Hydro's underlying EBIT for 2013 rose to 2,737 million from 1,297 million in 2012

Hydro's underlying earnings before financial items and tax (EBIT) fell to NOK 483 million in the fourth quarter 2013 from NOK 659 million in the third quarter, mainly due to seasonal effects and lower hydropower production. For the full year, underlying EBIT rose to 2,737 million from 1,297 million in 2012, helped by cost savings, strong performance at the Qatalum aluminium plant combined with higher product premiums.

Highlights:
• Underlying EBIT NOK 483 million
• USD 300-program completed, yielding NOK 1.5 billion improvements
• Alunorte production rising, offset by ICMS tax charges
• Primary Metal lifted by Qatalum insurance proceeds
• Downstream seasonality, lower power production
• Proposed 2013 dividend NOK 0.75 per share
• Expect 2-4% aluminium demand growth outside China in 2014

"Extensive improvement programs backed our results for 2013, despite market uncertainty and low aluminium prices. Although the uncertainty remains, we are entering 2014 on a positive note, as we expect demand for aluminium to slightly exceed production this year, in the world outside China," says Hydro President and CEO Svein Richard Brandtzæg.

Fourth-quarter underlying EBIT for the Bauxite & Alumina business area was lifted by improved production at the Alunorte alumina refinery in Brazil.

Underlying EBIT for the Primary Metal business area improved in the fourth quarter compared to the third, mainly due to insurance proceeds relating to a fire in a cooling tower at the Qatalum plant in Qatar in 2012. Rolled Products' underlying EBIT declined in the fourth quarter, mainly due to seasonal volume declines and higher maintenance activity.

Underlying EBIT for Sapa, the 50-50 extruded products joint venture, declined in the quarter, reflecting a seasonally weaker quarter and charges related to impairment of inventories and accounts receivables. Operating cash flow was NOK 2.5 billion for the fourth quarter. Net cash used for investment activities amounted to NOK 0.9 billion. Hydro's net cash position increased by NOK 1.2 billion, and amounted to around NOK 0.7 billion at the end of the fourth quarter.

Reported earnings before financial items and tax amounted to negative NOK 3 million in the fourth quarter. Reported EBIT included net unrealized derivative losses and negative metal effects amounting to NOK 151 million in total.

Reported earnings also included a loss of NOK 69 million from divestment of a rolling mill in Malaysia, charges of NOK 392 million relating to Hydro's head office lease arrangement, penalties of NOK 109 million relating to the settlement of tax claims in Brazil and charges of NOK 172 million primarily related to rationalization activities in Sapa. Hydro's Board of Directors proposes to pay a dividend of NOK 0.75 per share for 2013 reflecting the company's strong commitment to provide a cash return to its shareholders.