FINANCIAL RESULTS Q1 2018 CEO Christian Rynning-Tønnesen CFO Irene Egset 26 April 2018
Health, safety and environment TRI-rate 1 10 8 6 4 2 0 2016 2017 2018 Health and safety - No serious injuries in Q1 - Top priority to continuously improve safety performance Environment - No serious environmental incidents in Q1 2 1 TRI rate (12 months rolling): Total recordable injuries per million hours worked
Highlights in Q1 Record high hydropower generation Underlying EBIT of NOK 5962 million, up NOK 1972 million Performance improvement programme realised NOK 480 million so far Large gain from divestment of Dudgeon offshore wind farm Successful listing of Fjordkraft Strong result: Net profit amounting to NOK 10282 million, up NOK 7534 million Bordalsvatn 3
Cost reductions from the Performance Improvement Programme Estimated cost savings 2016-2018 800 320 480 Realised Remaining Target cost reduction 4
Exit from offshore wind completed: Large gains 30% share in Dudgeon divested with a gain of NOK 5.1 billion Statkraft s strategy to exit from offshore wind resulted in total recognised gains amounting to NOK 8.7 billion in addition to contributions from holding period Sheringham Shoal 5
Successful listing of Fjordkraft Statkraft divested its shares through the Initial Public Offering (IPO) Statkraft s subsidiary Skagerak Energi and associated company BKK continue as investors in Fjordkraft after the listing Gain amounting to NOK 1.7 billion 6
Outlook Robust earnings and strengthened financial position: - Europe s largest reservoir capacity and flexible power plants - Long-term contracts contribute to stabilising revenues and net profit - Ongoing performance improvement programme strengthens competitiveness - Divestments strengthen financial solidity Visualisation of a wind park at Fosen New renewable investments in hydro-, wind- and solar power 7
Key figures NOK million Q1 2018 Q1 2017 The year 2017 Net operating revenues and other income 8 884 6 972 23 350 Operating profit/loss (EBIT) underlying 5 962 3 990 10 824 Net profit 10 282 2 748 11 707 First quarter 2018: - Nordic prices measured in EUR up 24% Q-on-Q - Overall generation up 23% Q-on-Q Net profit impacted by gains from divestments of offshore wind asset and listing of Fjordkraft 8
Price drivers and the German power market 30 25 20 15 10 Coal, ARA (USD/t) 14 12 10 8 6 4 CO 2, EUA (EUR/t) 30 25 20 15 10 Gas, NBP/TTF (EUR/MWh) 5 2 5 0 1512 1603 1606 1609 1612 1703 1706 1709 1712 1803 0 1512 1603 1606 1609 1612 1703 1706 1709 1712 1803 0 1512160316061609161217031706170917121803 Q1 2018 vs. Q1 2017 Coal, CO 2 and gas prices increased German power prices down by 14% - Mainly related to higher nuclear and wind power generation German power prices (EEX base) Average quarterly price EUR/MWh -14% 45 40 35 30 25 20 15 10 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2015 2016 2017 2018 35,6 9
Nordic reservoir level 90 % 80 70 60 Median 2017 50 40 30 20 10 0 2018 Q1 Q2 Q3 Q4 Nordic reservoir level (total market) was below median at 81% end of March due to cold and dry weather. 10
Nordic power prices 45 Average monthly spot price EUR/MWh 40 35 30 25 20 15 10 5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2015 2016 2017 2018 Nordic power prices 38.6 EUR/MWh, up 24% Q1 2018 vs. Q1 2017 11
Energy management Monthly power generation TWh 2017 2018 6 4 2 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Q1 generation up 23% Q-on-Q Technology TWh Change in TWh Hydropower 19.9 4.1 Wind power 0.6-0.2 Gas power 0.4-0.1 Bio and solar power 0.1 - Total 21.0 3.9 12
Q1 net operating revenues and other income NOK million 8 884 8 160 Q1 2017 Q1 2018 5 456 6 972 835 0 320 288 490 474 243 233 267-24 Generation Sale of gas Customers Grid and other revenues Sales revenues less energy purchase Trading & Origination Other operating income -339-548 Transmission costs Total net operating revenues and other income 13
