophersen. An amount equivalent to the proceeds from the bond issue will be allocated to eligible activities as detailed in Hydro's European Green Bond Factsheet. The transaction also markets Hydro as the first issuer of an EuGB from the Nordic region, highlighting the company's commitment to the development of the sustainable finance markets. The bonds will be listed on the Irish Stock Exchange (Euronext Dublin). BNP Paribas, Citi, Crédit Agricole Corporate and Investment Bank, DNB Carnegie, Goldman Sachs Bank Europe SE and Nordea are Joint Lead Managers for the transaction. Citi acted as the Green Structuring Bank. Investor contactElitsa 91775472 Media contactAnders Vindegg+47 Group Treasury and TaxNesrin Taraf+47 This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading Act.
Yahoo
3 days ago
- Business
- Yahoo
Norsk Hydro: Successful placement of inaugural European Green Bond
Norsk Hydro ASA has successfully issued EUR 500 million of senior unsecured European Green Bonds (EuGB) under its Euro Medium Term Note (EMTN) Programme. The new bond has a tenor of 8 years and a fixed annual coupon of 3.75 percent (3.779 percent reoffer yield). "We are delighted to have completed such a successful placement and issued our inaugural EuGB. The strong interest confirms that Hydro is considered an attractive investment for bond investors supporting our strategy of pioneering the green aluminium transition, powered by renewable energy. We are pleased to have achieved highly competitive terms," says Chief Financial Officer, Trond Olaf Christophersen. An amount equivalent to the proceeds from the bond issue will be allocated to eligible activities as detailed in Hydro's European Green Bond Factsheet. The transaction also markets Hydro as the first issuer of an EuGB from the Nordic region, highlighting the company's commitment to the development of the sustainable finance markets. The bonds will be listed on the Irish Stock Exchange (Euronext Dublin). BNP Paribas, Citi, Crédit Agricole Corporate and Investment Bank, DNB Carnegie, Goldman Sachs Bank Europe SE and Nordea are Joint Lead Managers for the transaction. Citi acted as the Green Structuring Bank. Investor contactElitsa 91775472 Media contactAnders Vindegg+47 Group Treasury and TaxNesrin Taraf+47 This information is subject of the disclosure requirements pursuant to section 5-12 of the Norwegian Securities Trading in to access your portfolio
CNBC
09-05-2025
- Business
- CNBC
The aluminum sector isn't moving to the U.S. despite tariffs — due to one key reason
Sweeping tariffs on imported aluminum imposed by U.S. President Donald Trump are succeeding in reshaping global trade flows and inflating costs for American consumers, but are falling short of their primary goal: to revive domestic aluminum production. Instead, rising costs, particularly skyrocketing electricity prices in the U.S. relative to global competitors, are leading to smelter closures rather than restarts. The impact of aluminum tariffs at 25% is starkly visible in the physical aluminum market. While benchmark aluminum prices on the London Metal Exchange provide a global reference, the actual cost of acquiring the metal involves regional delivery premiums. This premium now largely reflects the tariff cost itself. In stark contrast, European premiums were noted by JPMorgan analysts as being over 30% lower year-to-date, creating a significant divergence driven directly by U.S. trade policy. This cost will ultimately be borne by downstream users, according to Trond Olaf Christophersen, the chief financial officer of Norway-based Hydro, one of the world's largest aluminum producers. The company was formerly known as Norsk Hydro. "It's very likely that this will end up as higher prices for U.S. consumers," Christophersen told CNBC, noting the tariff cost is a "pass-through." Shares of Hydro have collapsed by around 17% since tariffs were imposed. The downstream impact of the tariffs is already being felt by Thule Group, a Hydro customer that makes cargo boxes fitted atop cars. The company said it'll raise prices by about 10% even though it manufactures the majority of the goods sold in the U.S locally, as prices of raw materials, such as steel and aluminum, have shot up. But while tariffs are effectively leading to prices rise in the U.S., they haven't spurred a revival in domestic smelting, the energy-intensive process of producing primary aluminum. The primary barrier remains the lack of access to competitively priced, long-term power, according to the industry. "Energy costs are a significant