Elkem Stock

Warm welcome to Elkem's second quarter results presentation. My name is Odd-Geir Lyngstad. I'm responsible for Investor Relations in AGM. To take us through today's agenda, we have as usual, CEO, Helge Aasen and CFO, Morten Viga. Helge will cover the highlights and the business update, followed by a market update and outlook for the third quarter. Martin will then present the results for the second quarter. We are pleased to welcome Elkem'ss next CEO, Dag Teigland, today. He'll give will shortly introduce Dag, and he will give a short introduction. We will then open for Q&A after Helge Martin's presentation. And with that, I hand over to our CEO, Helge.

Yes. Thank you, and Welcome, and good morning. I'm doing this without is today. It's quite warm in here. It's actually my last quarterly presentation before handing over the CEO role to Dag. So it's been a privilege to lead Elkem. I've had this role almost continuously for 17 years. And I'm quite proud of what this organization has accomplished. I'm also confident that the company is well positioned now for continued value creation. And of course, looking forward to support Elkem going forward also in my new role as Chair of the morning. So going through the highlights this quarter. We continue to face quite challenging market conditions. And Elkem must continue to deliver on its continuous and various improvement initiatives. The organizational streamlining following the sale of the Silicones division, has been completed and the cost reductions, I would say, are on track and progressing as planned, actually, a little bit ahead of plan. We have also successfully raised NOK 1.8 billion in new equity and refinanced our main bank facilities and combined with other measures to improve the the balance sheet. We have achieved a significant net debt reduction and have improved the leverage ratio from 5 in the first quarter, now down to NOK 3.2 billion at the end of this quarter. In addition, we are actively assessing and pursuing strategic options. Of course, this is work that has just been kicked off with the new Board. Elkem's Iceland, which has suffered from weak results, actually, since 2024 has been reclassified as discontinued operation. And in addition to that, we're also looking into other opportunities to extract more value from our various assets. The Silicon Products division has improved its performance compared with the first quarter, and this is partly explained by resuming production at the Rana and Salto facilities. Carbon Solutions has sustained good performance despite low demand, soft markets. And as Odd-Geir mentioned, Dag Teigland has been appointed new CEO of Elkem's and he will take over on August 3. And I really look forward to work closely with Dag has known him since 1998. -- dog is here today. And I would like to give the word to him to briefly introduce himself. So please Dag, the floor is yours. .

Thank you. Good morning, everybody. I'm happy to be here. I hope to have the opportunity to spend more time with investors and analysts later after I start. I'm very appreciative by the trust of the Board of Directors and of Healthcare, in particular, for the confidence of taking over as CEO of -- take -- so I'll give a very quick introduction of myself. -- educated Bachelor of finance in the U.S., worked in the U.S. in Seattle for a few years, they're after shipping company. develop some new business opportunities within distribution and trading. Transitioning back to Europe. I stocked by in Spain, not my MBA degree in then a 2-year strategy consultant in Norway before I joined Elkem. And I have to say, I was very privileged to work with some of the most let's say, projects almost in strategic importance for Elkem at that time. So working with business development and then moving into more operational positions. And I actually took over the responsibilities of Helgason, when Helge moved on as a Commercial Director in the biggest division of Elkem at that time, manganese chrome being responsible for sales, marketing and raw material sourcing. So this is not the first time I take over the responsibilities from ever. Then we sold the manganese business to Eramet. I then took over the full profit and loss responsibility for the Chrome business of Auchan, consisting of mining operations in Brazil and the smelter in Morana. Eventually, we sold those businesses as well. I moved on outside of Elkem in a new CEO position. After a few years, I went back to the metal industry as CEO of Cintas. -- inforce group at that time was like Mini Elkem with manufacturing offer alloys, titanium dioxide, high-purity pig iron and energy. That company was basically acquired by Eramet. And then I joined the main shareholder of info to build up and develop an investment company. We -- as the CEO, I spent most of my time on industrial holdings, working actively on developing value this portfolio. Many of these assets were in the metal industry, both in Europe and the U.S. So I was trying to apply a lot of the principles I picked up from my time at Elkem, in particular, in the Elkem business system to develop the value of these assets. Then after 12 years, I left Homes. And the last few years, I have been working together with investors. -- on several engagement, in particular, within metals and advanced materials. So looking back, I've had the privilege of working both at an operational level where, let's say, the values are created. And at the strategic level, all the time trying to identify and implement the best structural solutions and also from an investment investor point of view, so understanding investors and shareholders. So Again, I'm very happy for this opportunity. I consider Elkem to be the most interesting opportunity in this industry right now. I think with the strong culture of continuous improvement, innovation, a strong position, a strong competitive position in the Western world. and with the most recent changes and not at least with the new ownership structure, I think there are a lot of strategic opportunities to be pursued. So looking very much forward to getting started at the beginning of August and working closely with Helge and the rest of the Board.

Thank you. .

Yes. Thank you, Dag. So as you grounded off strategic opportunities, I think that's going to be -- we'll touch briefly on that in today's presentation, but of course, more details will follow later on. And next time, Dag will talk to you about that. So let's get back to the business update. Few words on ESG performance. We continue to have strong performance across a number of ESG parameters. Safety is obviously a key priority for us. We are quite satisfied that the numbers are improving. The target is 0 injuries. At least it's an ambition, and we continue to strive for that in the way we operate. We also have clear ambitions on CO2 emission reduction targets. And much of the focus is on CO2, which I guess it should be. But I think it's also important to, from time to time, remind ourselves on where we are. And Elkem's CO2 footprint is actually more than 65% below the global average for silicon production -- this is obviously supported by renewable biopower, but also energy recovery at several of our sites and the use and increasing use of bio reductions. And in addition to that, strong operational performance with high yield, both on energy and material consumption are important contributors. So Elkem's materials are critical, classified as strategic critical raw materials, but also very critical to the green transition. And we continue to aim to be a leading company on sustainability parameters. We have now launched a new platform for low-carbon materials. It's called FeSi Leap. It's low carbon fersilicon that helps customers reduce Scope 3 emissions. -- while retaining the high performance, which is guaranteed from our materials. And in June, EcoVadis awarded us a gold rating also for 2026, which puts us among the top 5% of the companies they do -- or they rate. And the overall score improved compared to 2025, which puts us in the 97th percentile of their portfolio. So I think this is still going in the right direction, although I do expect that given the overall geopolitical scenario that both countries and companies probably will have to revise targets as we move along. .

Then coming to our financial position. As I mentioned initially, we did complete the NOK 1.8 billion equity raise. NOK 1.5 million was placed on the 6th of May through building process, well-received process. This was then followed by a NOK 0.3 billion repair issue on the 29th of May, and this rights offering was significantly oversubscribed. And in March before this, we initiated -- sorry, we initiated a refinancing of billion of bank facilities. And in April, we presented a fully underwritten financing solution, supported by Danske Bank, DNB, Nordea and SEB. And then on the 22nd of June, this new EUR 1 billion facility was signed with 10 relationship banks. The agreement comprises a EUR 600 million long-term our term loan and the EUR 400 million revolving credit facility, both with 5-year tenors. In previous agreements, Elkins had 2 financial covenants: equity ratio of minimum 30% and an interest cover ratio of at least 4x. We have changed the covenant structure now in this new facility. The new agreement still includes 2 covenants. The equity ratio of minimum 30% remains as before, but the interest cover ratio has been replaced with the leverage ratio. The leverage ratio shall not exceed 4.75x from the second quarter of 2026 to the first quarter of 2027. And then from then on and onwards, the leverage will not exceed 4.25x EBITDA. Elkem has also obtained a 10-year NOK 750 million lower from the Nordic Investment Bank on very attractive conditions, and this loan is expected to be disbursed in July. So combined, this transactions have materially strengthened Elkem's financial position.

Moving on to power and power contracts. As we have mentioned many times, access to Power at stable and competitive conditions is very important to secure Elkem's operations. Now we're talking about Norway. And in the second quarter, we signed a new long-term power purchase agreement with a cut -- this is for the period from 2031 to 2037 with a total contract volume of slightly above 1.5 terawatt hours. This will secure competitive and predictable electricity supply for Elkem's plant in Bjølvefossen, covering more than 60% of the plant's annual consumption. And as illustrated on this chart here on the right side of the slide, up to 80% of our consumption is covered with long-term contracts until 2030. And the cover is then around 65% until 2033. This new agreement is also a significant contribution to the extension of our portfolio beyond 2033. And we are continuously assessing opportunities to secure more.

Coming to the cost reduction program. I'm satisfied to be able to report that the program is on track and ahead of target. The initial target was to reduce the global workforce by approximately 300 FTEs full-time employees. This target has been exceeded as this process has been carried out. And once completed, we expect to reduce a reduction -- or to achieve a reduction of approximately 400 FTEs. The program will generate annual savings of more than NOK 600 million. In relation to this program, we also made a provision of NOK 125 million in the second quarter, which is you'll find included in other items. We are also targeting working capital reductions with a target of NOK 1 billion this year. And we have achieved by now NOK 841 million of improvements since year-end last year. Investment levels are capped this year at NOK 1 billion. And in order to preserve cash, obviously, and reduce debt. And by the end of June, the total investments amounted to around NOK 300 million, which means that we are well in line with the target, although I have to say that second half investments will be somewhat higher than in the first half.

Then coming to strategic options. The Iceland facility has had a weak performance since 2024. It's driven by a structurally higher cost base, a higher cost base than what we see, especially if we compare with the Norwegian sites. And in addition, the EU safeguard measures have reduced market access and limited tariff-free exports to what is Iceland's key market. So based on this development and situation, the Board has initiated a strategic review, which has been classified which results in classifying this plant as a discontinued operation. We have -- we are in discussions with national stakeholders in Iceland in order to evaluate opportunities for continued industrial and commercial development of the premises.

So this is early days. We'll come back with more details on this process in due course. But given the reclassification, I thought it was important to mention this.

And as part of a more broad strategic review, which we are also assessing opportunities for maximizing value across the Elkem portfolio, assessing opportunities for how to create and develop higher-value industrial ecosystems, looking at energy efficiency and sharing infrastructure, et cetera. The picture here is from Cisco and Christian Sam, I think, which is a good example. It's an industrial site where we already have invited 1 player, it's a hydrogen project under construction, and we're looking at other opportunities.

Data center developments are a hot topic these days. Obviously, this could also be an opportunity in order to strengthen industrial clusters, and support competitiveness and job creation. But as I say that, I strongly emphasize that new power supply must be developed alongside these expansions in order to to protect and enable -- to protect the existing industry and enable sustainable growth. So -- but we are open to partnerships. We're looking at various business models and of course, always trying to limit capital intensity and enable disciplined capital spending.

So again, we will come back and talk a lot more about this. We are planning a Capital Markets Day and won't at the date yet, but it's very likely to be in the second half of October. And I think that will be a very good time then to talk more about opportunities and definitely share more details with you.

So moving on to the market update and the outlook. Some of the key markets where products end up are listed here, very important demand drivers for Elkins materials and have remained -- all these markets have remained weak for a prolonged period if we compare with historical demand and activity level. In automotive, silicon metal is an essential material in electronics, batteries in all lightweight components. Light vehicle production is expected to reach 90.7 million units in 2026, which is down 2.6% compared with 2025. And this is mainly a result of lower output from China. There is an expectation that production will slightly recover in 2027. But due to weak domestic markets, China's auto exports continue to rise, this is pushing manufacturers to export excess capacity. Europe is a very available market for this, and other markets, of course, while the U.S. has put up a lot of market barriers for Chinese import.

Construction is another key market for Elkem and silicon-based products also go into high-performance concrete building materials into infrastructure. The activity here remains -- it's more a mixed picture in the U.S. The market is growing modestly. In Europe, the development remains more uneven. But there are infrastructure improvements. And also here, we see a lot of data center development driving higher demand or higher activity level. Germany's infrastructure rollout is behind schedule, 26 out of 107 milestones were reached by May. So this is also pushing expected positive demand more into 2027.

Purchase Managers Index, the PMI serves as an early indicator, as you know, changes in industrial and construction-related activities. In the Eurozone, the PMI has been above 50 for several consecutive months, which indicates that the manufacturing or services sector is expanding. U.S. manufacturing remains stronger, supported by more solid production. So that gives the big picture. -- then moving to regulatory issues, which, as you all know, has become increasingly important for everybody. The tariffs imposed by the U.S. are negative for Okay. and have created and continue to create uncertainty. In June, the final ADD CVD rates were resolved for silicon metal. The ADD rate ended up at 2.47%. -- that's the antidumping duty. It was slightly below the preliminary rate while the CVD rate countervailing duty rate which is very much linked to the CO2 scheme in the EU was slightly higher and then at 17.27%. Also in EU protective policies are building in order to support European demand and reassuring industrial value chains. -- this could have a positive impact for Elkem as the EU continue to be our main key market. EUs Industrial accelerator, active legislative proposal to strengthen the competitiveness and resilience and decarbon -- decarbonization of European industry. It is expected to gradually support the European demand and industrial activity. As a result, customers in the EU and U.S. are increasingly focused on supply chain resilience and strategic autonomy. And we see an increasing trend that there is a preference for known and trusted suppliers. So which obviously is a good thing for us. U.S. safeguards on Ferro Alloys was introduced in November 2025 and have less impact than expected. -- on price levels, so reflecting the weak underlying demand and continued substitution risk. So for silicon has been substituted with cheaper silicon metal. The effect is expected to improve and put it like that, as far alesupplytightens alongside a recovery in domestic steel production. As you know, there were significant reductions in the pre import or toll-free volumes of steel into the EU. Silicon was not included in EU safeguard for ferroalloys, silicon metal that is, but protective measures are under assessment. And finally, Alcon is eligible for 1.5 million CO2 quotas for the period 2021 to 2025. And -- we expect to receive those quarters in the second half of the year. We don't know exactly when yet. An increase in the EU steel production could have a positive impact for Elkem global steel demand appears to be bottoming out, if you look at the graphs here, but the growth is expected to be modest this year. EU steel production is showing signs of growth, which is positive as we see higher steel production in the EU as a potential demand driver also for our products. The carbon border adjustment mechanism, the so-called C-band effective from January 1 of this year. and the stronger EU steel safeguards on steel has now implemented from July 1 this year are expected also to support a higher production in the EU. And then hopefully having an impact on demand for our products. In Europe, the aluminum supply remains constrained by energy costs, while demand is subdued due to weakness in construction and broader manufacturing. European aluminium production currently receives less direct trade protection than steel with no equivalent safeguard regime in place. probably read Hydro's latest announcement that they are probably restarting in Slovakia, which I think is a sign that some activity is picking up again. The Middle East is a major exporter to Europe and global markets and very regional conflict there has disrupted regional smelters and logistics, which, as you know, has had quite a big impact on aluminum prices in general. If you look at -- a closer look at our specific markets for Elkem. -- silicon reference prices in the EU increased by around 6% by the end of this quarter. as buyers are reaching to European supply. In the U.S., the silicon prices also increased in the second quarter as higher freight costs and tariff uncertainty of a push replacement costs higher and limited imports. Per silicon prices in the EU were down in the second quarter despite the implementation of safeguard measures. Sales prices are expected to increase gradually as safeguard measures now talking about steel, gain the intended effect. In the U.S., ferrosilicon prices are impacted by tariff structures and demand is showing a more positive for here and further improvements in market conditions in the U.S. are expected.

