Norsk Hydro Asa · OSL:NHY

Norsk Hydro Asa — Debt Investor Presentation (September 2000)

21 slides from Norsk Hydro Asa's debt investor presentation, Sep 7, 2000

  1. Slide 1: Presentation to Fixed Income Investors, Berlin

    Presentation given by Senior Vice President Ida Helliesen to Fixed Income Investors Berlin, Sept. 7-8th 2000 11910-09.00*1-Hydro Media

  2. Slide 2: Norsk Hydro Business Focus

    1RUVN+\GUR%XVLQHVV)RFXV 2LODQG $JULFXOWXUH /LJKW0HWDOV (QHUJ\ Concentration on 3 core areas Divesting or alliances non-core areas Exploit new technology and capabilities across business units More focused - Multibusiness

  3. Slide 3: Norsk Hydro

    1RUVN+\GUR Operating revenues NOK 102 bill. Sales Other Europe Operating income NOK 7.7 bill. 5% Asia 5% North Return on capital employed 9 % America 14 % Investments NOK 12.3 bill. * Other 3% Almost 39,000 employees ** in 70 countries Norway 10 % EU 63% * 53 bill. NOK including the Saga aquisition

  4. Slide 4: Total assets NOK billion

    7RWDODVVHWV 12.%LOO Share Per division NOK billion Exploration and Production Oil Marketing* 60% Energy Aluminium Metal products Aluminium Extrusion Other Light Metals 15% Plant Nutrition Gas and Chemicals 20% KFK Petrochemicals, Others 5% 0 20 40 60 80 100 Non-current Current assets assets 11910-09

  5. Slide 5: Oil, gas and energy: selective growth

    2LOJDVDQGHQHUJ\VHOHFWLYHJURZWK Production 420 000 boe/day Saga Merger mid 1999 Production target approx. 800 000 boe/day within existing licences and investment levels Proven oil and gas reserves end 1999, 2,1 billion boe - 14 years production life Norwegian Continental Shelf and International posit

  6. Slide 6: Norwegian continental shelf importance

    1RUZHJLDQFRQWLQHQWDOVKHOILPSRUWDQFH RIIVKRUH!PHWHU 100 19 90 Australia Global Oil Production in % 80 12 Africa 70 Offshore, shallow water 9 14,0% South-America 60 30 50 Offshore > 50m NCR 15,0% 40 30 22 Onshore 20 71,0% UK 10 7 GOM 0 11910-09.00*6-Hydro Media

  7. Slide 7: Competence from offshore deepwater

    &RPSHWHQFHIURP2IIVKRUH'HHSZDWHU Production as operator, 1997, deepwater >50 meter 1000 bbl/day 1500 1251 1083 1055 1016 1000 777 490 485 500 444 415 365 364 241 192 177 175 167 154 147 119 0 Amerada Hess Phillips Agip BPAmoco Statoil Esso/Mobil Indian NOC Oryx /Kerr McG Chevron Woodside Enterprise T

  8. Slide 8: New Global Industry Structure Aluminium

    1HZ*OREDO,QGXVWU\6WUXFWXUH$OXPLQLXP Production capacity year 2000 Primary metal 1000 tonnes Extrusion 5000 Rolled Products 4000 3000 2000 1000 0 AR Pechiney Hydro Kaiser Alcan/ALgroup Billiton Comalco VAW 11910-09.00*8-Hydro Media

  9. Slide 9: Light Metals: Selective growth

    /LJKW0HWDOV6HOHFWLYHJURZWK Aluminium 2.5% - 3% Growth in demand Transport Construction Packaging Recent strategic steps taken by Hydro Alliance in Brazil: Alumina and Metal Acquired US extrusion company: Wells Brownfield smelter investment in Norway Magnesium World's largest producer 11910-09.00*9-H

  10. Slide 10: Hydro the leading supplier of Plant Nutrition globally

    +\GUR7KHOHDGLQJVXSSOLHURI 3ODQW1XWULWLRQ*OREDOO\ Hydro IMC, USA PCS, Canada Agrium, Canada Kemira, Finland MissChem, USA 0 500 1000 1500 2000 2500 3000 3500 Mill US dollar Revenue from Fertilizer in 1999 11910-09.00*10-Hydro Media

