Norsk Hydro Asa · OSL:NHY
Norsk Hydro Asa — Investor Day (January 2002)
14 slides from Norsk Hydro Asa's investor day presentation, Jan 8, 2002
Slide 1: Capital Markets Day
Capital Markets Day President President & & CEO, CEO, Eivind Eivind Reiten Reiten Norsk Norsk Hydro Hydro ASA ASA Oslo, Oslo, January January 8, 8, 2002 2002
Slide 2: Delivering on our strategy
2 Delivering on our strategy ● Strong financial capacity established ● VAW acquisition — a transforming step for Aluminium ● Attractive international positions established for Oil and Energy ● Agri turnaround successfully completed ● Challenging to meet 2002 return target 33047_1 - 01.2002 - * 2 - H
Slide 3: Creating a world class aluminium company
3 Creating a world class aluminium company The VAW acquisition ● Establishing Europe's no. 1 aluminium company ● An excellent strategic fit — new company well positioned ● Accretive to EPS already in 2002 ● Successful integration the main short term priority ● Ambitious programme to realise synergie
Slide 4: Creating a "top-tier" aluminium company
4 Creating a “top-tier” aluminium company Total production, thousand tonnes, 2000 Europe Global: World Integrated Aluminium Companies 1200 1000 4500 4000 800 3500 600 3000 2500 400 2000 1500 200 1000 500 0 0 oa an us W ey r an a W ey se o A lc lc or in A lc lc in ai V A A ch V C A A h + K + ec Pe o
Slide 5: Agri — potential for significant value creation
5 Agri — potential for significant value creation ● Successful turnaround exceeds original targets: ■ Greatly improved market balance in Europe ■ Annual fixed costs cut by 30% (NOK 2.3 billion) from 1998- level* ■ Manning reduced by 30% (3,600 persons*) from 1998-level ■ Platform for sustainable com
Slide 6: Oil and Energy — positive growth outlook
6 Oil and Energy — positive growth outlook ● 2001 production target of 415,000 boe/d. reached, average annual production growth to 2005 of 5 - 6% ● Growing natural gas sales and adding value through commercial activities ● Exciting exploration acreage secured ● Finding and development costs on track
Slide 7: Safety performance
7 Safety performance Total Recordable Injury Rate, Employees 12 month rolling average Total recordable injuries/million hours worked 25 20 15 MTC rate RW C rate 10 LTI rate 5 0 1996 1997 1998 1999 2000 1H Nov 2001 2001 MTC: Medical treatment cases RWC: Restricted work cases LTI: Lost time injuries 3
Slide 8: Share price performance — a major challenge
8 Share price performance — a major challenge NHY OSE 450 400 350 300 250 200 Annual Total Shareholder Return 1991 - 2001 13% 150 100 mar-90 mar-91 mar-92 mar-93 mar-94 mar-95 mar-96 mar-97 mar-98 mar-99 mar-00 mar-01 33047_1 - 01.2002 - * 8 - Hydro Media
Slide 9: Creating shareholder value
9 Creating shareholder value Aluminium — NOK 1.6 billion programme Performance Oil & Energy — and People lower F&D costs Performance culture Non-core units Share- holder- Portfolio Underperforming units value management Divestment target NOK 10 billion Major portfolio Transforming transactions restr
Slide 10: CROGI — our main metric for return on capital
10 CROGI — our main metric for return on capital CROGI — Cash Return on Gross Investments ● Average over the cycle 12.3 10% 12 10.3 10 8.5 8.4 ● Level achieved in two of 7.7 the last five years; 8 improved performance 6 required 4 2 ● 2001 CROGI affected by: 0 ■ Weak aluminium market 1996 1997 1998
Slide 11: Challenging to reach 2002 CROGI target
11 Challenging to reach 2002 CROGI target ● Current plans imply an expected normalised CROGI level of between 8 and 9% in 2002 ● Challenge being met by continued drive for better performance ■ Implementing an agressive restructuring and improvement programme in Aluminium ■ Developing an attractive e
Slide 12: Strengthen performance culture
12 Strengthen performance culture ● Speedy actions to correct deviations from plans ● New top management incentive systems established ● Performance drive in total compensation systems ● Improved management development programmes 33047_1 - 01.2002 - * 12 - Hydro Media
Slide 13: Increased strategic flexibility
13 Increased strategic flexibility ● A strong platform providing attractive opportunities ■ Oil and Energy with exciting exploration potential ■ VAW acquisition a transforming transaction for Aluminium ■ Agri established as a global industry leader ● Successful Agri turnaround and VAW acquisition cr
Slide 14: Safe harbour statement
14 Safe harbour statement 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 statements with respect to the financial conditi