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Norway's Hydro reports Q3 profit surge

Norway's Hydro reports Q3 profit surge

Norwegian aluminum producer Norsk Hydro ASA said Tuesday its third quarter net profit soared nearly threefold to 1 billion kroner ($178 million) as cost reductions more than offset a drop in demand, market prices and adverse currency effects.
The earnings compared with a 363 million kroner profit a year earlier.
"In response to the market downturn, we have completed a substantial program of capacity reductions and cost-cutting measures that are helping to reposition our company," Chief Executive Officer Svein Richard Brandtzaeg said.
Revenues dipped 25 percent to 16.3 billion kroner ($2.9 billion) in the third quarter compared to a year ago. The Oslo-based company blamed a weak aluminum market, the global financial crisis and a weak dollar for the decline.
Brandtzaeg noted the company was "cautious about the outlook for global aluminum demand" and would "consider additional restructuring" to curtail costs further.
Hydro shares dropped 1.7 percent to 40.13 kroner ($7.14) in morning trading in Oslo.
First Securities analyst Hans Erik Jacobsen said the shares fell because "profits were slightly below market expectations" despite the surge.
However, Jacobsen noted that Hydro's prospects for the future were much better than they have been in recent quarters. "It's looking good. We expect the world economy will improve, and that will raise the demand for aluminum," he said.
Hydro estimates that by the end of the year it will have laid off 4,500 employees since the middle of 2008.
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On the Net:
http://www.hydro.com


Updated : 2021-08-02 12:57 GMT+08:00