(RTTNews) - Aluminium and aluminium products supplier Norsk Hydro ASA (NHYDY.PK: News ,NHY: News ) Tuesday reported a sharp increase in net profit for the third quarter, benefited by financial gains as well as a positive development in aluminium prices, despite a plunge in revenues.

For the third quarter, net income attributable to shareholders was NOK 1.01 billion or NOK 0.83 per share compared to NOK 202 million or NOK 0.17 per share in the prior-year quarter.

The Oslo, Norway-based company's revenues for the period, however, plummeted to NOK 16.34 billion from NOK 21.77 billion in the third quarter of fiscal 2008.

On a segmental basis, revenues from primary metal were NOK 6.36 billion versus NOK 9.26 billion, revenues from metal markets segment slumped to NOK 9.57 billion from NOK 12.47 billion last year.

Rolled products segment generated revenues of NOK 4.35 billion compared with NOK 5.84 billion, revenues from extruded products fell to NOK 4.94 billion from NOK 6.16 billion in the 2008-year period. However, revenues from energy segment rose slightly to NOK 1.08 billion from NOK 1.01 billion in the year-ago quarter.

Norsk said its third quarter was marked by a strong positive development in aluminium prices. London Metal Exchange, or LME, three month prices increased from a low of US$1,566 per mt in the beginning of July reaching a high of US$2,066 per mt in the middle of August. For the remainder of the quarter, prices ranged from around US$1,800 to US$1,950 per mt.
During the quarter, total expenses incurred by the company were NOK 15.84 billion compared with NOK 19.55 billion in the previous year. Income tax expense incurred during the period totaled NOK 707 million versus NOK 201 million in the last-year period.

Norsk had a net financial income of NOK 989 million during the three-month period compared to an expense of NOK 1.98 billion in the prior year.

For the nine-month period, net earnings plunged to NOK 868 million or NOK 0.72 per share from NOK 2.09 billion or NOK 1.73 per share in the comparable period prior year. Year-to-date revenues were NOK 50.31 billion compared with NOK 67.28 billion a year ago.

Looking ahead, Norsk expects increased reservoir levels, along with lower maintenance activity, to result in higher power production in the fourth quarter compared to the third quarter of 2009. The company expects spot prices to continue to be on lower level. Power production in the fourth quarter is estimated to be significantly lower than the corresponding period in 2008 primarily due to outage at Suldal I power station, Norsk said.

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