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Annual report
2025
Table of
contents
This is Elkem Year in review
Who we are and what we do 006 CEO letter 020
One Elkem, three divisions 008 2025 in brief 024
Elkem’s history 010 Silicon Products 028
Elkem’s value chain 012 Carbon Solutions 030
Locations014 Silicones032
Elkem’s mission and strategy 016 The Elkem share 034
Board of directors’ report 038
Board and management 054
Corporate governance 056
Overview of main risks 068
002
Sustainability Financial
statement statements
General disclosures 078 Consolidated financial statements 174
Environment102 Notes to the consolidated financial
statements182
Social134
Financial statements Elkem ASA 278
Governance158
Notes to the financial statements
ESRS index 164 Elkem ASA 284
Declaration by the board
of directors 323
Independent auditors’ report 324
Alternative performance measures 329
Elkem Annual report 2025 003
This is Elkem
004
Elkem Annual report 2025 005
30.8
NOK billion total
operating income
11%
EBITDA margin
0
net zero emissions
by 2050
006 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
Who we are and
what we do
Elkem is a world-leading supplier of advanced
silicon-based materials shaping a better and more
sustainable future.
The group produces silicon products, carbon solutions, and silicones by
combining natural raw materials, renewable energy, and human resourcefulness.
Elkem helps customers develop and improve products that are essential for the
green and digital transitions, such as electric mobility, digital communication,
health and personal care, as well as smarter, more sustainable cities.
With a strong track record since 1904, Elkem’s global team of around 7 000
people has a joint commitment to stakeholders: Delivering your potential. Elkem
is listed on the Oslo Stock Exchange (ticker: ELK) where it is part of the OBX®
ESG Index, a selection of 40 companies demonstrating best environmental,
social, and governance (ESG) practices.
Elkem Annual report 2025 007
One Elkem,
three divisions
Elkem is organised into three divisions, which
produce silicon products, carbon solutions, and
silicones. These materials are essential to making
products that people use in their daily lives and serve
as necessary components for sustainable solutions
for the future, spanning digital communication,
health and personal care, green mobility, and energy.
Elkem is committed to achieving profitable growth
through strong cost and competitive market
positions, leveraging integrated and regionalised
value chains. The group places a strong emphasis
on innovation and research and development (R&D)
to enable a higher degree of product specialisation,
creating greater value to its customers.
008 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
Silicon Products
A leading producer of silicon-
based materials, including
silicon, ferrosilicon, specialty
alloys based on ferrosilicon, and
Elkem Microsilica®
Carbon Solutions
A leading producer of speciality
carbon products in various
metallurgical smelting processes
and in primary aluminium
industries
Silicones
A fully integrated producer
from silicon metal to upstream
siloxanes and downstream
silicone specialities
Elkem Annual report 2025 009
A collection of
milestones
1904 1918 1951
Søderberg electrode World’s largest
Elkem was technology patented ferrosilicon smelter put
founded for the first time into operation at Fiskaa
1913 1944 1964
Elkem listed on the Oslo First trial batch of First production of
Stock Exchange silicones in Lyon, France Silgrain® silicon at
Bremanger
010 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
2005-2011
1978 Orkla acquires Elkem in 2005
and de-lists the company.
2023
Sells Elkem to China National World’s first carbon capture
First production of Bluestar in 2011 pilot inaugurated at Elkem’s
silicones at Xinghuo, smelter in Rana, Norway
China
1981 2018 2025
Union Carbide Ferroalloys Elkem re-listed on Oslo Elkem ranks among the
Division acquired Stock Exchange top five global silicones
producers and is the
top producer of silicon
and foundry alloys in
Western markets and
the only global producer
of carbon products
Elkem Annual report 2025 011
Elkem’s value
chain
Quartz mining Smelters producing silicon-
based products
Quartzite extraction
Other input factors
Electrode
paste
Renewable
hydropower Heat and
energy recovery
Possible CO2 capture and
Carbon and storage
biocarbon
Research and innovation throughout value chain
012 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
Silicones plants Output
Silicones
End markets include automotive,
construction, electronics, health care,
personal care, textiles
Carbon solutions
End markets include aluminium,
ferroalloys, iron foundries, silicon
Silicon products
End markets include automotive,
construction, electronics, refractories,
specialty steel, solar and wind turbines
Elkem Annual report 2025 013
Our locations
Europe
014 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
Production site
Sales office
Headquarters
Asia
Africa North America South America
Elkem Annual report 2025 015
A leading global
provider of silicon-based
advanced materials
Our mission → Elkem’s materials are essential to most products used in daily life, such
To produce advanced as digital communication, health and personal care, green mobility, and
silicon-based materials transportation, as well as renewable energy and power. Elkem’s products
shaping a better and more are therefore critical to the green and digital transition, enabling sustainable
sustainable future solutions for the future.
→ Elkem’s goal is to create value through profitable and sustainable growth. We aim
to develop our business in accordance with the UN Sustainable Development
Goals and to reduce emissions to reach climate neutral production.
Our purpose → Elkem’s team of professionals is dedicated to developing innovative, high-quality,
Delivering your potential specialised solutions to unleash the potential of our customers.
→ We believe that the long-term megatrends will drive growth in demand for
advanced materials, including silicon, carbon solutions, and silicones.
Our values → Involvement commits people. We believe that our employees closest to the
production processes are best positioned to identify problems and opportunities,
Involvement
and to find solutions. By involving colleagues, customers, and other stakeholders,
Respect
and by being transparent and committed to teamwork, we increase our ability to
Precision
learn and develop new solutions.
Continuous improvement
→ We respect the law, the environment, our employees, colleagues, customers,
suppliers, owners, local communities, and different cultures. Respect is
about being fair, open, and honest, trusting your colleagues and partners and
appreciating diversity.
→ Commitment to precision expresses itself through our work to develop and
follow standards of best practice and safe and stable production. By establishing
work and safety standards, we can measure and continuously improve our
performance.
→ We know that the value chain can always be improved. We do this through
experimenting, using new technologies, and looking for ways to eliminate waste.
Continuous improvement means that we are always looking for improvement
potential, keeping an open mind and always ready to learn and share our knowledge.
016 This is Elkem
Table of contents Board of directors’ report Sustainability statement Financial statements
Our corporate strategy
Dual-play growth Green leadership
→ Driving growth and value → Cutting emissions and
creation in all three divisions resource-use to reach climate-
→ Securing supply chain neutral production
resilience through → Enabling the green transition
geographical diversification through the supply of critical
materials
Dual-play
growth and green
>5% >15% leadership 25% 0
growth EBITDA reduction net zero
per year margin CO2 (2022- by 2050
per year 2030)
Divisions
Silicon Products Carbon Solutions Silicones
→ Strengthen leading cost positions → Further improve profitability → Improve underlying profitability
through operational excellence and value creation
→ Reduce CO2 emissions and
energy consumption → Expand our green product → Accelerate product specialisation
portfolio and the drive towards a circular
→ Pursue organic growth and bolt- economy
on acquisitions → Pursue organic growth and bolt-
on acquisitions → Pursue selective growth
initiatives
Elkem Annual report 2025 017
Year in
review
018
Elkem Annual report 2025 019
CEO letter
Solid operational
performance and
strategic progress amid
a challenging market
020 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
While 2025 continued to present a challenging
market environment, Elkem’s diversified business
model, strong operational execution, and relentless
cost focus enabled us to maintain our market
positions and progress on our strategic priorities.
Dear Elkem shareholder, On 13 February 2026, we announced the agreement to
sell the majority of the Silicones division to Bluestar. The
The year 2025 was marked by the prolonged downturn transaction will be settled through the redemption of
our industry has faced over the past three years. Lower Bluestar’s shares in Elkem. Thus, once the transaction has
economic activity in key markets, persistent global been completed by May 2026, Bluestar will no longer hold
overcapacity, and the reshaping of global trade have been any Elkem shares.
the order of the day.
Elkem will be a focused metals and materials producer.
Drawing on Elkem’s 120-year legacy, we were able This allows us to pursue tailored strategies aligned with
to demonstrate resilience and agility, focusing on our divisions’ unique strengths and respective market
areas within our control. Through rigorous operational dynamics.
execution, cost management, innovation, and targeted
sales optimisation, we were able to moderate the impact Divisional highlights
of the adverse market conditions on Elkem’s profitability. Taking the adverse market conditions and pricing
pressures into account, Elkem’s financial results for the
A rapidly shifting geopolitical landscape year were relatively good, supported by robust operational
As an industrial major with operations and customers performance and cost improvements across all divisions.
across five continents, the rapidly shifting landscape
of global trade continues to impact Elkem. The The Silicon Products division was able to maintain high
increasing fragmentation of the world economy— capacity utilisation throughout the year, outperforming
driven by protectionism, geopolitical tensions, and competitors in this regard. The division’s specialty
shifting regulatory frameworks—has introduced greater segments, as well as foundry alloys and Elkem
uncertainty and complexity to our operating environment. Microsilica® reported strong results, maintaining both our
market positions, and profitability.
Examples of this include the EU’s decision to introduce
safeguard measures on imports of certain ferroalloys from Carbon Solutions reported solid margins supported by
third countries, including Norway and Iceland, and the strong operational performance. EBITDA was impacted
US’ introduction of countervailing duties on silicon metal by lower demand and pricing pressure, but the division’s
imports from Norway. These measures underscore the diversified market exposure continued to contribute
increasing politicisation of international trade. positively to the group’s earnings stability.
Elkem remains focused on supply reliability, capital The Silicones division delivered improved results due to
discipline, and operational excellence to mitigate this enhanced cost efficiency and higher sales volumes in
volatility. China. The division’s Asia Pacific operations, in particular,
were able to maintain high capacity utilisation, supported
Strategic review and portfolio focus by improved productivity and lower cost at the expanded
At the start of 2025, we initiated a strategic review of Xinghuo facility in China. Increased focus on high-
the Silicones division to streamline Elkem and to enable margin specialty products further contributed to offset
allocation of capital to accelerate growth in the Silicon commodity price pressure.
Products and Carbon Solutions divisions.
Elkem Annual report 2025 021
Health, safety, and environment (HSE) Also in the space of circularity, our new range of recycled
Safety remains a non-negotiable priority for Elkem. We silicones for the label industry developed at the Saint-
believe that all injuries are preventable and have a zero- Fons research centre in France is groundbreaking work,
harm philosophy throughout our operations. for which we were awarded the Business Intelligence
Group’s Sustainable Product of the Year award.
In recent years, we introduced a revised HSE
improvement system, which is delivering encouraging The successful trials of Elkem Carbon’s PAH-
results. The actual number of recorded incidents went free electrode paste at two silicomanganese and
down in 2025. However, despite our efforts to create a ferromanganese furnaces are also worth mentioning. The
safe working environment, the group experienced three new product ELSEP® G electrode paste is proving to be
tragic fatalities in 2025—one at the Carbon China facility an excellent replacement.
in Ningxia, China and two following an explosion at a
Silicones R&D pilot workshop in Lyon, France. We continue to invest in innovation and digitalisation to
drive future growth and operational excellence. These
These incidents had a profound impact across the efforts contribute to Elkem’s position as an industry
organisation. We have done our utmost to support leader in sustainable practices, ensuring long-term value
the families and loved ones of our colleagues who generation for all stakeholders, while enabling the twin
passed away and who were injured. Comprehensive green and digital transition.
investigations into each accident have been conducted,
and corrective actions are being implemented across A transformational year ahead
all sites. Strengthening process safety, improving risk 2026 will be a transformational year for Elkem. The
controls, and increasing competence development are key completion of the Silicones transaction will allow us
focus areas going forward. to restructure the group into a more focused, capital
efficient metals and materials producer with a simplified
Sustainability and innovation portfolio and improved strategic clarity.
Sustainability is firmly embedded across our entire value
chain and business strategy. Our climate strategy is built Our priorities for the year include:
on two core pillars: reducing CO2 and other emissions and
supplying critical materials essential for the green transition. → Completing the Silicones transaction and ensuring a
smooth transition
We maintain our long-term ambition to reduce, and
ultimately eliminate, fossil CO2 emissions from our smelting → Strengthening profitability through operational
operations. Across our value chain, we systematically target excellence and disciplined cost control
emission reductions, waste minimisation, and resource
efficiency, in the shift towards a low-carbon economy. → Continuing targeted investments in energy efficiency,
Many of our projects in this area are supported with public digitalisation, and decarbonisation
funding, notably from the EU, Norway, France, and China.
Such public-private partnerships, supported by favourable → Maintaining a strong balance sheet and strict capital
framework conditions, are key to accelerating the transition allocation discipline
to clean technologies.
Elkem’s resilience, long-term positioning, and
Our dedication to ESG is reflected in consistently strong commitment to sustainable value creation give us
external ratings. In 2025, we were awarded a Gold rating confidence as we enter the next chapter of the group’s
from EcoVadis, positioning Elkem among the top five per development.
cent of companies assessed globally.
Thank you for your continued support.
