Hafslund Q3 2012: Low power prices in third quarter

Highlights:

-          EBITDA: NOK 369 million in the third quarter of 2012.
-          Power prices: NOK 0.15 per kWh, down 40 percent from the third quarter of 2011 and down 58 percent from the third quarter of 2010.
-          Network power distribution business: Stable operations and normal profit for the quarter.
-          NOK 551 million in extraordinary write-downs and provisions negatively affect Hafslund Group's third-quarter after-tax profit, due to challenging market conditions for wood pellets and waste-derived fuel and an ongoing tax dispute.
-          BioWood Norway AS: Continued operations under assessment.
-          Cash flow from operations: NOK 519 million in the third quarter of 2012, including NOK 315 mill in reduced working-capital.

The Hafslund Group’s after-tax profit for the third quarter of 2012 was negatively affected by NOK 551 million in extraordinary write-downs and provisions. The write-downs and provisions are attributable to challenging market conditions and negative profit development at BioWood Norway AS and Bio-El Fredrikstad, and to a tax provision made as a result of developments in an ongoing tax dispute. Extraordinary write-downs and provisions were communicated to the market in a 16 October 2012 notice to the Oslo Stock Exchange.

Operating profit before extraordinary write-downs and provisions was NOK 229 million in the third quarter of 2012. The figure is NOK 67 million lower than the corresponding 2011 figure, if the third-quarter 2011 figure is adjusted for a NOK 360 million value decline associated with the Hafslund Group’s former ownership stake in Renewable Energy Corporation (REC). Profit performance reflects low power prices in a quarter featuring seasonally high hydropower production. Hydropower generation in the third quarter of 2012 was 924 GWh, which is on a par with normal production for the reporting period. The Hydropower business sold its production at NOK 0.15 per kWh, down 40 percent from the year-earlier figure. The Group’s Network power distribution business had stable operations and a normal profit for the quarter based on the regulatory income ceiling currently in force. Hafslund’s Markets business segment achieved satisfactory profitability in a seasonally weak quarter for power sales to retail and commercial customers.

Please read the flip-book report at www.hafslund.no/english/report (http://www.hafslund.no/english/report)

Hafslund ASA
Oslo, 25 October 2012

For further information, please contact:

CFO, Heidi Ulmo: Tel.: +47 909 19 325;
E-mail: heidi.ulmo@hafslund.no

Finance Director Morten J.Hansen: Tel.: +47 908 28 577;
E-mail: morten.j.hansen@hafslund.no