Norsk Hydro

Resilient in weak markets, positioned for growth

Hydro’s adjusted EBITDA for the first quarter of 2024 was NOK 5,411 million, down from NOK 7,525 million for the same quarter last year. Lower aluminium sales prices, Extrusions volumes and recycling margins, and higher fixed costs negatively impacted results, partly offset by lower raw material costs. This resulted in an adjusted RoaCE of 5.6 percent over the last twelve months.

• Results down on weaker demand and recycling margins, revenue drivers increasing
• Increasing recycling and post-consumer scrap capacity, supporting greener product offering
• Mendubim and Boa Sorte solar plants in commercial operation, securing renewable power for Hydro
• Hydro Alunorte starts using natural gas, improving profitability and executing decarbonization roadmap
• CO2 compensation agreement supporting decarbonization and greener investments

Health and safety remain Hydro’s top priority for both employees and the communities where the company operates. The total recordable injury rate (TRI) continues a positive trend, reaching 2.3 by the end of first quarter. 

"Despite weaker markets impacting results, the macroeconomic indicators as well as revenue drivers are showing signs of improvement towards year end. Hydro is well positioned to capitalize on strengthening demand for aluminium products,” says President and CEO, Hilde Merete Aasheim.

The economic outlook improved during the first quarter, reducing the risk of recessions and central banks are re-considering rate cuts amid easing inflation. Primary aluminium demand outside China slowed and was down 2 percent year-on-year, while Chinese demand remained robust in renewables and electric vehicles (EV), supporting overall growth in global primary demand of 5 percent year-on-year.

Residential and industrial building construction demand remained muted through the quarter, especially in Europe. The weak building and construction market continues the pressure on billet premiums. Decreased construction and demolition activity also leads to lower aluminium scrap generation. Coupled with rising scrap exports to Asia, this supports elevated scrap prices, squeezing recycling margins in both Metal Markets and Hydro Extrusions.

Despite continued growth in EV and hybrid demand, projections were tempered due to subsidy cuts in Germany and heightened competition from China. Reduced EV production in Europe had an adverse effect in Hydro Extrusions during the first quarter, being exposed to the EV segment. The North American transport segment faced constraints from low trailer build rates.