Behind these top ratings lie a number of pioneering
R&D projects. In 2025 we made significant steps within Sincerely,
circularity: our project aiming to develop green products
through the recycling of slag and silicon materials was
awarded NOK 33 million from Innovation Norway. The
project aims to reduce CO2 emissions and promote a Helge Aasen
circular economy for materials used in the automotive and CEO, Elkem ASA
construction industry.
022 Year in review | CEO letter
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem Annual report 2025 023
2025 in brief
1Q 2025 2Q 2025
→ Elkem initiated a strategic review to sell the → Elkem and partners NCL (North Sea Container
Silicones division in order to streamline the group Line AS) and MPC Container Ships, inaugurated
and redirect capital towards accelerating growth the first of two low-emission container feeder
in the Silicon Products and Carbon Solutions vessels in Norway, to enable more effective and
divisions. environmentally-friendly transportation of critical
metals and materials to Europe.
→ In February, Elkem received top ratings from
CDP with A on Forest and Water for 2024. In → Elkem was awarded NOK 33 million from Innovation
December, CDP again recognised Elkem with A Norway to pilot green products using recycled slag
ratings on Forest and Water for 2025. and silicon for the automotive and construction
industries. The aim of the project is to cut CO2
→ Elkem won the 2025 Ringier Technology emissions and boost circular economy through
Innovation Award for BLUESIL™ LSR 3935, an research and piloting low-emission materials.
innovative liquid silicone rubber that ensures long-
term waterproofing of high-voltage connectors in → Elkem signed a new long-term power contract of
battery packs of hybrid and electric vehicles. 300 GWh/yr in the NO4 price area, supporting
Elkem’s plant in Salten. The contract period is
from 2028 to the end of 2037.
Elkem Salten
024 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
Market conditions remained challenging in
2025, affecting sales prices and demand for
most of Elkem’s products. Elkem responded
by enhancing operations, optimising sales
and innovation, cutting costs, and reducing
investments to strengthen financial results.
3Q 2025 4Q 2025
→ Elkem was informed that the Norwegian Ministry → The EU implemented safeguard measures for
of Climate and Environment (KLD) had concluded ferrosilicon and foundry alloys, aimed at raising
in favour of Elkem in a complaint regarding EU prices and protecting internal production within
Emissions Trading System (ETS) allowances. KLD the EU. Norway and Iceland were not exempted
stated that Norwegian silicon and ferrosilicon from the measures, which include country-
producers were unequally treated compared to specific tariff rate quotas and duties.
EU producers in the allocation of free emission
allowances. → The US imposed countervailing duties (CVD) on
silicon imported from several countries, including
→ Elkem entered an exclusive sales process for the Norway, with a preliminary CVD rate of 16.87 per
Silicones division with Bluestar. cent.
→ Elkem announced the successful validation of a → Elkem introduced the new biocompatible, electro-
new mechanical recycling pathway for silicone conductive SILBIONE™ Liquid Silicone Rubber for
rubber, reinforcing its circularity leadership. advanced healthcare devices.
→ Elkem earned Gold rating for sustainability
transparency from EcoVadis, one of the world’s
largest and most trusted providers of business
sustainability ratings.
Elkem Annual report 2025 025
Key figures
Unit 2025 2024 2023 2022 2021 2020 2019 2018
Total operating income NOK million 30 806 33 004 34 760 45 898 33 717 24 691 22 668 25 230
Operating income growth Per cent (7%) (5%) (24%) 36% 37% 9% (10%) 20%
EBITDA NOK million 3 440 4 191 3 771 12 925 7 791 2 675 2 656 5 793
EBIT NOK million 699 1 339 1 365 10 898 5 899 948 1 189 4 522
Profit (loss) for the period NOK million (584) 577 170 9 642 4 664 278 897 3 367
Cash flow from operations NOK million 1 779 1 529 3 027 9 551 4 100 1 513 2 133 4 031
Reinvestments in % of DBA Per cent 58% 77% 102% 84% 91% 81% 80% 84%
Total assets NOK million 47 481 53 432 50 500 52 781 41 850 30 888 29 004 31 129
Net interest-bearing debt NOK million 11 883 10 327 8 373 1 280 3 341 7 327 5 106 2 101
Debt leverage Ratio 3.5 2.5 2.2 0.1 0.4 2.7 1.9 0.4
Equity NOK million 24 026 26 020 24 458 28 773 19 874 12 635 12 952 13 722
Equity share Per cent 51% 49% 48% 55% 47% 41% 45% 44%
Return on capital employed
(ROCE) Per cent 2% 5% 4% 40% 26% 5% 7% 26%
Earnings per share (EPS) NOK (1.05) 0.77 0.11 15.09 7.49 0.41 1.47 5.74
Number of employees Number 7 032 7 262 7 436 7 372 7 074 6 856 6 370 6 280
Total recordable injury rate
H1+H2 Ratio 3.6 3.5 3.0 3.2 3.7 2.3 2.2 2.2
NOX emissions Tonnes 5 490 5 460 5 830 6 519 8 932 6 610 6 718 6 280
Total CO2 emissions Million
(scope 1, 2 and 3)* tonnes 11.94 11.53 9.84 10.74 11.60 10.27 - -
Energy consumption TWh 7.12 7.15 7.27 6.54 6.54 6.40 6.01 6.23
*Total scope not reported before 2020.
026 Year in review | 2025 in brief
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem’s historical performance on key figures
Operating income EBITDA margin
NOK million Per cent
45.9 28%
CAGR 5%
23%
33.7 34.8
33.0 Avg. 16%
30.8
24.7
13%
11% 11% 11%
2020 2021 2022 2023 2024 2025 2020 2021 2022 2023 2024 2025
Equity ratio Leverage ratio
Per cent Ratio
Avg 49%
55%
48% 49% 51%
47% 3.5x
41%
2.7x 2.2x
Avg. 1.9x
2.5x
0.4x 0.1x
2020 2021 2022 2023 2024 2025 2020 2021 2022 2023 2024 2025
Elkem Annual report 2025 027
Silicon Products
Leading supplier of
critical materials
13.7
NOK billion total
operating income
42%
of group sales*
12
main production sites
→ Norway: Salten,
Thamshavn, Rana, Bremanger,
Bjølvefossen, Tana
→ Iceland: Grundartangi
→ China: Shizuishan
→ India: Nagpur
→ Paraguay: Limpio
→ Canada: Chicoutimi
→ Spain: Erimsa (various locations)
028 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
End markets
→ Automotive
→ Construction/industrial
equipment
→ Electronics
→ Specialty steel
→ Solar and wind turbines
→ Refractories
→ Oil and gas
Elkem is a leading producer of silicon-based materials, are automotive, construction, electronics, and renewable
including silicon, ferrosilicon, foundry alloys based on energy sectors. Recent tariffs and trade sanctions have
ferrosilicon, and Elkem Microsilica®. impacted market access and trade flows. Elkem’s broad
geographic reach and integrated value chains help
Silicon has several favourable chemical and physical mitigate these impacts, though policy changes continue
properties, including semiconductivity, making it critical to introduce uncertainty.
for numerous industrial and electronic applications.
Silicon is used in silicones, aluminium alloys, and Elkem has low-cost positions driven by scale and
polysilicon. Ferrosilicon is used in the steel industry, operational excellence, as well as strong market positions
with Elkem’s specialty grades primarily employed in in specialty niches based on deep application knowledge
the production of electrical steel for motors and power and close customer relationships.
network components, supporting the electrification.
Foundry alloys are used in the production of iron castings The division’s strategy is to strengthen its leading cost
to improve their properties such as tensile strength, positions and pursue selected organic growth initiatives
ductility, and impact properties. Elkem Microsilica® is a and opportunities for bolt-on acquisitions. In addition,
process product of silicon and ferrosilicon production the target is to reduce carbon emissions and energy
and is used in construction, refractories, and oil and gas consumption throughout the value chain. In 2025, the
production. main focus has been to further improve the division’s
good cost positions to mitigate challenging markets
The division’s growth is driven by key mega trends, such characterised by weak demand and low sales prices.
as the green transition, digital communications, and
smarter and more sustainable cities. The main markets
2025 2024 2023 2022 2021
Total operating income (in NOK million) 13 681 15 506 17 836 24 489 14 789
EBITDA (in NOK million) 1 517 2 864 3 304 10 226 3 704
EBITDA margin (in %) 11% 18% 19% 42% 25%
Number of employees 2 129 2 114 2 070 1 958 1 904
Sales volume (thousands metric tonnes) 434 422 462 522 566
*Share of group sales from external customers ex. Other
Elkem Annual report 2025 029
Carbon Solutions
A leading provider of
specialised products for
metallurgical industries
3.3
NOK billion total
operating income
10%
of group sales*
6
main production sites
→ Norway: Kristiansand
→ Slovakia: Žiar nad Hronom
→ Brazil: Serra (Carboindustrial and
Carboderivados)
→ South Africa: Emalahleni
→ China: Shizuishan
030 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
End markets
→ Ferroalloys
→ Silicon
→ Aluminium
→ Iron foundries
→ Steel
Elkem is a global player in specialty carbon products for The division’s strategy is to further strengthen profitability
metallurgical smelting and primary aluminium industries. through operational excellence, develop selective growth
Elkem’s Søderberg electrode paste is the most common projects organically and through acquisitions, and to
electrode system used in submerged arc furnaces to expand its green product portfolio.
ensure that the raw material reaches the required process
temperatures. The Søderberg electrode technology Market conditions in 2025 have continued to be
has more than 100 years of successful technology challenging for metallurgical industries, leading to
leadership. The technology and carbon products are production curtailments in several customer segments.
used by producers of silicon, ferrosilicon, ferrochromium, This has negatively impacted the demand for Carbon
ferronickel, ferromanganese, silicomanganese, calcium Solutions’ products. The division has concentrated on
carbide, and copper and platinum matte. Elkem’s cost improvements and operational excellence and has
ramming paste is used to seal the cathode part of maintained good results thanks to its strong market
aluminium reduction cells, avoiding metal leakage during positions and geographical presence.
operation.
The main market drivers are linked to the production
of steel and ferroalloys critical for the green transition,
transportation, and construction. High-quality electrodes
and ramming pastes are critical for customers to ensure
stable and reliable production processes.
2025 2024 2023 2022 2021
Total operating income (in NOK million) 3 272 3 649 4 210 3 752 2 176
EBITDA (in NOK million) 908 1 131 1 286 1 166 508
EBITDA margin (in %) 28% 31% 31% 31% 23%
Number of employees 425 455 454 401 395
Sales volume (thousands metric tonnes) 261 274 279 302 294
*Share of group sales from external customers ex. Other
Elkem Annual report 2025 031
Silicones
Improved results
from enhanced cost
positions
14.9
NOK billion total
operating income
48%
of group sales*
13
main production sites
→ China: Xinghuo, Shanghai,
Zhongshan, Yongdeng (silicon)
→ France: Roussillon, Saint-Fons,
Salaise-sur Sanne
→ Italy: Caronno
→ Spain: Santa Perpetua
→ USA: York
→ Brazil: Joinville
→ India: Pune
→ Korea: Gunsan
032 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
End markets
→ Construction
→ Automotive
→ Chemical formulators
→ Personal care
→ Healthcare
→ Paper and film release
→ Silicone rubber
→ Textile
Elkem is a global leader in fully integrated silicone The division’s key strategic focus is to improve profitability
manufacturing, from silicon metal to upstream siloxane and value creation through continuous cost improvement
and downstream silicone specialties. Silicones can take and accelerated product specialisation. The division
many forms, such as solids, liquids, semi-viscous pastes, has completed expansion projects in China in 2024 and
foams, oils, and rubber, and are known for their flexibility in France in 2025. These projects have significantly
and their resistance to moisture, chemicals, heat, cold, strengthened the division’s cost positions and explains
and ultraviolet radiation. Due to these versatile properties, the improved financial performance in 2025 compared to
silicones are widely used across various products and the previous two years.
industries, including manufactured goods, construction
materials, electronics, consumer, and medical items. In 2025, Elkem initiated a strategic review of the Silicones
division to streamline Elkem and to enable allocation of
Silicones can be encountered every day in several areas, capital to accelerate growth in the Silicon Products and
including in personal care products, in cars, in medical Carbon Solutions divisions. At 13 February 2026, Elkem
applications such as gels on wound dressing, and in announced the agreement to sell the majority of the
sealing and insulating materials in electrical equipment. Silicones division to Bluestar.
The main growth drivers are the green transition and
the rise of middle class worldwide to serve markets
such as electrification of transportation, electronics, and
healthcare.
2025 2024 2023 2022 2021
Total operating income (in NOK million) 14 941 15 091 14 163 19 288 17 429
EBITDA (in NOK million) 1 095 521 (605) 2 022 3 672
EBITDA margin (in %) 7% 3% (4%) 10% 21%
Number of employees 4 107 4 335 4 525 4 637 4 395
Sales volume (thousands metric tonnes) 443 388 332 394 409
*Share of group sales from external customers ex. Other
Elkem Annual report 2025 033
The Elkem
share
NOK 19.5 bn Elkem aims to be an attractive investment for
Elkem’s market capitalisation
shareholders by delivering sustained growth and
as at 31 December 2025 competitive profitability through the cycle.
