YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION

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YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION

  1. 1. YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION PAGE CONTENT FOURTH QUARTER 02 Transition to International Financial Reporting Standards (IFRS) 03 Changes in IFRS opening balance implementation effects 03 Reconciliation of equity from NGAAP to IFRS at 1 January 2004 and 31 December 2004 04 Actual/Pro Forma 4Q and 2004 Consolidated Statements of Income - reconciliation from NGAAP to IFRS 05 Actual Consolidated Balance Sheets - reconciliation from NGAAP to IFRS at 31 December 2004 06 Pro Forma YTD 2004 Consolidated Statements of Cash Flow - reconciliation from NGAAP to IFRS THIRD QUARTER 07 Actual/Pro Forma 3Q and YTD 2004 Consolidated Statements of Income - reconciliation from NGAAP to IFRS 08 Actual Consolidated Balance Sheets - reconciliation from NGAAP to IFRS at 30 September 2004 09 Pro Forma YTD 2004 Consolidated Statements of Cash Flow - reconciliation from NGAAP to IFRS 09 Reconciliation of equity from NGAAP to IFRS at 30 September 2004 SECOND QUARTER 10 Actual/Pro Forma 2Q and YTD 2004 Consolidated Statements of Income - reconciliation from NGAAP to IFRS 11 Actual Consolidated Balance Sheets - reconciliation from NGAAP to IFRS at 30 June 2004 12 Pro Forma YTD 2004 Consolidated Statements of Cash Flow - reconciliation from NGAAP to IFRS 12 Reconciliation of equity from NGAAP to IFRS at 30 June 2004 FIRST QUARTER 13 Pro forma 1Q 2004 Consolidated Statements of Income - reconciliation from NGAAP to IFRS 14 Pro forma 1Q 2004 Consolidated Balance Sheets - reconciliation from NGAAP to IFRS at 31 March 2004 15 Pro forma 1Q 2004 Consolidated Statements of Cash Flow - reconciliation from NGAAP to IFRS 15 Reconciliation of equity from NGAAP to IFRS at 31 March 2004 16 Consolidated Statements of Income - reconciliation from NGAAP to IFRS 2004 (Pro forma and Actual) 16 Reconciliation of Net Income from NGAAP to IFRS 17 Consolidated Statements of Cash Flow - reconciliation from NGAAP to IFRS 2004 (Pro forma and Actual) 18 Consolidated Statements of Income - IFRS quarterly information 2004 18 IFRS 2004 - Reconciliation of EBITDA to Income Before Tax and Minority Interest 19 IFRS 2004 - Operating Segment information 20 IFRS 2004 - Reconciliation from operating income to EBITDA Reconciliation 1Q 2004 from NGAAP to IFRS, are only stated for the Pro forma figures, as there are no IFRS-adjustments made for the period 25 March 2004 - 31 March 2004
  2. 2. 2 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION Q4 2005 TRANSITION TO INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) From 1 January 2005 Yara International ASA SUMMARY OF SIGNIFICANT DEFERRED TAXES with subsidiaries (“Yara”) prepares consolidated CHANGES IN ACCOUNTING The main implementation effects related to financial statements in accordance with POLICIES deferred taxes are explained by changes in International Financial Reporting Standards temporary differences resulting from other (IFRS) as adopted by the EU. PENSIONS IFRS implementation effects. In addition, Yara has decided to use the exemption under deferred taxes related to elimination of profit A summary of significant changes to Yara's IFRS 1, which permits that previously unrecog- in inventories are adjusted to reflect the tax accounting policies resulting from the transi- nized actuarial gains and losses as of 1 January rate of the receiving country. Under NGAAP tion to IFRS is given below. Reconciliations 2004 are booked directly to equity in the tran- the tax rate of the selling country was applied. between previously reported financial results sition to IFRS. Furthermore, the unconditional and financial results restated in accordance part of unrecognized past service costs is CURRENCY TRANSLATION with IFRS are also presented on the following recorded directly to equity at the date of EFFECTS ON EQUITY pages. implementation. Yara presents its pension lia- Yara has taken the exemption under IFRS 1 bilities at fair value in the balance sheet. that allows re-setting of cumulative currency IFRS 1 “First-Time Adoption of IFRS” was Actuarial gains and losses are recorded direct- translation effects to zero. Gains and losses applied in preparing the financial statements. ly to equity. Financial elements in defined ben- related to sales of subsidiaries in 2004 have Yara's IFRS accounting policies, except for efit plans were reported as payroll and related been restated accordingly. those related to Financial Instruments (IAS 32 costs under NGAAP while they are reported , and IAS 39), were consistently applied to all as financial items under IFRS. GOODWILL the periods presented. Yara has used the Under NGAAP goodwill was amortized. Under , exemption available under IFRS 1 to apply IAS SPARE PARTS IFRS, goodwill is not amortized, but tested for 32 and IAS 39 from 1 January 2005. Critical and major spare parts have been impairment at least once a year, and written reclassified from Inventory to Property, Plant down if impaired. Up to 31 December 2004, Yara's consolidated & Equipment in order to comply with IAS 16. financial statements were prepared in accor- DIVIDENDS dance with accounting principles generally CATALYSTS Under NGAAP dividends proposed at the end , accepted in Norway (“NGAAP”). NGAAP