Norsk Hydro (NHY) Investor Day 2025 summary

Strategic direction, market outlook, and priorities

• Execution of the 2030 strategy focuses on disciplined growth, value creation, and adaptability to market realities, with a clear roadmap to net-zero by 2030 and net-zero by 2050.

• Geopolitical tensions, trade barriers, and climate change are shaping investment and customer decisions, increasing the importance of regionalization and supply security.

• Demand for low-carbon and recycled aluminum is rising, driven by electrification, infrastructure, defense, and regulatory support, with CBAM and scrap export policies expected to further boost demand.

• Supply of low-carbon aluminum remains limited, with most new capacity globally being high-carbon.

• Social and environmental initiatives include biodiversity restoration, just transition frameworks, and over 300 community projects supporting local communities.

Financial performance, guidance, and capital allocation

• Adjusted ROAC over the cycle is 13.5%, with adjusted EBITDA for the last 12 months at NOK 31 billion and free cash flow above NOK 10 billion.

• CapEx guidance for 2025 and 2026 is reduced to NOK 13.5 billion, prioritizing value-creating projects and maintaining flexibility.

• Improvement program is ahead of plan, targeting NOK 1.2 billion in 2025 and NOK 6.5 billion in annual improvements by 2030.

• Shareholder distributions since 2021 total NOK 41 billion, with a five-year average payout ratio of 67% and a dividend yield of 5.9%.

• Net operating capital guidance is set at NOK 30 billion for 2026, with a continued focus on inventory management and supply chain flexibility.

Business area developments and operational adjustments

• Recycling and Extrusions divisions are undergoing restructuring, including closure of five European plants and eight presses, reducing capacity by 11% in extrusions and 29% in cast house, with expected annual savings of EUR 45 million and NOK 0.5–1 billion.

• Margin recovery and growth in Recycling and Extrusions are driven by improvement initiatives, market normalization, and expanded greener product offerings.

• Energy business is focused on renewable generation, with a major EUR 2.5 billion investment in the Illvatn pumped power project and new long-term power agreements.

• Bauxite & Alumina maintains a first quartile cost position, with ongoing decarbonization and nature-positive initiatives.

• Automation and press replacement projects in Extrusions are improving efficiency, safety, and FTE savings, with targeted payback periods of 2–8 years.