→ Elkem ASA is a public limited company. The share is listed on the Oslo
Stock Exchange and the ticker code is ELK.
16 731
→ Elkem ASA was re-listed on the Oslo Stock Exchange at 22 March 2018.
shareholders
as at 31 December 2025
→ Elkem ASA has one share class with 639 441 378 ordinary shares, each
with a nominal value of NOK 5.
639.4 → All shares have equal rights and are freely transferable. Each share grants
the holder one vote and there are no structures granting disproportionate
million shares voting rights.
→ Bluestar Elkem International Co. Ltd. SA, owned by China National Bluestar
is the majority shareholder with 52.9 per cent.
→ Ten analysts are covering Elkem, providing market updates and estimates
for Elkem’s financial development.
Elkem intends to pay dividends reflecting the underlying earnings and cash flow and will target a dividend pay-out ratio
of 30-50 per cent of the group’s profit for the year. The proposed dividend for 2025, subject to approval from the annual
general meeting in 2026, is NOK 0.0 per share.
2025 2024 2023 2022 2021 2020 2019 2018
Earnings per share (NOK) (1.05) 0.77 0.11 15.09 7.49 0.41 1.47 5.74
Dividend per share (NOK) 0.00 0.30 0.00 6.00 3.00 0.15 0.60 2.60
Date proposed 12.02.2026 12.02.2025 08.02.2024 08.02.2023 09.02.2022 09.02.2021 12.02.2020 11.02.2019
Date of approval 30.04.2026 30.04.2025 18.04.2024 28.04.2023 27.04.2022 27.04.2021 08.05.2020 30.04.2019
Ex date 04.05.2025 02.05.2025 19.04.2024 02.05.2023 28.04.2022 28.04.2021 11.02.2020 02.05.2019
Pay-out ratio 0% 39% 0% 40% 40% 37% 41% 45%
Dividend yield 0% 1% 0% 17% 9% 1% 2% 8%
034 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem’s financial targets
Target metric Targets Comments
Revenue growth 5 - 10% Grow faster than market through specialisation, organic growth, and acquisitions
EBITDA margin 15 - 20% Target average margin through the economic cycle
Reinvestments % of D&A 80 - 90% Ensure appropriate and disciplined capital allocation following long-term plans
Debt leverage ratio 1.0x - 2.0x Ensure efficient and robust capital structure
Dividend target 30 - 50% of group profit Stable and predictable over time
Share data
Share price (NOK) Number of shares traded
50 100
65
40 20
30 15
20 10
10 5
— —
2018 2019 2020 2021 2022 2023 2024 2025
Share price Number of shares traded
2018 2019 2020 2021 2022 2023 2024 2025
Share price high (NOK) 45.00 36.12 29.60 38.50 43.66 39.88 23.58 30.48
Share price low (NOK) 21.07 20.18 11.20 25.68 27.34 16.50 16.59 16.58
Share price avg (NOK) 34.00 25.12 20.40 32.20 35.60 26.90 20.19 23.50
Share price year-end (NOK) 22.20 24.76 28.38 29.82 35.20 21.16 17.52 30.48
Volume (# of million shares) 342.11 369.57 303.73 438.75 290.21 267.01 280.82 298.29
Turnover (NOK million) 10 506.95 9 438.91 6 114.49 14 103.00 10 324.89 6 779.64 5 677.87 6 932.01
Market cap year-end
(NOK million) 12.90 14.39 16.50 19.07 22.51 13.53 11.20 19.49
Elkem Annual report 2025 035
Share price performance compared to Oslo Stock Exchange and OBX Basic Materials (indexed)
180
140
100
60
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2025 2025 2025 2025 2025 2025 2025 2025 2025 2025 2025 2025
Elkem OSE OBX Basic Materials
Name Holding Stake Change from 2024 (%) Citizenship
China National Bluestar 338 338 536 52.91% 0% — China
Folketrygdfondet 25 032 189 3.91% (8%) ↓ Norway
DNB Asset Management 20 289 638 3.17% 28% ↑ Norway
Nordea Funds 20 175 466 3.16% 175% ↑ Finland
Must Invest 19 630 095 3.07% 0% — Norway
Pareto Asset Management 16 766 326 2.62% (1%) ↓ Norway
Vanguard 11 276 501 1.76% 2% ↑ United States
Arctic Asset Management 8 411 232 1.32% 17% ↑ Norway
Dimensional Fund Advisors 7 364 203 1.15% 23% ↑ United States
First Fondene 7 061 782 1.10% 27% ↑ Norway
BlackRock 6 974 931 1.09% 22% ↑ United States
Storebrand Verdipapirfond 6 042 649 0.94% (64%) ↓ Norway
Kvantia AS (Andenæsgruppen) 5 362 428 0.84% New — Norway
Elkem ASA 5 221 900 0.82% (1%) ↓ Norway
Eika Kapitalforvaltning 4 917 608 0.77% New — Norway
Forsvarets Personellservice 4 578 300 0.72% 0% — Norway
SR-Forvaltning 4 219 467 0.66% New — Norway
Perestroika 3 596 490 0.56% New — Norway
Handelsbanken Fonder 3 383 005 0.53% New — Sweden
ODIN Verdipapirfond 3 015 701 0.47% New — Norway
Total 20 largest shareholders 521 658 447 81.57%
036 Year in review | The Elkem share
Table of contents Board of directors’ report Sustainability statement Financial statements
Holding size (number of shares) Number of shares Share of capital
1-100 154 744 0.0%
101-500 1 128 144 0.2%
501-1000 1 757 235 0.3%
5001-10 000 17 574 399 2.7%
10 001-100 000 34 273 688 5.4%
100 001 - 1 000 000 42 337 069 6.6%
> 1 000 000 548 559 012 85.8%
Elkem Annual report 2025 037
Board of directors’ report
Solid operations, disciplined capital
allocation, and strategic progress
in a prolonged market downturn
Elkem delivered strong operational performance in a challenging year
marked by continued weak demand, pricing pressure in all regions,
and a shifting trade environment. The group has maintained strong
cost control and a disciplined investment portfolio. The strategic
review progressed according to plan and is expected to be completed
during the first half of 2026. Elkem is well positioned to deliver
attractive financial results as the market improves.
Macroeconomic conditions remained weak throughout The transaction was approved by the extraordinary
2025, with low industrial activity, continued overcapacity of general meeting at 9 March 2026. Subject to customary
upstream silicones in China, weak demand from automotive closing conditions, the transaction is expected to close
and steel, in particular in Europe, and heightened uncertainty by May 2026. Consistent with this process, the Silicones
from protectionist measures. The EU implemented division has been classified as discontinued operations
safeguard measures on ferrosilicon and foundry alloys in and assets held for sale in the financial statements.
the fourth quarter, while the US announced preliminary
countervailing duties on silicon imports from several The board of directors believes that the long-term
countries, including Norway. These factors have contributed underlying growth and development prospects remain
to weaker silicones prices in China and weaker silicon positive for Elkem and is of the opinion that Elkem has a
and ferrosilicon prices in the EU, compared to 2024. To solid asset base and financial capability to support further
mitigate the adverse market conditions, Elkem continued to growth, creating value for all stakeholders.
implement cost‑reduction measures and execute operational
improvements. High-capacity utilisation compared with Elkem’s consolidated operating income decreased by
peers, robust furnace performance, and disciplined 7 per cent year on year to NOK 30 806 million in 2025.
maintenance spending supported stable operations in a EBITDA* ended at NOK 3 440 million in 2025, resulting in
turbulent environment. These initiatives, combined with an EBITDA margin of 11 per cent compared to 13 per cent
strict investment prioritisation, helped reduce the negative in 2024. The leverage ratio** was 3.5x as at 31 December
impact of market headwinds on profitability. 2025. This is above the leverage target of 1.0x-2.0x over
the cycle and is a consequence of the weak results and
At the beginning of 2025, Elkem initiated a strategic higher debt levels. Given the weak results driven by the
review of the Silicones division with the objective of prolonged market downturn, Elkem continues to focus
streamlining the group and reallocating capital to on cost control and disciplined investment prioritisation,
accelerate growth in Silicon Products and Carbon while maintaining and further developing attractive
Solutions. At 13 February 2026, Elkem announced an market positions. Elkem is thus well positioned to realise
agreement to sell the majority of its Silicones division attractive financial results when markets recover.
to Bluestar to be settled with all Elkem shares held by
*EBITDA commented under APM section
Bluestar. **Leverage ratio commented under APM section
038 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
Operating income EBITDA and EBITDA margin Leverage ratio
NOK million NOK million and per cent Ratio
50 000 15 000 30% 4.0
40 000 12 000 24% 3.2
30 000 9 000 18% 2.4
20 000 6 000 12% 1.6
10 000 3 000 6% 0.8
0 0 0% 0.0
2021 2022 2023 2024 2025 2021 2022 2023 2024 2025 2021 2022 2023 2024 2025
Elkem’s policy is to pay a dividend of 30-50 per cent of Key business developments 2025
the parent company’s share of profit for the year. The Capacity growth and operational optimisation
board of directors has proposed to the annual general Elkem aims to deliver revenue growth of 5–10 per cent
meeting a zero dividend payment for 2025, in line with the per year through the cycle, supported by organic growth
dividend policy. initiatives and acquisitions. Since 2020, the compound
annual growth rate has been slightly below 5 per cent with
Safety remains a non‑negotiable priority for Elkem. The an EBITDA margin of 16 per cent on average.
board upholds the view that all injuries are preventable
and maintains a zero‑harm philosophy across all During the year, Elkem prioritised the completion
operations. In 2025, despite strengthened HSE systems of ongoing expansion initiatives, projects with short
and training, Elkem experienced three tragic fatalities, one payback, and the optimisation of its production
at Carbon China in Ningxia and two following an explosion capabilities by maintaining high utilisation:
at a Silicones pilot workshop in Lyon, France. Elkem has
supported affected families and colleagues, conducted → Elkem completed the capacity expansion in Brazil
comprehensive investigations, and is implementing during 2025 following an investment of around NOK
corrective actions. The board remains fully engaged in 200 million. The project increased productivity and
overseeing the implementation of lessons learned and efficiency at the plant and delivered profitability in
ensuring accountability for improvements. line with targets. The expansion increased production
capacity by 40 per cent.
Environmental, social, and governance (ESG) activities
enable Elkem to operate in an environmentally responsible → During the first half of 2025, Elkem ramped up the
and socially sustainable manner in the production of silicones expansion in France. The upgraded facilities
advanced silicon‑based materials. Elkem continues to have a total silox capacity of 110 kilotonnes annually.
pursue its global climate roadmap, targeting a 32 per The new capacity improves the plant’s cost position.
cent reduction in the average product‑group carbon
footprint by 2030 and carbon‑neutral production globally → In addition to the expansion projects, Elkem prioritised
by 2050. The ambition is to reinforce the group’s position projects that improved productivity and maintenance
as a leader in the green transition by reducing emissions, investments, including Silicones downstream
supporting low‑carbon value chains, and contributing specialisation in China, the relining of furnaces at
to circular economies. In addition, strong social and Rana in Norway and in Iceland, the upgrade of furnace
governance principles underpin efforts to foster a diverse filters, and technical and digital upgrades supporting
workforce grounded in respect and an inclusive culture, operational efficiencies.
and to safeguard human rights throughout the value
chain.
Elkem Annual report 2025 039
Actions to support profitability People and safety at the core of ESG and green
Key initiatives have been implemented during the year to leadership
strengthen shareholder value by executing profitability Elkem’s people and their safety form the foundation of
improvements, thereby positioning Elkem for attractive the group’s operations, supported by responsible and
margins when markets improve. sustainable practices grounded in operational excellence.
Elkem strives to be an attractive employer and aims
→ To mitigate the prolonged market downturn, Elkem to lead the green transition by contributing actively to
continued its focus on cost discipline through emission reductions.
manning reductions, operational efficiency initiatives,
and margin optimisation. In addition, Elkem reduced → Elkem is engaged in several initiatives throughout the
investments in 2025 compared to 2024. value chain to reduce emissions. Through North Sea
Container Line AS, which is 50 per cent owned by
→ In the second quarter, Elkem signed a long‑term Elkem, the group is deploying two dual-fuel methanol
power purchase agreement with NTE for 2028–2037, 1 300 TEU container ships, which trade between
securing renewable electricity in Norway’s NO4 Norway and Rotterdam.
price area to support operations at the Salten plant
in Norway. The agreement strengthens Elkem’s → Elkem received NOK 33 million from Innovation
long‑term power portfolio, covering part of its annual Norway to pilot green products made from recycled
3.5 TWh consumption in Norway. Renewable energy is slag and silicon for use in the automotive and
essential for producing low‑CO2 silicon and supports construction sectors, aiming to cut CO2 emissions and
Elkem’s goal of net zero emissions by 2050. support circular material flows.
