Hydro's Results for the Third Quarter 2002


OSLO, Norway, Oct. 21, 2002 (PRIMEZONE) -- Norsk Hydro (NYSE:NHY), Oslo (20021021):

Consolidated Results (US GAAP)(unaudited)


                       Third quarter         01.0130.09          Year
                      2002  2002   2001   2002   2002    2001    2001
Million, except per    NOK  EURO    NOK    NOK   EURO     NOK     NOK
share data
Operating revenues   40560  5521  36086 123301  16783  118165  152835
Operating income      3945   537   4741  13845   1884   18251   21083
Nonconsolidated       (356)  (48)    17   (451)   (61)    301     566
investees
Interest income and
other                  210    29    655   1084    148    2059    2847
financial income
Other income, net                   418    219     30     597     578
Earnings before
interest              3799   517   5831  14697   2001   21208   25074
expense and taxes
(EBIT)
Interest expense
and                   (628)  (85)  (250)   294     40   (2573)  (3609)
foreign exchange
gain/(loss)
Income before taxes
and minority          3171   432   5581  14991   2040   18635   21465
interest
Income tax expense   (2701) (368) (4213) (9549) (1300) (12047) (13750)
Minority interest       43     6    (35)    43      6     160     177
Net income             513    70   1333   5485    746    6748    7892
Earnings per share    2.00  0.30   5.20  21.30   2.90   26.10   30.50
(in NOK and Euro)
Financial data
EBITDA  million       7490  1019   9131  25203   3430   30460   37757
Investments           3712   505   3820  39767   5413   10044   16328
million
Net
interestbearing       0.43  0.43   0.24   0.43   0.43    0.24    0.28
debt/equity
Cash flow from
operations           10020  1364   9508  19784   2693   22880   26172
million

Norsk Hydro's net income in the third quarter of 2002 was NOK 513 million (NOK 2.00 per share), compared to NOK 1,333 million (NOK 5.20 per share) in the third quarter of 2001. Operating income in the third quarter of 2002 was NOK 3,945 million compared to NOK 4,741 million for the corresponding period of the prior year.

The decline in net income was principally due to higher expensing of exploration costs. In the third quarter of 2002 exploration costs amounted to approximately NOK 1.3 billion (NOK 295 million) of which a little over NOK 1.1 billion is connected to activities outside of Norway. Earnings in all of Hydro's business areas were negatively impacted by the strengthening of the Norwegian kroner and weakening of the U.S. dollar. Earnings were positively affected by higher oil prices and increased oil and gas production. However, the positive factors were largely offset by currency translation effects of oil and gas prices when measured in Norwegian kroner. Hydro Agri maintained good earnings in spite of the continued lower fertilizer prices. Hydro Aluminium's results were negatively influenced by difficult market conditions.

Hydro's net income for the first three quarters of 2002 was NOK 5,485 million (21.30 per share), compared to NOK 6,748 million (26.10 per share) for the corresponding period of previous year.

"As a whole, the earnings we are reporting for the third quarter are not satisfactory. We can be pleased about the production growth in oil and gas, but the results of our international exploration activities are disappointing. Earnings have been negatively impacted by the weak markets in our aluminium activities. The integration and improvement program in Aluminium is being carried out according to our plans and will be reinforced to help make earnings more robust during difficult market conditions. The positive developments in Hydro Agri continue, especially the growth outside of Europe remained strong in the quarter. I am satisfied that we have restored our strong financial position so soon after our acquisition of VAW and the SDFI assets. Moving forward we expect that oil and gas production will continue to develop positively. There continues to be great uncertainty related to the market development for our industrial products, especially aluminium," said President and CEO, Eivind Reiten.

Operating income for Oil and Energy was NOK 3,170 million for the third quarter of 2002, compared with NOK 4,622 million in the corresponding period of the prior year. Hydro's production of oil and gas in the third quarter of 2002 averaged 452,000 barrels of oil equivalents per day (boed), an increase of 33,000 boed compared to the third quarter of 2001. Hydro anticipates that its oil and gas production for the fourth quarter of 2002 will be approximately 500,000 boed, and therefore, has revised its 2002 average production target to 470,000 boed.

Operating income for Aluminium for the third quarter of 2002 was NOK 412 million, and has been affected by the weaker markets for processed products and a continued decline of metal prices in the third quarter of 2002.

Operating income for Agri for the third quarter of 2002 was NOK 436 million, compared with NOK 207 million in the third quarter of 2001. The result was negatively influenced by continued low international fertilizer prices. However, further reductions in fixed costs and increased sales volumes outside Europe made a positive contribution.

The provision for current and deferred taxes for the third quarter of 2002 amounted to NOK 2,701 million, approximately 85 percent of income before tax. The unusually high rate of taxation for the quarter is due primarily to a combination of high exploration costs outside of Norway, and the high marginal tax rate on earnings from oil and gas operations on the Norwegian Continental Shelf, which accounted for a considerable portion of Hydro's income before tax.


Third quarter 2002              Noncons.
                                  inv.,
                    Operating  Interest &   Other    Depreci-  EBITDA
                      income    selected    Income    ation
NOK million           (loss)   fin.items              and
                                                     amorti-
                                                     zation 
                                                      

Hydro Oil and Energy     3170        71      --         2210    5451
Hydro Aluminium           412      (372)     --          787     827
Hydro Agri                436        (6)     --          289     719
Other Activities           19       (58)     --          404     365
Corporate and             (92)      219      --            1     128
Eliminations

Total                    3945      (146)     --         3691    7490


01.0130.09. 2002                  Noncons.
                                     inv.,
                    Operating   Interest &    Other  Depreci-   EBITDA
NOK million           income      selected   income   ation
                      (loss)     fin.items            and  
                                                      amorti-
                                                      zation

Hydro Oil and Energy   10563        172        77      6641    17453
Hydro Aluminium         1468       (475)       --      2025     3018
Hydro Agri              1998        170       166       966     3300
Other Activities          (7)      (147)       --       865      711
Corporate and           (177)       913       (24)        9      721
Eliminations

Total                  13845        633       219     10506    25203

Further information about Norsk Hydro ASA and the company's third quarter results are available on the Internet: www.hydro.com

Certain statements in this press release are or may constitute "forward-looking" statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements that are not in the nature of historical facts may be deemed to be forward-looking statements and may contain identifying words such as "believes," "anticipates," "plans," "expects" and similar expressions. These forward-looking statements are based on Hydro's current expectations, assumptions, estimates and projections about the company and the industries in which it engages in business. All forward-looking statements involve risks and uncertainties. For a detailed description of factors that could cause Hydro's actual results to differ materially from those expressed in or implied by such statements, please refer to its annual report on Form 20F for the yearended December 31, 2001 and subsequent filings on Form 6K with the U.S. Securities and Exchange Commission.

To view this release in its entirety, please click the link: http://reports.huginonline.com/877455/108957.pdf



            

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