Taking a look at China and what's going on there. As you know, our presence in China has been significantly reduced with the sale of the silicones division. But still China is by far the largest producer of silicon metal and also silicones. And silicones is an important -- is important for the silicon metal market. silicon being 1 of the main input factors and also important for Elkem's remaining operations in France. So it's therefore important to follow the Chinese market as Chinese silicon and DMC prices are having a big impact on global pricing. Silicon metal prices in China remain close to historical low levels due to over expansion over a long period of time and overcapacity then substantially and substantially lower demand from polysilicon continue to have a big impact on Chinese pricing. Soft domestic demand in China gives continued pressure on export markets and exports to Europe has increased quite significantly in 2025. And also that has continued into 2026. There are policy signals that indicate that China will introduce measures from next year to curb excess silicon capacity through more strict energy consumption standards. -- we're seeing these changes also before. But we remain -- yes, we are hoping that this can have a positive impact -- this uplift in DMC prices that you see here is largely explained by what is quite a new term for us, but it's called Entievolution actions. In China, aimed at reducing production. So they are basically taking an overall effort in order to cap production. Same thing has happened in aluminum, by the way.

Then I'll end this with the outlook for the third quarter. So trade regulations and protective measures are expected to continue to affect Elkem's markets. This could support a recovery in demand and prices in the EU if policy measures have the intended effect. Our cost reduction program will continue to contribute positively from the third quarter and onwards. The silicon products division is still experiencing challenging market conditions. -- the underlying profitability is improving. But the third quarter is expected to be impacted by seasonally lower activity levels. the Carbon Solutions division expect generally stable financial performance in the third quarter. And we would also like to remind you that from the third quarter we will report on the new divisional structure. And there's 3 new reporting areas are called Elkem Silicon, Elkem foundry alloys and Healthcare Carbon. And I think with this, I'll give the word to Morten, who will take us through the financials -- thank you very much, Helen.

And good morning, everybody. So I'm pleased to go through the results for the second quarter in more detail. And first of all, please note that Elkem Iceland has now been reclassified as discontinued operations, and hence, it's no longer included in revenues and EBITDA neither in the current nor in the historical numbers. The silicones plant in France is also classified as discontinued operations, together with our young Yang smelter in China and silicones India. So Elkem's operating income for the quarter was NOK 3.7 billion, which was 4% lower than the second quarter of last year on a comparable basis. This was mainly explained by lower sales prices, particularly for silicon metal, lower sales prices has, to some extent, been offset by higher sales volumes for silicon products. The EBITDA amounted to NOK 523 million, which was a reduction by 19% from the second quarter last year, but still up from the first quarter this year, particularly due to the fact that our Arana and salt plants in Northern Norway have resumed production in this quarter. And the EBITDA margin for the quarter amounted to 14%. As usual, we have provided an overview of some of the main financial numbers and ratio, I will not go through all of them. As mentioned, the EBITDA was NOK 523 million. and the realized derivative effects in segment Other was NOK 21 million in the quarter. Other items amounted to minus NOK 89 million consisting of losses on power and currency derivatives of NOK 50 million, currency gains of NOK 77 million restructuring expenses of NOK 188 -- sorry, NOK 118 million and other items of NOK 3 million. The net finance income was NOK 227 million, and this consisted of net interest expenses of NOK 86 million currency losses of NOK 121 million due to a weaker NOK in the quarter and not other financial items of minus NOK 20 million. The income tax was minus NOK 24 million, consisting of various smaller items. And we will get back to the financial ratios on the following slides.

So let's then take a look at the divisions, and we'll start with silicon products. Clearly, the silicon and ferrosilicon markets remain challenging with low prices for both these main products. Elkem has, however, had a strong operating performance in the quarter and in June, all furnaces are operating at full capacity with good productivity. This is thanks to Elkem's strong cost and market positions and also due to our strong operational excellence. As I mentioned, our operating income and EBITDA and also sales volumes do not include Elkem Iceland, which has been reclassified as discontinued operations. The total operating income amounted to NOK 2.946 billion, and this was a reduction of 4% compared to the second quarter last year. And the reduction in operating income is mainly due to lower sales prices for silicon, while this was partly countered by higher sales volumes. The EBITDA amounted to NOK 319 million, which was down 28% from the second quarter of last year. And the reduction is primarily due to lower sales prices for silicon. The sales volume was 9% higher than the second quarter last year last year with higher sales across all product lines, but the strongest increase was in silicon. The Carbon Solutions segment continued to report a stable performance in a very weak market environment. So the total operating income was 900 -- sorry, NOK 741 million, which was down 13% from the second quarter last year. The EBITDA was NOK 172 million, which was a reduction of 29% from the second quarter last year. The reduction in income and EBITDA is mainly explained by lower sales volumes and lower average sales prices. While our EBITDA has been then -- or the negative impact has been partly countered by cost improvements. Sales volume was down 4% compared to the second quarter last year. And as we have said, the market conditions remain challenging due to continued idle capacity and lower demand, particularly from ferro alloys customers in the Western world.

Let's then take a closer look at some of Elkem's key financial ratios. The earnings per share, the EPS amounted to minus NOK 2.09 per share in the second quarter 2026, this is clearly a weak number, but it's mainly explained by losses in discontinued operations, which also include a negative fair value adjustment. EPS for the continued operations was minus 0.15% in the quarter and NOK -- plus NOK 0.60 per share year-to-date. And the earnings per share is now calculated based on the current number of issues or issued shares. Total equity as at 30th of June amounted to NOK 12.6 billion, which gives an equity ratio of 44%. The equity ratio up to and including Q1 2026 are based on historic figures, which include silicones and the Blue Star shares. So the reduction in equity ratio is there for a reflection of the deconsolidation of silicones and also the cancellation of Bluestar previous shareholders. However, very important, the balance sheet remains very solid, also following new capital injections of NOK 1.8 billion during the second quarter. By the end of the second quarter, we had net interest-bearing debt of NOK 6.6 billion, and this is in line with our guiding a significant reduction from the previous quarter is driven by equity injections, but also targeted very disciplined working capital improvements. Elkem has also now fully refinanced its main bank facilities during the first -- or during the second quarter. There is a -- now a new term loan of EUR 600 million maturing in 2031 while the new revolving credit facility remains undrawn. The refinancing has significantly improved Elkem's maturity profile, as you can see from the graph. -- yearly maturities amounting to around NOK 1 billion has been moved over the next 4 years. And there is also a cash balance of close to NOK 4.9 billion by the end of second quarter. In addition, we have also obtained a new 10-year loan from NIB Nordic Investment Bank of NOK 750 million at very attractive conditions. And this loan will be disbursed in July, and it will further improve Elkem's financial position. The leverage ratio has been reduced from 5 by the end of the first quarter to now 3.2% based on last 12 months EBITDA of NOK 2 billion per end of second quarter. And this is very well within the new bank covenants, where leverage ratio can be up to 4.75 until the first quarter in 2027 and 425 there after. Part of LCM's improvement program is to reduce working capital and keep investments below NOK 1 billion in order to reduce debt and improve cash generation. Cash flow from operations was NOK 733 million in the second quarter of 2026. And this is a significant year-on-year improvement as I said, due to very disciplined working capital reductions and also lower reinvestments. The investments amounted to NOK 192 million in the second quarter with reinvestments of 171 million and very low strategic investments of NOK 21 million. Reinvestments amounted to 75% of depreciation and amortization. Both these items show that Elkem's program for working capital reductions and disciplined capital spending are delivering on target.

So let me wrap up this presentation by summarizing the main takeaways from the quarter. First of all, Elkem's transformation continues to build momentum, and we are ahead of target on our delivered on our committed improvements. The organizational streamlining is completed. Cost and manning reductions are exceeding targets and deleveraging is well underway. Elkem has successfully raised NOK 1.8 billion in new equity during the second quarter, and we have fully refinanced all our main bank facilities. And these transactions have materially strengthened Elkem's financial position. Strategic options are being actively pursued across the portfolio with several initiatives ongoing. And as we said, Elkem Iceland has been reclassified as discontinued operations. Elkem's underlying profitability shows signs of improvement, but third quarter is expected to be impacted by seasonally lower activity due to summer vacation, particularly in Europe. Trade regulations and protective measures such as safeguards for ferro alloys and steel in the EU will likely support demand and price recovery in healthcare market when these measures become effective. So I think that rounds off the second quarter presentation, and then I will hand the word back to Odd-Geir to facilitate the Q&A session.

Thank you. Very good. Thank you, Martin, and thank you, Helge. We will now open for Q&A. We obviously have a couple of analysts present, so I'll start with the ones that are present here, but we have also a few questions on the webcast. So if we are not covered the will obviously take them as well. So Magnus, you seem to raise your hand.

Thank you -- congratulations with a high EBITDA figure. At least today, you beat consensus by roughly NOK 130 million. If I sum the 2 segments, there's a bit of around NOK 25 million, which means there's more than NOK 100 million beat on, let's call it, other EBITDA. Can you help us explain where everyone seems to be wrong and sort of is a one-off or

No, I think nobody is wrong, but I can shed a bit of light on that. First of all, we have a hedging -- FX hedging program. where we have a transaction hedging of the expected cash flow up to 12 months. Now we have seen a movement on NOK versus Europe. So we've had a a loss in the underlying FX positions in the divisions, while we've had a profit in the FX hedging program, which is accounted in the other segment. So those 2 balances each other, but it looks -- it makes the other look better than it actually is. Then secondly, we have had good and better-than-expected cost reductions from the cost improvement program also in the other segment. Thirdly, we have better results in smaller entities like our shipping and logistics entities. And there are also some revenues related to the Blue Star transaction, where we invoiced some of the support services to Blue Star. So there are good explanations for the improvement that we have seen in the other segment and -- no 1 is wrong on this. .

We don't mind being wrong by the way.

So you stated in the chart, I think that there's like a 20-something million derivative effect. I assume then that the FX. And if we subtract that, is that sort of a sensible level now going forward, given what's happening with the cost reductions and the Blue Star agreements, et cetera.

On other?

Yes.

Yes. Well, I will not give specific numbers, but you shouldn't expect better numbers in other going forward compared to the level that we have, for instance, 1 year ago. Yes. .

On the cost improvement program. Obviously, you've had -- you've taken some provision already. Some FTEs, I assume, have already left how much of sort of the NOK 600 million run rate by year-end should we start to see already now in H2?

You can take it .

Yes. No, you should basically now start to see the major part of that from Q3. Having said that, you will not necessarily see a similar quarter-on-quarter change from Q2 to Q3 first of all, because there is a salary adjustment in Norway and other countries effective from Q2 and also because of the fact that we have already taken out some of the costs already in Q2. But compared to what was our, let's say, baseline for this project, namely the planned budget 2026, we will see a quarterly NOK 600 million per year, i.e., NOK 150 million per quarter improvement from Q3, but not necessarily on a on quarter basis. .

And the FTE reduction increase from 300 million to 400 million, is that sort of in remain core? Or does that include the fact that you're selling Iceland?

No, it has nothing to do with Iceland.

And final question for me on Iceland. When we look at sort of the difference between EBITDA with and without Iceland, it seems like the loss that's been there has increased quite a lot in Q2. Have you done anything sort of differently in terms of selling product from Iceland. Obviously, it's a big plant in European context are really reducing volumes sort of to help market situations? Or are you running that as normal?

No, the mid there's not been any particular the optimizations that has hit the Iceland bottom line. .

Yes. So you're running Iceland as normal until sort of the strategic .

We are currently running Iceland at a bit reduced capacity level, and that's also, let's say, hitting our EBITDA for the time being. That would have been done anyway. .

Great -- so just to -- on markets, which I guess you can't have any firm answer on, but I will try. You talked about China in production out of China. We've seen them actually pushing aluminum production up coal prices and so on has come up. Have you seen any signs of them actually lowering silicon production as we speak? Or is it very much still 2027.

I don't have particular or specific numbers, but we definitely have seen planned start-ups during the wet season, which is not taking place this year, which you normally would have seen. But I think it illustrates a high inventory levels. and domestic demand is definitely depressed. And they're trying to place these volumes in other markets and there are not many workers to choose from Europe is an obvious target, of course. So we'll see there is a lot of discussions now with the EU commissions, of course, driven by Gala to see if it's possible to implement some stricter protective measures also on silicon metal. So we are joining those discussions, have a meeting myself on July 17 in that regard. So we'll see what happens, but there's more momentum now than we've seen before. to do something, which I hope can have a positive effect also for us, of course, assuming that we will be able to access the market. .

First hopeful hopefully Meetings as well. And also on cost measures, you stated up the sum will likely come in October. Will there be any firm it up to the targets on the long-term cost ambitions? And when you're looking at cost measures right now, are you looking beyond the FTE reductions? I guess there's plenty of things to do outside just the FTEs.

Definitely and the NOK 600 million that we have been talking about, it's not salary cost alone, that's maybe half of it approximately. But there is definitely additional potentials -- and I think procurement is something we're actively working on right now, which will think -- or we see definitely higher potential than what we have talked about so far. So -- there's more to come. .

We will definitely come back with more specific number of plants during the capital markets update, but I think it will be wrong to boat we are saying say, in October. -- do not expect that at all.

Just lastly, on the Carbon Solutions historically been closer to 30% EBITDA margin. that had a pretty significant drop in Q1, which I think you at least explain it being some product mix, adverse product mix. What happened in Q2? And can you try to add some color on if this being a very short-lived ASP drop, which you had to do to compensate to get the volumes out? Or is it more of a new normal with what you see in the segment?

No, I think this is primarily volume driven, but there is definitely a product mix impact. We have quite big variations, especially in supplies to the aluminum sector. where you typically have much higher margins. And then on some of the more commodity part of their business. So -- but the overall picture is demand is on a low level. Fair value production is down, and the main product for Elkem Carbon is electrode-based, prebaked electrodes and -- and that's directly correlated to production capacity utilization.

Very good. Thank you. We have a few questions also on the web. So I'll take them. There are a couple of questions related to Iceland, and 1 is if data center is an action not surprisingly.

Not an expected question. We are not in a process to establish a data center in Iceland say that we are discussing with vessels mentioned, National stakeholders solutions for Iceland. -- silicon and ferrosilicon are strategic value chains in Europe. So I think our goal is to find a way to continue operating Iceland and produce those critical materials. But obviously, we cannot just do nothing because the situation is not not sustainable with the current financial performance. So we are looking at all options. And when I say all options, it means all options. .

Then it's more related to the book values because discontinued operations into the book value of NOK 3.5 billion. And the question is how much of that is related to Iceland? And what should we think about the fair value of Iceland.

We have included a separate note to the quarterly report containing more details on the book value and also the value assessment of the discontinued operations and also in particular, related to Iceland, where we also have given a range of the potential value. So I think I will refer to that note, which is quite specific. .

Is also a question -- well, we touched up on discontinued operation. We have some silicon assets in Europe. And the question is, what will we do with that? Will they be sold or expanded? .

