Slide 1: Hydro: Brazil site visit
Hydro: Brazil site visit Jørgen C. Arentz Rostrup, Executive Vice President and CFO November 5, 2012 (1)
Slide 2: Strong positions across aluminium value chain
Strong positions across aluminium value chain Recycling Rolling Bauxite Alumina Energy Primary Casting Products Extrusion Recycling (2)
Slide 3: Reflections on the acquisition
Reflections on the acquisition (3)
Slide 4: Challenging markets
Challenging markets Aluminium price in USD per tonne 3 400 3 000 2 600 2 200 1 800 1 400 1 000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 LME (3-month avg.) LME forw ard October 19, 2012 (4)
Slide 5: Discussions on financial solidity and rating
Discussions on financial solidity and rating • Challenging rating situation in 2009 • Challenging markets • BBB- with negative outlook from S&P, difficult to meet financial ratios • Rights issue discussed in industry • Market open for “defensive” rights issues • (Originally) no link to Vale deal • M
Slide 6: Timeline
Timeline • Fall 2009: Initial meetings • January/February 2010: Due diligence • February/April: Negotiations • 2 May: Announcement • May: Roadshow • 28 February 2011: Closing (6)
Slide 7: Transaction highlights
Transaction highlights • Structure – unique and needed approvals from several stakeholders including the Norwegian, Brazilian and Japanese Governments • Financing – same net financial position after transaction with a significant larger asset base • Successful rights issue • Transforming transaction
Slide 8: Strong positions across aluminium value chain: before acquisition
Strong positions across aluminium value chain Before acquisition Raw materials processing Primary aluminium production, Aluminium in products and energy marketing and recycling Bauxite Primary Metal Rolled Extruded & Alumina Energy Metal Markets Products Products • Net short position • Long-term pow
Slide 9: Strong positions across aluminium value chain: after acquisition
Strong positions across aluminium value chain After acquisition Raw materials processing Primary aluminium production, Aluminium in products and energy marketing and recycling Bauxite Primary Metal Rolled Extruded & Alumina Energy Metal Markets Products Products • Net long position • Long-term power
Slide 10: World-class assets in resource-rich Brazil
World-class assets in resource-rich Brazil CAP alumina Alunorte refinery project alumina refinery Increasing stake from Increasing stake from 20% to 81% 34% to 91% • Bauxite licenses • Sales contract portfolio • Competence MRN bauxite mine Paragominas bauxite mine Albras aluminium smelter Current st
Slide 11: Raw material is key to our aluminium future
Raw material is key to our aluminium future Aluminium equivalent consolidated capacity, million tonnes End-2010 End-2011 Post-CAP 4.3 • Long position in bauxite and alumina 3.3 3.4 creates flexibility • Strategically attractive 2.3 2.4 2.4 assets 1.9 • New business 1.4 opportunities 0.5 • Resource c
Slide 12: Bauxite & Alumina: Strategically robust, challenging markets
Bauxite & Alumina: Strategically robust, challenging markets • Strategic rationale verified • Tougher competition for resources • Commercialization of bauxite and alumina markets • Higher cost to build new capacity • Significantly increased production in Paragominas • Macro and raw material pressure