Catalysts used in the production of ammonia of the year and paid in the following year, were differs from IFRS in some areas. When and nitric acid were previously classified as recorded as a reduction to equity and as debt. preparing its consolidated IFRS financial inventory in the balance sheet and recorded as Under IFRS, dividends are accrued when statements, Yara has amended its accounting product variable costs in the profit & loss declared. policies compared to those previously applied statement. Under IFRS these catalysts are under NGAAP The comparative figures . treated as Property, Plant & Equipment and SHARE INCENTIVE RIGHTS for 2004 were restated to reflect these recorded as depreciation expense. Under NGAAP the expense related to the , adjustments. share incentive program was calculated based MAJOR INSPECTIONS AND PLANT on the intrinsic value method. Under IFRS, the The financial information presented below MAINTENANCE SHUTDOWNS share incentive program is recorded at fair is prepared on the basis of the IFRS stan- Accruals for major plant maintenance shut- value in accordance with IFRS 2. dards and interpretations in force on 31 downs were recorded under NGAAP Provisions . December 2005. The numbers in the tables for plant maintenance shutdowns are not per- FINANCIAL INSTRUMENTS are unaudited. mitted under IFRS. Subsequent costs related Yara has chosen to use the option under IFRS to plant maintenance shutdowns are capital- 1 to apply IAS 32 and IAS 39 from 1 January, ized if the recognition criteria under IFRS are 2005. The IFRS implementation effect is relat- met, and depreciated over the period up to the ed to embedded derivatives, which are record- next planned plant maintenance shutdown. ed at fair value in IFRS.
  3. 3. 3 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CHANGES IN IFRS OPENING BALANCE IMPLEMENTATION EFFECTS When preparing the IFRS consolidated financial in the period as well as more accurate IFRS IFRS income statement. An updated reconcili- statements for 2005 Yara determined that certain reporting from our non-consolidated investees. ation of equity from NGAAP to IFRS for 2004 adjustments would be required in numbers previ- The adjustments also impacts deferred taxes is presented below. ously presented as preliminary IFRS implemen- due to the changes in temporary differences tation effects – Pro Forma as at 1 January 2004. resulting from the adjustments. The net The previously presented transition to IFRS impact is a reduction of equity of MNOK 143. information for 1Q, 2Q, 3Q and 4Q has been The adjustments have mainly been caused by The impact on net income for 2004 of the updated and can be found on the following changes in assumptions in the calculations of adjustments is immaterial and no adjustment pages. pension obligations, changes in interpretation has been made to the previously presented RECONCILIATION OF EQUITY FROM NGAAP TO IFRS Majority share- Net Income after Recorded Currency trans- Majority share- holders' equity minority interest directly to equity lation effects holders' equity IFRS Implementation effects - Pro Forma 1 Jan 2004 2004 2004 2004 31 Dec 2004 NGAAP 9,595 3,761 (1,954) (688) 10,714 IFRS implementation effects: Pensions (1,156) 91 70 21 (975) Plant maintenance shut downs 509 (6) (10) 493 Deferred taxes 177 (26) (15) (7) 128 Gain on sale of foreign subsidiaries (26) 26 - Goodwill amortization 4 4 Dividend 712 712 Stock based compensation (4) (4) Non-consolidated investees (39) 2 (37) IFRS 9,085 3,794 (1,161) (684) 11,035 Implementation of IAS 32 & 39 on 1 January 2005 (7) IFRS - 1 January 2005 11,028
  4. 4. 4 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF INCOME NGAAP/IFRS Statements of Income NGAAP/IFRS Statments of Income Actual Actual Actual Pro Forma Pro Forma Pro Forma NGAAP IFRS ADJ. IFRS NGAAP IFRS ADJ. IFRS NOK millions, except share information 4Q 2004 4Q 2004 4Q 2004 Year 2004 Year 2004 Year 2004 Revenue 11,158 - 11,158 43,066 - 43,066 Other Income 149 (1) 148 185 (26) 160 Revenue and Other Income 11,307 (1) 11,305 43,252 (26) 43,226 Raw materials, energy costs and freight expenses 8,777 (43) 8,734 32,870 (217) 32,653 Change in inventories of own production (172) - (172) 155 - 155 Payroll and related costs 975 (40) 935 3,600 (156) 3,444 Depreciation and amortization 319 49 368 1,208 219 1,427 Other 522 4 526 1,833 4 1,837 Operating costs and expenses 10,421 (29) 10,392 39,667 (150) 39,518 Operating Income before financial items 886 28 914 3,584 124 3,708 Share of net income in non-consolidated investees 203 - 203 768 - 768 Interest income and other financial income 52 - 52 171 - 171 Earnings before interest expense and tax (EBIT) 1,141 28 1,169 4,523 124 4,647 Foreign exchange gain/(loss) 417 - 417 737 - 737 Interest expense and other financial items (78) (16) (94) (334) (65) (399) Income before tax and minority interest 1,478 12 1,490 4,926 59 4,985 Income tax expense (231) (4) (235) (1,185) (26) (1,211) Net Income 1,248 8 1,255 3,741 33 3,775 Minority interest (5) - (5) 20 - 20 Net Income after minority interest 1,243 8 1,251 3,761 33 3,794 Earnings per share 3.91 0.02 3.94 11.79 0.10 11.90 Average number of shares outstanding 1) 317,438,181 317,438,181 317,438,181 318,938,750 318,938,750 318,938,750 1) Average number of shares outstanding was reduced in fourth quarter 2004 due to the share buy-back program.
