Norsk Hydro ASA

Earnings Release • Oct 24, 2025

Norsk Hydro: Solid results amid uncertain markets

Norsk Hydro: Solid results amid uncertain markets

Hydro's adjusted EBITDA for the third quarter of 2025 was NOK 5,996 million,

down from NOK 7,367 million in the same quarter last year. The results decreased

from lower realized alumina prices and a stronger NOK. This was partly offset by

higher primary and alumina volumes, positive gain from increasing U.S. Midwest

premium in Extrusions (metal effect) and realization of previously eliminated

internal profits. Hydro generated NOK 2.2 billion in free cash flow, while the

twelve month adjusted RoaCE ended at 11 percent.

* Solid cash generation, uncertain extrusion markets

* Executing on strategic workforce and cost reductions

* Future proofing Alouette by signing an Agreement in Principle for long-term

power contract until 2045

* Dutch court dismisses all claims against Hydro filed by Brazilian Cainquiama

and nine individuals in 2021

* Advancing low-carbon and circular solutions through customer collaborations

"Challenging markets are affecting our third quarter and we experience weaker

results. Despite lower adjusted EBITDA, I am pleased to report solid cash

generation while we continue to create results in our efficiency and improvement

initiatives in order to improve robustness," says Eivind Kallevik, President and

CEO of Hydro.

In June, Hydro launched a strategic workforce and cost reduction program to

future proof the organization and strengthen long-term competitiveness. The

initiative includes reducing approximately 750 white collar positions to

streamline the organizational structure and enhance profitability. About 600

positions will be reduced in 2025, with estimated gross redundancy costs of

around NOK 400 million and expected cost savings of NOK 250 million, resulting

in a net 2025 cost of NOK 150 million. Further 150 position reductions are

planned for in 2026, mainly through natural attrition. From 2026, the program is

expected to deliver annual net run-rate savings of NOK 1 billion, including

lower travel and consultancy expenses.

These measures comes in addition to several performance and capital discipline

initiatives, thereby complementing the 2030 NOK 6.5 billion improvement program

and reduced 2025 capex estimate, further strengthening Hydro's ability to

navigate global uncertainty. The process is being carried out in line with

Hydro's values of care, courage, and collaboration, and in close cooperation

with employee representatives.

"Hydro is committed to building resilience, and in an increasingly unpredictable

market situation, this program is a significant step. The savings following this

program will be an important contribution to our future performance. While such

initiatives are challenging, I am encouraged by the thorough and considerate

approach taken to ensure that we keep critical resources while adopting to the

new reality," says Kallevik.

Reliable access to renewable energy remains key to Hydro's low-carbon aluminium

strategy. In the third quarter, Hydro's joint venture smelter, Alouette, made

progress in its global power sourcing initiatives, reaching an Agreement in

Principle (AiP) with the Government of Québec and Hydro-Québec to secure

renewable power supply for the period 2030 - 2045. The agreement ensures stable,

competitive energy in a tightening market and reinforces Alouette's position as

the largest aluminium smelter in the Americas. The parties will now work toward

a final agreement, further strengthening Hydro's global portfolio of long-term

renewable power purchase agreements and overall energy resilience.

Hydro is progressing its batteries phase out, as previously communicated on

Capital Markets Day in November 2024, in line with its strategic priorities. On

October 10, Hydro exchanged its shares in Lithium de France for a 6 percent

share in Arverne Group. In addition, Hydro has signed an agreement to divest its

entire stake in the maritime battery company Corvus Energy for USD 30 million,

with closing expected in early November.

On September 24, 2025, the Rotterdam court issued its final judgment in the case

brought forward by Brazilian Cainquiama and nine individuals against Norsk Hydro

ASA and its Dutch subsidiaries in 2021. The court fully dismissing all claims

brought forward by the plaintiffs, including claims of pollution caused by

Alunorte following heavy rains in the region in February 2018. The court's

dismissal was based on both legal and factual grounds. During the proceedings,

Hydro presented extensive evidence, including expert analyses and empirical

data. On this basis the court confirmed as an established fact, that there were

no overflow from the bauxite residue deposits in 2018, and consequently no harm

was caused to the environment.

Hydro continues to shape the aluminium market by expanding low-carbon and

circular solutions. Since 2022, the company has partnered with Mercedes-Benz to

decarbonize the automotive value chain, a collaboration highlighted by the new

electric CLA launched this year, which features Hydro REDUXA 3.0 aluminium from

the Årdal smelter. This partnership reinforces Hydro's commitment to

transparency, traceability and responsible sourcing in automotive applications.

In the infrastructure sector, the Hangarbrua pedestrian bridge in Trondheim

exemplifies industrial collaboration and circular innovation. A substantial

portion of the material originates from recycled aluminium recovered from the

decommissioned Gyda oil platform, showcasing Hydro's capability to close the

recycling loop and transform offshore materials into new, low-carbon

applications. The project demonstrates how innovative design and aluminium's

unique properties enable lighter, low maintenance, and longer lasting

infrastructure.

Results and market development per business area

Adjusted EBITDA for Bauxite & Alumina decreased compared to the third quarter of

last year, to NOK 1,290 million from NOK 3,410 million, mainly driven by lower

alumina sales prices, weaker BRL to USD and higher fixed costs. Partly offset by

increased sales volume and positive effect from the fuel switch project, which

replaces fuel oil with natural gas in the Alunorte refinery.

