Hydro’s Q1 Adjusted EBITDA surges 5x on upstream aluminium strength; Extrusions weakness triggers strategic response

Hydro has reportedly announced the first quarter results of 2025 where it has shown positive effects of alumina and all-aluminium prices on its financial performance during the period. However, higher raw material costs, lower extrusion volumes and margins, and lower alumina sales volumes have offset the result to an extent, said Hydro.

Here are the key takeaways from Hydro’s Q1 results:

• Strong upstream results, driven by bauxite and alumina’s record performance
• Suffered from economic uncertainty and risk of low demand due to tariff
• Bearish extrusions outlook due to uncertain markets, leading Hydro to adjust portfolio and cut costs
• Recycling executing on hot metal cost improvements, one-third of 2030 target to be realised in 2025

Financial performance review

In the first quarter of 2025, Hydro earned the revenue of NOK 57,094 million, which was 20 per cent higher than NOK 47,545 million during the corresponding period of the previous year. On a quarter-on-quarter basis, the revenue witnessed an increase of 4 per cent from NOK 55,057 million.

Adjusted EBITDA was NOK 9,516 million in Q1 2025, up by 24 per cent Q-o-Q from NOK 7,703 million and 76 per cent Y-o-Y from NOK 5,411 million. The annual growth in Hydro’s Adjusted EBITDA was primarily driven by the bauxite and alumina sector, recording more than five-fold growth from NOK 804 million in Q1 2024 to NOK 5,135 million in Q1 2025. Over the quarter, the Adjusted EBITDA under Hydro’s bauxite and alumina unit climbed up 3 per cent from NOK 4,969 million.

Adjusted EBITDA in Hydro’s aluminium sector was NOK 2,545 million, up by 30 per cent Y-o-Y from NOK 1,965 million and 31 per cent higher Q-o-Q than NOK 1,949 million. In contrast, Adjusted EBITDA earnings from extrusions were 18 per cent less Y-o-Y, totalling NOK 1,174 million in Q1 2025 versus NOK 1,437 million in Q1 2024. However, over the quarter, it gained 216 per cent than NOK 371 million.

Given the bearish trend in the extrusions EBITDA and amid the rising uncertainty in aluminium product consumptions, Hydro Extrusions has reduced its 2025 outlook to NOK 4.5 billion, whereas it anticipated a growth till NOK 5.5 billion. The current expected EBITDA from extrusions is based on CRU’s 2 per cent growth forecast for the EU and North America combined. But if CRU’s demand growth forecast delays to turn into reality, Hydro’s Adjusted EBITDA estimation will come down to NOK 3.5-4 billion.