NOK 6 billion in underlying EBIT NOK million 10 824 Underlying EBIT up NOK 1972 million Q-on-Q 5 962 Primarily a result of - higher Nordic power prices - record high generation 3 990 Q1 2017 Q1 2018 FY 2017 Q1 18/Q1 17 +49% 14
Financial items Breakdown Net financial items Q1 2018 NOK million 5 064 5 428 88 548-272 Interest income Interest expenses Currency gains and losses Other Net financial items Q1 2018 financial items 15
Net profit NOK million Q1 2018 Q1 2017 The year 2017 Net profit 10 282 2 748 11 707 Solid contributions from operating activities Gains from divestment of offshore wind assets and listing of Fjordkraft 16
Q1 net profit breakdown Underlying EBIT Q1 2017 Q1 2018 NOK million Underlying EBIT Q1 2018 Net Profit Q1 2018 5 428 2 689 10 282 1 913 59 5 962 1 460 10 500 3 990 368 Q1 2017 Operating profit/loss (EBIT) underlying Net operating revenues and other income Operating expenses Q1 2018 Operating profit/loss (EBIT) underlying Unrealised value changes from energy derivatives Gain/loss from acquisitions/ divestments of business activities Impairments Share of profit/loss in equity accounted investments Net financial items Tax Q4 2017 Net profit Underlying EBIT +49% vs. Q1/17. Booked net profit affected by items gains from divestments 17
Q1 segment financials NOK million 4 872 2 648 2017 2018 Operating profit/loss (EBIT) underlying 653 170 156 191 80 87 131 605 614-15 European flexible generation Market operations International power Wind power District heating Industrial ownership 432 279 Share of profit/ loss in equity accounted investments 39 60 12 15 European flexible generation Market operations International power Wind power District heating Industrial ownership 18
Q1 2018 capital expenditure 1 Other 2 5% Industrial ownership 23% Wind power 28% NOK 0.9 billion European flexible generation 28% International power 17% Distribution of CAPEX in the quarter: - 54% expansion investments - 45% maintenance/other investments - 1% shareholdings New hydropower capacity under construction in Albania Wind power developments in Norway Maintenance primarily within Nordic hydropower and Norwegian grid 19 1 Excluding loans to equity accounted investments 2 Including District heating, Market operations and Other activities
Cash flow in Q1 NOK million 28 000 26 000 24 000 22 000 20 000 18 000 16 000 14 000 12 000 10 000 8 000 6 000 4 000 2 000 0 14 217 Cash reserves 01.01 5 813 64 21 352 6 277 4 889 From operations Investment activities Changes in debt Currency effects Cash reserves 31.03 20
Long-term debt repayment profile 10 000 8 000 6 000 4 000 2 000 0 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 >2028 NOK 2.2 billion debt repurchased in Q1 NOK 13.3 billion in net interest-bearing debt (NOK 32.4 billion in Q1 2017) - NOK 35%, EUR 59%, USD 2%, BRL 3%, CLP/CLF 1% - Average maturity: 5.6 years - Net interest-bearing debt-equity 11.8% 21
Strong credit ratings A- / Stable Baa1 / Stable Maintaining current ratings with S&P and Moody s Strong support from owner CAPEX adapted to financial capacity Rating impact assessment completed prior to new investment decisions 22
Summary Delivering on strategy Strong underlying operations Robust financial position Solid foundation for further growth in renewable energy 23
THANK YOU Investor contacts: Debt Capital Markets Financial information Funding manager Stephan Skaane Senior Financial Advisor Arild Ratikainen Phone: +47 905 13 652 Phone: +47 971 74 132 E-mail: Stephan.Skaane@statkraft.com E-mail: Arild.Ratikainen@statkraft.com Vice President Tron Ringstad Vice President Bjørn Inge Nordang Phone: +47 905 13 652 Phone: +47 913 59 865 E-mail: Tron.Ringstad@statkraft.com E-mail: Bjorn.Nordang@statkraft.com www.statkraft.com