→ Elkem has spent considerable time and effort to → Elkem received a Gold rating for sustainability
advocate for equal treatment for Norwegian industry transparency from EcoVadis, one of the world’s
in the allocation of free emission allowances under leading providers of business sustainability
EU ETS. In July, Norway’s Ministry of Climate and assessments. In December, CDP recognised Elkem
Environment upheld Elkem’s complaint regarding with A ratings on Forest and Water for 2025.
unequal allocation of free EU ETS allowances for
2021–2025. Elkem therefore expects to receive → Elkem aims to cut its fossil CO2 emissions by 25 per
additional allowances, which will help level cent from 2020 to 2030 and increase the share of
competition and lower future CO2 quota costs. products that support the green transition, improving
its average product carbon footprint by 32 per cent.
The group’s long‑term ambition is to reach net zero
emissions by 2050.
040 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
About Elkem chemicals, aluminium, electronics, automotive, speciality
Established in 1904, Elkem is one of the world’s leading steel segments, solar, construction, refractories, military
providers of advanced silicon-based materials shaping equipment, and oil and gas. China has been the largest
a better and more sustainable future. The company is growth market for silicon in recent years, however the
headquartered in Oslo, Norway, and is listed on the Oslo material is critical for the green and digital transition in
Stock Exchange (ticker code: ELK). Elkem has more than Europe and the United States.
7 000 full-time equivalents (FTE), 31 main production
sites and an extensive network of sales offices worldwide. The Carbon Solutions division is the world-leading
In 2025, Elkem had a total operating income of NOK 30 supplier of electrode paste, prebaked electrodes and
806 million. To learn more, please visit speciality products to the ferroalloys, silicon, and
elkem.com. aluminium industries. The division has approximately
400 FTEs, with plants in Norway, South Africa, Brazil,
Elkem’s mission is to provide advanced silicon-based Malaysia, Slovakia, and China. The Carbon Solutions
materials shaping a better and more sustainable division represents 10 per cent of Elkem’s operating
future. The board of directors believes that a safe income from external customers. The steel and aluminium
and environmentally responsible business model is a industries account for a significant portion of the
prerequisite for value creation. With a highly competent division’s end-user applications and, as a result, drive the
organisation, well-invested assets, attractive market demand dynamics in the industry.
positions and select growth initiatives, Elkem is
committed to creating value for all stakeholders. The Silicones division is one of the world’s leading fully-
integrated silicone companies, with approximately 4 100
Elkem is a fully-integrated producer with operations FTEs and a global footprint. The division has research and
throughout the silicon value chain from quartz to innovation (R&I) centres in Europe and Asia, sales offices
silicon and downstream silicone specialities, as well as worldwide, and plants in China, France, Italy, Spain, the
speciality ferrosilicon alloys and carbon materials. In US, Brazil, India, and South Korea. The Silicones division
recent years, Elkem has organised its operations into represents 48 per cent of the group’s total operating
three business divisions: Silicon Products, a provider of income.
silicon, ferrosilicon, foundry alloys, Elkem Microsilica®, and
related speciality products; Carbon Solutions, a supplier of The markets for the Silicones division’s products are large
electrode paste and speciality products to the ferroalloys, and growing. Demand is driven by megatrends, such as
silicon, and aluminium industries; and Silicones, a fully- the green transition, digitalisation and energy demand
integrated silicones producer. A strategic review of the growth. The Silicones division serves diverse markets,
Silicones division was initiated in early 2025, and Elkem from electric cars to construction, via electronics,
announced an exclusive sales process for the division’s aerospace, healthcare, personal care, packaging, airbag
assets in September 2025. coating, and more. Elkem has a comprehensive range
of silicone products (> 5 000 stock keeping units) with
The Silicon Products division is a world-leading supplier leading market positions in engineering elastomers for
of silicon, ferrosilicon, foundry alloys, Elkem Microsilica®, EVs, coatings for packaging, hygiene and baking paper,
and other speciality products. The Silicon Products division and airbag coatings.
represents 42 per cent of the group’s total operating
income. Silicon Products has about 2 100 FTEs and has Financial performance
plants in Norway, Iceland, Canada, India, Paraguay, and The consolidated financial statements are prepared
China, and quartz mines in Norway and Spain. in accordance with IFRS® Accounting Standards as
endorsed by the European Union (EU) and effective at 31
Silicon possesses a unique combination of physical and December 2025.
chemical properties that make it a cornerstone of modern
industry. As such, it has a wide range of applications, The analysis in this section reflects the combined
predominantly as an alloying material for aluminium results of the three divisions, including Silicones. Note
and in the production of silicones and polysilicon for 38 shows the reconciliation of Elkem group figures with
electronics and solar cells. Ferrosilicon and foundry Elkem continued operations, the Silicones division, and
alloys are used in the steel industry and the iron foundry respective eliminations.
industry, respectively. The Silicon Products division
serves customers in several end markets, ranging from
Elkem Annual report 2025 041
Consolidated profit and loss statement Consolidated operating profit was NOK 525 million in
Consolidated operating income for the Elkem group 2025 compared to NOK 712 million in 2024, a decrease
amounted to NOK 30 806 million compared to NOK of NOK 188 million, explained mainly by decreased
33 004 million in 2024. The 7 per cent decrease was EBITDA of NOK 751 million, countered by reduced
driven by lower sales prices. Operating income for the amortisation, depreciation and impairment losses, and
Silicon Products division decreased by 12 per cent due positive contributions from other items. Amortisation and
to negative price development for silicon and ferrosilicon depreciation were NOK 2 659 million in 2025 compared to
driven by weaker demand, countered partially by higher NOK 2 674 million in 2024. The decrease in amortisation
sales volumes. Carbon Solutions’ operating income and depreciation is attributed to lower investment levels
decreased by 10 per cent, driven by lower sales volumes. in 2025. Impairment losses were NOK 82 million in
The Silicones division saw a 1 per cent decrease in 2025 compared to NOK 178 million in 2024. Impairment
operating income, driven by lower sales prices countered losses were related to write-downs of assets, primarily
partially by 14 per cent higher sales volumes, primarily in in the Silicones division. Other items were positive NOK
China. 91 million in 2025 compared to negative NOK 460
million in 2024. Other items effect in 2025 are largely
Consolidated EBITDA ended at NOK 3 440 million related to currency exchange hedge gains, embedded
compared to NOK 4 191 million in 2024. The EUR derivatives in power contracts, and restructuring
corresponding margin declined from 13 per cent in 2024 expenses primarily in the Silicones division.
to 11 per cent in 2025. EBITDA fell year on year, driven
by weaker EBITDA results from Silicon Products and Consolidated profit before income tax ended at negative
Carbon Solutions, as a result of lower sales prices and NOK 381 million for the year, compared to positive NOK
sales volumes respectively. Silicones improved EBITDA 47 million in 2024.
through comprehensive margin improvement initiatives
and higher sales volumes. We refer to “Divisions’ business
performance” for further descriptions.
Operating income EBITDA
NOK million NOK million
34 000 4 650
33 004 4 191
33 000 4 150
32 000 3 650
246 3 440
(1 825) 537
31 000 3 150
154 30 806
(377)
(150)
(1 348)
30 000 2 650
(223)
29 000 2 150
28 000 1 650
2024 Silicon Carbon Silicones Other/Elim 2025 2024 Silicon Carbon Silicones Other/Elim 2025
Products Solutions Products Solutions
042 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
Net financial items were negative NOK 905 million in 1 131 million in 2024. The reduced EBITDA was mainly
2025 compared to negative NOK 665 million in 2024. due to lower sales volumes and lower sales prices. Sales
The share of profit from equity-accounted financial volumes decreased by 5 per cent from 274 kilotonnes in
investments was zero in 2025 compared to negative NOK 2024 to 261 kilotonnes in 2025.
143 million in 2024. Finance income was NOK 85 million,
and the foreign exchange loss was NOK 284 million in The Silicones division had an operating income in 2025 of
2025 compared to NOK 147 million and positive NOK 247 NOK 14 941 million (NOK 15 091 million in 2024). EBITDA
million in 2024, respectively. Finance expenses were NOK was positive NOK 1 095 million in 2025 compared to NOK
707 million compared to NOK 916 million in 2024 driven 521 million in 2024. The EBITDA improvement was driven
by lower interest rate charges despite a higher interest- by higher sales volumes and comprehensive margin
bearing debt level. improvement initiatives, partially countered by weaker
sales prices. DMC market index prices in China fell from a
The consolidated profit for the year was NOK 584 million, 10-year low level in December 2024 to a new low level in
after NOK 203 million in tax expense. The tax expenses September 2025 and averaged 13 per cent lower in 2025
was driven by positive results in most countries whereas compared with 2024 level. Prices overall were weak as
negative results in France and China are not capitalised as a result of lower demand in all regions and overcapacity
deferred tax assets. in China. Sales volumes increased by 14 per cent year
on year from 388 thousand metric tons in 2024 to 443
The main items recognised in the consolidated statement thousand mt in 2025 supported by the new capacity
of other comprehensive income are related to cash flow completed last year in China.
hedges (foreign currency hedges and power price hedges)
and currency translation differences. These items had a Cash flow and statement of financial position
net loss of NOK 1 142 million for 2025, compared to a net Cash flow from operating activities (IFRS) was NOK 1 176
income of NOK 1 100 million in 2024. million for the year, compared to NOK 2 030 million in
2024. Positive cash flow contribution from EBITDA (NOK
The share of consolidated profit attributable to 3 440 million) was reduced by operating losses from
shareholders of Elkem ASA was negative NOK 668 discontinued operations (NOK 782 million), increased
million, resulting in basic earnings per share of negative working capital (NOK 138 million), changes in fair value of
NOK 1.05 per share in 2025 compared to positive NOK derivatives (NOK 107 million), changes in provisions, bills
0.77 per share in 2024. receivable and other (NOK 821 million), interest payments
made (NOK 684 million), and income taxes paid (NOK
The total comprehensive income for the year was negative 436 million). This was countered partially by gains from
NOK 1 726 million in 2025 compared to positive NOK 1 equity accounted investments (NOK 13 million) and
677 million in 2024. interest payments received (NOK 84 million).
Divisions’ business performance In 2025, amortisation, depreciation, and impairment
The Silicon Products division had an operating income in decreased compared to 2024 levels, due to lower
2025 of NOK 13 681 million (NOK 15 506 million in 2024). investment levels in 2025 compared to relatively high
EBITDA was NOK 1 517 million in 2025 compared to NOK investments in the preceding years. During 2025, Elkem
2 864 million in 2024. EBITDA fell during the year mainly reduced investment levels to mitigate the negative impact
due to lower sales prices countered partially by increased from the prolonged market downturn.
sales volumes and lower raw material cost. During 2025
sales prices developed negatively in Europe on continued Changes in working capital were negative year on
weak demand and imports of low-priced volume from year, primarily due to reduced accounts payable
China. Silicon and ferrosilicon sales prices were on partially countered by reduced accounts receivable and
average 22 per cent and 6 per cent lower, respectively, in inventories. Management continues to maintain a strong
2025 compared to 2024. Sales volumes increased from focus on working capital optimisation. Key initiatives
422 kilotonnes in 2024 to 434 kilotonnes in 2025 driven include aligning production and sales forecasts through
by higher production. rigorous planning, optimising minimum and maximum
stock levels, accelerating the sale of slow‑moving
The Carbon Solutions’ division had an operating income inventories, strengthening follow‑up on credit terms
in 2025 of NOK 3 272 million (NOK 3 649 million in 2024). with customers and suppliers, and refining the group’s
EBITDA was NOK 908 million in 2025 compared to NOK factoring arrangements.
Elkem Annual report 2025 043
Cash flow from investing activities amounted to negative Going concern
NOK 2 248 million for the year, compared to negative The board of directors considers Elkem capable of
NOK 3 303 million in 2024. Elkem invested NOK 1 continuing its operations for the foreseeable future and
536 million in maintenance, environment, health and confirms that the financial statements are prepared on a
safety, and productivity improvement initiatives during going‑concern basis. It further concludes that the group
the year. In addition, Elkem had NOK 328 million in has sufficient equity and liquidity to meet its obligations.
strategic investments. The cash flow from investing
activities in 2025 is mainly explained by investments in Strategic priorities
Carbon Solutions’ expansion project in Brazil, Silicon The board of directors reviews Elkem’s strategy annually,
Product’s expansion of specialisation materials capacity evaluating strategic priorities and financial scenarios
at Bremanger in Norway, and the Silicones division’s based on industry trends, market development, and other
downstream initiatives, and continuous maintenance framework conditions.
and improvement investments at selected plants in all
divisions. In January 2025, Elkem announced that it had initiated a
strategic review of the Silicones division, with the purpose
Cash flow from financing activities was negative NOK 921 to streamline Elkem and enable allocation of capital to
million, compared to positive NOK 737 million in 2024. accelerate growth in the Silicon Products and Carbon
The negative cash flow from financing activities in 2025 Solutions divisions. The decision followed a thorough
was mainly related to new interest-bearing loans and review of the growth and return prospects of Elkem,
borrowings of NOK 691 million, countered by payment as well as its capital allocation strategy and the market
of interest-bearing loans and borrowings of NOK 1 186 dynamics in the silicones business.
million, dividends paid to non-controlling interests of NOK
85 million, dividends paid to owners of NOK 190 million, Elkem’s current strategic goals include dual-play growth
and payment of lease liabilities of NOK 151 million. and green leadership. Dual-play growth means to drive
growth and value creation in all three divisions while
Change in cash and cash equivalents was negative NOK 1 securing supply chain resilience through geographical
993 million for the year. diversification. Green leadership means that Elkem is
cutting emissions and resource use to reach climate-
Elkem’s financial position remained solid at the end of neutral production, and enabling the green transition
2025. The group’s equity ratio ended at 51 per cent at the through the supply of critical materials.
end of the year, an increase from 49 per cent last year.
