Norsk Hydro (NHY) Q4 2024 earnings summary

Executive summary

• Adjusted EBITDA for Q4 2024 reached NOK 7.7 billion, with free cash flow at NOK 1.7 billion and adjusted ROAC at 8.5%; driven by record Bauxite & Alumina results and early achievement of the 2025 CO2 reduction target.

• Proposed cash dividend of NOK 2.25 per share, representing 50% of adjusted net income, with a total shareholder distribution of NOK 4.5 billion subject to AGM approval.

• Hydro Extrusions underwent restructuring, reducing over 900 FTEs and incurring NOK 350 million in restructuring costs due to weak demand.

• Strategic partnerships with Rio Tinto (USD 45 million carbon capture investment) and Siemens Mobility (circular rail) support decarbonization and circularity.

• NOK 300 million provisioned for social investments in Brazil pipeline communities.

Financial highlights

• Q4 2024 revenue was NOK 55,057 million, up 18% year-over-year; adjusted EBITDA was NOK 7,701 million, up from NOK 3,737 million in Q4 2023.

• Adjusted net income for Q4 2024 was NOK 2,804 million; adjusted EPS was NOK 1.11.

• Net debt increased by NOK 1.3 billion in Q4, ending at NOK 24.1 billion adjusted net debt.

• Free cash flow for Q4 2024 was NOK 1.7 billion.

• Adjusted RoaCE for 2024 was 8.5%, up from 7.1% in 2023.

Outlook and guidance

• Alumina market expected to remain tight in Q1 2025, with prices down from December peak but still sensitive to disruptions.

• Bauxite & Alumina Q1 output expected at nameplate capacity; lower raw material and fixed costs anticipated.

• Aluminium Metal Q1 sales volumes stable; higher raw material costs expected, partly offset by lower energy costs and internal hedging.

• Extrusions to see continued soft demand in Q1 2025, with lower sales volumes and pressured recycling margins.

• Working capital expected to release NOK 2 billion between year-end 2024 and 2025.