PAX traded down to USD 321 per mt at the end of the third quarter, from USD 358

at the end of the second quarter, driven by Chinese alumina price trends and a

loosening global alumina balance as the production at new refineries in

Indonesia continued ramping up as demand stayed stable. China's alumina market

was oversupplied, driving domestic prices down towards marginal cash cost. The

suspension of some bauxite mining licenses in Guinea reduced bauxite production

and exports to China, ending the bauxite price decline started in the first

quarter of 2025.

Adjusted EBITDA for Energy increased in the third quarter compared to the same

period last year, to NOK 828 million from NOK 626 million. The increase was

mainly driven by higher price area gain partly offset by lower production.

Average Nordic power prices increased compared to the previous quarter and the

same quarter last year. The increase in prices from the same quarter last year

are primarily due to lower wind and nuclear production. The increase in prices

from the previous quarter are mainly due to lower wind and solar production.

Price area differences between the south and north of the Nordic market regions

increased, both compared to the same quarter last year and the previous quarter,

as the northern areas were influenced by strong hydrology and high wind

production.

Adjusted EBITDA for Aluminium Metal decreased in the third quarter of 2025

compared to the third quarter of 2024, to NOK 2,732 million from NOK 3,234

million, mainly due to weaker USD to NOK, partly offset by higher sales volume

and lower alumina cost.? Global primary aluminium consumption was flat compared

to the third quarter of 2024, with demand growth in China balancing a 1.8

percent decline in demand in the World ex. China. The three month aluminium

price increased throughout the third quarter of 2025, starting the quarter at

USD 2,599 per mt and ending at USD 2,681 per mt.

Adjusted EBITDA for Metal Markets decreased in the third quarter of 2025

compared to the same period last year, to NOK 154 million from NOK 277 million,

due to lower results from sourcing and trading activities, partly offset by

increased results from recyclers.

Adjusted EBITDA for Extrusions increased in the third quarter of 2025 compared

to the same quarter last year, to NOK 1,107 million from NOK 879 million, driven

by lower cost in combination of somewhat higher volumes. Increasing U.S. Midwest

premium (positive metal effect) compensated for pressured sales margins.

European extrusion demand is estimated to have been flat in the third quarter of

2025 compared to the same quarter last year, but decreased 20 percent compared

to the second quarter due to seasonality. Demand for building & construction and

industrial segments have stabilized at historically low levels with some

improvements in order bookings. Automotive demand has been negatively impacted

by lower European light vehicle production, partly offset by increased

production of electric vehicles.

North American extrusion demand is estimated to have increased 2 percent in the

third quarter of 2025 compared to the same quarter last year, but decreased 2

percent compared to the second quarter. Extrusion demand has continued to be

weak in the commercial transport segment driven by lower trailer builds.

Automotive demand has also been weak. Demand has been positive in the building &

construction and industrial segments. While the ongoing impacts from the

introduction of tariffs and duties are still uncertain at this stage, order

bookings have developed better for domestic producers due to lower imports so

far this year.

Other key financials

Compared to the second quarter of 2025, Hydro's adjusted EBITDA decreased to NOK

5,996 million from NOK 7,790 million, mainly due to lower realization of

previously eliminated internal profits, lower realized aluminium price and a

stronger NOK, partly offset by reduced raw material costs.

Net income (loss) amounted to NOK 2,149 million in the third quarter of 2025.

Net income (loss) included a NOK 206 million unrealized derivative loss, mainly

on LME related contracts, and a net foreign exchange gain on risk management

instruments of NOK 66 million. The result also included NOK 116 million in

rationalization charges and compensation for termination of a power contract of

which NOK 251 million is related to future periods. Further, foreign exchange

gains of NOK 381 million was also adjusted for. The tax effect on these

adjustments reflected a standardized tax rate for taxable gains and tax-

deductible losses.

Hydro's net debt decreased from NOK 15.5 billion to NOK 13.6 billion during the

third quarter of 2025. The net debt decrease was mainly driven by EBITDA

contribution, partially offset by investments and net operating capital build.

Adjusted net debt decreased from NOK 23.0 billion to NOK 21.1 billion, mainly

driven by the decrease in net debt of NOK 1.9 billion, partially offset by

increased adjustments of NOK 0.1 billion, driven by increased hedging

collateral.

Reported earnings before financial items and tax (EBIT), and net income include

effects that are disclosed in the quarterly report. Adjustments to EBITDA, EBIT

and net income (loss) are defined and described as part of the alternative

performance measures (APM) section in the quarterly report.

Investor contact:

Elitsa Blessi

+47 91775472

Elitsa.Blessi@hydro.com

Media contact:

Halvor Molland

+47 92979797

Halvor.Molland@hydro.com

The information was submitted for publication from Hydro Investor Relations and

the contact persons set out above. 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. Except where required by law,

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

statements, whether as a result of new information, future events or otherwise.

This information is considered to be inside information pursuant to the EU

Market Abuse Regulation and is subject to the disclosure requirements pursuant

to Section 5-12 the Norwegian Securities Trading Act.