factor in the overall production cost of a smelter," said Ami Shivkar, principal analyst of aluminum markets at analytics firm Wood Mackenzie. "High energy costs plague the US aluminium industry, forcing cutbacks and closures." "Canadian, Norwegian, and Middle Eastern aluminium smelters typically secure long-term energy contracts or operate captive power generation facilities. US smelter capacity, however, largely relies on short-term power contracts, placing it at a disadvantage," Shivkar added, noting that energy costs for U.S. aluminum smelters were about $550 per tonne compared to $290 per tonne for Canadian smelters. Recent events involving major U.S. producers underscore this power vulnerability. In March 2023, Alcoa Corp announced the permanent closure of its 279,000 metric ton Intalco smelter, which had been idle since 2020. Alcoa said that the facility "cannot be competitive for the long-term," partly because it "lacks access to competitively priced power." Similarly, in June 2022, Century Aluminum, the largest U.S. primary aluminum producer, was forced to temporarily idle its massive Hawesville, Kentucky smelter – North America's largest producer of military-grade aluminum – citing a "direct result of skyrocketing energy costs." Century stated the power cost required to run the facility had "more than tripled the historical average in a very short period," necessitating a curtailment expected to last nine to twelve months until prices normalized. The industry has also not had a respite as demand for electricity from non-industrial sources has risen in recent years. Hydro's Christophersen pointed to the artificial intelligence boom and the proliferation of data centers as new competitors for power. He suggested that new energy production capacity in the U.S., from nuclear, wind or solar, is being rapidly consumed by the tech sector. "The tech sector, they have a much higher ability to pay than the aluminium industry," he said, noting the high double-digit margins of the tech sector compared to the often low single-digit margins at aluminum producers. Hydro reported an 8.3% profit margin in the first quarter of 2025, an increase from the 3.5% it reported for the previous quarter, according to Factset data. "Our view, and for us to build a smelter [in the U.S.], we would need cheap power. We don't see the possibility in the current market to get that," the CFO added. "The lack of competitive power is the reason why we don't think that would be interesting for us." While failing to ignite domestic primary production, the tariffs are undeniably causing what Christophersen termed a "reshuffling of trade flows." When U.S. market access becomes more costly or restricted, metal flows to other destinations. Christophersen described a brief period when exceptionally high U.S. tariffs on Canadian aluminum — 25% additional tariffs on top of the aluminum-specific tariffs — made exporting to Europe temporarily more attractive for Canadian producers. Consequently, more European metals would have made their way into the U.S. market to make up for the demand gap vacated by Canadian aluminum. The price impact has even extended to domestic scrap metal prices, which have adjusted upwards in line with the tariff-inflated Midwest premium. Hydro, also the world's largest aluminum extruder, utilizes both domestic scrap and imported Canadian primary metal in its U.S. operations. The company makes products such as window frames and facades in the country through extrusion, which is the process of pushing aluminum through a die to create a specific shape. "We are buying U.S. scrap [aluminium]. A local raw material. But still, the scrap prices now include, indirectly, the tariff cost," Christophersen explained. "We pay the tariff cost in reality, because the scrap price adjusts to the Midwest premium." "We are paying the tariff cost, but we quickly pass it on, so it's exactly the same [for us]," he added. RBC Capital Markets analysts confirmed this pass-through mechanism for Hydro's extrusions business, saying "typically higher LME prices and premiums will be passed onto the customer." This pass-through has occurred amid broader market headwinds, particularly downstream among Hydro's customers. RBC highlighted the "weak spot remains the extrusion divisions" in Hydro's recent results and noted a guidance downgrade, reflecting sluggish demand in sectors like building and construction.
Yahoo
15-02-2025
- Business
- Yahoo
Norsk Hydro ASA (NHYDY) Q4 2024 Earnings Call Highlights: Strong Financial Performance Amid ...