We have no expansion plans. We have contracts now for the Xiloxproduction out of OCO in France for the next 5 years. We are also ramping up production. So I think we have a good basis now to bring this up to capacity this year, but obviously not a strategic core business for Elkem necessarily. So we are going to evaluate and are evaluating possibilities. But, Yes. That's basically my answer at the moment.

Then a question on the CO2 quotas that we are expected to receive this year. Have they been taken into the account in the P&L for first quarter and second quarter.

that's the 1.5 million quotes that we have talked about.

No, we have not received those quotas, but we have been giving, let's say, clear feedback from the weakened government that we will receive those quotas when all formalities with the EU and ESA are in place. We do not capitalize these quotas, so they were not given immediate P&L effect once we receive them, we will rather use those quotas to buy less quotas in the future or even even sell quotas if we have surplus quotas.

More than signal, it's in writing.

Yes. stating Okay. We're soon running out of time. So take 1 question -- 1 last question related to outlook for the third quarter. And the question is if you have any further details on that and the expected mentioned seasonal effects for sales figures.

August is typicationmo. So we always see some variation in the wants -- I don't have any significant additional information on that. do you want to .

No, I think we have covered this. We believe that we are seeing at least indications of normalization and also a recovery in some segments, although I will not at all exaggerate that, but we are also very clear about the fact that particularly in Europe, there is always a seasonality factor in August when pretty much the entire component goes on summer vacations. But we should also have that in mind. But underlying things are at least moving in the right direction. .

Very good. Thank you very much for that. That completes our presentation here today. So for those present here and also those following us on the web. I would like to thank you very much for your attendance and wish you all a very nice and good summer. Thank you.

Okay. I think we're ready to start. Good morning, and welcome to Elkem's First Quarter Results Presentation. My name is Odd-Geir Lyngstad, and I'm responsible for Investor Relations here in Elkem.

To take us through today's agenda, we have CEO, Helge Aasen; and CFO, Morten Viga. Helge will go through the highlights for the quarter, the market update and the outlook for the second quarter. CFO, Morten Viga, will then present Elkem's first quarter results in more detail. We will open for Q&A after Helge and Morten's presentations.

So with that, I give the word to CEO, Helge Aasen.

Yes. Thank you, Odd-Geir, and good morning, everyone. Welcome. Yes, we are expecting to close the sale of the Silicones division to Bluestar today, 30th of April. This transformation will move Elkem towards a more pure-play metals and materials company.

Another goal and the motivation behind this is to sharpen our strategic focus, tighten capital allocation and improve earnings quality. We're also using this opportunity to streamline the organization and cut costs.

And following the transaction, we plan to raise new equity of NOK 1.5 billion through a publicly announced book building process and of course, in order then to strengthen the balance sheet. And this equity offering is guaranteed as previously communicated. In addition, we have secured an offer from our relationship banks for a fully underwritten debt refinancing of EUR 1 billion.

The operational performance in the quarter was hampered by challenging market conditions. Visibility is quite limited. We have to say that due to changing trade regulations and all the geopolitical uncertainty ongoing.

Silicon Products presented a weak result in the first quarter, mainly impacted by production curtailments at several plants in Norway, that's primarily affecting the Rana and Salten sites. These stops had an estimated EBITDA negative impact of approximately NOK 250 million for the quarter.

Carbon Solutions was also impacted by negative sales mix with lower share of specialties and negative impact from currency due to a weaker U.S. dollar. In addition, the division was impacted by lower sales internally to the Silicon Products division.

So the EBITDA for the first quarter ended at NOK 249 million, which gave an EBITDA margin of 6% for the company. These numbers do then not include silicones, and we have focused now on Elkem's continuing business throughout this presentation today.

So before we go into more detail on markets and results, I'd like to say a few words about ESG. The safety numbers on the right-hand side of the slide here are now excluding the Silicones division.

Total injury rate is higher than what we have previously announced, but the graph shows a positive development, reflecting our extensive focus on health and safety measures, which is a focus we've had over many, many years.

When it comes to environmental issues, the sale of the Silicones division will further improve Elkem's carbon footprint due to a significantly reduced operational footprint in China, where the energy mix is quite different from Norway.

We do, however, continue our efforts to reduce fossil CO2 emissions. And as part of this work, we have recently been granted NOK 87 million from Enova, and this is to test and scale up the use of biocarbon in the silicon and ferrosilicon production facilities in Norway.

In April, we signed a 5-year offtake agreement for biocarbon from CHAR Tech. It's part of the announced sale of the biocarbon pilot production facility that we have been working on in Canada. And we will update our climate strategy after the closing of the Silicones transaction. And the plan is to present this at the capital market update. We haven't set the date yet, but it will be in the third quarter.

And as you can see to the right, we continue to have strong ratings from CDP and EcoVadis as you know, 2 well-known leading ESG rating agencies.

Yes. The sale of the Silicones division has developed according to plan and is expected to close today. I got the last message very early this morning that now everything is in place and the papers are on the way to [indiscernible].

The transaction was approved by the minority shareholders on the EGM on March 9th, and Elkem has obtained approval then from necessary majority of its lenders. The creditor notice period expired on April 23rd, and Elkem obtained the last regulatory filing approval in France this week.

The sale of the Silicones division comprised all assets, excluding 3 sites, Yongdeng, it's the silicon metal -- idle silicon metal plant in China; Roussillon, the upstream siloxane production in France and a smaller downstream facility in India. So we will continue to evaluate strategic options for these plants together with the new Board of Directors.

Roussillon, the French operation has entered into a 5-year supply agreement with Bluestar. We've also secured additional offtake in the U.S. So this will ensure stable operations, and we will gradually ramp this up to capacity. We're also talking to other potential customers for products from this site. So I think this will be -- turn out to be a good solution.

We will also increase capacity utilization, as I mentioned. Yes, I already said that. The Yongdeng plant in China, which produces silicon metal was idle in 2025. We are currently in the sales process of this site.

India, which is a much smaller facility. It's located just outside Mumbai. This was not included due to a very extensive regulatory approval process in India, difficult for Chinese companies, especially state-owned entities to do anything in India. And we will then take care of this and divest this facility in due course. I don't think that's going to represent any major problem.

The sale of the Silicones division, as now well known, will be settled through a share redemption of all of Bluestar's shares in Elkem. Following that, we will conduct a NOK 1.5 billion equity offering. This will be done through a publicly announced book building process in order to strengthen the balance sheet.

And as we also previously announced, the offering is guaranteed by a consortium consisting of Folketrygdfondet, Must Invest, DNB Asset Management, Nordea Investment Management and Perestroika. There are plans for a subsequent repair offering of up to NOK 300 million, which will provide shareholders the opportunity to subscribe for new shares at the same subscription price.

Elkem's Board will be responsible for the allocation of the new shares. And -- of course, we have not had a chance to sit down with the new Board and talk about this, but we can assume that the Board will adhere to common market practices, which secure the interest of all shareholders. And in that, without going into too many details, current ownership will clearly be a key allocation criteria.

In addition to the equity offering, we have been working on the refinancing of our bank facilities. And as I mentioned initially, we have secured a fully underwritten offer for refinancing of EUR 1 billion from key relationship banks. This financing is also subject to final approval from the new Board of Directors.

In March, Scope resolved Elkem's rating status and affirmed an issuer rating of BBB- and assigned a negative outlook. Elkem is committed to maintain its investment-grade rating and will sustain robust financial metrics by further cost and debt reductions. We'll come a little bit back to that.

We are also reorganizing the company following the sale of the Silicones division into 3 new -- 3 divisions, Elkem Silicon, Elkem Foundry Alloys and Elkem Carbon. And this has been done in order to improve the transparency around the key value drivers in the company.

Financial reporting based on this new structure will begin from the third quarter this year. And we plan to present these new divisions and their management in a planned capital market update then after the third quarter presentation, I assume.

In the second quarter, we will conduct a review of our asset portfolio with the new Board. And as part of this process, we're going to assess some options, strategic options for our Iceland operation.

This is necessary due to a very weak profitability and negative EBITDA at Iceland since the fourth quarter of 2024. Some structural challenges at Iceland, which I'm sure we'll talk more about later, but that will be a key topic quite soon.

After closing of the Silicones transaction, Bluestar's representatives on the Board of Directors and on the Nomination Committee will resign and then with immediate effect. The Nomination Committee has proposed new shareholder-elected Board members to the Annual General Meeting, which will take place just after this presentation.

I have been proposed as the Chairman of the new Elkem Board of Directors, but will obviously then continue to serve as CEO until a successor has been appointed and is in place.

The other Board members, the Nomination Committee have proposed are Marianne Elisabeth Johnsen. She has been on the Elkem Board since 2019. She's actually the only one continuing from the old Board of Directors.

Then we have Christian Must, Co-owner and Director of Must Invest, one of our largest shareholders. Astrid Margrethe Hilde, she's the Chief Legal and Community Relations responsible in Glitre Nett; and Richard Olav Aa, now serving as CFO at Fred Olsen & Company.

Following the reorganization of the corporate structure, we have also appointed our new Senior Vice President. So we have Luiz Simao, previously running the Carbon division is now appointed SVP for Elkem Silicon, Brazilian by origin. Then we have Elkem Foundry Alloys, which will be led by Senior Vice President, Inge Grubben-Stromnes.

And then we have promoted Izaias Entringer, also Brazilian to the role as Senior Vice President of Elkem Carbon. And this team will be physically located here in Oslo. The SVPs will be presenting their respective divisions on the announced -- on the Capital Markets update that I mentioned previously.

We are also, as I alluded to, implementing a significant cost reduction program. It's developed -- developing according to plan, I have to say that. We have spent some time on the planning phase, but saw a kickoff a couple of months ago on this program, the estimated cost reductions amount to NOK 600 million. Approximately half of this will be realized by the year-end of 2026.

And an important part of this is the rightsizing of the organization and the global workforce will be reduced by approximately 300 full-time employees by year-end, and this then represents about a 10% reduction of the remaining organization after the sale of the Silicones division.

In addition, we are targeting working capital and capital expenditure improvements totaling NOK 1.3 billion. And the inventory reductions already completed amounted to approximately NOK 500 million, which is linked to the production curtailment I mentioned earlier in the presentation.

Investments will be kept -- reinvestments will be kept at the maximum of NOK 1 billion for the year. And this program is well underway. We had total investments of around NOK 100 million during the first quarter. So we'll make a provision for the cost reduction program in the second quarter, and we'll come back with details on that when we report the second quarter in July.

Then let's move on to the market update and the outlook. It continues, I would say, to be marked by high uncertainty, low visibility. And in addition to regulatory issues, we have -- or we have regulatory issues that could have a significant impact on prices and market development for our products.

Recently, the Middle East conflict dominated the news. This has limited direct impact on our business, but higher transportation and energy costs will likely impact sales prices in the EU. So this could have a positive effect, definitely short term. But of course, this may very well be countered by lower economic activity overall.

Implementation of safeguard measures for ferrosilicon and foundry alloys in the EU has had limited price impact in the first quarter. We think this is due to a combination of weak demand and quite significant stock building that took place ahead of the safeguard implementation.

Prices for ferrosilicon are expected to increase once stock levels normalize. The production at Rana and Salten was stopped during the first quarter and partly restarted in late March, and both plants are now back in full production from the end of April.

A positive factor for Elkem is that we have -- or we are eligible for 1.5 million CO2 quotas for the period 2021 to 2025 after the Ministry of Climate and Environment have approved our complaint case. So following this decision, we have not purchased quotas in 2025.

Adjusted for this, the net value of excess quotas amounts to approximately NOK 1 billion. And we expect to receive them -- these quotas in 2026. We have a constructive dialogue with the authorities on this matter, but I have to say that we do think this is taking far too long to conclude.

Silicon metal was not included in the safeguard measures in the EU when ferrosilicon measures were introduced. The silicon market in the EU clearly suffers from low-priced imports, particularly from China.

Protective measures are being assessed. We know that. In any case, if it's decided, it will take time, and we will come back to it as soon as we have more information on that potential measures.

On steel, a new safeguard regime will be implemented from 1st of July in the EU, which will limit imports into the EU of a maximum 18 million tonnes. The total consumption in the EU is around 150 million tonnes per year, and the import last year was 49 million tonnes. So any imports above this level will be taxed with a duty of 50%.

So this is expected to increase steel production and capacity utilization in the EU, which again, we think will have a positive impact on the demand for Elkem's products, namely ferrosilicon, foundry alloys and also electrode paste.

So moving on to the key market trends and indicators, automotive, as we talked about many times, is an important sector for Elkem, driving demand for many of our products. Silicon metal is an essential ingredient in electronics, batteries, lightweight materials.

The automotive production in Europe has declined and the outlook remains weak due to soft demand and significant import pressure from China. A new minimum price mechanism on EVs imported into the EU could offer some protection.

Construction is another key market for us and silicon-based products go into high-performance concrete, into building materials, into infrastructure. Europe is seeing some signs of a gradual recovery, but performance varies significantly across countries and segments. U.S. industrial activity is also relatively soft with the growth in sectors such as data centers, power infrastructure and also institutional-driven projects.

PMI numbers are normally a good indicator and for the economic sentiment and globally, the PMI indices are showing a mixed but at least stable picture. Manufacturing remains soft, but we do see signs of this downturn now it's starting to ease, and we see some mild expansion in the U.S. Picture in Europe is mixed and the German economy continues to contract. It remains to be seen then how this Middle East situation will impact the markets longer term.

If we look -- take a closer look at specific markets for Elkem and start with silicon. The markets are still challenging with continued price pressure. Silicon reference prices in the EU have declined in the first quarter and were influenced by continued weak demand and low import prices.

And it's quite remarkable when you look at the difference of price now in the U.S. and the European markets. In the U.S., prices increased slightly in the first quarter, mainly due to imposed tariff imports.

So I don't think I have ever seen prices in the U.S. being double the level of Europe. In China, silicon prices remained low, hampered by weak demand and significant overcapacity, also resulting in some stock buildup,

The ferrosilicon markets have many of the same underlying drivers as silicon. Markets are characterized by -- also here by weak demand, the new safeguard regime for steel in the EU is expected to increase production and have a positive impact on the ferroalloys in general.

Ferrosilicon prices in the EU have increased moderately after the implementation of safeguard measures. But as mentioned, the impact so far has been quite modest due to stock buildup prior to the implementation and which we think is still ongoing to normalize. In the U.S., ferrosilicon prices are impacted by tariff structures and the demand is showing a positive development and further improvement in market conditions are expected there.

The market for carbon products is similar -- sorry, the market for carbon products is much smaller than silicon and ferrosilicon. We don't have reference prices here, but -- and demand differs a lot by region and is influenced by steel, ferroalloys and aluminum industries.

Global crude steel production declined by 4% in the first quarter this year compared with last year, primarily driven by lower activity in China, where output decreased by 7%. The European production decreased by 4%, while North American production was on a stable level.

Steel and ferroalloy markets continue to face challenges. However, Carbon Solutions specialized product offering and also our wide geographic presence will provide resilience and stability in earnings.