The leverage ratio for the group increased from 2.5x in To support its strategic goals, Elkem will focus on
2024 to 3.5x at the end of 2025 due to higher net interest- operational excellence, digitalisation, people development,
bearing debt* (NIBD) and lower EBITDA. and ESG (environmental, social, and governance). In
addition, Elkem’s divisions will focus on developing and
The board of directors considers the group’s strong maintaining sustainable low-cost positions. Together
underlying competitive position and solid equity ratio these initiatives comprise the group’s strategic priorities
to provide a sound foundation for supporting further to secure profitable and sustainable growth.
profitable growth.
The demand for Elkem’s products is expected to be driven
Total interest-bearing liabilities were NOK 11 970 million by global megatrends, creating opportunities based on
as of 31 December 2025, of which NOK 2 322 million the group’s broad geographic presence and solid cost
matures in 2026. Cash and cash equivalents amounted and market positions. Current strategic targets include to
to NOK 2 694 million in addition to NOK 6 658 million in deliver growth by more than 5 per cent annually, with an
undrawn credit facilities. NIBD amounted to NOK 11 883 EBITDA margin over the cycle of at least 15 per cent.
million as of 31 December 2025. The board views the
group’s cash and financial position to be strong.
*See APM section
044 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem Annual report 2025 045
Elkem aims to maintain an investment grade profile and → Energy efficiency and CO2 emission reductions,
targets a leverage ratio, defined as net interest-bearing notably by replacing fossil coal with biomass in the
debt to EBITDA, at the level of 1.0-2.0x, based on earnings production of silicon and ferrosilicon alloys
over the business cycle. As at 31 December 2025, the
leverage ratio was 3.5x. The board of directors’ target is to → Circular economy, mainly through recycling (including
ensure a leverage ratio in line with policy over the business waste and end-of-life) and eco-design (products and
cycle. processes)
Elkem’s dividend policy aims to align dividend → New materials, including 3D printing and additive
distributions with the underlying earnings and cash flow manufacturing processes, battery cells and batteries,
of the group, targeting a dividend payout ratio of 30-50 and lightweight materials
per cent of the group’s annual profit.
→ R&I digitalisation, processes and new materials
Research and innovation (R&I) is key to Elkem’s modelling to speed up the capture of value
strategy on sustainable growth and specialisation
Elkem devotes considerable effort and resources to → Technology scouting, to better anticipate the future
R&I activities, with approximately 3.5 per cent of 2025 needs of our customers and markets
revenues dedicated to new products and new processes,
including technical support to customers. Through this Highlights from 2025 include:
investment, and with around 550 researchers working → Focus on energy efficiency and CO2 emission
globally across 14 R&I and application centres, the R&I reductions
teams filed 83 patents across the world in 2025 and — Elkem, together with NCL (North Sea Container
got 93 patent registrations. New products introduced Line AS) and MPC Container Ships ASA, invested
less than five years ago represent 15 per cent of Elkem’s in two container feeder vessels that can run on
revenue. bio-methanol. Both ships began operating in 2025,
enabling more effective and environmentally-
R&I efforts are key to creating and developing innovative friendly transportation of goods and critical
products that meet new needs in the market, including metals and materials from Norway to European
demand for environmentally-friendly products and markets. The containers, NCL VESTLAND and
energy-efficient production technologies. Optimising the NCL NORDLAND, are the first ships powered with
global value chain is at the heart of the projects managed bio-methanol in operations in Norway. Elkem owns
by Elkem and is a key part of Elkem’s strategy. 40 per cent of NCL.
Elkem’s R&I facilities within chemistry and new chemicals, → Focus on 3D printing and new materials:
new materials and supporting laboratories, play a crucial — Elkem expanded its portfolio of silicone solutions in
role in our customers’ success. Elkem’s R&I efforts 2025, ranging from the BLUESIL™ Textile Coating
contribute to the development of new products with Silicone solutions that bring added insulation and
tailored properties for high-end markets, new additives protection to industrial fabrics such as welding
for process aids, or reinforced materials and support with blankets, insulation panels, and personal protective
critical analysis information needed for troubleshooting. equipment, to new high-performance, low-cyclic
Elkem’s R&I is also important to support Elkem’s silicone solutions for safer and more sustainable
ambitions related to specialisation and growth, to meet cosmetics.
demand stemming from global megatrends. — Elkem won an award at the “2025 Plastic
Industry - Ringier Technology Innovation Awards”
Open innovation and collaborative mindset in Shanghai for its breakthrough achievements
Through several national and European collaborative with the BLUESIL™ LSR 3935 technology. This
projects conducted with start-ups, small and medium- is an innovative liquid silicone rubber product
sized enterprises, groups, academics, and clusters, Elkem used for long-term waterproofing of high-voltage
is recognised for its open and innovative culture. Elkem connectors in new energy vehicles, which is
aims to be at the forefront of new technologies in five resistant even under high-temperature ageing
prioritised areas: conditions.
046 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
→ Focus on climate strategy and circular economy: R&I initiatives and expansion
— In France, Elkem’s team launched two additions At Elkem’s production sites, new applications are
in 2025 to the SILCOLEASE® range for release developed and supported by laboratory expertise and
liners, which are 100 per cent recycled silicone- analysis to ensure that the latest technologies and
based, solvent-free products that deliver identical capabilities are used. The working methodology is
technical performance to their non-recycled used across all segments and markets, to optimise the
counterparts. They are the first commercial customer or market interaction. Elkem’s also contributes
products from Elkem’s state-of-the-art chemical with its know-how, data, and expertise to new research
recycling pilot unit in Saint Fons, France. centres being established.
— Elkem was awarded NOK 33 million from
Innovation Norway for the development of green → In 2021, Elkem’s new R&I centre ATRiON opened at
products through the recycling of slag and silicon the Saint-Fons site in Lyon, France, at the heart of the
materials. The project aims to materially reduce so-called “Chemistry Valley” to reinforce innovation
CO2 emissions and promote a circular economy for within Elkem and open innovation together with
materials used in the automotive and construction external partners. The state-of-the-art R&I centre is
industry. The research team is working on dedicated to the Silicones division and brings together
developing cement alternatives from slag from more than 100 researchers.
Elkem’s ferrosilicon smelters, with a CO2 footprint
of less than a third of that of the average standard → In 2024, Elkem inaugurated the enlarged Flagship
for cement. In addition, the project has a target Asia-Pacific R&I Center in Shanghai with four new
of achieving recycling rates of over 50 per cent in application centers for E-mobility, bioscience, coating,
new products, utilising secondary silicon sources. and 3D printing, to develop high-performance
products and promote the innovative development
→ Technology scouting to better anticipate the future of the industry. The centre supports customers in
needs of our customers and markets: the Asia-Pacific region, improve their innovation
— Elkem served as a pilot customer for MOMEK capabilities, accelerate the development of new
Group’s TappingMate, an industrial robot which products and applications, and seize emerging
automates the processes for tapping molten metal opportunities for advanced silicone products and
from smelting furnaces by using various tools, technologies in the region.
machine vision, sensors, and other automation
equipment. The robot has been successfully put to → In 2025, Elkem announced it would be a partner in
use at Elkem’s smelter at Rana in Norway, creating the Norwegian Centre on AI for Decisions, one of
a better working environment for employees, and six national AI centres supported by the Research
reducing emissions. Council of Norway’s (Norges forskningsråd) NOK
1 billion investment in artificial intelligence. This
To maintain and develop this technological edge, Elkem interdisciplinary collaboration, led by Norwegian
is evolving through internal projects and the support of University of Science and Technology (NTNU), will
collaborative platforms, such as: seek to develop AI that can support high-impact
decisions across energy, health, logistics, and
→ The pilot facility at Elkem’s corporate R&I centre in manufacturing. By combining different AI techniques
Kristiansand, Norway, is an important asset for both to interpret sensor data from physical processes in
process and product development. The partnership industry and critical infrastructure, the centre will
with the Norwegian Catapult Centre, Future Materials, explore how AI can be used for responsible, reliable
and new collaborative projects, national and European, decision-making in areas where precision and trust are
has further strengthened the position of the centre. critical.
Elkem Annual report 2025 047
Sustainability: Environmental, social, and
governance (ESG)
Elkem, as a signatory to the UN Global Compact, is
committed to developing its business in alignment with
the UN Sustainable Development Goals and the objectives
of the Paris Climate Agreement. Safe and environmentally
responsible production is of importance to the group.
Through close collaboration with customers and partners,
Elkem develops solutions that address both current needs
and future challenges, recognising the essential role of
responsible business practices across the value chain.
Elkem reports in accordance with the Corporate
Sustainability Reporting Directive (CSRD). Material
topics have been identified through a double materiality
assessment, covering areas where Elkem has significant
impacts on society and the environment, as well as topics
that are financially material to the group. The material
topics identified include climate change (ESRS E1),
pollution (ESRS E2), water and marine resources (ESRS
E3), biodiversity and ecosystems (ESRS E4), resource
use and circular economy (ESRS E5), own workforce
(ESRS S1), workers in the value chain (ESRS S2), affected
communities (ESRS S3), and business conduct (ESRS
G1).
For more detailed information on Elkem’s management
of these material topics, reference is made to the
sustainability statement (previously the ESG report),
which describes the group’s commitments, actions,
and performance related to environmental, social, and
governance matters. The chapters on own workforce and
workers in the value chain are prepared in accordance
with the Norwegian Transparency Act (2021), the UK
Modern Slavery Act (2015), and the Forced Labour in
Canadian Supply Chains Act (2023). The sustainability
statement forms an integral part of the annual report, has
been subject to independent third‑party verification, and
is available on pages 168–171.
Health, safety, and environment (HSE)
HSE forms the foundation of Elkem’s business,
consistently holding the top priority. Guided by a zero-
harm philosophy, our HSE management system, FORUS,
is methodically implemented to progress toward this
paramount goal.
The safety of our employees stands as the cornerstone
of our philosophy. The group firmly believes that Elkem’s
operations can be conducted without harm to employees
and individuals. Elkem allocates significant resources to
hazard identification and the implementation of suitable
measures, aiming to reduce risks to an acceptable level.
048 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
This ensures that all employees and contractors working Further information on emissions performance and
at Elkem can conclude their tasks as healthy as when they the group’s climate‑related measures is provided in the
commenced. climate change section of the sustainability statement on
pages 103–113.
Even though safety is a priority at Elkem, three fatalities
and one life-changing injury occurred in two separate Diversity, inclusion, and equality
accidents in China and France. These accidents highlight Elkem is committed to fostering equal opportunities
the importance of ensuring that all employees understand within a diverse and inclusive working environment.
that safety should always take precedence over all other The group values the uniqueness of every individual and
activities. expects all employees to act in accordance with these
principles and Elkem’s four core values. Human capital
Elkem’s commitment to a safe workplace remains the top is considered Elkem’s most important asset, and the
priority. The total injury rate for own employees per million diversity of backgrounds, experiences, knowledge, and
working hours was 3.6 in 2025 compared to 3.5 in 2024, capabilities contributes significantly to the group’s culture,
while for contractors it was 3.7 in 2025 compared to 5.7 performance, and long‑term value creation. Elkem has
in 2024. Elkem made significant efforts to improve its zero tolerance for discrimination or harassment.
health, safety, and environment (HSE) practices through
the implementation of the advanced and upgraded version To support diversity, equality, and inclusion (DEI), Elkem
of the FORUS programme in 2025. This upgraded HSE has established policies and practices applicable across
initiative aimed to improve awareness, precision, and the organisation. These include the Code of conduct,
follow-up of safe behaviour across all operations. The the Human rights policy, the People policy, and global
programme included comprehensive training sessions standard procedures covering recruitment, working
covering essential topics related to the lifesaving rules and conditions, promotions, competence development,
FORUS introductions. A comprehensive understanding onboarding and offboarding, and protection against
of the health and safety risks has the highest priority in harassment.
the group, and the understanding is founded on critical
process control combined with a culture of precision and Elkem’s DEI vision is to build a workplace where diversity
continuous improvement. is embraced, equity is ensured, and inclusion is actively
fostered, enabling employees to feel engaged, valued,
For detailed insights into Elkem’s management system, and a sense of belonging. Promoting DEI supports
reporting, safety metrics, and organisational and value the attraction and retention of talent, strengthens
chain follow-up, consult the chapter on own workforce in competitiveness and profitability, and enhances Elkem’s
the sustainability statement on pages 135-145. ability to deliver market‑leading products and services in a
responsible and sustainable manner.