  5. 5. 5 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED BALANCE SHEETS NGAAP/IFRS Balance Sheets 31 December Actual Actual Actual NGAAP IFRS ADJ. IFRS NOK millions, except for number of shares information 2004 2004 2004 Assets Non-current assets Deferred tax assets 1,362 116 1,478 Other intangible assets 284 (148) 136 Property, plant and equipment 6,786 597 7,383 Non-consolidated investees 2,558 (37) 2,521 Prepaid pension, investments and other non-current assets 1,151 (597) 554 Total non-current assets 12,141 (68) 12,073 Current assets Inventories 5,814 (288) 5,526 Accounts receivable, less allowances 6,518 - 6,518 Prepaid expenses and other current assets 1,766 - 1,766 Other liquid assets 16 - 16 Cash and cash equivalents 1,230 - 1,230 Total current assets 15,345 (288) 15,056 Total assets 27,486 (357) 27,129 Liabilities and shareholders' equity Equity Share capital 543 - 543 - Treasury shares (5) - (5) Premium paid-in capital 3,703 - 3,703 Total paid-in capital 4,241 - 4,241 Retained earnings 6,674 321 6,995 - Treasury shares (201) - (201) Total majority shareholders' equity 10,714 321 11,035 Minority shareholders' interest in consolidated subsidiaries 63 - 63 Shareholders' equity 10,777 321 11,098 Non-current liabilities Accrued pension liabilities 1,846 213 2,059 Deferred tax liabilities 1,037 (13) 1,024 Other long-term liabilities 430 (52) 378 Long-term interest bearing debt 4,494 - 4,494 Total non-current liabilities 7,808 148 7,956 Current liabilities Bank loans and other interest-bearing short-term debt 776 - 776 Current portion of long-term debt 175 - 175 Dividends payable 712 (712) - Other current liabilities 7,238 (114) 7,123 Total current liabilities 8,901 (826) 8,074 Total liabilities and shareholders' equity 27,486 (357) 27,129 Total number of shares outstanding 1) 316,441,190 316,441,190 316,441,190 1) Number of shares outstanding was reduced in fourth quarter 2004 due to the share buy-back program.
  6. 6. 6 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF CASH FLOW NGAAP/IFRS Pro Forma Statements of Cash Flow Pro Forma NGAAP Pro Forma IFRS ADJ. Pro Forma IFRS NOK millions Year 2004 Year 2004 Year 2004 Operating activities Operating Income 3,584 124 3,708 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 1,208 219 1,427 Tax paid (555) - (555) Dividend from non-consolidated investees 385 - 385 Change in net operating capital (427) 25 (402) Other (423) (44) (467) Net cash provided by operating activities 3,772 324 4,096 Investing activities Purchases of property, plant and equipment (974) (324) (1,297) Purchases of other long-term investments (251) - (251) Net sales (purchases) of short-term investments 9 - 9 Proceeds from sales of property, plant and equipment 67 - 67 Proceeds from sales of other long-term investments 163 - 163 Net cash used in investing activities (986) (324) (1,310) Financing activities Net cash used in financing activities (2,851) - (2,851) Foreign currency effects on cash flows 142 - 142 Net increase (decrease) in cash and cash equivalents 77 - 77 Cash and cash equivalents at beginning of period 1,153 - 1,153 Cash and cash equivalents at end of period 1,230 - 1,230
  7. 7. 7 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION Q3 2005 CONSOLIDATED STATEMENTS OF INCOME NGAAP/IFRS Statements of Income NGAAP/IFRS Statments of Income Actual Actual Actual Pro Forma Pro Forma Pro Forma NGAAP IFRS ADJ. IFRS NGAAP IFRS ADJ. IFRS NOK millions, except share information 3Q 2004 3Q 2004 3Q 2004 YTD 2004 YTD 2004 YTD 2004 Revenues 10,876 - 10,876 31,908 - 31,908 Other income 18 (8) 10 36 (24) 12 Operating Revenues 10,893 (8) 10,885 31,945 (24) 31,920 Raw materials, energy costs and freight expenses 8,367 (66) 8,300 24,093 (174) 23,919 Change in inventories of own production 117 - 117 327 - 327 Payroll and related costs 864 (39) 826 2,626 (117) 2,509 Depreciation and amortization 287 57 344 890 170 1,059 Other 466 - 466 1 311 - 1,311 Operating costs and expenses 10,100 (48) 10,052 29,247 (121) 29,126 Operating Income before financial items 794 40 834 2,698 96 2,794 Share of net income in non-consolidated investees 243 - 243 565 - 565 Interest income and other financial income 55 - 55 119 - 119 Earnings before interest expense and tax (EBIT) 1,092 40 1,132 3,382 96 3,478 Foreign exchange gain/(loss) 54 - 54 320 - 320 Interest expense and other financial items (85) (16) (102) (254) (49) (303) Income before tax and minority interest 1,060 24 1,084 3,448 48 3,496 Income tax expense (308) (10) (318) (954) (22) (976) Net income 752 14 766 2,494 26 2,519 Minority interest (7) - (7) 24 - 24 Net Income after minority interest 745 14 759 2,518 26 2,544 Earnings per share 2.33 0.04 2.38 7.88 0.08 7.96 Average number of outstanding shares 319,442,590 319,442,590 319,442,590 319,442,590 319,442,590 319,442,590