And as mentioned, the new safeguard framework for steel in the EU is expected to support higher steel production and could definitely positively impact the markets for Carbon Solutions.

Then moving on to the outlook for the second quarter. The conflict in the Middle East, along with trade regulations and protective measures is expected to keep impacting Elkem's markets and leading to continued uncertainty. However, Elkem is well positioned due to our diversified geographic presence and also strong market and cost positions.

Silicon Products is still experiencing difficult market conditions, but the results are expected to improve gradually as production now returns to full capacity utilization. However, there will be an impact of costs related to restarting production and ramping it then up to full capacity.

Carbon Solutions anticipates a generally stable financial performance in the second quarter compared to the first quarter.

So I think with this, I'll give the word to Morten to take us through the financials.

Thank you very much, Helge, and good morning, everybody. So let's start with the overall numbers, and these numbers are excluding Elkem Silicones, where we expect to have the closing of the divestment later today.

Elkem's operating income for the remaining business amounted to NOK 4 billion for the quarter, which is down 7% compared to the first quarter last year. And the reduction was applicable both for Silicon Products and Carbon Solutions.

Elkem's EBITDA for the first quarter amounted to NOK 249 million, and this was a reduction by 65% from the first quarter last year. The EBITDA was significantly impacted by the production stops at Elkem Rana and Elkem Salten, which was estimated to have a negative impact of NOK 250 million minus for the quarter. And this resulted then in an EBITDA margin of 6% for the quarter.

As usual, we have provided an overview of some of the main financial numbers and ratios. I will not go through all of them. And as closing of the Silicones transaction is expected today, we are focused on Elkem's figures for the quarter and what the key ratios will be for our continuing operations without silicones.

As I said, the EBITDA amounted to NOK 249 million, where there was realized derivative effects in segment Other of only NOK 1 million in the quarter. Other items amounted to NOK 18 million, and this consists of gains on power and currency derivatives of NOK 40 million, currency losses of NOK 24 million and other items of NOK 2 million.

The net finance income was NOK 366 million. This consisted of net interest expenses of minus NOK 102 million, currency gains of plus NOK 471 million, and this is due to a significantly stronger NOK, which is the functional currency versus euro, where we have the majority part of our loans. And net other financial items amounted to minus NOK 3 million. The income tax was minus NOK 63 million, giving a tax rate of 26% for the quarter.

Let's then take a look at the divisions and start with Silicon Products. The silicon and ferrosilicon markets remain difficult, and the results were significantly impacted by the reduced production at several plants, particularly Salten and Rana, where we had a full production stop at the part of the -- or during a part of the quarter.

Total operating income amounted to NOK 3.3 billion, and this was a reduction of 5% compared to the first quarter last year. The reduction in operating income was mainly due to lower sales prices for silicon, but this is partly countered by higher sales volume compared to the corresponding quarter last year.

The EBITDA was NOK 122 million, which was down 75% compared to the first quarter last year. And this reduction is primarily driven by the full and partly production stops at several plants, including Rana and Salten, but also at other plants in Norway, we had production curtailments for longer or shorter periods.

And as I said, the production stop had a negative EBITDA effect of approximately NOK 250 million in the quarter. Lower sales prices this quarter also impacted the EBITDA compared to last year's EBITDA.

Sales volume, however, was 14% higher this quarter compared to last year. and sales volumes were higher across all product lines, as we have focused a lot to increase sales in order to take down inventory and to reduce working capital.

The Carbon Solutions division presented a relatively weak quarter, but still generated an EBITDA margin of 23%. The first quarter was affected by negative sales mix, particularly lower share of specialty products.

Total operating income amounted to NOK 722 million, which was 16% down compared to the first quarter last year. And the EBITDA amounted to NOK 165 million, which is a reduction of 37% from the first quarter last year.

In addition to the negative sales mix effects, the operating income and EBITDA were also impacted by currency effects. The weakening of the U.S. dollar versus the NOK and Brazilian reais has had a negative impact on the results.

And the production curtailments in silicon products, which represent a major customer base for Carbon Solutions also had a negative effect for the Carbon Solutions results. We also experienced low demand in South America due to trade restrictions into the U.S.

Sales volumes were stable compared to the first quarter of last year, but market conditions remain challenging due to continued idle capacity and low demand from the ferroalloys industries.

So let's then take a look at some of Elkem's key financial ratios. The EPS amounted to NOK 0.56 per share for the first quarter of 2026. And this number is calculated excluding Bluestar shares, which will be redeemed in connection with the closing of the Silicones transaction later today. Having said that, we should also remind you that the number of shares will increase in connection with the equity offerings later in May.

Total equity for Elkem adjusted for the sale of the Silicones division amounted to NOK 11.6 billion as per the end of the quarter, and this gives an equity ratio of 42%.

Now if we adjust for the new equity offering of NOK 1.5 billion and the planned repair offering of NOK 0.3 billion, the pro forma equity ratio would be 46%. And this clearly means that the balance sheet remains solid also after the Silicones transaction and the redemption of the Bluestar shares.

By the end of the quarter, Elkem had net interest-bearing debt of NOK 9.3 billion, and this gives a leverage ratio of 5 based on the last 12 months EBITDA of NOK 1.9 billion. Adjusted for the already underwritten equity offering of NOK 1.5 billion and the planned repair offering estimated to NOK 300 million, the pro forma net interest-bearing debt was NOK 7.5 billion, and this then represents a leverage of 4x EBITDA.

Leverage is expected to be further reduced going forward by working capital improvements and effects of the cost reduction program, which will kick in from Q3 and onwards. And we're also targeting a well-distributed maturity profile.

And as Helge said, we have then entered or we have got an offer for a favorable refinancing package, where there will be a refinancing of EUR 1 billion, and we have secured a fully underwritten offer from 4 of our main relationship banks. The interest cover ratio amounts to 6x by the end of first quarter 2026.

As I said, it's a key priority to reduce working capital and also have a very disciplined program on CapEx in order to reduce debt and improve cash flow generation going forward. So cash flow from operations was NOK 169 million in the first quarter, and this was an improvement from the corresponding quarters despite lower EBITDA.

We have, during the quarter, reduced inventories by approximately NOK 500 million due to higher sales and lower production. And this reduction will then be converted into lower working capital and freed up cash during the next quarter.

The investments were very moderate and amounted only to NOK 122 million in the first quarter, where reinvestments amounted to NOK 111 million and strategic investments are basically at [ 0 ] or NOK 11 million.

The reinvestments amounts to 44% of depreciation and amortization. And this clearly is an indication that our program, our commitment to cap investments at maximum NOK 1 billion is progressing well, and we will definitely deliver on also on that target.

So -- we have not included silicones numbers in the previous slides, but of course, we still are the owner of silicones until closing later today. So this is a slide summarizing the silicones performance in Q1. As you know, the division has been classified in the accounts as assets held for sale and discontinued operations.

Overall, the division reported improved results compared to the corresponding quarter last year, mainly due to cost improvements. Total operating income was down 4% from Q1 2025, mainly driven by stronger NOK versus main business currencies.

EBITDA, however, was up 85% from Q1 2025, mainly explained by lower raw material costs, higher sales volumes and other internal cost improvements. Sales volume was up 10% from Q1 2025, driven by higher sales of commodities and specialty products in main regions.

DMC prices in China were stable in Q1, and there clearly is an effective problem to curb over production in China. And we see that anti-involutions, similar anti-involution measures are underway in a number of sectors in China. And the measures from silicones producers have so far been effective at curbing overproduction and increasing sales prices [ to ] price weak underlying demand.

So let me wrap up this presentation by summarizing the main headlines and takeaway for the quarter. First of all, we are streamlining the organization and implementing targeted cost measures to support a more focused business model. And the target is clearly to improve Elkem's profitability in a very challenging market situation. And of course, when market sentiment is improving, we will still have a great benefit for improving our cost position.

We're also clearly implementing measures to strengthen the balance sheet, and we will conduct a guaranteed NOK 1.5 billion equity offering and plan a subsequent repair offering after closing of the Silicones transaction.

And as I said, in addition, we have secured a refinancing of bank facilities of EUR 1 billion, NOK 11 billion, and this refinancing is underwritten by 4 main relationship banks. So following the guaranteed equity raise and the guaranteed refinancing, Elkem's financing position is considered to be very robust.

The first quarter was clearly weak, but the profitability is expected to improve in the second quarter as production gradually returns to full capacity. So far, we have not experienced any tailwind from improved market conditions.

Trade regulations and protective measures are likely to continue affecting Elkem's markets, and we expect that market conditions will gradually improve. We believe that we continue to be very well positioned due to strong market and cost positions when the markets improve.

So let me finish up there and hand the word back to Odd-Geir, who will then chair the Q&A session.

Thank you. Perhaps, we will then open for Q&A and I'd like to start with the people here in the audience and see if there are any questions, and I expected that to be among those. So please.

Yes. [indiscernible] microphone.

No, not needed.

Yes. So just wanted to touch on the silicon product figures because the volumes were very high despite some production cutbacks. Can you say a bit about the dynamic there? Are you back to normal or the desired levels in terms of tonnes of inventory? And is the quarter negatively impacted by you having to sell at a discount or something to get that much volume in a relatively weak market?

Yes, you can probably add Morten. But I think definitely, we see some positive signs on demand outlook. And otherwise, we could not have restarted production. So I think the underlying sentiment is good in terms of sales. And you're right, it did pick up during the quarter. So on inventory reduction, we can probably do more. We'll always have an attention to that. But what we intended with this curtailment has been achieved.

Yes. I think the answer is yes to your questions. Our sales was -- sales volume was high in Q1, but we had to sell deliberately also in marginal markets at low prices in markets that we usually do not sell big quantities into, but we did that in order to reduce inventories. So obviously, the EBITDA impact from that was not great, but we will reduce inventories and working capital, and that was needed.

Clearly, we also had a negative profitability impact from the sale of surplus power as we closed down the plants in Northern Norway and Rana and Salten. We had a major amount of surplus electric power. that needs to be sold in the market. At the beginning of the quarter, spot prices were quite high. But due to heavy precipitation, the power prices had a drastic decline. So we also had a loss on that impacting the quarter.

So going forward, I think the important thing is that we have now laid a basis for a significant reduction in inventories that will then cause a significant reduction in working capital [indiscernible].

Can you sort of quantify if you had normal production and you didn't have to sell those extra volumes at a bit of discount -- or in soft markets, like roughly how much higher EBITDA would be?

No, I think the number that we have announced of NOK 250 million, that represents the difference versus normal run rate given current market conditions.

And another question as well on the CO2 quotas that you are going to hopefully soon receive. Can you say a bit about what is -- what's the holdup? I mean, it's been almost a year since it seemed like it was sort of a done deal that you were getting this quotas. And is there any risk at all that it could be [indiscernible].

Not really. It has been confirmed in writing that we have support for our complaint. This is the second round time we do this. We also have a similar process in the round of allocation. So why the Norwegian government keeps creating problems like this, it's hard for us to say. But I cannot give any answer on bureaucratic processes that takes much time. No reason to believe that we should not get this.

There is also a formal, let's say, notification process with EU on such matters, and that's probably also a bit time consuming. But Helge is absolutely right. We have it in writing that we will get those quotas.

And then finally for me, it seems like you are sort of looking to potentially sell some of these units that you are left within silicones and also sort of looking into the Iceland units. Can you -- I don't know if you can give any indication of like what you can be looking at in terms of sales prices or how much they are worth or at least like how much book value is tied up in these units so we can have some sort of idea on the value.

I think it's very hard to start guessing on the value in potential transactions. I don't want to do that.

But you know, I guess, what you have in or thought.

I think we would like to, of course, first of all, initiate a discussion with the new Board to be elected later today. And I'm sure we will address these issues during Q2. I think it's a bit premature to start addressing this right now.

But we are very open about the fact that there are, of course, 3 silicones assets where we have plants. And we're also quite open about the fact that we have a challenge in Iceland that we will solve and we are pursuing, let's say, several options.

Other questions from the audience here before we go to questions on the web? If not, there are also some questions here on the web. And one question is regarding sales that you touched upon also with regards to what we're seeing now in the second quarter and the potential to reduce inventories further. Is it fair to say that selling at lower prices continue into the second quarter like in the first quarter?

No, that's not the intention.

[ Very sharp and clear ]. The question is also, could you provide some more color regarding the cost in the second quarter restating (sic) [ restarting ] the facilities, Rana and Salten in particular?

No. There will always be some start-up costs when you restart furnaces, not big amounts, but we have then fully restarted both Salten and Rana in April. So although capacity utilization will be higher in Q2 versus Q1. And as such, the profitability of these plants will be significantly better. We will not have a normal capacity utilization. So there is a potential for a further increase in Q3 and onwards.

There is a question also about Iceland that was mentioned in the presentation that we look at our asset portfolio. And the question is if you could elaborate on the structural challenges in Iceland.

I think Iceland has one competitive advantage that's hydropower or renewable power. Other costs are historically on a higher level than what we see in Norway, for instance, compared with Norway. And I think that has become even more difficult combined with safeguard measures and especially as very strong Icelandic currency have deteriorated the competitive position. So we need to look at all potential or all possible options for the future of Iceland.

I don't think it's right to speculate on who they are right now, but obviously, an important topic with the new Board and we will be -- we will definitely elaborate more on that in the second quarter presentation.

You mentioned safeguard and safeguard has been implemented for ferrosilicon. Why has the prices moved up further?

So I think the -- obviously, low demand is still there, but the destocking that's been going on is the main explanation for that. We do expect something -- we will see some improvement in price levels now going forward. And there are also some positive signs from steel in general, which I think can support ferrosilicon in general.

And with safeguard on ferrosilicon and steel being implemented, do we see similar measures for silicon metal going forward?

I think that's a more controversial issue in the EU to look at the exposure of different consumers. So I know that has been discussed for quite some time, but there doesn't seem to be any, say, consensus around how and when to implement such measures. but definitely needed because there is antidumping on silicon from China, but it's not enough to protect EU-based players. So as a consequence, very little capacity utilization is taking place in the EU right now.

Yes. Then there is a question about the refinancing package and if you can say anything about terms and conditions?

No, first of all, we're very happy to have this refinancing package in place. We believe it's a very good package. But it's up to the new Board to finally approve it, and the Board will be elected later today. So let's have the approval, and then we will disclose more details on the package.

And then the last question here before we wrap up. If we can see any further working capital release in the second quarter as compared to first quarter.

Definitely. We have made a commitment. We will take down working capital by NOK 1 billion during the year. I think a major part of that will be realized already during Q2. We have already laid a good foundation with the reduction in inventories. There will probably be even more reduction in inventories.

And then we are working on other measures also on credit terms, which in total should exceed the working capital reduction to more than NOK 1 billion for the year. And then the major part already in Q2.

Very good. That was the last question, and that concludes our presentation today. So I would like to thank people in the audience for attending and also those on the webcast following us there. Thank you very much, and have a nice day.

Thank you.

Thank you.

Good morning. My name is Dag Opedal, and I'm the Deputy Chairman of the Board of Directors of Elkem ASA. Before we start the official general meeting, I first wish to give you some practical information.

