• Underlying EBIT NOK 518 million
• Lower alumina and aluminium prices
• Lower result in Energy, mainly from seasonally lower production
• Production in Bauxite & Alumina affected by power outages
• Increased volumes lift result in Rolled Products
• Aluminium demand growth outlook 2-4% outside China

"Although the global macroeconomic situation remains challenging, aluminium demand is expected to continue to show solid growth this year. Hydro maintains its outlook for a balanced aluminium supply and demand in 2013," Hydro's President and CEO Svein Richard Brandtzæg said.

Underlying EBIT for Bauxite & Alumina declined compared to the first quarter, mainly due to lower LME-linked alumina prices and reduced bauxite production. Alumina production declined further from weak levels experienced in the previous quarter following external power outages affecting the Alunorte refinery.

"Hydro's main focus is on our company-wide improvement efforts, where one of the key priorities is to implement actions to stabilize and lift production following the power outages that caused production disruptions at Alunorte," said Brandtzæg. The production disruptions will initially affect Bauxite & Alumina's improvement program "From B to A", but Hydro expects to reach savings of NOK 1 billion by end-2015, in line with original plans.

Primary Metal delivered lower underlying results for the second quarter, primarily due to lower realized aluminium prices. Underlying EBIT for Metal Markets was stable compared to the previous quarter.

Compared to the first quarter, underlying EBIT for Rolled Products improved, impacted by seasonally higher volumes partly offset by lower margins. Operating costs per metric tonne declined.

Underlying EBIT for Energy declined compared to the first quarter mainly due to seasonally lower production following high production levels in the first quarter.

Operating cash flow was NOK 1.0 billion for the second quarter. Net cash used for investment activities amounted to NOK 0.5 billion. Dividends paid in the quarter amounted to NOK 1.7 billion. Hydro's net debt position amounted to around NOK 1.3 billion at the end of the second quarter.

Reported earnings before financial items and tax amounted to NOK 375 million in the second quarter. In addition to the factors discussed above, reported EBIT included net unrealized derivative losses and positive metal effects amounting to NOK 74 million in total, rationalization and closure cost of NOK 86 million and divestment gains of NOK 16 million. In the previous quarter, reported EBIT amounted to NOK 705 million including net unrealized derivative losses and positive metal effects amounting to NOK 294 million in total and rationalization and closure costs of NOK 78 million.

Loss from continuing operations amounted to NOK 713 million in the second quarter including a net foreign exchange loss of NOK 1,291 million. In the previous quarter, income from continuing operations amounted to NOK 254 million including a net foreign exchange loss of NOK 115 million.

Income from discontinued operations amounted to NOK 48 million in the second quarter including rationalization and closure costs of NOK 77 million. In the previous quarter, income from discontinued operations amounted to NOK 9 million including rationalization and closure costs of NOK 40 million.

Hydro has sold forward around 50 percent of its expected primary aluminium production for the third quarter of 2013 at a price level of around USD 1,850 per mt. This excludes volumes from the Qatalum plant.

The Alunorte alumina refinery and the Albras aluminium smelter have entered into USD currency forward contracts in Brazil for second half 2013 and 2014, in total amounting to USD 800 million. The forward contracts reduce the net USD/BRL exposure of the entities and thereby of Hydro. The achieved exchange rate for the forward contracts is on average 2.25 and 2.37 for 2013 and 2014 respectively. Hedge accounting is applied to the forward contracts.