Norsk Hydro's net income in the first quarter of 2003 was NOK 2,482 million (NOK 9.60 per share), an increase from NOK 2,132 million (NOK 8.30 per share) in 2002.
Net income included a positive effect to the change in accounting principle of NOK 281 million (NOK 1.10 per share).
On schedule
"The first quarter of the year has been a period of continued improvements in operations in our three core areas. I would particularly like to highlight the strong development in Oil and Energy, where new oil and gas production records have been set, at the same time prices have been high," says president and CEO Eivind Reiten.
"The extensive improvement programs in the aluminium operation are on schedule, and Hydro Agri has produced good results despite high energy costs and unfavorable development in foreign exchange rates.
"Good cash earnings further strengthen the company's financial position. We will continue to maintain high pressure on internal improvement programs and stringent capital discipline," says Reiten.
Oil and Energy
Hydro's oil and gas production in the first quarter of 2003 reached an average of 552,000 barrels of oil equivalents per day (boed), with particularly high gas sales due to low temperatures on the European Continent.
The development of the Grane oil field made highly satisfactory progress, and the field is expected to start production in October 2003. Thus far, the oil and gas production target for 2003 of an average of 510,000 boed is being maintained.
Aluminium
The improved results in Aluminium were mainly due to new activities following the acquisition of VAW and Technal in the first quarter of 2002. The markets remain weak, with margins for finished products under pressure. The strong Norwegian kroner, particularly in relation to the US dollar, continues to remain a challenge to Norwegian aluminium operations.
The improvement programs are proceeding according to plan, and sharp focus will be directed during the year to ensuring that the targets are met despite the difficult market situation.
Agri
Hydro Agri continues to produce good results, although improved market conditions did not fully compensate for negative currency effects and high energy costs. Agri further strengthened its competitive position during the first quarter of 2003, principally through increasing its market share in Europe.
Provisions for tax amounted to NOK 4,274 million in the first quarter of 2003. This was equivalent to 66 percent of pre-tax income.