Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Investor Presentation (August 2004)
19 slides from Norsk Hydro Asa's investor presentation, August 2004
Slide 1: Automotive sector
Aluminium Dieter J. Braun Sector President, Automotive Automotive sector
Slide 2: A broad product range
A broad product range Precision tubing Structures Castings Aluminium & Rolled Magnesium castings magnesium alloys products (Meridian, 49%) 51145_3 • H ydro M edia • 08.2004 • 2
Slide 3: Present in all major markets
Present in all major markets Main products Bumper beams, crash boxes, frames, precision tubing, engine blocks & heads, magnesium castings (JV) Production 177 000 tonnes Employees * 6 100 * 100% owned companies per 31.12.2003 51145_3 • H ydro M edia • 08.2004 • 3
Slide 4: Product portfolio and main markets – 2003
Product portfolio and main markets – 2003 Shipments : 177 000 tonnes Markets (% of revenue) Castings Structures North Other 32 % 32 % America 3 % 19 % Precision Tubing Europe 36 % Revenues : NOK 7 600 million 78 % Castings Structur es 37 % 36 % Precision Tubing 27 % 51145_3 • H ydro M edia • 08.2004
Slide 5: Our customers
Our customers 51145_3 • H ydro M edia • 08.2004 • 5
Slide 6: Key value drivers and competitive strengths
Key value drivers and competitive strengths z High quality asset base Market positions 2003 (% of total market incl. steel/ cast iron solutions) z Competence across the 80 % Europe value chain 65 % 60 % NAFTA z Leading market positions 40 % 35 % 17 % 14 % 20 % z Strong reputation for process 4% 6% 5
Slide 7: Delivering according to plan
Delivering according to plan What we said in 2003 What we have done Successfully launch new z All major projects launched in accordance with QS 9000 product programs z Renault Megane bumper programs, BMW 5-series bumper and front end programs, GM EV6 block & head, Ford Lion head, VW radiator tubing
Slide 8: Strong contribution to growth by emerging markets
Strong contribution to growth by emerging markets* z Annual global vehicle NOK million Global light vehicle production production expected to 80 grow 11 million to 2009 70 67.8 million 56.6 million 60 50.5 million z Almost 44% of global **CTG 2003-2009 growth emanates from 50 the emerging markets 44
Slide 9: Reducing vehicle weight by aluminium yields improved driving characteristics
Reducing vehicle weight by aluminium yields improved driving characteristics 10% reduction in vehicle weight results in… Improved Improved braking safety Enhanced Reduced performance emissions Improved Improved fuel durability economy Improved More vehicle dynamics features Source: CSFB, 2004 51145_
Slide 10: Focus on weight reduction strengthens aluminium attractiveness
Focus on weight reduction strengthens aluminium attractiveness z Environmental legislation Emphasis on weight - Fuel economy and oil prices reduction z Comfort features require weight savings elsewhere z Improved vehicle performance z Growing light metal demand in automotive z Continuous search for
Slide 11: Growing emerging markets and increasing diesel penetration foster expansion
Growing emerging markets and increasing diesel penetration foster expansion z SUVs and light trucks continue to gain share (57 % of 2003 vehicle sales in North America) Shifting product mix z Further increase in diesel engine penetration (Europe 44 %) z New solutions and products for SUVs and light
Slide 12: Global presence is a decisive success factor
Global presence is a decisive success factor z Shorter product life cycles z Derivative vehicles based off common platforms Changing vehicle z Increased component sharing across platforms design & z Modular assembly of pre-assembled systems manufacturing z Bigger volumes – global presence of compone
Slide 13: Automotive industry requires the highest levels of expertise from its main suppliers
Automotive industry requires the highest levels of expertise from its main suppliers z Shifting capital expenditures to suppliers z Shifting supply chain management to Tier 1 integrators Outsourcing of z Continued cost pressure on suppliers component systems z Growing opportunity for competent suppl
Slide 14: A success story: BMW 5-series aluminium front end
A success story : BMW 5-series aluminium front end Comparison ∆= of Weight 19,9 kg 0,8 kg glue steel steel 17,4 67,5 kg 47,6 kg aluminium 29,4 before 7/2003 since 7/2003 Hydro delivers to BMW 5-series: z Front structure - front beam and crash boxes, longitudinals, diagonal tube and miscellaneous ext
Slide 15: Priorities going forward
Priorities going forward Precision Tubing Castings z Continued high profitability z Good profit going forward z Continue to grow – niches with z Start up of new production line strong positions in Dillingen for diesel engine (2004) z China and Mexico, new plants z Reduced investment levels – focus o
Slide 16: Forward-looking statements/ use of non-GAAP financial measures
16 Forward-looking statements/ use of non-GAAP financial measures In order to utilize the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995, Hydro is providing the following cautionary statement: This presentation contains certain forward-looking statemen
Slide 17: Appendix
Aluminium Appendix
Slide 18: Trends in the automotive supplier industry
Trends in the automotive supplier industry Shifting value adding from OEMs to suppliers Value creation Development made by 25-35% 20-30% OEM 30-40% 49% 57% 67% 70-80% 65-75% 60-70% Supplier 51% 43% 33% 2000 2005 2010 2000 2005 2010 z Value creation: OEM reduction, supplier increasing z Higher R&D ac
Slide 19: Automotive sector overview
Automotive sector overview z Operating revenues € 1.9 billion € million z Components* 1 100 z Aluminium & 500 magnesium alloys z Sheet and profiles 300 z Global businesses z Castings (AI & Mg) z Structures z Precision tubing z Rolled products z Foundry alloys (AI & Mg) * incl. 49% Meridian JV 51145_