Norsk Hydro - ADR

Strong Q2 financial performance + cash generation (good): Adjusted EBITDA NOK 8.9bn; free cash flow NOK 4.0bn. Adjusted RoaCE 10.9% (above the 10% target over the cycle). Adjusted net income NOK 4.6bn and adjusted EPS NOK 2.21 (up vs NOK 1.68 in Q2’25). Dividend: ordinary dividend NOK 3/share paid in May (~NOK 5.9bn). CapEx outlook for full-year 2026 remains ~NOK 13.5bn.

Operational momentum, but Middle East turbulence remains the key drag/risk (bad/ongoing): Safety metrics remain excellent (HRIs/TRIs at historically low levels; ambition 0 injuries). Production: Norwegian casthouses delivered all-time high cathode production, smelters operated near full capacity with +6% production vs prior year period. However, Gulf/Middle East situation keeps curtailments and shipment constraints in focus (e.g., Qatalum operating ~60%; limited sales out of the Middle East in Q2; difficult to predict evolution due to volatility and logistics).

Slovalco restart milestone (opportunity): Hydro reached an agreement enabling restart of Slovalco (pending EU final approval). Restart planned for first 75,000 tonnes; ~NOK 400m restart capital (plus operating capital) expected, within the year’s CapEx guidance. Hydro says return depends on being “reasonably well-placed” on the cost curve (not giving a specific aluminum price requirement). Hydro intends to restart the remaining 100,000 tonnes only later if conditions/opportunity allow (after safely restarting the first phase).