  8. 8. 8 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED BALANCE SHEETS NGAAP/IFRS Balance Sheets Actual Actual Actual NGAAP IFRS ADJ. IFRS NOK millions, except for number of shares information as of 30.09 2004 as of 30.09 2004 as of 30.09 2004 Assets Non-current assets Deferred tax assets 1,037 120 1,157 Other intangible assets 246 (139) 107 Property, plant and equipment 6,806 547 7,353 Non-consolidated investees 2,780 (40) 2,741 Prepaid pension, investments and other non-current assets 1,069 (507) 562 Total non-current assets 11,939 (19) 11,920 Current assets Inventories 5,973 (285) 5,688 Accounts receivable, less allowances 7,158 - 7,158 Prepaid expenses and other current assets 1,353 - 1,353 Other liquid assets 27 - 27 Cash and cash equivalents 1,174 - 1 174 Total current assets 15,685 (285) 15,400 Total assets 27,624 (304) 27,320 Liabilities and shareholders' equity Equity Share capital 543 - 543 Premium paid-in capital 3,703 - 3,703 Total paid-in capital 4,246 - 4,246 Retained earnings 6,763 (464) 6,298 Total majority shareholders' equity 11,009 (464) 10,545 Minority shareholders' interest in consolidated subsidiaries 64 - 64 Shareholders' equity 11,073 (464) 10,608 Non-current liabilities Accrued pension liabilities 1,821 425 2,245 Deferred tax liabilities 1,110 (31) 1,079 Other long-term liabilities 509 (103) 406 Long-term interest bearing debt 5,259 - 5,259 Total non-current liabilities 8,699 291 8,989 Current liabilities Bank loans and other interest-bearing short-term debt 742 - 742 Current portion of long-term debt 50 - 50 Other current liabilities 7,060 (130) 6,930 Total current liabilities 7,853 (130) 7,722 Total liabilities and shareholders' equity 27,624 (304) 27,320 Total number of outstanding shares 319,442,590 319,442,590 319,442,590
  9. 9. 9 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF CASH FLOW NGAAP/IFRS Pro forma Statements of Cash Flow Pro Forma Pro Forma Pro Forma NOK millions NGAAP YTD 2004 IFRS ADJ. IFRS YTD 2004 Operating activities Operating Income 2,698 96 2,794 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 890 170 1,059 Tax paid (242) - (242) Dividend from non-consolidated investees 380 - 380 Change in net operating capital (1,066) 23 (1,043) Other 423 (69) 354 Net cash provided by operating activities 3,083 220 3,302 Investing activities Purchases of property, plant and equipment (578) (220) (798) Purchases of other long-term investments (146) - (146) Net sales (purchases) of short-term investments (2) - (2) Proceeds from sales of property, plant and equipment 51 - 51 Proceeds from sales of other long-term investments 98 - 98 Net cash used in investing activities (577) (220) (797) Financing activities Net cash used in financing activities (2,609) - (2,609) Foreign currency effects on cash flows 124 - 124 Net increase (decrease) in cash and cash equivalents 21 - 21 Cash and cash equivalents at beginning of period 1,153 - 1,153 Cash and cash equivalents at end of period 1,174 - 1,174 RECONCILIATION OF EQUITY FROM NGAAP TO IFRS NOK millions Majority shareholders' equity 30 September 2004 NGAAP 11,009 IFRS implementation effects: Pensions (1,088) Plant maintenance shutdowns 509 Deferred taxes 152 Goodwill amortization 3 Non-consolidated investees (40) IFRS 10,545
  10. 10. 10 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION Q2 2005 CONSOLIDATED STATEMENTS OF INCOME NGAAP/IFRS Statements of Income NGAAP/IFRS Statments of Income Actual Actual Actual Pro Forma Pro Forma Pro Forma NGAAP IFRS ADJ. IFRS NGAAP IFRS ADJ. IFRS NOK million, except per share information 2Q 2004 2Q 2004 2Q 2004 YTD 2004 YTD 2004 YTD 2004 Revenues 10,138 - 10,138 21,033 - 21,033 Other income 22 (22) 0 18 (16) 2 Operating Revenues 10,160 (22) 10,138 21,051 (16) 21,035 Raw materials, energy costs and freight expenses 7,521 (51) 7,470 15,726 (108) 15,618 Change in inventories of own production 114 - 114 211 - 211 Payroll and related costs 883 (38) 845 1,761 (78) 1,683 Depreciation and amortization 300 57 356 603 113 716 Other 441 - 441 846 - 846 Operating costs and expenses 9,259 (33) 9,226 19,147 (73) 19,074 Operating Income before financial items 901 11 912 1,904 56 1,961 Share of net income in non-consolidated investees 180 - 180 322 - 322 Interest income and other financial income 34 - 34 64 - 64 Earnings before interest expense and tax (EBIT) 1,115 11 1,125 2,290 56 2,346 Foreign exchange gain/(loss) (13) - (13) 266 - 266 Interest expense and other financial items (60) (16) (77) (168) (33) (201) Income before tax and minority interest 1,041 (6) 1,036 2,388 24 2,412 Income tax expense (228) (6) (234) (646) (12) (658) Net income 813 (12) 801 1,742 12 1,753 Minority interest (2) - (2) 31 - 31 Net Income after minority interest 811 (12) 800 1,773 12 1,785 Earnings per share 2.54 (0.04) 2.50 5.55 0.04 5.59 Average number of outstanding shares 1) 319,442,590 319,442,590 319,442,590 319,442,590 319,442,590 319,442,590 1) Average number of shares outstanding was reduced in fourth quarter 2004 due to the share buyback program.
