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Investing.com -- Norsk Hydro reported weaker-than-expected third-quarter results as lower alumina prices and a stronger Norwegian crown weighed on profitability, partly offset by higher production and solid cash generation.
Shares in the company fell more than 4% in Oslo trading.
Adjusted EBITDA fell 18.6% to 6 billion kroner from 7.4 billion kroner a year earlier, below the company-compiled consensus 6.4 billion kroner.
Adjusted net income dropped to 1.91 billion kroner, or 1.02 kroner per share, compared with 3.51 billion kroner, or 1.49 kroner per share, last year.
Revenue edged up 1% to 50.55 billion kroner.
“Challenging markets are affecting our third quarter and we experience weaker results," said Chief Executive Eivind Kallevik. "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.”
RBC analyst Marina Calero described the results as “weaker than expected,” noting that Hydro missed both their and consensus forecasts by 5–6%, mainly due to softer performances in aluminium metal and metal markets segments.
She highlighted that while alumina performed better than forecast, metal markets EBITDA fell nearly 40% short of expectations amid continued pressure on recycling margins.
Calero said the company’s preliminary commentary for the fourth quarter “points to continued pressure,” with aluminium metal premiums guided between $310 and $360 per tonne, below the consensus estimate of $380 per tonne.
The analyst expects the results and weaker outlook to lead to “around a 3% downgrade to consensus EBITDA expectations for the year.”
Hydro reaffirmed its full-year capital expenditure guidance of 13.5 billion kroner but said it continues to implement its strategic workforce and cost-reduction programme.
The company aims to reduce 600 white-collar positions in 2025, generating annual run-rate savings of 1 billion kroner from 2026 through lower travel and consultancy costs.