Elkem’s total greenhouse gas emissions increased by 3.5
per cent on a location‑based basis in 2025. The group’s Governance
scope 1 emissions decreased by 3.45 per cent, mainly as a The board of directors acknowledges the significance of
result of lower production levels and the impact of planned good corporate governance. The goal is to ensure equal
maintenance activities. Scope 2 emissions (location‑based) treatment and protection of all shareholders’ interests,
decreased by 9.75 per cent compared to the previous year. compliance with laws and regulations, and adherence to
high ethical and social standards.
In 2025, the share of biocarbon used in production
increased, primarily due to changes in the production mix. Elkem is subject to corporate governance reporting
As a result, the biogenic share of Elkem’s total emissions requirements under section 2-9 of the Norwegian
increased from 19 per cent to 21 per cent. Increasing the Accounting Act and the Norwegian Code of Practice for
use of biocarbon reductants is key to reduce Elkem’s Corporate Governance, cf. section 7 of the continuing
emissions. Access to sufficient volumes of certified obligations of stock exchange-listed companies.
biocarbon is expected to remain challenging in the
coming years. Consequently, continued research and Elkem’s board consists of 11 persons as of 31 December
development related to carbon capture and storage (CCS) 2025, of which eight are shareholder-elected and three
and carbon capture and utilisation (CCU) are expected to are elected by and among the group’s employees. Four
be key measures for reducing Elkem’s absolute emissions of the shareholder-elected board members represent the
over the long term. majority shareholder, while the other four shareholder-
Elkem Annual report 2025 049
elected members are independent. Elkem had 11 board stable financial position. To address these risks, Elkem has
meetings in 2025. A detailed overview of the board concentrated on developing a resilient and geographically
members’ attendance may be found in the board of diverse supply chain and ensuring a robust financial
directors’ report on salary and other remuneration to position.
leading personnel in Elkem.
Geopolitical tensions, sanctions, and changing regulatory
The board of directors’ report on corporate governance framework conditions continue to impact Elkem, and
can be found on page 56 in this report and is an integral have introduced greater uncertainty and complexity to our
part of the Board of directors’ report. operating environment. Examples of this include the EU’s
decision to introduce safeguard measures on imports of
Risk management certain ferroalloys from third countries, including Norway
Elkem’s board and management maintain a robust and Iceland, and the US’ introduction of countervailing
approach to risk management, integrating it as a key duties on silicon metal imports from Norway. Elkem’s
part of the group’s corporate governance structure to regionalised value chains have enabled us to respond
monitor the risk profile and ensure that adequate risk to the changing market conditions, and the group has
management processes are in place. actively engaged with relevant authorities to promote
stable and predictable operating conditions. In addition,
To effectively monitor the group’s risk profile and confirm Elkem monitors sanctions lists and trade restrictions to
the adequacy of the risk management procedures, ensure compliance.
Elkem conducts an annual risk mapping process. This
process involves interviews with representatives from Elkem’s financial results have been influenced by
divisions and corporate staff functions. Each risk factor macroeconomic factors, such as slow growth, high
is assessed based on internal and external conditions, inflation, and increased interest rates, all of which have
considering factors such as perceived likelihood, reduced demand in industries like construction and
estimated financial impact, time horizon, and mitigating automotive. To address these challenges, Elkem carefully
activities. By identifying key risks for each division and monitors market trends and maintains strong cost
corporate function, the board and management obtain management. Its integrated value chain also provides
a comprehensive understanding of the risk picture and production flexibility across various product lines,
financial risk tolerance. A summary of this risk analysis allowing the group to better manage periods of economic
can be found on page 68 of this annual report. downturn.
Evaluating climate-related risks and opportunities is a key Elkem’s working environment involves substantial
part of Elkem’s approach to risk management, covering inherent risks, such as potential injuries, fires, and
both transitional and physical risks. Elkem’s production explosions linked to high-temperature smelting and
facilities are typically situated near the coast or rivers, or chemical production processes. The safety of our
within urban or local communities. Higher temperatures employees and contractors is a main priority, and Elkem
and extreme weather could disrupt operations and uses considerable resources to prevent hazards and
damage assets. Each business unit has assessed its reduce risks to an acceptable level. This includes safety
exposure to climate change in accordance with the instructions, training, physical protection, and adherence
Corporate Sustainability Reporting Directive (CSRD). to Elkem Business System (EBS) principles.
Elkem is committed to reducing its environmental impact
by sourcing raw materials sustainably, using renewable Elkem operates globally and faces several financial
energy, energy recovery projects, reducing dust and NOX risks, such as currency, interest rate, liquidity, and
emissions, and incorporating biogenic reduction agents counterparty risks. Its earnings, cash flow, and equity can
in smelting processes. The group also prioritises recycling be affected by changes in exchange rates. To manage
and cutting waste. this, Elkem uses a set cash flow hedging programme to
limit the impact of currency fluctuations. Additionally,
In recent years, rare and unpredictable events called the company balances its foreign exchange exposure by
“black swans” have led to major crises, such as the holding loans in foreign currencies that correspond to its
2008 global financial crash and the Covid-19 pandemic. underlying assets.
These examples show the importance of general risk
preparedness, strong supply chains, and maintaining a
050 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
Liquidity risk refers to a company’s capability to meet Meetings are attended by the external auditors, together
its financial obligations. Elkem has strong cash reserves, with representatives from management and the finance
substantial undrawn credit facilities, and stable long- organisation, ensuring a thorough and well‑informed
term financing. At year-end 2025, Elkem complied with review process.
all covenant requirements in its loan agreements. Elkem
holds an investment-grade rating of BBB- from Scope. Future prospects
Scope placed the rating under review for a possible In January 2025, Elkem announced that it had initiated
upgrade following Elkem’s announcement of the strategic a strategic review of the Silicones division, with the
review for the Silicones division. Elkem is dedicated to purpose to streamline Elkem and enable allocation of
maintaining an investment-grade profile, aiming for a capital to accelerate growth in the Silicon Products and
leverage ratio of 1.0–2.0x over the business cycle. Carbon Solutions divisions. The decision followed a
comprehensive assessment of Elkem’s growth and return
Counterparty credit risk is managed by monitoring the prospects, capital allocation priorities, and the market
receivables portfolio and using credit insurance and dynamics affecting the global silicones industry.
payment conditions. Elkem’s financial transactions and
deposits are conducted with established and reputable At 13 February 2026, Elkem signed an agreement to
banks. transfer the majority of its Silicones division to Bluestar.
This transaction will be settled through the cancellation
Elkem has established a liability insurance policy covering of 338 338 536 Elkem shares currently held by Bluestar
all current, former, and future members of the board and was approved by an extraordinary general meeting at
of directors as well as its officers. The policy provides 9 March 2026. Subject to customary closing conditions,
protection against pure financial losses, including defence completion is expected during the second quarter of 2026
costs, that the insured individuals are legally obligated to and after the release of Elkem’s annual report.
pay resulting from or associated with claims. The liability
insurance extends to cover any financial losses incurred The transaction will not affect the 2025 financial
by Elkem and its subsidiaries due to securities claims and statements. Upon closing, the book value of the
indemnified claims against the board of directors and its transferred assets will be derecognised against equity,
officers. with no gain or loss recognised in the statement of profit
or loss.
See note 31 in the financial statements for more details on
financial risk. Following completion, Elkem will have a more focused
portfolio centred on Silicon Products and Carbon
Financial reporting process Solutions, which strengthens its strategic flexibility and
Elkem has established robust routines to ensure that the long-term value creation potential.
financial statements are prepared in accordance with
applicable laws, regulations, and adopted accounting Market conditions remained challenging through 2025,
policies. These routines are documented in internal characterised by weak demand, lower sales prices,
reporting manuals, which are updated regularly to reflect and continued geopolitical uncertainty with intensified
changes in accounting standards and principles. trade barriers. In the near term, Silicon Products is still
experiencing weak demand, although the division is
The group’s financial reporting plan includes defined benefitting from ongoing cost improvements and higher
controls and review procedures to secure the consistency ferrosilicon prices. Carbon Solutions expects a slight
and accuracy of reported figures. Financial information is improvement in sales volumes, but overall demand
consolidated and subject to systematic controls at several remains weak. In the Silicones division, Chinese producers
levels within the respective divisions, ensuring a high have recently succeeded in raising sales prices, but
standard of reliability in the group’s financial reporting. underlying demand continues to be soft; the division is
expected to benefit from the higher price levels if they
The audit committee reviews the quarterly, half‑year, and are sustained. Potential trade regulations and protective
annual reports, with particular attention to key accounting measures are expected to influence Elkem’s markets
matters such as provisions and liabilities, significant going forward.
estimates and judgements, and other issues that may
materially affect the financial statements. The committee
also oversees Elkem’s ESG and climate‑related reporting.
Elkem Annual report 2025 051
Despite near‑term uncertainty, the board of directors For Elkem ASA, the operating income amounted to NOK
continues to view Elkem’s fundamentals and long‑term 8 461 million in 2025 compared to NOK 9 710 million in
prospects as strong. The group benefits from a 2024. The operating profit ended at NOK 131 million in
skilled global organisation, a cost‑competitive and 2025, compared to NOK 181 million in 2024.
well‑integrated business model, and a solid operational
platform. Elkem aims to strengthen its position in both The net change in cash and cash equivalents amounted
Eastern and Western markets, focusing on financially to NOK 1 262 million negative. Cash flow from operating
attractive opportunities while closely monitoring activities amounted to NOK 550 million negative,
geopolitical developments and potential trade restrictions. investing activities of NOK 523 million positive, and
Climate‑related regulations and the global shift toward negative cash flow from financing activities of NOK 1 236
lower‑emission solutions continue to influence market million.
conditions. Elkem is well positioned to meet these
requirements through its high share of renewable energy Elkem ASA’s equity was NOK 18 617 million at the end of
and its targeted climate ambitions. 2025. The equity ratio* ended at 53 per cent. Profit for
the year was NOK 2 900 million. The net interest-bearing
Elkem’s financial position is considered to be good at liabilities amounted to NOK 9 221 million per 31 December
the end of the year with a robust equity ratio and strong 2025. Cash and cash equivalents amounted to NOK 1 468
liquidity position. million.
Elkem ASA Allocation of 2025 net profit
Elkem ASA is the parent company of the Elkem group. The board of directors proposes that the profit for the
The company’s accounts have been presented in year be transferred to retained earnings. In light of the
accordance with the Norwegian Accounting Act and strategic review and prevailing market conditions, the
generally accepted accounting practices in Norway. The board proposes that no dividend be distributed for the
accounts are prepared on the basis of a going concern year. In total the board of directors proposes the following
assumption. allocation (in NOK million):
Profit for the year to retained earnings NOK 2 900 million
The board of directors of Elkem ASA
Oslo, 10 March 2026
Bo Li Dag Jakob Opedal Olivier Tillette de Clermont- Wei Yao
Chair Vice chair Tonnerre Board member
Board member
Dachuan Dong Grace Tang Nathalie Brunelle Marianne Elisabeth Johnsen
Board member Board member Board member Board member
Terje Andre Hanssen Marianne Færøyvik Thomas Eggan Helge Aasen
Board member Board member Board member CEO, Elkem ASA
*See Note 26 Interest-bearing liabilities
052 Year in review | Board of directors’ report
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem Annual report 2025 053
Board of
directors
Bo Li Dag Jakob Opedal Marianne Elisabeth Olivier Tillette de
Chair Vice chair Johnsen Clermont-Tonnerre
Board member Board member
Wei Yao Dachuan Dong Grace Tang Nathalie Brunelle
Board member Board member Board member Board member
Marianne Færøyvik Terje Andre Hanssen Thomas Eggan
Board member Board member Board member
For more information, please see elkem.com.
054 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
Corporate
management
Helge Aasen Morten Viga Katja Lehland Håvard Moe
Chief executive officer Chief financial officer SVP human resources SVP technology
Morten Magnus Voll Sandy Chen Inge Grubben-Strømnes Luiz Simao
SVP strategy & business SVP Silicones SVP Silicon Products SVP Carbon Solutions
development
Louis Vovelle* Asbjørn Søvik**
SVP innovation & R&D SVP green ventures & digital
For more information, please see elkem.com.
*Louis Vovelle retiered from Elkem in February 2025.
**Asbjørn Søvik stepped out of corporate management in October 2025.
Elkem Annual report 2025 055
Corporate
governance
The board of directors’ report on corporate governance
Good corporate governance builds trust and creates value
for shareholders, employees, and other stakeholders. Elkem
values strong relationships with society and all affected
groups, and aims to maintain high standards in environmental,
social, and governance (ESG) criteria. This report, along with
the sustainability statement, annual report, and website,
documents Elkem’s activities and results.
Elkem is subject to corporate governance reporting → Section 6: Voting on members to the board of
requirements according to section 2-9 of the Norwegian directors and the nomination committee takes place
Accounting Act and the Continuing obligations of stock as a combined vote. In 2025, decisive considerations
exchange listed companies at the Oslo Stock Exchange. were made for re-elections due to the ongoing
Elkem’s board of directors endorses “The Norwegian strategic review of the Silicones division, which further
Code of Practice for Corporate Governance” (the “Code”), underlined the aspect of totality in the nominations
most recently revised on 25 August 2025 and issued and a combined vote. Pursuant to the Code the
by the Norwegian Corporate Governance Policy Board shareholders should be able to vote on each individual
(NCGB). This report follows the system used in the Code, candidate nominated for election.
and forms part of the board of directors’ report.