Our secretarial function today is managed by DNB registrar department. They will be in charge of registration and counting of shares represented in the meeting and in due course, the counting of the votes cast at the meeting. As you are aware, this meeting is conducted as a virtual meeting.

I assume that most shareholders present are well acquainted with the digital general meetings conducted by use of the Lumi platform. And for them, which this solution is new, you will find information under the home button.

Agenda item #1. I welcome you all to this extraordinary general meeting of Elkem ASA. Together with me are our CFO, Morten Viga; Senior Vice President for Business Development, Morten Magnus Voll; and Head of Investor Relations, Odd-Geir Lyngstad. Present is also Hans Cappelen Arnesen from the law firm, Thommessen.

I will now refer to the list of represented shares here today. 19,751,630 shares are represented by proxy. 131,375,379 shares are represented by advanced votes. 338,338,536 shares are represented by instructions to the Chairman or myself. For shareholders participating online and representing in aggregate 159,006 shares. In aggregate, this is 489,624,551 shares represented, which constitutes 77.2% of the share capital.

We now move on to Item #2 on the agenda, where the Board of Directors has proposed that Hans Cappelen Arnesen, partner with Thommessen, is elected to chair the meeting and Morten Viga, our CFO, is elected to co-sign the minutes together with the Chair of the meeting.

I will hereby kindly ask the shareholders to cast their votes on agenda #2.

[Voting]

The voting is now closed, and the count of votes shows that the proposals have been approved. I will then hereby hand over the management of the General Meeting to Hans Cappelen Arnesen.

Thank you, Dag. We will then move over to agenda Item 3, which is approval of the notice and agenda for this meeting. The Board of Directors has proposed that the notice and the agenda are approved by the general meeting. If there are no comments or questions to this agenda item, we will go to the voting over this item. So if you have not voted yet, please do so now because we will close for voting shortly.

[Voting]

The notice and the agenda have been approved by the general meeting. When it comes to the exact number of shares voted for and against or abstaining from each agenda item, that will be disclosed together with the minutes from this meeting. So I will not read the numbers under each agenda item.

We will then move on to agenda item #4, which is approval of the share purchase agreement that has been entered into with Bluestar. The background for this proposal is explained in the notice of the agenda and also in the statements from the Board referred to therein and the statement from PwC, which is also referred to in the agenda. Are there any comments or questions to the background for the proposal? And you will see the proposal and the proposed resolution on your screen.

There seems to be no comments or questions to this agenda item. So I suggest we move on to voting. So those of you who have not voted yet and would like to vote can do so now, and we will close for voting shortly. On this agenda item, Bluestar is not entitled to vote, so their shares will not be included in the counting.

[Voting]

The voting has now been closed, and the proposed resolution is approved by the general meeting. We then move on to agenda Item 5, which is a share capital decrease related to the share purchase agreement. The background for the proposal is explained in the notice of the general meeting. But if there are any comments or questions to the proposal, please let us know. Otherwise, we will move on to voting on this agenda item.

There seems to be no comments or questions to the proposal, and you can see the proposed resolution on your screen. So if you have not voted yet, please do so now if you would like to vote because we will close for voting shortly.

[Voting]

Thank you. We have now closed for voting and the proposed resolution has been adopted by the general meeting. And that was the last agenda item for today. So thank you all for participating, and the general meeting is now adjourned. Thank you.

Good morning, and welcome to Elkem's Fourth Quarter Results Presentation. My name is Odd-Geir Lyngstad, and I'm responsible for Investor Relations in Elkem. Today's presentation has been extended because Elkem has reached a significant milestone to sell the majority of its Silicones division to Bluestar. But before we present the details of that transaction, we will take you through the fourth quarter results.

As usual, we will go through the highlights for the quarter and give you an update on the markets and the first quarter outlook. CEO, Helge Aasen, will take us through the first part of this presentation before CFO, Morten Viga, will present Elkem's fourth quarter results in more detail. We will open for Q&A after the presentation of the sales of the Silicones division. So with that, I give the word to CEO, Helge Aasen.

Yes. Thank you, Odd-Geir, and good morning, and welcome, everyone. So as already indicated by Odd-Geir, we have the pleasure of announcing that we've entered into a sales agreement with China National Bluestar, our majority shareholder for a sale of most of the Silicones division. This transaction will be settled through a redemption of all of Bluestar's shares in Elkem. And as already mentioned, we will come back to the details later in the presentation about this transaction.

The result for the quarter was relatively strong given the current market conditions. And I think we can say that as most of our competitors in Europe have temporarily or permanently curtailed production, while we have, throughout the quarter, maintained close to full capacity utilization.

The EBITDA for the fourth quarter ended up at NOK 890 million, which gave an EBITDA margin of 12% for the group. And if you exclude Silicones, which is reclassified as assets held for sale and which will now be sold, the operating income was NOK 4 billion with an EBITDA of NOK 485 million, which is then also representing a margin of 12%. We have been able to partly mitigate low demand and declining sales prices with cost improvements, both on raw material costs and other operational costs. And that is, of course, still ongoing.

In the quarter, Silicon Products was impacted by lower sales prices. However, we do see higher ferrosilicon prices in the EU due to the safeguard measures restricting imports of ferroalloys into the EU. Carbon Solutions had lower sales in the fourth quarter due to continued idling of steel and ferroalloy capacity, which we have seen across many main operating regions.

In the quarter, Silicones delivered further profitability improvements, which is primarily due to higher sales prices towards the end of the year in Asia Pacific and generally strong performance on cost improvements. The share redemption in connection with the sales of the Silicones division will impact Elkem's equity. And due to that, the Board has proposed not to distribute a dividend for 2025.

So before we go on to present the market update and results, I'd like to say a few words about ESG. At the end of last year, it was unfortunately marked by a tragic accident at one of our plants in France. On the 22nd of December, an explosion occurred at an R&D facility in our Silicones facility in Sanfo, just outside Lyon. We had 4 colleagues injured and sadly, 2 of them later passed away from the injuries that were sustained.

Internal and external investigations are still not finally concluded. But of course, regardless of that, I can only say that this is a very tragic setback in our efforts on safety work. And obviously, such an event right now overshadow other achievements within our ESG work. But we continue to get good ratings on ESG assessments in general as is illustrated on this slide.

And moving on to trade barriers. This continues to impact markets and is also having an impact on Elkem, both directly and indirectly. EU's safeguard measures that came into effect in November last year, unfortunately, exempted Norway and Iceland. So we are outside of the EU safeguard measures. I think that's been broadly covered in the media. However, we have received country-specific quotas, which puts us in a rather beneficial position compared with most other countries.

Those quotas are approximately 70% to 75% of historic sales. And this has been combined with the pricing benchmark of EUR 2,400 as a reference when you calculate the tariffs for sales, which exceed the quotas. So far, ferrosilicon prices are up about 20% since this was implemented. And if these measures are effective, we will -- we expect to see further price increases.

Then moving on to the U.S., countervailing duties have been imposed on silicon, silicon metal, imported from several countries, including Norway. And the preliminary CVD rate is close to 17%. In addition, there are also antidumping duties announced, which is close to 4%. So that brings the total tariffs now that was 5%. Then we have the Trump tariff, 15%. And then we put this on top of that, we are now up to around 40% on silicon metal exported from Norway to the U.S.

So the basis for the CVD duty is based on CO2 compensation and the allocation of CO2 quotas, which Norwegian companies receive under the EU carbon scheme. Of course, our position is that EU's policies on CO2 quotas and CO2 compensation do not constitute countervailable subsidies, harming the U.S. domestic industry as there is no CO2 tax in the U.S.

So the case is expected to be finally decided in June this year. And so far, I think we can say that we've been fairly successful in navigating and adapting to unpredictable trade dynamics, while we are leveraging a global business model and strong -- with strong cost and market positions.

Here, we have included a summary of Elkem's performance over the past years and how that compared to our communicated financial targets. So if we look at the 3 last years, we have seen deteriorating market conditions due to lower economic activity, global overcapacity and a very, I would say, big reshaping of global trade. So despite these challenging conditions, Elkem has met the financial targets over the cycle, very much due to our diversified business model and strong operational execution. And of course, we have continuous cost focus.

So since 2020, we have delivered a compound annual growth of 5%, which is in line with our target. And the EBITDA margin during the same period was 16%, which is also within our target range. And if you exclude Silicones from these numbers, the performance is even better with a compound growth in operating income of 6% while the EBITDA margin was 21%, exceeding the target range.

Then we move on to the market update and the outlook. So let's have a look at some of the key markets and market trends and indications -- indicators, I mean, automotive is an important sector for Elkem, driving demand for many of our products as silicon is essential in electronics, in batteries and in aluminum, lightweight components.

Markets, particularly in Europe, have declined and the outlook remains weak. Soft demand combined with import pressure from China. A new minimum price mechanism in the EU on imported Chinese electrical vehicles could offer some protection; remains to be seen. In the U.S., the outlook for 2026 is also relatively soft due to the pressure on affordability and an overall weak demand for EVs.

Construction is another key market for Elkem, for Elkem silicon-based products, which go into high-performance concrete, building materials and other infrastructure. It seems that Europe is seeing a gradual recovery in the sector, but the performance is varying significantly across countries and different segments.

The U.S. industry is also relatively soft, but data centers, power infrastructure and institutional projects are showing growth. The PMI number is normally a good indicator for the economic sentiment and global PMIs show a mixed but stable picture. Manufacturing remains soft, but the downturn seems to be easing now. The U.S. stays in mild expansion, supported by improving output, though underlying demand and export orders remain soft. Europe is a mixed picture with the German economy continuing to contract, keeping the broader Eurozone picture rather subdued.

If we look at the specific markets for Elkem and start with the silicon. As illustrated on the graph, the silicon reference prices remained on a low level during the quarter. Year-to-date figures for November 2025 show that exports from China to Europe increased significantly compared with last year. And this, combined with, I say, generally weak demand have put quite significant pressure on prices in the EU.

In the U.S., silicon prices increased slightly in the fourth quarter, but also here, the demand is relatively low. Prices are, however, expected to rise in 2026 due to tariffs, antidumping duties and a tightening domestic supply. In China, silicon prices are affected by challenging market conditions. Power prices are increasing and sales prices for silicon remain on a low level. A little bit positive is that production curtailments are expected from several producers.

Moving on to ferrosilicon. As you know, we have many of the same underlying drivers as the silicon metal. The overall picture for Elkem is also here marked by weak demand. But as mentioned earlier, we've seen an increase in reference prices by around 20% following the implementation of the safeguard measures in the EU.

And in addition, the EU has announced a tightening on the safeguard measures for steel. The annual tariff-free import quotas will be reduced. And the out of quota duty will be doubled to 50%. So as these measures will take effect, it is expected that steel production in the EU will increase. I think Outokumpu reported a similar picture yesterday. This could also have a positive impact on the demand for ferroalloys and electrode materials supplied by our Carbon division.

In the U.S., ferrosilicon prices were marginally down in the fourth quarter due to weaker demand. And in China, ferrosilicon prices remain on a low level despite further production cuts to address overcapacity. Then the market for carbon products, obviously much smaller than the market for silicon and ferrosilicon, and there are no available reference prices here. Demand for carbon products differ by region, influenced by steel primarily, which again drives consumption of ferroalloys and aluminum is also an important driver.

This was -- yes, global steel production actually declined by 3% in the fourth quarter compared to the year before, primarily driven by lower activity in China, where production actually decreased by 9%. In Europe, the production increased by 4%, while North America remained stable. So this means that the steel and ferroalloy markets continue to be challenging and affecting Carbon Solutions. The effects are partly mitigated by our specialized product offering in carbon and a diverse geographic presence, which gives us a natural hedge and creates quite a stable situation, which you have seen on historical financial figures.

Then lastly, Silicones. Anti-involution measures are underway in a number of sectors in China, also in silicones, so addressing overcapacity. The DMC price in China rose by about 23% from around RMB 11,000 per tonne by the end of the third quarter, up to RMB 13,600 by the end of the fourth quarter, primarily driven by various anti-involution measures, curbing over production and then leading to an increasing in sales prices. The demand still within China remains on a weak level, particularly due to the construction sector. In the EU and the U.S., demand for commodity silicones was low in the quarter, mainly impacted by shifting tariff policies.

So moving on to the outlook for the first quarter. As mentioned, trade regulations and protective measures are likely to continue to affect Elkem's markets and contributing to ongoing uncertainty. However, I think Elkem is well positioned due to our geographic presence and strong market and cost positions. Silicon products still facing subdued demand. We are temporarily reducing capacity in Norway to -- mainly to manage inventory levels. And the EBITDA effect of that is expected to be somewhat negative, but with a very positive cash flow effect.

Carbon Solutions is expecting a slight improvement in sales volumes. But again, due to already mentioned the situation in steel, et cetera, the overall demand remains on a relatively weak level. Silicones prices in China have increased due to the reduced supply, while the fundamental demand situation remains on a lower level than what we've seen historically. The division will, of course, benefit from higher sales prices anticipating that yes, that these actions will be maintained on production reduction.

So I think with this, I'll give the word to Morten to take you through the financials for the fourth quarter, and then we'll come back to the transaction afterwards.

Thank you very much, Helge, and good morning, everybody. It's certainly a pleasure to go through the results for the fourth quarter in more detail. Our operating income for the quarter was NOK 7.3 billion, which was down 14% compared to the fourth quarter last year. And we saw a reduction in all 3 divisions, and this is mainly explained by lower sales prices.

Elkem's EBITDA for the fourth quarter was NOK 890 million, and this was 24% lower than the fourth quarter last year, but slightly higher than in the previous 2 quarters. The reported group EBITDA margin was 12%, which is somewhat below our long-term target of 15% to 20%. However, it's clearly important to bear in mind that sales prices in key markets, particularly in silicon and ferrosilicon have been at or close to all-time low levels.

And as such, we believe that Elkem's EBITDA is clearly supported and held up by good operational performance and strong underlying cost positions. There were no particular one-offs affecting the EBITDA in this quarter.

As usual, we have provided an overview of some of the main financial numbers and ratios on this slide. I will certainly not go into detail on all of them, but it is important to note that the Silicones division has been reclassified as discontinued operations and assets held for sale. And as you know, now we are announcing this transaction. But Silicones has been a part of Elkem's structure during the quarter, and the division is affecting Elkem's key financial numbers. And for that reason, we will mainly focus on the financial numbers for the group, including Silicones.

In the table to the right, you can see comparable figures, however, for Elkem with and without Silicones. Including Silicones, the group EBITDA was NOK 890 million, and the realized effects from the currency hedging program was minus NOK 21 million reported in segment other. Other items amounted to minus NOK 68 million, and the main items were gains on power and currency derivatives of plus NOK 64 million and restructuring expenses of minus NOK 20 million and other items of minus NOK 111 million, mainly consisting of dismantling and environmental expenses.

Net finance expenses were minus NOK 192 million. The main items were net interest expenses of minus NOK 130 million and currency losses of minus NOK 48 million. We have been able to reduce the interest expenses from minus NOK 187 million in the same period in '24. Income tax was positive with NOK 6 million due to tax deductions and changes in the tax losses carried forward.