  11. 11. 11 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED BALANCE SHEETS NGAAP/IFRS Actual Balance Sheets Actual Actual Actual NGAAP IFRS ADJ. IFRS NOK million, except for number of shares as of 30.06. 2004 as of 30.06. 2004 as of 30.06. 2004 Assets Non-current assets Deferred tax assets 1,075 133 1,208 Other intangible assets 233 (141) 92 Property, plant and equipment 6,933 455 7,388 Non-consolidated investees 2,574 (41) 2,533 Prepaid pension, investments and other non-current assets 1,063 (529) 534 11,878 (124) 11,755 Current assets Inventories 5,259 (273) 4,987 Accounts receivable, less allowances 6,685 - 6,685 Prepaid expenses and other current assets 1,145 - 1,145 Other liquid assets 26 - 26 Cash and cash equivalents 1,419 - 1,419 14,535 (273) 14,262 Total assets 26,414 (396) 26,017 Liabilities and shareholders' equity Equity Share capital 543 - 543 Premium paid-in capital 3,703 - 3,703 Total paid-in capital 4,246 - 4,246 Retained earnings 6,204 (492) 5,712 Total majority shareholders' equity 10,451 (492) 9,959 Minority shareholders' interest in consolidated subsidiaries 60 - 60 Shareholders' equity 10,511 (492) 10,019 Non-current liabilities Accrued pension liabilities 1,804 433 2,237 Deferred tax liabilities 1,125 (31) 1,094 Other long-term liabilities 514 (93) 421 Long-term interest bearing debt 5,328 - 5,328 8,771 309 9,081 Current liabilities Bank loans and other interest-bearing short-term debt 618 - 618 Current portion of long-term debt 16 - 16 Other current liabilities 6,497 (214) 6,284 7,131 (214) 6,918 Total liabilities and shareholders' equity 26,414 (396) 26,017 Total number of outstanding shares 319,442,590 319,442,590 319,442,590
  12. 12. 12 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF CASH FLOW NGAAP/IFRS Pro forma Statements of Cash Flow Pro Forma Pro Forma Pro Forma NOK million NGAAP YTD 2004 IFRS ADJ. IFRS YTD 2004 Operating activities Operating Income 1,904 56 1,961 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 603 113 716 Tax paid (160) - (160) Dividend from non-consolidated investees 348 - 348 Change in net operating capital 128 8 136 Other 540 (114) 426 Net cash provided by operating activities 3,363 64 3,426 Investing activities Purchases of property, plant and equipment (357) (64) (420) Purchases of other long-term investments (96) - (96) Net sales (purchases) of short-term investments 1 - 1 Proceeds from sales of property, plant and equipment 28 - 28 Proceeds from sales of other long-term investments 63 - 63 Net cash used in investing activities (361) (64) (424) Financing activities Net cash used in financing activities (2,835) - (2,835) Foreign currency effects on cash flows 99 - 99 Net increase (decrease) in cash and cash equivalents 266 - 266 Cash and cash equivalents at beginning of period 1,153 - 1,153 Cash and cash equivalents at end of period 1,419 - 1,419 RECONCILIATION OF EQUITY FROM NGAAP TO IFRS Majority shareholders' equity 30 June 2004 NGAAP 10,451 IFRS implementation effects: Pensions (1,121) Plant maintenance shut downs 504 Deferred taxes 164 Goodwill amortization 2 Non-consolidated investees (41) IFRS 9,959
  13. 13. 13 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION Q1 2005 CONSOLIDATED STATEMENTS OF INCOME NGAAP/IFRS Statements of Income Pro Forma Pro Forma Pro Forma NGAAP IFRS ADJ. IFRS NOK million, except per share information 1Q 2004 1Q 2004 1Q 2004 Revenues 10,895 - 10,895 Other income (4) 6 2 Operating Revenues 10,891 6 10,897 Raw materials, energy costs and freight expenses 8,205 (56) 8,149 Change in inventories of own production 97 - 97 Payroll and related costs 878 (39) 838 Depreciation and amortization 303 56 359 Other 405 - 405 Operating costs and expenses 9,888 (40) 9,848 Operating Income before financial items 1,003 46 1,049 Share of net income in non-consolidated investees 142 - 142 Interest income and other financial income 30 - 30 Earnings before interest expense and tax (EBIT) 1,175 46 1,221 Foreign exchange gain/(loss) 279 - 279 Interest expense and other financial items (108) (16) (125) Income before tax and minority interest 1,347 29 1,376 Income tax expense (418) (6) (424) Net income 929 23 952 Minority interest 33 - 33 Net Income after minority interest 962 23 985 Earnings per share 3.01 0.07 3.08 Average number of outstanding shares 319,442,590 319,442,590 319,442,590
