(CercleFinance.com) – Norsk Hydro announced on Friday that it would invest more than expected this year in order to boost its profitability and cope with inflation, a statement that did not sit well with the market.
The industrial group, one of the main aluminum producers in the world, intends to invest around 20.5 billion Norwegian crowns in 2023, instead of the 16.5 billion crowns initially targeted.
In the second quarter, the Norwegian group saw its operating profit (Ebitda) fall to 7.1 billion crowns, against 11.6 billion crowns a year earlier.
This performance is slightly above the average of market estimates.
In its press release, Hydro stresses that the demand for primary aluminum is weakening and that Chinese producers are making a comeback, an environment which it describes as ‘difficult’ and which is forcing it in particular to reduce its costs.
Affected by these announcements, the title lost 2.8% on Friday morning, signing the largest drop in the flagship index of the Oslo Stock Exchange, the OSEBX, which rose by 0.5% at the same time.
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