So let's then take a look at the divisions, and we start with Silicon Products. The silicon and ferrosilicon market clearly remain difficult with low sales prices, and this is also affecting the division's result in the fourth quarter. Total operating income amounted to NOK 3.2 billion for the quarter, which was a reduction of 14% from NOK 3.8 billion in the fourth quarter of '24. The reduction was largely due to lower sales prices, particularly for silicon and ferrosilicon.

The EBITDA amounted to NOK 294 million, which was a significant reduction of 53% from the fourth quarter last year. And the reduction is also here primarily driven by lower sales prices, but this is then partly balanced by lower raw material costs and higher sales volumes. The specialty segments, particularly foundry alloys and materials maintained strong performance also this quarter due to Elkem's very strong market positions. Sales volume was 8% higher compared to the fourth quarter last year, and we had a higher sales volumes across all product lines.

The Carbon Solutions division has presented extraordinary good results over a long period and continue to deliver good margins. However, this quarter was impacted by lower sales volumes. The operating income came in at NOK 735 million, which was down 20% from the fourth quarter last year. EBITDA amounted to NOK 174 million, which is a reduction of 38% from the corresponding quarter in '24. But the reduction in operating income and EBITDA can be explained by decline in sales volumes. We have also seen a reduction in sales prices, but this has been partly offset by extraordinary cost improvements. Sales volume was down 11% compared to fourth quarter last year.

The Silicones division, where the majority now is being sold to Bluestar has delivered improved results in the fourth quarter, mainly due to cost improvements. Total operating income was NOK 3.6 billion. That's down 14% from the fourth quarter of last year. And the decline is primarily due to lower commodity sales prices during the quarter.

EBITDA, on the other hand, improved by 6% from the corresponding quarter last year, and it reached almost NOK 400 million. The decline in sales prices and sales volumes was more than offset by good cost reductions and lower raw material costs. Sales volumes was down 3% compared to the fourth quarter last year, and this is mainly due to lower commodity sales across the geographical regions.

Let's now have a look at some of Elkem's key financial ratios. The earnings per share, EPS, was negative with NOK 0.21 per share in the fourth quarter, and that brings the EPS year-to-date to minus NOK 1.05 for the year. We are, of course, not satisfied with this, but clearly, the EPS has been negatively impacted by net losses from the Silicones division, which we are now selling. If we exclude Silicones from the '25 numbers, Elkem's EPS for the full year would have been plus NOK 0.61 per share. The balance sheet remains very solid and total equity amounted to NOK 24 billion by the end of '25, and that equals an equity ratio of 51%.

By the end of the fourth quarter, Elkem had a net interest-bearing debt of NOK 11.9 billion, and this gives a debt leverage ratio of 3.5x based on last 12 months EBITDA. The sale of the Silicones division will impact Elkem's equity and debt, and we will revert to that later. The equity will be reduced by share redemption and the net debt will also be reduced from NOK 11.9 billion to NOK 9.8 billion as Bluestar will take over NOK 2.1 billion of the debt.

This will then increase Elkem's leverage based on pro forma numbers. But the plan will be or is to raise additional equity and conduct a refinancing of the main bank facilities after closing of the Silicones transaction. As I said, we will get back to more details on this under the presentation of the Silicones transaction.

As mentioned in the previous quarters, Elkem's focus has been on cash generation and disciplined capital spending in response to the very challenging market conditions that we are experiencing now. And we have delivered on our promises. In the fourth quarter, the cash flow from operation was plus NOK 829 million, a clear improvement compared to previous quarters. And this is explained by lower CapEx and positive working capital changes.

In the fourth quarter, total investments were down to NOK 674 million. Reinvestments were down to NOK 530 million, which amounted to 75% of depreciation for the quarter. And for the full year, reinvestments amounted to NOK 1.5 billion, which equals 58% of depreciation. Strategic investments were moderate, NOK 145 million in the fourth quarter, taking the total number to NOK 328 million for the full year.

So let me wrap up this presentation by summarizing the main headlines and takeaway. First of all, trade regulations and protective measures are likely to continue affecting Elkem's markets. Elkem is, however, very well positioned due to strong market and cost positions and a diverse business model. Silicon Products is still facing weak demand, but the division is benefiting from cost improvements and higher ferrosilicon prices after the implemented EU safeguard measures.

Carbon Solutions benefits from good cost positions and a geographically diverse customer base. And clearly, the division is excellently positioned when there is a market recovery. Our Silicones business delivered further profitability improvements in the fourth quarter and is well positioned if current price levels are maintained. As I said, the Board has proposed not to distribute dividend for 2025, and this is due to the share redemption in connection with Elkem's sale of the Silicones division. So then I think that summarizes the Q4 presentation, and then I hand the word back to Odd-Geir. Thank you.

Okay. That concludes the presentation of the fourth quarter results. So thanks to Helge and Morten for taking us through the results and the presentation. We will now go on to present the divestment of the Silicones division and CEO, Helge Aasen and Morten Viga will then take us through the rationale for the transaction, the structure and the approval process for the contemplated divestment. And we will then open for Q&A after this part of the presentation. So with that, I'll give the word back to you, Helge.

Thank you. Yes, it's been a quite a long process. It's now about a year since we announced the strategic review to sell the Silicones division. And we are very satisfied to present to you today a transaction that we think will benefit all our stakeholders. So before going into the details of the transaction, I'd like to put this into a historic perspective.

I mean transformational changes are not new to Elkem. In the company's long history dating back to 1904, continuous portfolio optimization has been part of the course. And in order to adapt to new market environments, seize growth opportunities, consolidate the market or gain more financial room to maneuver, we have on this slide illustrated some of the major transactions that have shaped this company over the years and made it to what it is today.

The current chapter that we are about to close started in 2011 with Bluestar's acquisition of Elkem from Orkla. During Bluestar's ownership, Elkem has had a strong development in product diversification and not at least in revenue growth. I mean we have quadrupled the revenue in that period. We've strengthened our market positions. We have emerged as a more cost-effective company and -- than we were, back in 2011.

And we've also invested significantly in expanding and upgrading our facilities. Just in Norway alone, we have invested more than NOK 10 billion over the last 10 years, which makes us the European silicon major. And we play a critical role in strategic value chains.

It's been a very exciting journey. I've been part of it myself personally. Taking over Bluestar's global silicones business headquartered in France. We took the first part in 2015 and then the silicones business in China in connection with the IPO in 2018. And obviously, that's a particular highlight when Bluestar relisted Elkem on the Oslo Stock Exchange in 2018 after the Orkla takeover, where Elkem was delisted in 2005. And we had actually been listed since 1913, when Orkla delisted the company. So we have a long history here in Oslo on the stock exchange. And significant achievements have been made, and we are proud of that.

Today, Elkem is a fully integrated silicon-based manufacturer, all the way from quartz mining to high-end downstream applications in silicones. The company has global positions and each of the 3 divisions are major players within their respective industries and markets. Silicon Products being a global producer and provider of silicon, ferrosilicon and a number of specialty products derived from those -- from the starting point.

Carbon Solutions is a leading producer of electrode paste and specialty products for the metallurgical industry. And Silicones, which will now be sold to Bluestar is also a fully integrated silicones manufacturer with focus on specialties and strong global positions. So combined, our divisions have leading cost and market positions delivering and have delivered strong results over the cycle, with a geographically resilient and diverse business model.

And I think we should also underline that Elkem is a supplier of critical materials to the green and digital transitions with a strong focus on sustainability. And of course, these efforts will continue regardless of the transaction being announced today.

So with such a successful development, I guess the obvious question is why do we undergo such a significant transformation now. And I would say, first of all, it is related to growth potential, and the fact that the current structure and financial capacity of Elkem is not adequate to support the growth opportunities that we see for Elkem's business portfolio going forward.

We have #1 positions in carbon materials, in silicon, in foundry alloys, microsilica. And a sale of the Silicones division will now ensure a better capital allocation in order to accelerate organic growth and also enable us to pursue attractive M&A opportunities within these business areas. It will also leave Elkem with more resources for innovation and improve the prospects to strengthen our financial profile through reduced volatility and lower capital intensity. In short, we believe that this transaction will put us in a significantly stronger position to develop these 2 divisions.

The fact that Bluestar will take full ownership of Silicones through this transaction, we also think will significantly improve the future opportunities for the Silicones division. It will enable access to a significant investment capacity that would not have been possible in the Elkem structure. In addition, Silicones will benefit from deep strategic synergies within a global chemicals major with improved ability to innovate across the whole value chain.

Silicones will also be in a better position to adapt to local market dynamics and accelerate growth in specialty products and in key global markets. So in short, we are confident that this agreement with Bluestar delivers the most favorable outcome for Elkem's employees, shareholders and other stakeholders, while we position ourselves with the remaining metals and materials division and the Silicones division for future growth.

This is an overview of the transaction structure and the timeline. So Elkem will sell the majority of the Silicones division to Bluestar. The sale includes all Silicones' assets, excluding Yongdeng, it's a silicon metal plant in China; Ruossillon which is an upstream silox plant in France; and India, a small downstream facility in silicones.

The transaction will be settled through the redemption of all of Bluestar's 338 million shares in Elkem. There will be no cash payments by Elkem nor Bluestar. The minority investors, which today have 47.1% of the shares will then assume 100% control of the listed company, Elkem ASA. And through the contemplated transaction, Elkem and Bluestar will solve important long-term strategic goals regarding development and ownership.

The transaction is conditional upon shareholders' approval at an Extraordinary General Meeting, waivers and approvals from lenders and other customary approvals. We have obtained pre-commitment from Folketrygdfondet, Must Invest, AS, DNB Asset Management, Nordea Investment Management and Perestroika to vote in favor of the transaction. These investors have also underwritten NOK 1.5 billion equity capital raise.

Elkem will call for an EGM today. The EGM is expected to take place on the 9th of March, and we will seek lenders' approval of the transaction before the EGM. After a 6-week formal creditor process, the closing is then expected to take place by the end of April. We are planning to arrange a capital markets update after the summer to present our plans and strategy for the company going forward.

Where are we now? Is this -- are you taking over now? Or is it -- this is my last slide. I think, yes, this slide summarizes the outcome of the contemplated transaction. So upon completion, Bluestar will be the owner of all Silicones' assets, except the units that will be retained by Elkem. And since 2018, Silicones' share of EBITDA has been 32%, while the share of EBIT has been negative.

The divisions that will constitute Elkem going forward have since 2018 represented 68% of EBITDA of more than 100% of EBIT by offsetting the losses from Silicones. The performance since 2018 demonstrates the potential to strengthen Elkem's financial profile going forward through improved earnings.

Yes. I think, Morten, you can take the rest. Let's share the burden of this very nice presentation.

Share the pleasure I would say. Certainly, it's a magnificent day in the history of Elkem. So I'm very happy to continue. So the settlement of the transaction will be made through redemption of all Bluestar's share in Elkem ASA. The decision is subject to 2/3 vote by minority shareholders at the upcoming AGM on the 9th of March. And the minority shareholders will then effectively exchange the 47.1% they hold in the sold Silicones assets with Bluestar's 52.9% in the remaining Elkem.

Bluestar will not hold any shares or have any formal roles in Elkem after completion of this transaction. And a new Board of Directors will be elected in connection with the closing of the contemplated transaction.

So what is new Elkem all about? Well, after the transaction, Elkem will consist of Silicon Products and Carbon Solutions. And this will certainly then result in a much more focused pure-play metals and materials company. The Silicon Products division has 12 main production sites and has all around the world and has delivered an average EBITDA margin of 22% from 2018 to 2025. Carbon Solutions also has a global business model with 6 main production sites, which have delivered an average EBITDA margin of 27% over the same period.

So Elkem will remain a global player with plants all over the world and clearly with #1 positions within these 2 business areas and with very strong and resilient value chains. We will certainly continue to focus on innovation and customer support with strong R&D centers as an embedded part of our value chain. And we believe that this will be even more important going forward due to increased focus on supply chains and the secure supply of critical materials.

We also have very strong positions in terms of renewable energy and energy efficiency. And we also believe that this will be a strong competitive advantage going forward. In this transaction, we will keep 3 of the Silicones' plants, which will not be sold to Bluestar. The Roussillon upstream Silicones' plant in France will be a prolonged -- will serve as a prolonged part of the upstream silicon metal value chain. And as such, it will secure demand from -- for our production in Norway. For India, which is a very small business and for Yongdeng, which is a silicon smelter in China, but belonging to the Silicones division, we will explore other alternatives, and we will get back to that in due time.

This slide contains a profile of the new structure's historical financial performance. I will certainly not go into detail on all these numbers. But you will see that the historical performance has been volatile as the markets have been volatile, but we have delivered profitability, which is clearly above the average profitability of Elkem Group in the same history.

Since Elkem was IPO-ed back in 2018, the remaining business that we will keep has represented 55% of the group revenue, but it has also represented 67% of the EBITDA. And as a matter of fact, it has represented more than 100% of the historical group EBIT. So we believe that it is a very good part of the portfolio that we are bringing further. And that means that we will have a stronger and more profitable Elkem going forward, and we will certainly also focus a lot on cash flow generation based on very good underlying market and cost positions.

As mentioned previously in our presentation, we believe that Elkem's positioning will be significantly improved after the transaction. Going forward, the operational and business focus will be on our #1 positions in Silicon Products and Carbon Solutions. And these divisions have demonstrated a very strong ability to deliver solid profitability throughout the cycle with an EBITDA approaching 20% since 2018 and with a strong cash flow generation.

So where do we stand today? We, certainly, Elkem's remaining divisions, we have gone through a cyclical trough in terms of turnover, yet we have still delivered profitability and good cash flow throughout 2025. And we clearly believe that with the completion of this transaction, we are very well positioned to deliver increased turnover, higher earnings over time. From 2018 to 2025, Silicon Products and Carbon Solutions together have delivered on an average an EBITDA of around NOK 4 billion throughout the cycle, which is significantly higher than the 2025 numbers.

Compared to 2025, we expect a gradually improving market in 2026. And over time, we expect that we should at least be back in line with historical earnings at a minimum. Based on the current outlook, we anticipate an underlying top line growth of more than 10% in 2026 compared to 2025. This is driven by a better mix and higher volumes.

Our relative competitiveness versus competitors in our main markets is stronger than ever before, and we are confident that we will gain market shares with good profitability. Higher prices should certainly provide the company with strong operating leverage and also based on today's cost base.

Historically, rising revenues have led to increased margins, which is natural given higher volumes and prices. In addition, we have a long track record, and we will continue with that of achieving significant cost improvements in our core business model. And we plan to return to the market with specific cost-cutting measures over the coming quarters as we will streamline the new organization.

One of the important factors in the transaction is that we will also significantly reduce our capital intensity through the sale of Silicones, which has clearly been the most capital-intensive part of our portfolio. We expect for the new portfolio around NOK 1 billion in ongoing annual investments, and that is clearly significantly below the average level during the last 5 years. And this also should enable a higher return on capital employed going forward than the historical numbers.

In line with our strategy of being a well-capitalized company throughout the cycle, we have also decided to raise new equity from solid investors upon completion of the transaction. We're very happy to see the good support from current shareholders, and we believe that our new financial process has a -- would give a stronger resilience than the historical Elkem.