  14. 14. 14 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED BALANCE SHEETS Actual Actual Actual NGAAP IFRS ADJ. IFRS NOK million, except for number of shares information as of 31.03 2004 as of 31.03 2004 as of 31.03 2004 Assets Non-current assets Deferred tax assets 1,047 137 1,184 Other intangible assets 242 (143) 99 Property, plant and equipment 7,120 486 7,606 Non-consolidated investees 2,511 (41) 2,470 Prepaid pension, investments and other non-current assets 1,060 (496) 564 11,980 (57) 11,922 Current assets Inventories 5,384 (274) 5,110 Accounts receivable, less allowances 7,677 - 7,677 Prepaid expenses and other current assets 1,157 - 1,157 Other liquid assets 30 - 30 Cash and cash equivalents 1,501 - 1,501 15,748 (274) 15,475 Total assets 27,728 (331) 27,397 Liabilities and shareholders' equity Equity Share capital 543 - 543 Premium paid-in capital 3,703 - 3,703 Total paid-in capital 4,246 - 4,246 Retained earnings 5,474 (509) 4,965 Total majority shareholders' equity 9,721 (509) 9,211 Minority shareholders' interest in consolidated subsidiaries 64 - 64 Shareholders' equity 9,784 (509) 9,275 Non-current liabilities Accrued pension liabilities 1,774 494 2,269 Deferred tax liabilities 945 (36) 909 Other long-term liabilities 576 (80) 496 Long-term interest-bearing debt 7,488 - 7,488 10,783 379 11,162 Current liabilities Bank loans and other interest-bearing short-term debt 406 - 406 Current portion of long-term debt 29 - 29 Other current liabilities 6,726 (200) 6,526 7,161 (200) 6,960 Total liabilities and shareholders' equity 27,728 (331) 27,397 Total number of outstanding shares 319,442,590 319,442,590 319,442,590
  15. 15. 15 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF CASH FLOW NGAAP/IFRS Pro forma Statements of Cash Flow Pro Forma Pro Forma Pro Forma NOK million NGAAP 1Q 2004 IFRS ADJ. IFRS 1Q 2004 Operating activities Operating Income 1,003 46 1,049 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 303 56 359 Tax paid (61) - (61) Dividend from non-consolidated investees 242 - 242 Change in net operating capital (617) 10 (607) Other 537 (76) 461 Net cash provided by operating activities 1,407 36 1,443 Investing activities Purchases of property, plant and equipment (142) (36) (178) Purchases of other long-term investments (42) - (42) Net sales (purchases) of short-term investments (1) - (1) Proceeds from sales of property, plant and equipment 10 - 10 Proceeds from sales of other long-term investments (1) - (1) Net cash used in investing activities (176) (36) (211) Financing activities Net cash used in financing activities (1,033) - (1,033) Foreign currency effects on cash flows 149 - 149 Net increase (decrease) in cash and cash equivalents 348 - 348 Cash and cash equivalents at beginning of period 1,153 - 1,153 Cash and cash equivalents at end of period 1,501 - 1,501 RECONCILIATION OF EQUITY FROM NGAAP TO IFRS Majority shareholders equity 31 March 2004 NGAAP 9,721 IFRS implementation effects: Pensions (1,153) Plant maintenance shut downs 512 Deferred taxes 171 Goodwill amortization 1 Non-consolidated investees (41) IFRS 9,211
  16. 16. 16 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF INCOME NGAAP/IFRS Pro forma Statments of Income NGAAP/IFRS Actual Statments of Income Pro Forma Pro Forma Pro Forma Actual Actual Actual NGAAP 2004 IFRS ADJ. IFRS 2004 NGAAP 2004 IFRS ADJ. IFRS 2004 NOK million, except per share information (25.03.-31.12.) (25.03.-31.12.) (25.03.