→ Section 7: The nomination committee justifies its
Elkem generally follows the recommendations set out in proposals combined, and not separately for each
the Code, but has deviations in the following sections: board member pursuant to the Code. The nomination
committee focuses on the combined qualifications
→ Section 3: The board of directors’ authorisation to and experience, as well as diversification of
increase the share capital corresponding to 10 per cent background and gender.
of the current share capital can be used for several
purposes, to ensure flexibility and the ability to act
quickly. Pursuant to the Code, such authorisation
should be intended for a defined purpose.
056 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
1. Implementation and reporting on Elkem’s business scope is described in section 3 of the
corporate governance articles of association:
Elkem’s corporate governance policy is based on the
Code, and as such designed to establish a basis for good → The object of the company is to develop and engage
corporate governance to support achievement of the in industry, mining, trade and transportation, as well
company’s core objectives, strategies, and risk profile on as exploration and exploitation of natural resources.
behalf of its shareholders, including the achievement of The company may also develop, acquire, and exploit
sustainable profitability. patents, inventions, and technical know-how. The
company may participate directly or indirectly, or
Elkem believes good corporate governance involves by other means, in companies engaged in activities
openness and trustful cooperation between all parties outlined above, or in activities that promote or support
involved in the group: the shareholders, the board of such objects.
directors and executive management, employees,
customers, suppliers, public authorities, and society in Elkem’s main strategic goals are dual play growth and
general. green leadership. Dual-play growth means to drive
growth and value creation in all three divisions while
By pursuing the principles of corporate governance, securing supply chain resilience through geographical
the board of directors and management contribute diversification. Green leadership means that Elkem is
to achieving open communication, equal rights for all cutting emissions and resource use to reach climate-
shareholders, and good control and corporate governance neutral production and enabling the green transition
mechanisms. The board of directors assesses and through supply of critical materials. To support its
discusses Elkem’s corporate governance policy, strategy, strategic goals, Elkem will focus on operational
and risk profile on a yearly basis. excellence, digitalisation, people development, and ESG
(environmental, social, and governance). In addition,
Elkem aspires to comply with the recommendations of Elkem’s divisions will focus on developing and maintaining
the Code. If the Code is deviated from, the deviation is sustainable low-cost positions. Together these initiatives
described and explained in the relevant section of this comprise the group’s strategic and operational goals to
statement. A summary of the deviations is also provided secure profitable and sustainable growth.
above.
Elkem operates in capital intensive and cyclical industries
No deviations from the Code. and has 31 main production sites and an extensive
network of sales offices around the world. While this gives
2. Business competitive strengths, it also gives exposure to a range
Founded in 1904, Elkem is one of the world’s leading of risk factors. The board of directors has defined goals
suppliers of advanced silicon-based materials. The and strategies for the business and has a clear focus
company produces silicones, silicon products, and carbon on risk management to create value for the company’s
solutions by combining natural raw materials, renewable shareholders.
energy, and human resourcefulness. Elkem’s mission is to
provide advanced silicon-based materials shaping a better Macroeconomic conditions have been weak during the
and more sustainable future, and to help our customers past years, and the board of directors has focused on
to create and improve essential innovations like electric actions to mitigate negative impact on Elkem by reducing
mobility, digital communications, health and personal costs and investments. In addition, Elkem has initiated
care, as well as smarter, more sustainable cities. a strategic review to sell the Silicones division in order
to streamline the company and redirect capital towards
Elkem is a signatory to the UN Global Compact and accelerating growth in the Silicon Products and Carbon
applies sustainability in line with the principles of the Solutions divisions. Elkem is confident that the potential
UN Global Compact. Elkem is committed to develop its transaction will represent the best possible outcome for
business in support of the ambitions of the Paris Climate the Silicones division as well as the company, benefiting
Agreement and the UN Sustainable Development Goals all stakeholders. More details on risk management
(SDGs). principles and an overview of Elkem’s main risks are
presented in the annual report. See also section 10 below.
Elkem Annual report 2025 057
Risk management and internal control systems are in Elkem aims to maintain an investment grade profile
place to manage operational risks. The company aims to and targets a leverage ratio, defined as net interest-
maintain a sound financial profile with a robust capital bearing debt to EBITDA, at the level of 1.0 - 2.0x, based
structure. The target, based on earnings over the business on earnings over the business cycle. As at 31 December
cycle, is to have a leverage ratio of 1.0x-2.0x, defined as 2025, the leverage ratio was 3.5x. This higher ratio reflects
net interest-bearing debt to EBITDA. the weak market sentiment characterised by low demand
and reduced sales prices. The board of directors’ target
Sustainability is central in Elkem’s business strategy. is to ensure a leverage ratio in line with policy over the
Elkem defines sustainability work as continuous efforts business cycle. In addition, Elkem aims to keep a robust
to maximise the positive impact on the environment and liquidity reserve and a smooth maturity profile on its loan
societies, as well as to minimise any negative impact. portfolio to mitigate financing and liquidity risk. As at
31 December 2025, available cash and cash equivalents
Elkem has implemented guidelines and procedures in amounted to NOK 3 806 million, providing a strong
accordance with section 2-9 of the Accounting Act, liquidity position. In addition, Elkem has undrawn credit
including a code of conduct, a policy on anti-corruption, facilities amounting to NOK 6 658 million. The board of
and CSR polices. Elkem’s ESG sustainability report is directors considers Elkem’s capital structure, including
integrated into the annual report for 2025. equity and debt structure, to be appropriate to the
company’s objective, strategy, and risk profile.
Elkem’s objectives, strategy, risk profile, and financial
targets are evaluated by the board of directors on Elkem’s dividend policy aims to align dividend
an annual basis. The board also reviews the group’s distributions with the underlying earnings and cash flow
performance in ESG, evaluates the climate risks and of the group, targeting a dividend pay-out ratio of 30-50
opportunities, and makes regular assessments to ensure per cent of the group’s annual profit.
compliance and high-quality standards.
The board of directors proposes not to distribute a
No deviations from the Code. dividend for the financial year 2025. The board of
directors has not been granted any authorisation to
3. Equity and dividends approve distribution of dividends.
As at 31 December 2025, the group’s equity was NOK
24 026 million, which is equivalent to 51 per cent of total At the annual general meeting on 30 April 2025, the board
assets. The total issued share capital of Elkem amounted of directors was granted the following authorisations:
to NOK 3 197 206 890 divided into 639 441 378 shares,
each with a nominal value of NOK 5.
058 Year in review | Corporate governance
Table of contents Board of directors’ report Sustainability statement Financial statements
→ To ensure that the board of directors has financial 4. Equal treatment of shareholders
flexibility and to enable quick access to the market in All shareholders shall be treated on an equal basis, unless
the event of an acquisition with shares as settlement there is just cause for treating them differently. In line
or for general corporate purposes, the board of with the 2025 NUES recommendation, the board clarifies
directors was granted an authorisation to increase the that if a resolution is made to increase the share capital
company’s share capital by up to NOK 319 720 689 where shareholders’ pre-emptive rights are set aside, the
corresponding to 10 per cent of the company’s current rationale for such deviation will be specifically explained in
share capital. To exercise the authorisation in the the stock exchange announcement disclosing the capital
best possible commercial manner, it may be relevant increase. The explanation will address how the principle of
in certain situations to make a private placement of equal treatment of shareholders is safeguarded.
shares directed at certain named persons and/ or
enterprises. It may also be appropriate to use the No deviations from the Code.
authorisation in the event of acquisition of business/
assets with shares as settlement. It was therefore 5. Shares and negotiability
approved that the board of directors was authorised The shares in Elkem are freely negotiable and there are
to deviate from the shareholders’ preferential rights no restrictions on any party’s ability to own, trade or vote
when using the authorisation. The authorisation for the share in the company. Elkem has only one class of
covers share capital increases against contribution in shares. Each share grants the holder one vote and there
kind and share capital increase in connections with are no structures granting disproportionate voting rights.
mergers. The authorisation is valid until the annual
general meeting in 2026, but no longer than to and No deviations from the Code.
including 30 June 2026. This authorisation was not
utilised in the financial year ended 31 December 2025. 6. General meetings
The board of directors will ensure that the company’s
→ In order to allow the board of directors to utilise the shareholders can participate and cast their vote in
mechanisms permitted by the Norwegian Public the general meetings, including through electronic
Limited Liability Companies Act to acquire treasury attendance and voting.
shares, the board of directors was granted an
authorisation to acquire shares in the company, with a The annual general meeting in 2025 was held as a digital
nominal value of up to NOK 319 720 689, equal to 10 meeting. The shareholders could attend the general
per cent of the current share capital. The authorisation meeting through a live webcast and submit questions
can be used to fulfil the company’s obligations in relating to the items on the agenda and cast their votes
connection with acquisitions, incentive arrangements in real time. The webcast was organised by DNB Bank
for employees, fulfilment of earn-out arrangements, ASA, Elkem’s registrar in the Central Security Depository,
sale of shares to strengthen the company’s equity, or Verdipapirsentralen ASA (Euronext Securities Oslo), and
deletion of shares. The maximum amount that can its subcontractor.
be paid for each share is NOK 150 and the minimum
is NOK 1. The authorisation is valid until the annual The board of directors will further ensure that:
general meeting in 2026, but no longer than to and
including 30 June 2026. This authorisation was not → notices for the general meetings are sent to all
utilised in the financial year ended 31 December 2025. shareholders individually, or to their depository
banks, at least 21 days in advance, that all matters
Deviations from the Code: The board of directors’ to be considered by the meeting are specified, and
authorisation to increase the share capital with an amount that relevant documents are made available on the
up to NOK 319 720 689, corresponding to 10 per cent of company’s website;
the current share capital can be used for several purposes.
Elkem believes that this authorisation is important in → the resolutions and any supporting documentation
order to allow the board of directors, in the interest of are sufficiently detailed, comprehensive, and specific,
time, to act quickly in connection with a transaction or allowing shareholders to understand and form a view
other corporate events where it is in the shareholders and on all matters to be considered at the general meeting;
Elkem’s interest to increase the share capital.
Elkem Annual report 2025 059
→ the CEO, the chair of the board of directors, and the 7. Nomination committee
chair of the nomination committee attend the general According to section 7 of Elkem’s articles of association,
meeting; and the company shall have a nomination committee
consisting of two or three members in accordance with
→ the general meeting is able to elect an independent the decision of the general meeting. The members
chair for the general meeting. of the nomination committee are elected by the
annual general meeting. The general meeting has also
The articles of association of Elkem do not specify approved guidelines for the duties of the nomination
a deadline for shareholders to give notice of their committee, elected the chairperson, and determined the
attendance at the general meeting. The board of directors remuneration of the members of the committee.
may still encourage shareholders to give such notice
within a set deadline. A shareholder holding shares As of 31 December in 2025 the nomination committee
through a nominee account must, however, notify Elkem comprises the following members:
two days prior to the date of the general meeting (unless
the board of directors has included a shorter notification → Sverre S. Tysland / Chair / Practicing lawyer /
deadline in the notice for the general meeting). Independent / Re-elected in 2024 for a term of office
of two (2) years until the annual general meeting in
Shareholders who are unable to participate in the general 2026
meeting will be given the opportunity to vote by proxy
or through written voting in a period prior to the general → Lingxiao Liu / Committee member / HR Director of
meeting. The company will in this respect provide China National Bluestar (Group) Co, representing the
information on the procedure and prepare a proxy form/ majority shareholder / Elected in 2024 for a term of
written voting form. office until the annual general meeting in 2026
The company will nominate a person to act as proxy. → Anne Grete Dalane / Committee member / Vice
President Improvement Project Finance in Yara
All board members and members of the nomination International ASA / Independent / Re-elected in 2025
committee are encouraged, but not obliged, to participate for a term of office of two (2) years until the annual
in the annual general meeting. The chair of the board general meeting in 2027
was represented by the vice chair at the annual general
meeting in 2025, due to the unavailability of the chair. The members of the nomination committee have been
elected to take into account the interests of shareholders
Elkem has chosen not to follow the recommendation in general, and to consider and ensure compliance with
to vote separately on each candidate nominated for the the guidelines in section 9 of the Code regarding the
board of directors and the nomination committee. The composition and independence of the board of directors.
process of the nomination committee is focused on the The nomination committee does not include members of
combined qualification and experience of the proposed the board of directors or the executive management.
members to the board of directors and the nomination
committee, and the voting was therefore carried out as Shareholders are informed about how they can propose
a combined vote. In 2025, decisive considerations were candidates to the board of directors and the nomination
made for re-elections due to the ongoing strategic review committee. Information on the procedure and deadlines
of the Silicones business, which further underlined the for submitting proposals is available on the company’s
aspect of totality in the nominations and a combined vote. website.