So even though the markets remain, for the time being, challenging and uncertain, we believe that we are in an excellent position to deliver profitable operations, good cash flow even under quite challenging conditions. And over time, as illustrated, we are also comfortable that we have a position that can deliver results at least in line with our historical performance.

I should be humble about timing. Normalization, full normalization will probably take some time and our markets will keep fluctuating. But as the markets will settle, we are very well positioned to deliver strong revenues and profitability. And as I said, we will certainly focus on maintaining a strong and efficient balance sheet over time. And we will also, in the future, get back to delivering attractive dividends to the shareholders when the time is right.

Finally, I think it's also worth mentioning that the transaction and the streamlining of Elkem in the coming years will enable profitable expansion and growth. And once the transaction is completed, as we said, we will also then after the summer vacation, get back with a capital markets update, elaborating more on our future financial targets and strategic priorities.

As we said, the sale of the Silicones division is settled by share redemption with no cash payments. We're planning also, as said, an equity issuance following the closes of the contemplated transaction to ensure a robust and efficient balance sheet. And a number of key current investors have already fully underwritten a NOK 1.5 billion equity capital increase. And with this capital increase, the new pro forma leverage will be 3.6x based on the last 12 months EBITDA.

The equity capital raise is subject to certain terms and conditions to be completed following the closes of the contemplated transaction. But what's important from the company's perspective is that there is no uncertainty related to the equity raise and to the financial position of the company going forward. We believe this will be a very strong structure. And certainly, our target is to maintain a strong credit position and a flexible balance sheet, qualifying for investment grade.

The transaction is conditional upon approval from certain Elkem lenders and the waiver and approval process is now being initiated. After transaction closing, we plan then to conduct a full refinancing of main credit and loan facilities, and we will get back with more information on that in due time.

So then a few words about the approval process from the minority shareholders. The contemplated transaction is conditional upon the approval by Elkem's General Meeting. We will then call for an Extraordinary General Meeting today to be held on the 9th of March to approve the contemplated transaction and the redemption of Bluestar's shares in Elkem.

Bluestar will not vote on the agenda items relating to approval of the contemplated transaction as they are part of the transaction. But Folketrygdfondet, Must Invest, DNB Asset Management, Nordea Investment Management and Perestroika have pre-committed to vote in favor of the share purchase agreement, and that is representing approximately 30% of the eligible voting capital for this matter. And as I also said, these investors have collectively underwritten NOK 1.5 billion in new equity capital, subject to market terms. The Board of Directors in Elkem will certainly also ensure to take into consideration of the minority shareholders in relation to the equity capital raise.

With respect to the share redemption, Bluestar is entitled to vote and has undertaken to vote in favor. Hence, shareholders holding 67% of the share capital eligible to vote on that item have undertaken to vote in favor of the share redemption at the EGM. And subject to being approved by -- or subject to approval by the EGM and other closing conditions, where there are really no major ones, the contemplated transaction is expected to close late April or early March this year -- May. Thank you, Helge.

Elkem's management and the independent Board have thoroughly assessed available options in a long time before entering into these -- or into exclusive negotiations with Bluestar, and we clearly believe that this is the best option, and it's a very good solution.

To safeguard the interests of the minority investors in Elkem, the Independent Board has also obtained a fairness opinion from DNB Carnegie, which has concluded that the contemplated transaction is fair from a financial point of view when considering the valuation from the perspective of the Independent Board and its shareholders.

So to summarize, we certainly believe that this transaction will be beneficial to all stakeholders, and it will position Elkem as a focused pure-play #1 metals and materials company. This will certainly allow us to pursue tailored strategies aligned with our division's unique strengths and market positions. Elkem, post the transaction, will hold leading positions within operations, technology, market, product technology, et cetera. We will continue to have attractive positions in all relevant geographies. And we clearly also see potential value-accretive M&A opportunities when the timing is right.

As a supplier of critical materials to the green and digital transformation, we have developed strong customer relations based on very capable in-house R&D resources, and we will continue to strengthen that going forward and make sure that it's sustainable, both from a financial and an environmental point of view.

As I said, Elkem's target is clearly to maintain a robust financial profile over the cycle with a very strong focus on solid cash conversion. And we believe that this will, over time, provide the necessary flexibility for growth and development of the company.

So I guess that concludes our presentation, and then I'm happy to leave the word back to Odd-Geir again, who will facilitate the Q&A session. Thank you very much.

Thank you for that, Morten. We will then open up for Q&A. We have received some questions on the webcast and including some on e-mail. But since there are a few people present here today, I would like to take the opportunity to see if there are any questions from the audience. And the best solution is probably if you just say the question and then I'll repeat for the webcast. So please feel free.

If there are no questions from the audience, we'll take a few of the questions that are on the webcast.

And the first question is related to the Roussillon and the part of the Silicones' assets that are not part of the transaction. And questions are if -- what is the EBITDA for the Silicones part that are not part of the transaction where obviously, the Roussillon plant is the main item. What was that in '25? And I mean, the part of EBITDA that we are not selling to Bluestar?

I don't think we have -- this has been an integrated part of the Silicones operations in France. Obviously, we have looked at what is going to look like going forward, but I don't think we have a specific number on 2025 EBITDA for this part.

No, you're absolutely right. This has been an integrated part of the Silicones business in France. So we don't have a precise number on that. We believe that we will have a -- how should I call it, a neutral to positive profitability going forward.

I should add that this -- to keep that asset obviously gives us a very stable outlet for silicon metal and value uplift on silicon metal into the European market. It's also very important for Bluestar to have a stable source of silox for their downstream operations. And we have entered into a long-term agreement that I think will be very beneficial for both parties.

And then we have a question related to debt and EBITDA and where do we see the net debt to EBITDA for the remaining Elkem after the NOK 1.5 billion equity raise?

Well, then we will be at a net interest-bearing debt of approximately NOK 8.3 billion. And as I said, we will be at approximately 3.6x EBITDA on a leverage. There will probably be an additional equity raise, which can change or lower that also somewhat. Our target is clearly to generate cash flow going forward, which enable a further deleverage of that number.

While we are into kind of equity raise, there is also a question about the agreed equity price issue or the conditions of the equity offering, if you're able to provide any further details on that?

More details on that will be provided later. I think the important issue today is that we have underwritten NOK 1.5 billion in new equity, very happy with the support from major shareholders, which clearly see this as a very good and attractive investment. And then we will provide more details on the structure and terms later in the process.

We have also received a question on the price exchange between Elkem and Bluestar and therefore, the implied EV of the sold assets.

Yes, that's a good question. I think we have provided all the relevant information. And of course, there are many ways to regard this. From our perspective, what's important is that we clearly believe that this is very attractive as seen from the minority interest and from the company's perspective. I think that has also been confirmed by opinions made by ABG and by DNB Carnegie. And as I also said, the important thing is that we now have secured a very, very good business structure for the future of Elkem and also a very good ownership structure.

Very good. Given the fact that we are seeking to enable the capital allocation to accelerate growth in Carbon Solutions and Silicon Products, are there any concrete opportunities that you are assessing?

Definitely, we have been looking at that for a long time. And I think that's a very good topic for the Capital Markets update that we will come back to in a few months. So let's get past this next milestones with the EGM and the closing of the deal. And then I think that will be a very, very interesting topic to discuss.

And also the last question goes more into kind of the future and the prospects for '26. We have guided on improved margins and results for '26. And the question is if you can elaborate a little bit on what is market related and what is cost efficiency related when it comes to that improvement.

I don't think we should go into those details on that now. But obviously, we are now reducing Elkem's organization and simplifying the business model. And it's a very good opportunity to streamline organization. So we have already been working on that for a while. So there we'll definitely be taking measures to reduce cost through efficiency improvement.

And then regarding the market, I think we're positive on the outlook. I think Q1, I mean, we have said there's still a lot of uncertainty. We don't guide beyond Q1. I think Q1, you can expect that to be in line with Q4, and then we are positive going forward.

Thank you very much. I don't have any further questions, and there doesn't seem to be any from the audience. So that concludes our presentations here today. So thank you very much for attending, and thank you to Helge, Morten for taking us through the 2 presentations.

Thank you.

Thank you.

Thank you.

Hello, and good morning, and a very warm welcome to Elkem's Third Quarter Results Presentation. My name is Odd-Geir Lyngstad, and I'm responsible for Investor Relations here in Elkem.

In today's presentation, we will go through the highlights for the quarter and give an update on the markets before we go through the outlook for the fourth quarter. CEO, Helge Aasen, will take us through this first part of the presentation before CFO, Morten Viga, will present the third quarter results in more detail. We will open for Q&A after Helge and Morten's presentations.

So with that, I give the word to CEO, Helge Aasen.

Thank you, Odd-Geir, and good morning, everyone. Very nice to see the turn up today. Yes, we seem to be repeating ourselves when it comes to describing the markets we operate in. The story about weak and challenging conditions doesn't seem to go away. And the market does actually remain much the same as it has been for a while now.

However, despite challenging macroeconomic environment, Elkem's results are relatively good, but of course, below our financial targets. The EBITDA for the third, I'm sorry, the EBITDA for the third quarter ended at NOK 829 million, which gave an EBITDA margin of 11% for the group. If you exclude silicones, the operating income ended at NOK 4.1 billion with an EBITDA of NOK 586 million, which then represents a margin of 14%. This result is to a great extent, explained by good operational performance and ongoing cost improvements.

Silicon Products was impacted by low silicon and ferrosilicon prices in the third quarter. But Specialty segment as Foundry alloys and Microsilica, which is a silica powder, delivered improved results. Carbon Solutions continued to deliver good margins, but the operating income and the following EBITDA is impacted by the lower sales. Silicones has improved on cost and market positions and delivered a higher EBITDA compared to the same period last year. The strategic review is ongoing. We gave an announcement some weeks ago, and I can just confirm that this is moving ahead as planned with an exclusive sales process, and we are still aiming for closing this transaction within the first half of next year.

So before we go on to the market update and the results, I'd like to say a few words about our ESG work. It's built on two main pillars: reduce CO2 emissions and to supply the green transition with critical materials. Our aim is to reduce and ultimately remove fossil CO2 emissions from the smelting processes.

Elkem supports the green transition through the supply of critical raw materials, and we work systematically to cut emissions and reduce waste throughout the entire value chain. Circularity is also playing an increasingly important role in this world. And we have introduced a new, actually a breakthrough method for recycling silicones through a mechanical recycling. And this then goes back into what used to be waste now is going back into new formulations.

Our efforts within ESG are also recognized with strong ratings from EcoVadis and CDP. And in the third quarter, we received a gold rating from EcoVadis, and this puts us among the top 5% of all the companies they are assessing globally. And over the past years, Elkem has consistently received either gold or platinum ratings from EcoVadis, which places us among the top of the companies they are rating.

Here, we show a couple of examples from Silicon Products and Carbon Solutions, illustrating some of our strong cost and market positions. I mentioned Microsilica initially. It's SiO2 silica powder, a byproduct from the ferrosilicon and silicon metal smelting processes. And over decades, we have developed this into a portfolio of specialty products, which go into quite a wide range of end applications. To mention some of them, construction, well drilling, cementing, refractories and also polymers.

Over the past years, this product area has consistently grown and shown stable high margins. And I think it's a very good excellent example of how we are able to specialize on the basis of commodity production capacity. We're also a leading producer of electrode paste, electrodes and refractory materials coming from Elkem Carbon. This goes into the metallurgical industry. And these products are probably not very familiar to you, but they are critical consumables and lining materials, which are very important for stable operations and lifetime in furnaces and electrolyser cells in the aluminum industry.

Also here, we are focusing on product development, and we have developed a more environmentally friendly product. With bio-based binders, which greatly improves working conditions. This solution has a proven performance record, and we have installed the product in more than 15,000 aluminum electrolytic cells. And we are gaining market share.

Competitive cost position can, of course, be explained by many factors, operational knowledge, operational excellence, economies of scale, upstream integration, et cetera. However, electric power is another, of course, very important cost factor in the production of most metals.

We have long-term supply agreements for renewable hydropower in Norway, Iceland, Canada, Paraguay. And access to long-term competitive energy contracts is a prerequisite for achieving competitiveness and also, of course, predictability in order to plan investments, et cetera. And renewable sourcing of energy also gives us a low carbon footprint, which clearly is, if not gaining or achieving premiums on end products, it gives us a preferential supplier status.

CRU, a global business intelligence company, have published their analysis of the 2025 cost curve, which is illustrated on the graph here. This is for silicon 99, silicon metal. And as you can see from the chart, this puts our Salten and Thamshavn plants in Norway among the lowest cost producers in the western part of the world.

Then coming to another important frame condition, which is trade barriers. That's affecting several markets and industries these days. And as you know, a highly dynamic and quite unpredictable environment. We are affected by this directly and indirectly. Two relevant examples are EU's ongoing safeguard assessment on silicon and on ferrosilicon and potentially silicon metal and also a U.S. countervailing duties assessment on silicon metal imports. EU safeguard measures could come into effect from November 19th. It's so far unclear how this is going to affect Elkem and how it will be structured.

The potential measures will be aimed at raising prices, obviously, and protecting internal production within the EU, but we don't know how Norway and Iceland will be positioned in it.

The regulations appear to focus on ferrosilicon and foundry alloys in this round, and there's no clear indication if silicon will be included. But most likely, silicon will be subject to another process at a later stage. The U.S. has imposed countervailing duties on silicon imported from several countries, including Norway with a preliminary rate of 16.87%.

The basis for these duties are the CO2 compensation and CO2 quotas that the Norwegian companies receive under EU's carbon schemes. And our position on this is that these policies are a compensation for CO2 tax and do not constitute countervailable subsidies harming the U.S. domestic industry. We have had similar cases in the past. And each time we have been able to document that there was no injury to U.S. industry.

So, we don't know the outcome of this round. It's now introduced as a preliminary measure, and then it will be followed by a permanent decision later on. Unclear when, partly because of the shutdown of the U.S. government at the moment.

A few more words on the strategic review process. It's underway, as I mentioned, and it is going according to plan. We cannot say much more about the process beyond the status update that we gave during the third quarter. We are in an exclusive sales process with a major industrial player with a significant presence in the global chemical industry.

The process is well aligned with the strategic review and represents an important milestone. And in a challenging market environment. But we are confident that the potential transaction will represent the best possible outcome for the silicones division in Elkem. And we're also confident that this process will be the best outcome for the rest of Elkem and as such, benefit to all stakeholders.Subject to further negotiations, final agreement and necessary approvals, the closing of the transaction is, as mentioned, expected to happen during the first half of next year.

Now let's have a look at the markets. Automotive continues to be an important sector for Elkem, driving demand for many of our products. The growth in this sector remains weak with the exception of China, where the production is up in 2025. This is mainly the case for electrical vehicles.

During the first half of 2025, the overall production in the EU is characterized by weak order intake and consequently low number of new registrations. Forward-looking forecasts have been revised upwards as markets adapt to ongoing trade and structural changes.