-31.12.) Revenues 43,066 - 43,066 33,030 - 33,030 Other income 185 (26) 160 189 (32) 158 Operating Revenues 43,252 (26) 43,226 33,219 (32) 33,188 Raw materials, energy costs and freight expenses 32,870 (217) 32,653 25,274 (160) 25,114 Change in inventories of own production 155 - 155 112 - 112 Payroll and related costs 3,600 (156) 3,444 2,790 (117) 2,673 Depreciation and amortization 1,208 219 1,427 928 163 1,091 Other 1,833 4 1,837 1,467 4 1,470 Operating costs and expenses 39,667 (150) 39,518 30,571 (110) 30,461 Operating Income before financial items 3,584 124 3,708 2,649 78 2,727 Share of net income in non-consolidated investees 768 - 768 637 - 637 Interest income and other financial income 171 - 171 144 - 144 Earnings before interest expense and tax (EBIT) 4,523 124 4,647 3,429 78 3,508 Foreign exchange gain/(loss) 737 - 737 461 - 461 Interest expense and other financial items (334) (65) (399) (235) (48) (284) Income before tax and minority interest 4,926 59 4,985 3,656 30 3,686 Income tax expense (1,185) (26) (1,211) (796) (20) (816) Net income 3,741 33 3,775 2,860 10 2,870 Minority interest 20 - 20 (6) - (6) Net Income after minority interest 3,761 33 3,794 2,854 10 2,864 Earnings per share 11.79 0.10 11.90 8.95 0.03 8.98 Average number of outstanding shares 1) 318,938,750 318,938,750 318,938,750 318,788,669 318,788,669 318,788,669 1) Average number of shares outstanding was reduced in fourth quarter 2004 due to the share buy-back program. RECONCILIATION OF NET INCOME FROM NGAAP TO IFRS Preliminary IFRS implementation effects – Actual Net Income after minority interest 25.3.–31.12. 2004 NGAAP 2,854 IFRS implementation effects: Provisions for pensions 68 Plant maintenance shut downs (6) Deferred taxes (20) Gain on sale of foreign subsidiaries (32) Goodwill amortization 3 Dividend Stock based compensation (4) IFRS 2,864
  17. 17. 17 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF CASH FLOW NGAAP/IFRS Pro forma Statements of Cash Flow NGAAP/IFRS Actual Statements of Cash Flow Pro Forma Pro Forma Pro Forma Actual Actual Actual NGAAP 2004 IFRS ADJ. IFRS 2004 NGAAP 2004 IFRS ADJ. IFRS 2004 NOK million (25.03.-31.12.) (25.03.-31.12.) (25.03.-31.12.) Operating activities Operating Income 3,584 124 3,708 2,649 78 2,727 Adjustments to reconcile operating income to net cash provided by operating activities: Depreciation and amortization 1,208 219 1,427 928 163 1,091 Tax paid (555) - (555) (494) - (494) Dividend from non-consolidated investees 385 - 385 143 - 143 Change in net operating capital (427) 25 (402) (46) 15 (31) Other (423) (44) (467) (456) 34 (422) Net cash provided by operating activities 3,772 324 4,096 2,724 289 3,013 Investing activities Purchases of property, plant and equipment (974) (324) (1,297) (849) (289) (1,137) Purchases of other long-term investments (251) - (251) (210) - (210) Net sales (purchases) of short-term investments 9 - 9 10 - 10 Proceeds from sales of property, plant and equipment 67 - 67 58 - 58 Proceeds from sales of other long-term investments 163 - 163 164 - 164 Net cash used in investing activities (986) (324) (1,310) (827) (289) (1,116) Financing activities Net cash used in financing activities (2,851) - (2,851) (1,818) - (1,818) Foreign currency effects on cash flows 142 - 142 9 - 9 Net increase (decrease) in cash and cash equivalents 77 - 77 88 - 88 Cash and cash equivalents at beginning of period 1,153 - 1,153 1,142 - 1,142 Cash and cash equivalents at end of period 1,230 - 1,230 1,230 - 1,230
  18. 18. 18 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION CONSOLIDATED STATEMENTS OF INCOME – QUARTERLY IFRS Statements of Income Actual Actual Actual Pro Forma NOK million, except per share information 4Q 2004 3Q 2004 2Q 2004 1Q 2004 Revenues 11,158 10,876 10,138 10,895 Other income 148 10 - 2 Operating Revenues 11,305 10,885 10,138 10,897 Raw materials, energy costs and freight expenses 8,734 8,300 7,470 8,149 Change in inventories of own production (172) 117 114 97 Payroll and related costs 935 826 845 838 Depreciation and amortization 368 344 356 359 Other 526 466 441 405 Operating costs and expenses 10,392 10,052 9,226 9,848 Operating Income before financial items 914 834 912 1,049 Share of net income in non-consolidated investees 203 243 180 142 Interest income and other financial income 52 55 34 30 Earnings before interest expense and tax (EBIT) 1.169 1.132 1,125 1,221 Foreign exchange gain/(loss) 417 54 (13) 279 Interest expense and other financial items (94) (103) (77) (125) Income before tax and minority interest 1,490 1,084 1,036 1,376 Income tax expense (235) (318) (234) (424) Net