Norsk Hydro ASA — Earnings Release 2017

Jul 14, 2017

Norsk Hydro: Sapa (joint venture) - Announcement of results for the second quarter 2017

Norsk Hydro: Sapa (joint venture) - Announcement of results for the second quarter 2017

Underlying EBIT for Sapa in the second quarter increased compared to the

previous quarter, in line with general seasonality in the industry but also

related to improved performance.

Sapa improved its underlying EBIT in the second quarter of 2017 compared to the

same period last year, ending the quarter at NOK 914 million. The quarterly

result is the best in Sapa's history. The increase was driven by a higher share

of value-add business and internal improvements for all business areas.

Underlying EBIT for the first half of 2017 improved compared to the same period

in 2016, influenced by the same factors as discussed above.

Net interest-bearing debt increased to NOK 3.1 billion at the end of the

quarter, mainly reflecting dividend payments of NOK 3 billion to the owners.

+------------------------------+-------+-------+-------+-------+-------+-------+

|Key Figures - Sapa (100%)  |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|NOK million, except sales | | | | | | |

|volumes |  |  |  |  |  |  |

+------------------------------+-------+-------+-------+-------+-------+-------+

|Volume (kmt) | 349| 366| 340| 310| 355| 359|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Total operating revenues | 13 905| 14 071| 13 140| 12 210| 14 323| 15 309|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | 901| 1 132| 812| 653| 1 100| 1 252|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | 571| 804| 487| 335| 778| 914|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying net income | 365| 540| 315| 334| 562| 658|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Reported EBIT | 655| 920| 497| 350| 856| 781|

+------------------------------+-------+-------+-------+-------+-------+-------+

Demand for extruded products in Europe and North America increased compared to

the previous quarter by around 9 percent and 3 percent respectively, driven by

seasonality.

In North America, total demand for extruded products increased by around 3

percent compared to the same quarter last year. The increase was driven by

stronger automotive demand and higher building and construction activities

whereas demand from commercial transportation was declining.

In Europe, total demand for extruded products increased by around 2 percent

compared to the same quarter last year. Europe experienced stronger automotive

and transportation demand, as well as an improved building and construction

market.

Key figures per business area

+------------------------------+-------+-------+-------+-------+-------+-------+

|Extrusion Europe |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|NOK million, except sales | | | | | | |

|volumes |  |  |  |  |  |  |

+------------------------------+-------+-------+-------+-------+-------+-------+

|Volume (kmt) | 148| 157| 142| 130| 154| 155|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Operating revenues | 5 366| 5 468| 4 932| 4 565| 5 553| 5 999|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | 349| 425| 276| 221| 390| 416|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | 223| 304| 154| 97| 274| 292|

+------------------------------+-------+-------+-------+-------+-------+-------+

+------------------------------+-------+-------+-------+-------+-------+-------+

|Extrusion North America |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|NOK million, except sales | | | | | | |

|volumes |  |  |  |  |  |  |

+------------------------------+-------+-------+-------+-------+-------+-------+

|Volume (kmt) | 150| 155| 149| 131| 150| 151|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Operating revenues | 5 265| 5 234| 5 183| 4 617| 5 514| 5 753|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | 414| 362| 361| 199| 437| 466|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | 315| 263| 260| 90| 331| 353|

+------------------------------+-------+-------+-------+-------+-------+-------+

+------------------------------+-------+-------+-------+-------+-------+-------+

|Building Systems |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|NOK million, except sales | | | | | | |

|volumes |  |  |  |  |  |  |

+------------------------------+-------+-------+-------+-------+-------+-------+

|Volume (kmt) | 19| 21| 18| 19| 20| 21|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Operating revenues | 1 869| 1 939| 1 680| 1 685| 1 830| 2 044|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | 110| 210| 104| 109| 155| 219|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | 75| 166| 67| 74| 119| 183|

+------------------------------+-------+-------+-------+-------+-------+-------+

+------------------------------+-------+-------+-------+-------+-------+-------+

|Precision Tubing |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|NOK million, except sales | | | | | | |

|volumes |  |  |  |  |  |  |

+------------------------------+-------+-------+-------+-------+-------+-------+

|Volume (kmt) | 37| 40| 37| 35| 36| 38|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Operating revenues | 1 620| 1 664| 1 549| 1 543| 1 651| 1 734|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | 144| 169| 135| 161| 180| 193|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | 86| 112| 76| 103| 123| 136|

+------------------------------+-------+-------+-------+-------+-------+-------+

+------------------------------+-------+-------+-------+-------+-------+-------+

|Other and eliminations |Q1 2016|Q2 2016|Q3 2016|Q4 2016|Q1 2017|Q2 2017|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBITDA | -116| -33| -64| -37| -63| -43|

+------------------------------+-------+-------+-------+-------+-------+-------+

|Underlying EBIT | -128| -41| -69| -28| -69| -49|

+------------------------------+-------+-------+-------+-------+-------+-------+

Investor contact

Contact Stian Hasle

Cellular +47 97736022

E-mail Stian.Hasle@hydro.com

Certain statements included in this announcement contain forward-looking

information, including, without limitation, information relating to (a)

forecasts, projections and estimates, (b) statements of Hydro management

concerning plans, objectives and strategies, such as planned expansions,

investments, divestments, curtailments or other projects, (c) targeted

production volumes and costs, capacities or rates, start-up costs, cost

reductions and profit objectives, (d) various expectations about future

developments in Hydro's markets, particularly prices, supply and demand and

competition, (e) results of operations, (f) margins, (g) growth rates, (h) risk

management, and (i) qualified statements such as "expected", "scheduled",

"targeted", "planned", "proposed", "intended" or similar.

Although we believe that the expectations reflected in such forward-looking

statements are reasonable, these forward-looking statements are based on a

number of assumptions and forecasts that, by their nature, involve risk and

uncertainty. Various factors could cause our actual results to differ materially

from those projected in a forward-looking statement or affect the extent to

which a particular projection is realized. Factors that could cause these

differences include, but are not limited to: our continued ability to reposition

and restructure our upstream and downstream businesses; changes in availability

and cost of energy and raw materials; global supply and demand for aluminium and

aluminium products; world economic growth, including rates of inflation and

industrial production; changes in the relative value of currencies and the value

of commodity contracts; trends in Hydro's key markets and competition; and

legislative, regulatory and political factors.

No assurance can be given that such expectations will prove to have been

correct.  Hydro disclaims any obligation to update or revise any forward-looking

statements, whether because of new information, future events or otherwise.

This information is subject to the disclosure requirements pursuant to section

5-12 of the Norwegian Securities Trading Act.