Adjusted EBITDA: NOK7.7 billion for Q4 2024. Free Cash Flow: NOK1.7 billion for Q4 2024. Adjusted RoaCE: 8.5% for Q4 2024. Revenue: Increased by 18% year-over-year to NOK55 billion for Q4 2024. Net Income: NOK1.8 billion for Q4 2024. Adjusted Net Income: NOK2.6 billion for Q4 2024. Adjusted EPS: NOK1.11 per share for Q4 2024. Dividend Proposal: NOK2.25 per share, representing 50% of adjusted net income. Net Debt: Increased by NOK1.3 billion to NOK14.7 billion at the end of Q4 2024. Alumina Market Deficit: 1.4 million tonnes in 2024. Extrusion Sales Volume: Declined by 7% year-over-year in Q4 2024. Aluminum Metal Adjusted EBITDA: NOK1.9 billion for Q4 2024. Energy Adjusted EBITDA: NOK1.15 billion for Q4 2024. CO2 Emission Reduction Target: Achieved 10% reduction one year ahead of schedule. Full-Time Positions Reduced: 900 positions through divestments, plant closures, and cost-cutting measures. Warning! GuruFocus has detected 3 Warning Signs with ETCMY. Release Date: February 14, 2025 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Norsk Hydro ASA (NHYDY) achieved a record low TRI rate in Q4, indicating improved safety performance. The company delivered an adjusted EBITDA of NOK7.7 billion and a free cash flow of NOK1.7 billion, reflecting strong financial performance. Norsk Hydro ASA (NHYDY) achieved its 2025 CO2 emission reduction target of 10% one year ahead of schedule. The company strengthened key partnerships to accelerate the green aluminum transition, including collaborations with Rio Tinto and Siemens Mobility. A proposed cash dividend of 50% of adjusted net income, translating into NOK2.25 per share, demonstrates a commitment to shareholder value. There was a slight increase in high-risk incidents, highlighting ongoing safety challenges. Hydro extrusions faced weak market demand, necessitating significant restructuring measures. The US reintroduced Section 232 tariffs, imposing a 25% duty on imported aluminum and steel, potentially impacting costs. The extrusion market continues to face challenging conditions, particularly in Europe, with weak demand persisting. In Brazil, capped energy deliveries and squeezed profits from solar and wind projects led to NOK0.4 billion in impairments. Q: Historically, you have seen an escalation in fixed costs which now appears to be reversing with a large step down in fixed cost of NOK700 million to NOK800 million. Does this get up to a new normal for fixed cost or is it temporary? A: Trond Olaf Christophersen, CFO, explained that the reduction is due to a NOK300 million social provision in Q4 and seasonally higher project costs, which are not expected to recur in Q1. Long-term, no change in fixed cost level is anticipated. Q: In the extrusion market, are there any green shoots you are seeing? Should we expect more restructuring costs in 2025 and how will Q1 '25 compare with Q1 '24? A: Eivind Kallevik, CEO, noted that the US market is expected to perform better than Europe, with growth potential in southern Europe. However, transportation and automotive sectors need to recover for significant improvement. Restructuring costs are not expected to impact long-term targets. Q: Can you give a rough percentage on the share of domestic sourcing across scrap and ingots in the US extrusion market? A: Eivind Kallevik stated that most raw materials consumed in the US are locally sourced, with some ingots used as sweeteners in recyclers, which is a common practice across the industry. Q: Do you see potential for buybacks in 2025? A: Eivind Kallevik mentioned that while a NOK4.5 billion dividend is proposed for 2024, it's too early to predict 2025 earnings and potential buybacks. However, current market conditions suggest a positive outlook. Q: Do you reiterate the NOK4.5 billion to NOK5 billion EBITDA guide for 2025 for extrusions, and how will restructuring impact this? A: Trond Olaf Christophersen confirmed the guidance for 2025, noting a slow start is expected. Restructuring is not anticipated to affect long-term extrusion targets. Q: How much of the NOK350 million restructuring cost in extrusion was charged in Q4? A: Eivind Kallevik reported that approximately NOK270 million to NOK280 million was charged in Q4, with NOK80 million impacting adjusted EBITDA. Q: Could you provide guidance on minority dividends from BNA in 2025? A: Eivind Kallevik explained that Alunorte plans to continue debt repayment in 2025, having reduced debt from $1 billion to $800 million in 2024. Future earnings will be evaluated for dividend proposals. Q: What would encourage the wide-scale deployment of hydrogen beyond the pilot stage? A: Eivind Kallevik emphasized the importance of proving industrial use of hydrogen as an energy carrier. Current energy costs make hydrogen a costly replacement, but industrial validation is the first step. For the complete transcript of the earnings call, please refer to the full earnings call transcript. This article first appeared on GuruFocus.
Yahoo
07-02-2025
- Business
- Yahoo
Norsk Hydro: Reminder – Invitation to Hydro's fourth quarter results 2024
Hydro's fourth quarter results 2024 will be released at 07:00 CET (01:00 EST, 06:00 UTC/GMT) on February 14, 2025. The annual report 2024 will be released the same day at 08:00 CET (02:00 EST, 07:00 UTC/GMT). The quarterly report, presentation slides and annual report will be available on at the same time as the releases. President and CEO Eivind Kallevik, and Executive Vice President and CFO Trond Olaf Christophersen, will host a webinar in English at 08:30 CET the same day. There will be a Q&A session directly after the presentation. There will be no physical presentation or press conference. To join the webinar and ask questions, register your details in the webcast page. Once registered, you will receive a separate email confirming your registration. The webcast is powered by Livestorm. We advise you to investigate in advance if your company has any restrictions using this contact: Martine Rambøl Hagen +47 91708918 Sign in to access your portfolio