Europe's outlook is up, supported by improved expected demand in Germany, France, Austria and Turkey. China's forecast has increased due to incentives and export growth. But overcapacity and price competition clearly persist, especially for electrical vehicles. North America is also seeing upgrades driven by tariff relief and higher production. In South America, the gains are so far limited by very high import pressure. So, any improvement in the automotive sector will definitely have a positive impact for Elkem.

Several markets have been impacted by weak demand and various trade regulations and governmental initiatives. In the EU, the silicon reference price dropped by approximately 20% in late June. This was mainly due to low import prices from China, which suffer from, I would say, a severe oversupply.

Prices in the EU then recovered modestly again in September due to improved market balance. This was a result of capacity being taken out in Europe as well as higher prices in China. U.S. silicon prices have increased in the third quarter. This is expected to continue to rise due to trade regulations.

And in China, we have seen some price recovery from very low levels, mainly due to signals that the government will launch initiatives to curb overcapacity. Discussions are ongoing there regarding new energy consumption standards for the industry, which seems to be aimed at reducing overproduction.

The ferrosilicon markets have many of the same drivers as silicon. Also here, we have a market impacted by trade regulations and possible safeguard measures in the EU, which have resulted in price fluctuations. The market sentiment is still characterized by weak demand and downward price pressure.

However, based on the expected safeguard measures in the EU in August, we saw ferrosilicon prices jump up. This didn't last very long. It dropped back down again when it became clear that no preliminary measures would be announced. Prices in the U.S. increased towards the end of the third quarter. This was mainly driven by trade regulations.

And in China, we've also seen some recovery from very low levels, partly due to this government focus on reducing excess production capacity. It's also somewhat linked to higher raw material costs in China.

The market for carbon products is much smaller than silicon and ferrosilicon. We don't have reference prices to compare with here. Quite a big difference between regions when it comes to demand. But obviously, the underlying driver is the production of steel, which again triggers ferroalloy demand and then, of course, the aluminum industry.

Global steel production in the third quarter remained quite stable compared to the same quarter last year. Europe experienced a 3% decline, whereas North America saw a 3% increase, largely due to tariffs again.The steel and ferroalloys markets continue to face challenges. Carbon Solutions specialized product offering and wide geographic presence is, however, proving to be resilient and creating a stability in earnings.

Then moving on to silicones. Also like in silicon metal, overcapacity is significantly hampering any meaningful price recovery in the commodity part of the business. Producers are actively trying to increase the prices, and we've seen quite a lot of fluctuations in China, in particular, during the quarter.

DMC prices first rose from a level of around RMB 10,400 per tonne to up to RMB 12,250. This was a result of a fire at one of the bigger players. But due to the overcapacity, that was a very short-lived price uptick and prices subsequently lowered again because other producers are ready to fill the gap quite quickly. So, the current price level is around RMB 11,050 per tonne and quite sensitive to changes in raw material costs, where silicon metal obviously is one of the big input factors.

Demand in China continues to be weak, especially in construction. Demand for commodity silicones in the EU and the U.S. is also negatively impacted by changing tariff policies. But I would say, in general, there's quite good and stable demand for specialties.

So, coming to the outlook. Silicon Products are still going to face quite challenging conditions and low demand on a historical basis. But as mentioned in the presentation, our leading cost position and good performance in more specialized part of the business are mitigating the negative impact.

Carbon Solutions benefits from good cost positions and geographical diversity, and continued weak demand will have some impact on the results. Silicone producers are actively trying to increase prices. But as mentioned, the markets are still hampered by overcapacity. Potential trade regulations and protective measures are expected to impact our markets going forward. And of course, we are very eager to see the safeguard measures in the EU and how that's going to play out. It's not yet concluded, and very hard to say the overall impact on Elkem from this.

So I think with that, I'll give the word to you, Morten, and take us through the financials.

Thank you very much, Helge, and good morning, everybody. So it's a pleasure to go through the financial numbers for Q3. Our operating income for the quarter amounted to NOK 7.5 billion, and that's down 7% compared to the third quarter last year. All divisions had a decline in operating income this quarter, mainly explained by lower sales prices.

Elkem's EBITDA for the quarter was NOK 829 million. This was also well below the third quarter last year, but it's slightly higher than Q2 this year. The reported group EBITDA margin for the quarter amounted to 11%, which is somewhat below our long-term target of 15% to 20% EBITDA margin. Having said that, we should also emphasize that the EBITDA margin for the continuous operations, i.e., excluding silicone's was 14%.

And it is important to bear in mind that these margins are generated in a situation where sales prices in key markets are at or close to historical low levels. And as such, the EBITDA is not supported by market conditions, but it's held up by good operational performance and a very strong underlying cost position. There were no particular one-offs affecting the EBITDA in the third quarter.

As usual, we provide an overview of some of the main financial numbers and ratios. I will not go into detail on all of them, but it's important to note that the Silicones division has been reclassified as discontinued operations and assets held for sale. In this presentation, we mainly focus on the financial numbers, which include silicones. However, the regular financial statements, including the profit and loss statements, reflects Elkem's results excluding silicones. And in the table to the right, you can see the comparable figures for Elkem with and without silicones.

Including silicones, the group EBITDA amounted to NOK 829 million. The realized effects from the currency hedging program was minus NOK 16 million reported in the segment Other. Other items amounted to NOK 78 million and the main [Technical Difficulty] of minus NOK 17 million.

Net finance expenses were minus NOK 34 million. And here, the main items related to net interest expenses of minus NOK 114 million, which was largely offset by currency gains on NOK 96 million, mainly related to translation effects on our external loans.

The income tax was minus NOK 96 million, and this gives a very high effective tax rate of 65%. And the reason for that is that the Silicones division had a loss before income tax, which is rather high, and there is no tax in a major part of that division.

Let's then take a look at the divisions and start with the Silicon Products division. So, the silicon and ferrosilicon markets remained difficult, but the division's EBITDA for the third quarter was supported by good operating performance.

Total operating income amounted to NOK 3.4 billion, representing an 8% decrease compared to the same quarter in 2024. And the decline in operating income is mainly driven by lower sales prices for the commodity segments in silicon and ferrosilicon.

EBITDA amounted to NOK 389 million, representing an EBITDA margin of 12%. The EBITDA is higher than the previous quarter, but significantly lower than Q3 '24, and this is explained by significantly lower sales prices, particularly for silicon. This is partly countered by good and stable results from the specialty segments, particularly foundry alloys.

And as I said, in addition, the EBITDA is supported by strong operations and good cost improvements. Sales volume increased by 13% compared to the third quarter last year, mainly due to improved sales of specialty products.

So, if we look at the Carbon Solutions, this division is once again presenting a good margin, and it reached an EBITDA margin of 28% in the third quarter despite very challenging market conditions.

Total operating income amounted to NOK 822 million, which was down 7% from the third quarter last year. And this decline here is mainly explained by lower sales prices. The EBITDA was NOK 231 million, which represents an EBITDA margin of 28%. The EBITDA margin is in line with the previous quarter, but it's somewhat lower than Q3 '24, mainly explained by lower sales prices and somewhat higher raw material costs. The sales volume for the third quarter was in line with the previous quarter, but is negatively affected by low steel production, particularly in the EU.

As mentioned, and very well known, the Silicones division is under strategic review. The division has a good portfolio of specialty products, which provides to a large extent, stable sales and margins. But also, the division's exposure to the commodity market is still very significant. And particularly in China, we have seen strong price pressure hampering our margins. The division has, however, been able to compensate for lower commodity sales prices in the quarter through higher sales volumes and good cost improvements.

Total operating income amounted to NOK 3.6 billion, which was down 6% from the third quarter last year. Higher sales volume in the third quarter was more than offset by lower commodity sales prices. The EBITDA amounted to NOK 248 million, representing an EBITDA margin of 7%, and this is in line with the previous quarter, but it is significantly 23% higher than the third quarter last year, mainly driven by cost improvements and better sales volume.

Sales volume was up 10% compared to the third quarter last year, mainly due to higher sales volumes in the Asia Pacific region, where we also have introduced a new production line, higher capacity, and significantly stronger underlying cost position.

Let's now take a closer look at some of Elkem's key financial ratios. The earnings per share, EPS were quite low also in the third quarter with NOK 0.05 per share, and that brings the EPS year-to-date to minus NOK 0.77 per share.

And we are, of course, not satisfied with this, and we are working on further cost reductions and other improvements to mitigate the market situation. The EPS was also this quarter negatively impacted by net losses from the Silicones division, which is under strategic review. And if you exclude the Silicones division, the EPS for the third quarter would have been NOK 0.34 per share plus, and it would have been a positive NOK 0.40 per share year-to-date.The balance sheet remains very solid. Total equity amounts to NOK 24 billion by the end of third quarter, which equals an equity ratio of 50%, very stable level.

Elkem's financing position is well managed, and we have a very good and robust maturity profile. However, as you can see, the interest-bearing debt has continued to increase, and the current leverage is above our target level of 1 to 2x EBITDA last 12 months. By the end of the third quarter, our net interest-bearing debt amounted to NOK 11.7 billion, and that's up by NOK 0.3 billion from the previous quarter. And based on the last 12 months EBITDA, the debt leverage ratio is now 3.1.

Our target is clearly to bring down the leverage, and Elkem has a plan to deleverage the company after the strategic review process has been concluded, which we plan to achieve during the first half of next year. By the end of the third quarter, Elkem's interest coverage ratio was 6x, which is well within the covenant of 4x, which is the covenant in our loan agreements.

The cash flow from operation was NOK 526 million in the third quarter. We have a high emphasis on preserving and generating a good cash flow despite underlying market weaknesses. And this was a clear improvement from the previous quarters. It's explained by lower reinvestments and also positive working capital changes.

As already mentioned, the markets are weak, and we will definitely continue to focus on a very disciplined capital spending as long as the weak market conditions prevail. In the third quarter, total investments were down to NOK 312 million and reinvestments were NOK 244 million, which amounted to 39% of depreciation. Strategic investments are very much down and amounted only to NOK 68 million as we have completed all major strategic CapEx projects previously.

So let me take the opportunity to wrap up this presentation by summarizing the main headlines and takeaways from the quarter. We will continue to focus on cash generation and a very disciplined capital spending in response to the challenging market conditions.

We're very happy to see that Silicon Products has leading cost positions and strong performance within the specialty segments. And I think this is very important to bear in mind when the markets are really, really, really tough out there. Also, Carbon Solutions is in a very good position, and we benefit from good cost positions and a very geographically diverse customer base.

Silicones, also a very tough market, but we have improved our cost and market positions based on specialization and also based on new and more modern production lines, both in China and in France. The safeguard measures for ferrosilicon and ferroalloys in the EU and a new trade defense regime for steel in the EU could lead to improved market conditions if these measures are successfully supporting increased industry production in the EU, which is the intention.

The strategic review process is progressing as planned with an exclusive sales process ongoing. And as we said, we expect to have the transaction closed within the first half of 2026.

So I think that summarizes the presentation, and then I hand back the word toOdd-Geir for the Q&A session.

Thank you, Helge, and Thank you, Morten. We have a good audience here today. So I think we will start and see if there are any questions from the audience. There is Marcus?

Marcus Gavelli, Pareto Securities. So you talked about the safeguard measures, and clearly, we have no visibility right now. But could you try to provide some color on how you think about potentially worst-case scenario with higher tariffs and with Elkem potentially not being as competitive in the EU market. What sort of flexibility do you see having to redirect volumes and do other sort of measures to fight that?

I think if we are left on the outside of this and have to compete on the same basis as everybody else, EU is a big net importer of ferrosilicon. And I would claim that Norway and Iceland are among the best position to continue to supply that market. So I don't think we will have to redirect volumes. Obviously, we are very uncertain about how the price protection mechanism will be constructed or put together. But that could, of course, I would say, I don't see a big downside, but there is quite a significant upside if this is done in a way that favors us.

And also just to follow up on the, you mentioned the cost reductions that you're currently looking at. Could you also provide some color on what sort of measures that is? Is it, we've seen some ferrosilicon production now being curtailed? Is it more trying to optimize the production? Or is it actual larger reductions you're looking at?

This is a wide range of different measures. Obviously focusing on fixed cost reductions continuously, but it's also linked to a lot of optimization in production, producing campaigns where we have the best cost position in different plants and furnaces, and yield improvements. And yes, there's no one particular program that's yielding this, but a very big effort ongoing, and it's giving results over time.

Magnus Rasmussen, SEB. You have an improvement in the Silicon Products EBITDA Q-on-Q despite lower silicon metal prices, as you said in Q2. Our understanding is that after the decision that you were to be allocated more CO2 quotas, which you reported in early July, you have to purchase less CO2 quotas on a running basis to cover what was previously a deficit. Has that been a positive driver this quarter, and by how much?

Sounds like a CFO question.

Yes. You're absolutely right. We have got the ruling from the Norwegian Ministry, securing equal treatment with our European competitors. And that's very important. We have not yet received any additional quotas. Such things takes a bit of time, but we are very sure that we will receive a good amount of new quotas. And of course, that will put us in a much better position. There are no particular significant, let's say, CO2 quota P&L elements in our Q3 results.

When you, on a running basis, start to receive quotas on equal terms as your peers in Europe, then I assume you will not have to purchase quotas to cover that deficit as you've done in the past. Doesn't that imply that you will get a cost saving?

That is correct that in the future, there are 2 important things about this. First of all, equal treatment that's very important as a principle. And certainly, we will have significantly lower CO2 quota costs in the future when we receive those quotas, either late this year or early next year, we assume. So for our long-term competitiveness, it's good news, very good news.

And also, I see that your net interest-bearing debt in silicones is increasing by about NOK 375 million quarter-on-quarter. And it seems to me like more or less half of that is driven by you repaying what you label as bills payable in your balance sheet, and bills payable has come down by more than half over the past year. So, I'm just wondering why you are repaying that working capital financing ahead of the sale of the division?

No, that is kind of a working capital management done by the Chinese operation. So, I'm not able to give a precise answer to that. But they're managing this position. And as you rightly say, they have decided to repay some of that and reduce some of the bills outstanding.

Should we expect bills payable to be repaid ahead of the sale? And/or should we look at bills payable as interest-bearing debt when the sales price?

You should not look at bills payable as interest-bearing debt. So, it's part of the working capital management done locally in China.

Are there any further questions among the audience? If not, I think the questions are quite well covered from what I see here, but one additional question maybe that could, and that is how long you expect curtailments at Rana in Iceland to last, and also if any of our competitors are reducing capacity to the same extent?

Yes. We had an idle furnace in Rana, and we decided to postpone starting it up again. We are closely monitoring what's happening now. It's obviously inventory management, but it's also in anticipation of what will be the outcome of the safeguard decision in November. And then we have, we're going to stop one furnace in Iceland in mid-November, and that will be idle for 2 months, approximately, and what was the other part of the question?

Competition.

Yes, competition. Interestingly enough, Ferroglobe, which is our biggest competitor in silicon products in the conference, I think a couple of weeks ago, announced that they are now stopping all production in Europe. So, it says something about Elkem's competitive position.

Very good. Thank you very much. And that also concludes our presentation here today. So, thank you very much for attending.

Thank you.