income 1,255 766 801 952 Minority interest (5) (7) (2) 33 Net Income after minority interest 1,251 759 800 985 Earnings per share 3.94 2.38 2.50 3.08 Average number of outstanding shares 1) 317,438,181 319,442,590 319,442,590 319,442,590 1) Average number of shares outstanding was reduced in fourth quarter 2004 due to the share buy-back program. IFRS RECONCILIATION OF EBITDA TO INCOME BEFORE TAX AND MINORITY INTEREST Pro Forma Actual Actual Actual Pro Forma NOK million 2004 4Q 2004 3Q 2004 2Q 2004 1Q 2004 EBITDA Downstream 2,142 477 526 573 566 EBITDA Industrial 696 165 156 211 164 EBITDA Upstream 3,573 965 910 738 961 EBITDA Other and eliminations (303) (42) (114) (38) (109) EBITDA Yara 6,108 1,565 1,477 1,484 1,582 Depreciation and amortization (1,427) (368) (344) (356) (359) Amortization of excess value in non-consolidated investees (34) (28) (2) (2) (2) Interest expense (585) (144) (154) (127) (159) Capitalized interest 1 (2) 2 1 1 Net foreign exchange (gain)/loss 737 417 54 (13) 279 Other financial income/expense, net 185 51 51 49 34 Income before tax and minority interest 4,985 1,490 1,084 1,036 1,376
  19. 19. 19 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION IFRS OPERATING SEGMENT INFORMATION Pro Forma Actual Actual Actual Pro Forma NOK million 2004 4Q 2004 3Q 2004 2Q 2004 1Q 2004 External Operating Revenues Downstream 30,436 7,804 7,668 7,410 7,553 Industrial 5,319 1,423 1,309 1,292 1,294 Upstream 7,302 2,025 1,880 1,413 1,985 Other and eliminations 169 53 29 22 65 Total 43,226 11,305 10,885 10,138 10,897 Internal Operating Revenues Downstream 1,005 243 219 223 320 Industrial 47 7 8 28 5 Upstream 11,301 2,904 2,701 2,620 3,076 Other and eliminations (12,353) (3,154) (2,927) (2,871) (3,401) Total - - - - - Operating Revenues Downstream 31,441 8,047 7,887 7,634 7,874 Industrial 5,366 1,430 1,317 1,321 1,298 Upstream 18,603 4,929 4,580 4,032 5,061 Other and eliminations (12,184) (3,100) (2,898) (2,849) (3,336) Total 43,226 11,305 10,885 10,138 10,897 Depreciation and Amortization Downstream 445 118 106 107 113 Industrial 238 58 53 67 60 Upstream 730 183 183 181 184 Other and eliminations 15 9 2 2 2 Total 1,427 368 344 356 359 Operating Income Downstream 1,381 289 334 362 396 Industrial 448 106 98 141 102 Upstream 2,200 572 522 454 653 Other and eliminations (321) (54) (120) (45) (102) Total 3,708 914 834 912 1,049 EBITDA Downstream 2,142 477 526 573 566 Industrial 696 165 156 211 164 Upstream 3,573 965 910 738 961 Other and eliminations (303) (42) (114) (38) (109) Total 6,108 1,565 1,477 1,484 1,582 Investments Downstream 413 185 87 76 65 Industrial 228 85 46 61 35 Upstream 751 301 281 94 74 Other and eliminations 183 75 - 64 44 Total 1,574 646 413 296 219
  20. 20. 20 YARA INTERNATIONAL UPDATED TRANSITION TO IFRS INFORMATION IFRS RECONCILIATION FROM OPERATING INCOME TO EBITDA Selected Operating Non-cons. Interest Financial Depr. and 1) NOK million Income Investees Income Items EBIT Amort. EBITDA 2004 Pro Forma Downstream 1,381 119 161 2 1,663 478 2,142 Industrial 448 7 3 - 458 238 696 Upstream 2,200 642 1 - 2,843 730 3,573 Other and eliminations (321) - 9 (5) (318) 15 (303) Total Yara 3,708 768 175 (4) 4,647 1,461 6,108 4Q 2004 Actual Downstream 289 (9) 50 - 330 146 477 Industrial 106 (1) 2 - 107 58 165 Upstream 572 213 (3) - 782 183 965 Other and eliminations (54) - 9 (6) (51) 9 (42) Total Yara 914 203 58 (6) 1,169 396 1,565 3Q 2004 Actual Downstream 334 38 45 1 418 108 526 Industrial 98 4 1 - 103 53 156 Upstream 522 201 4 - 727 183 910 Other and eliminations (120) - 4 - (116) 2 (114) Total Yara 834 243 54 1 1,132 345 1,477 2Q 2004 Actual Downstream 362 73 28 1 464 109 573 Industrial 141 3 - - 144 67 211 Upstream 454 103 - - 557 181 738 Other and eliminations (45) - 5 - (40) 2 (38) Total Yara 912 180 33 1 1,125 358 1,484 1Q 2004 Pro Forma Downstream 396 17 38 - 451 115 566 Industrial 102 1 1 - 104 60 164 Upstream 653 124 - - 777 184 961 Other and eliminations (102) - (9) - (112) 2 (109) Total Yara 1,049 142 29 - 1,221 361 1,582 1) Including amortization of excess value in non-consolidated investees.

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