  11. Slide 11: Agri: Turnaround mode

    $JUL7XUQDURXQGPRGH Hydro the largest producer in Europe - Capacity reduction within European industry Hydro has a global marketing and distribution network Global Market Growth of 1.5- 2.0% per year Fertilizer (and water) key input for efficient crop production 11910-09.00*11-Hydro Media

  12. Slide 12: Financial performance by quarter: Net income

    )LQDQFLDOSHUIRUPDQFHE\T 1HWLQFRPH By quarter NOK million 3.000 2.500 2.000 1.500 1.000 500 0 1997* 1998 1999 2000 Accumulated 5,205 3,754 3,416 5,226 *) After effect of changes in tax law, 4th qtr 1997, NOK 106 million 11910-09.00*12-Hydro Media

  13. Slide 13: Financial strategy

    )LQDQFLDOVWUDWHJ\ Limited ability to control timing of investments Ability to sell assets Keep all financing sources open - Bond market - Bank loans - Equity market Raise funds when markets are receptive 11910-09.00*13-Hydro Media

  14. Slide 14: Investments

    ,QYHVWPHQWV NOK billion 60 Saga 53 Other activities 50 Exploration and Production 40 30 20 12,8 12,5 13,5 10 8,7 0 1995 1996 1997 1998 1999 1st half 2000 11910-09.00*14-Hydro Media

  15. Slide 15: Focusing and improving financial ratios: Divestments

    )RFXVLQJDQGLPSURYLQJILQDQFLDOUDWLRV 'LYHVWPHQWVDQG Pronova Biopolymer Dyno shares UK oil and gas licences Hydro Seafood* Others Total value 14 BNOK (1.6 billion USD) *Approval from authority pending 11910-09.00*15-Hydro Media

  16. Slide 16: Financial targets

    )LQDQFLDOWDUJHWV Shareholder return 15-20% per year over a business cycle Cash Return on Gross Investment, nominal after tax 10% Return on new investments, real rate after tax 10% Dividend: Share of net income 30% Solidity: Longterm debt/equity 0,5 11910-09.00*16-Hydro Media

  17. Slide 17: Financial position

    )LQDQFLDOSRVLWLRQ Long-term debt/equity 0,8 0,7 0,6 0,5 0,4 0,3 0,2 0,1 0 1994 1995 1996 1997 1998 1999 30.06.2000 Long-term interest bearing debt divided by shareholders' equity plus minority interest 11910-09.00*17-Hydro Media

  18. Slide 18: Funding Strategy

    )XQGLQJ6WUDWHJ\ Long-term funding - aligned with long term industrial perspective - mainly bonds Mainly fixed interest - predictability and stability Bond issues 1980's Europe 1990's US 1999/00 400 Mill euro Europe likely to be more important for us in the future Maintain Investment Grade Rating 119

  19. Slide 19: Long-term debt repayment profile

    /RQJWHUPGHEWUHSD\PHQWSURILOH Average maturity: 15,2 years 4500 4000 3500 3000 2500 2000 1500 1000 500 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 Committed long-term standby credit facilities: USD

  20. Slide 20: Drawdowns on long-term standby credit facilities

    'UDZGRZQVRQORQJWHUPVWDQGE\ FUHGLWIDFLOLWLHV Norsk Hydro ASA USD millions 700 600 500 400 300 200 100 0 12.89 12.90 12.91 12.92 12.93 12.94 12.95 12.96 12.97 12.98 12.99 11910-09.00*20-Hydro Media

  21. Slide 21: Performance of Hydro's euro million issue

    3HUIRUPDQFHRI+\GUR VHXURPLOOLVVXH Spre ad Developments - Norsk Hydro ASA EUR 400 million 60 55 Spread over Euribor in bps 50 45 40 35 30 27 27 27 27 27 27 27 27 27 27 27 0- 1- 2- 1- 2- 3- 4- 5- 6- 7- 8- -1 -1 -1 -0 -0 -0 -0 -0 -0 -0 -0 99 99 99 00 00 00 00 00 00 00 00 19 19 19 20 20 20 20 20 20 20 2

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