Financial Overview

(in NOK million)	FY2006	FY2005	Rate of change
Overall
Operating revenues	196,234	171,231	14.6%
Operating income	52,224	46,237	12.9%
Net Income	17,224	15,542	10.8%
Aluminium Products
Operating revenues	49,844	42,477	17.3%
-Rolled products	23,227	19,490	19.2%
-Extrusion	20,418	16,826	21.3%
-Automotive	6,463	6,423	0.1%
Operating income	(83)	(370)	-
-Rolled products	782	754	3.7%
-Extrusion	231	275	(16.0%)
-Automotive	(1,006)	(1,579)	-
-Other and elimination	(90)	180	-

Aluminium Products
Alminium Products incurred an operating loss of NOK 83 million in FY2006, compared with an operating loss of NOK 370 million in FY2005. Its European extrusion and global building systems delivered a strong performance during FY2006. However, the FY2006 results were heavily influenced by writedowns and charges related to its ongoing restructing and divestment program.

Structure Change

The Company announced its aluminium tubing units in Workington, UK, and in Hannover, Germany, have been merged into a strategic business unit. The strategic business unit will specialize in welded tube manufacture. The Workington-based plant, specializes in smaller tubes for the automotive heat transfer market, while in Hannover plant specializes in larger tubes for structural applications.(From a press release by the company on Apr. 7, 2006)

Restructuring
The Company decided to close Becancour, Quebec-based magnesium plant during the first half of 2007. The timing of closure is in connection with the windup of a 10-year supply contract with General Motors. It is primarily the extensive export of very low-priced metal from China that is preventing continued production at Becancour, Canada. As a result of the Company's decision to exit the magnesium industry, it will work toward divesting its magnesium casthouses in Bottrop, Germany, and in Xi'an, China. (From a press release on Oct. 31, 2006)

In November 2006, the Company announced the sale of its automotive casting business. The sale was finalized in March 2007 resulting in a gain of about NOK 900 million.

The Company agreed to sell its 49-percent share in the Canadian company Meridian Technologies Inc. to a consortium led by Swiss holding company Estatia AG. The sale marks another step in the ongoing restructuring of the Company's downstream aluminium portfolio. Meridian Technologies, which is headquartered in Ontalio, Canada, is the world's largest supplier of die-cast magnesium components to the automotive industry. The transaction is based on an enterprise value of busienss of CAD 200 million (NOK 1.1 billion). (From a press release on Dec. 6, 2006)

Automotive sales volumes (1,000 tons to market)

-	FY2006	FY2005	FY2004
Precision tubing	65	60	70
Structures	40	50	65
Magnesium	85	100	100

R&D Structure
The automotive structures competence center is based at Raufoss, Norway with branches in :
-Oslo, Norway
-Munich, Germany
-Louviers, France
-Tonder, Denmark
-Worcester, England
-Michigan, USA

The Company is starting to work on the new technology center in Ardal, Norway. The investments is in the order of NOK 200 million, and the center is scheduled to open in 2007. (From a press release on Jun. 15, 2006)

R&D Expenditure

(NOK in million)	FY2006	FY2005	FY2004
Overall	726	716	760
Aluminium business	487	N.A	220

During FY2006, the Company allocated NOK 726 million to R&D. Roughly half of this goes to its in-house research organization, while the half supports work carried out at external institutions. Its aluminium business spent total of NOK 487 million in FY2006.

Capital Expenditure

(in NOK million)	FY2006	FY2005	FY2004
Oil & Energy	22,804	36,179	12,067
Aluminium Metal	1,979	1,792	4,244
Aluminium Products	1,250	1,970	1,951
Other Activities	647	1,097	1,058
Corporate & Eliminations	35	72	145
Total	26,713	41,110	19,464

Investments for Aluminium Products in 2006 related primarily to a revamp of the rolled products plant in Slim, Italy and the completion of the precision tubing plant in Reynosa, Mexico.