Deviations from the Code: Voting on members to the The nomination committee shall make recommendations
board of directors and the nomination committee takes to the general meeting for the election of shareholder
place as a combined vote. elected board members and members of the nomination
committee, and the remuneration for the board of
directors and the nomination committee. When
nominating shareholder representatives to the board of
directors, the nomination committee presents relevant
information about the candidates, together with an
evaluation of their independence.
060 Year in review | Corporate governance
Table of contents Board of directors’ report Sustainability statement Financial statements
In connection with the nomination committee’s work with → Wei Yao / Board member / Representing the majority
proposing candidates, and to ensure that the candidates shareholder / Elected in 2024 as new board member
represent a broad group of the company’s shareholders, until the company’s annual general meeting in 2026;
the nomination committee is in contact with the board
of directors, the CEO, and major shareholders. The → Grace Tang / Board member / Independent / Re-
nomination committee will consider holding individual elected in 2025 for a term of one (1) year until the
discussions with each member of the board of directors, company’s annual general meeting in 2026;
and furthermore, ensure that the board of directors is
composed to comply with legal requirements and the → Marianne Elisabeth Johnsen / Board member /
Code. Independent / Re-elected in 2025 for a term of office
of one (1) year until the company’s annual general
The nomination committee has justified its proposal for meeting in 2026;
the board of directors. While the nomination committee
presents relevant information about each candidate → Dachuan Dong / Board member / Representing the
separately, the nomination committee focuses on the majority shareholder / Elected in 2024 as new board
combined qualifications and experience of the proposed member until the company’s annual general meeting
members of the board of directors when presenting its in 2026;
proposal to the general meeting. Information on how to
propose candidates is available on Elkem’s webpage. → Terje Andre Hanssen / Board member / Elected by
and from the employees / Elected for a term of office
Deviations from the Code: The nomination committee until the annual general meeting in 2026;
justifies its proposals combined and not separately for
each board member. → Marianne Færøyvik / Board member / Elected by and
from the employees / Elected for a term of office until
8. Board of directors: composition and the annual general meeting in 2026 and;
independence
As of 31 December 2025, the board of directors of → Thomas Eggan / Board member / Elected by and from
Elkem comprised 11 members, of which eight members, the employees / Elected for a term of office until the
including the chair, are shareholder elected. The remaining annual general meeting in 2026.
three members are elected by and among the company’s
employees. The board of directors of Elkem comprise of The composition of the board of directors is considered
the following persons: to attend to the common interests of all shareholders
and meet the company’s need for expertise, capacity,
→ Bo Li / Chair / Representing the majority shareholder and diversity. Four of the board members are women,
/ Re-elected in 2025 for a period of two (2) years until and none of the members of the company’s executive
the company’s annual general meeting in 2027; management are members of the board of directors.
→ Dag Jakob Opedal / Vice chair / Independent / Re- The board of directors is composed so that it can act
elected in 2025 for a term of office of one (1) year until independently of any special interests. The majority of
the company’s annual general meeting in 2026; the shareholder elected board members are independent
of the executive management and material business
→ Olivier Tillette de Clermont-Tonnerre / Board connections of the company.
member / Representing the majority shareholder /
Re-elected in 2024 for a term of office of two (2) years Further, four out of the current eight shareholder elected
until the company’s annual general meeting in 2026; board members are independent of the company’s
majority shareholder. Further information on each of
→ Nathalie Brunelle / Board member / Independent / the board members is presented at elkem.com and
Re-elected in 2024 for a term of two (2) years until the information on their record of attendance at board
company’s annual general meeting in 2026; meetings can be found in the board of directors’ report on
salary and other remuneration for leading personnel for
2025.
Elkem Annual report 2025 061
Members of the board of directors are encouraged to The board of directors has established an audit
own shares in the company, however, with caution not to committee and a remuneration committee.
let this encourage a short-term approach which is not in
the best interests of the company and its shareholders No deviations from the Code.
over the longer term. As of 31 December 2025, the
following board members owned shares in the company: The audit committee
Olivier Tillette de Clermont-Tonnerre (15 517 shares), Dag The board of directors has established an audit
Jakob Opedal (40 000 shares through Alcaran AS), and committee which is a working committee for the
Marianne Færøyvik (4 950 shares). board of directors, preparing matters and acting in an
advisory capacity. The audit committee is responsible
No deviations from the Code. for overseeing the financial and sustainability reporting
and disclosure. The audit committee assists the board
9. The work of the board of directors of directors with assessments of the integrity of the
The board of directors’ work follows an annual plan, company’s financial statements, financial reporting
with a particular focus on objectives, strategy, and processes, internal controls, risk management, and
implementation. The plan is evaluated and approved performance of the external auditor.
around the beginning of each calendar year. The board
of directors also annually evaluates its performance and The audit committee is responsible for preparatory work
expertise, the evaluation is presented to the nomination and supervision related to the board’s management of
committee. sustainability and non-financial reporting, internal control
over sustainability and non-financial reporting, and
The board of directors has implemented instructions for sustainability-related risk management.
the board of directors and the executive management,
which are focused on determining the allocation of The board of directors has issued instructions for the work
internal responsibilities and duties. The objectives, of the audit committee, and the duties and composition
responsibilities, and functions of the board of directors of the committee are in compliance with the Norwegian
and the CEO are in compliance with rules and standards Public Limited Liability Companies Act. The members
applicable to the group and are described in the of the audit committee are elected by and amongst the
company’s annual report. The board of directors has also members of the board of directors for a term of up to
implemented procedures to ensure that members of the two years and comprised the following persons as of 31
board of directors and executive personnel make the December 2025:
company aware of any material interests they may have
to be considered by the board of directors. The board of → Dag Jakob Opedal / Chair / Independent
directors will also be chaired by some other member of
the board if the board is to consider matters of a material → Grace Tang / Member / Independent
character in which the chair of the board is, or has been,
personally involved. → Wei Yao / Member / Representing the majority
shareholder
The board of directors held 11 board meetings in 2025.
Most board members have attended all board meetings The committee members have the overall competence
during their terms of office, and the overall attendance required to fulfil their duties based on the organisation
rate was 95 per cent. The instructions for the board of and operations of the group, at least one member of the
directors state how agreements with related parties shall audit committee is competent in respect of finance and
be handled. In the event of a material transaction between audit. The majority of the members are independent.
the company and its shareholders, a shareholder’s parent
company, members of the board, executive management, No deviations from the Code.
or closely related parties of any such parties, the board
will arrange for a valuation to be obtained from an
independent third party. Agreements with related parties
will be disclosed in the directors’ annual report.
062 Year in review | Corporate governance
Table of contents Board of directors’ report Sustainability statement Financial statements
The remuneration committee 10. Risk management and internal control
The board of directors has appointed a remuneration It is ultimately the responsibility of the board of directors
committee which comprised the following persons as of to ensure that the company has sound and appropriate
31 December 2025: internal control systems and risk management systems
reflecting the extent and nature of the company’s
→ Bo Li / Chairperson / Representing the majority activities. Sound risk management is an important tool
shareholder to create trust, ensure a good environment, health and
safety standards, and enhance value creation.
→ Olivier Tillette de Clermont-Tonnerre / Member /
Representing the majority shareholder Evaluation of climate-related risks and opportunities is
an important part of Elkem’s overall risk management
→ Marianne Elisabeth Johnsen / Member / Independent processes. As part of this work, Elkem has prepared a
global climate roadmap targeting reductions of absolute
The remuneration committee is a preparatory and CO2 emissions and of the group’s relative product
advisory committee for the board of directors in carbon footprint. Elkem is reporting on climate risks and
questions relating to the company’s compensation of the opportunities according to the Corporate Sustainability
executive management. The purpose of the remuneration Reporting Directive (CSRD) implemented by the EU.
committee is to ensure thorough and independent Evaluation of climate related risks has been implemented
preparation of matters relating to compensation to as an integrated part of Elkem’s yearly risk assessment.
the executive personnel. The remuneration committee Elkem complies with all laws and regulations that apply
puts forth a recommendation for the board of directors’ to the group’s business activities. The group’s Code of
guidelines for remuneration to senior executives in conduct sets out the overall ethical guidelines, which
accordance with section 6-16a of the Norwegian Public apply to all Elkem employees, members of the board of
Limited Liability Companies Act. directors, as well as those acting on Elkem’s behalf.
The members of the remuneration committee are elected The company has a comprehensive set of relevant
by and amongst the members of the board of directors corporate manuals and procedures, which provide
for a term of up to two years and are independent of the detailed descriptions of procedures covering all aspects of
company’s executive management. managing the operational business. The procedures and
manuals are continuously revised to reflect best practice
The board of directors has issued instructions for the work derived from experience or adopted through regulations.
of the remuneration committee. The company’s compliance programme has been
reviewed by a third party, which validated a strong level of
No deviations from the Code. compliance maturity. A visible and accessible channel for
reporting misconduct (whistleblower) is in place.
Elkem Annual report 2025 063
The board of directors conducts annual reviews of the The board members, or companies associated with board
company’s most important areas of exposure to risk and members, have not been engaged in specific assignments
such areas’ internal control arrangements. A summary of for the company in addition to their appointments as
the main risks is presented in the annual report. The board members of the board of directors.
of directors describes the main features of the company’s
internal control and risk management systems connected The remunerations for the period from May 2025 until the
to the company’s financial reporting in the company’s annual general meeting in 2026 are as follows:
annual report. This covers the culture of control, risk
assessment, controlling activities and information, Board of directors:
communication, and follow-up. The board of directors → Chair: NOK 1 030 630
is obliged to ensure that it is updated on the company’s
financial situation, and to continuously evaluate whether → Vice chair: NOK 772 972
the company’s equity and liquidity are adequate in
terms of the risk from, and the scope of, the company’s → Board members: NOK 515 315
activities. The board of directors shall immediately take
necessary actions if it is demonstrated at any time that → Observers: NOK 257 657
the company’s capital or liquidity is inadequate. The
company focuses on frequent and relevant management Audit committee and remuneration committee:
reporting to the board of directors. The reports contain → Leader: NOK 185 514
matters related to health and safety, market development,
operations, and financial performance. The purpose → Member: NOK 123 675
is to ensure that the board of directors has sufficient
information for decision-making and is able to respond The total compensation to members of the board of
quickly to changing conditions or important incidents. directors is disclosed in the board of directors’ report on
Board meetings are held regularly, and management salary and other remuneration for leading personnel for
reports are provided to the board on a monthly basis. 2025.
No deviations from the Code. No deviations from the Code.
11. Remuneration of the board of directors 12. Salary and other remuneration for
The remuneration to the board of directors is determined executive personnel
by the shareholders at the annual general meeting based The board of directors prepares guidelines for the
on a proposal from the nomination committee. The level remuneration of executive management. These
of remuneration to the board of directors is considered to guidelines include the main principles for the company’s
reflect an international level and the board of directors’ remuneration policy and contributes to Elkem’s
responsibility, expertise, the complexity of the company commercial strategy, long-term interests, and financial
and its business, as well as time spent and the level of viability, which align the interests of the shareholders
activity in both the board of directors and any board and the executive management. The guidelines were
committees. communicated to the annual general meeting in 2023 and
will be presented to the annual general meeting every four
The remuneration of the board of directors is not linked to years, or if there should be substantial changes. A report
the company’s performance, and Elkem does not grant on the salary and other remuneration to the executive
share options to its members of the board of directors. management will be prepared in accordance with the
rules of the Norwegian Public Companies Act and relevant
regulations.
No deviations from the Code.
064 Year in review | Corporate governance
Table of contents Board of directors’ report Sustainability statement Financial statements
13. Information and communications 14. Take-overs
Elkem is under an obligation to continuously provide Elkem has one major shareholder controlling 52.9 per
its shareholders, the Oslo Stock Exchange, and the cent of the shares as of 31 December 2024. Elkem has not
financial markets in general with timely and precise been subject to any takeover bids in 2025.
financial and other information about the company and
its operations. Relevant information is given in the form of In the event of a takeover bid, the board of directors
annual reports, quarterly reports, press releases, notices and executive management each have an individual
to the stock exchange, and investor presentations in responsibility to ensure that the company’s shareholders
accordance with what is deemed appropriate from time are treated equally and that there are no unnecessary
to time. Elkem maintains an open and proactive policy interruptions to the company’s business activities.
for investor relations and gives regular presentations in
connection with annual and quarterly results. The goal is The board of directors has a particular responsibility in
that Elkem’s information work shall be in accordance with ensuring that the shareholders have sufficient information
best practice at all times and all communications with and time to assess the offer. In the event of a takeover
shareholders shall be in compliance with the provisions process, the board of directors shall abide by the
of applicable laws and regulations and in consideration principles of the Code, and also ensure that the following
of the principle of equal treatment of the company’s take place:
shareholders.
→ the board of directors will not seek to hinder or
Investor contact/investor relations (IR) activities are obstruct any takeover offer for the company’s
conducted in accordance with the IR policy and by the IR operations or shares unless they have valid and
team only. The IR team comprises the CEO, the CFO and particular reasons for doing so;
the vice president for finance and investor relations.
→ the board of directors shall not exercise mandates or
The company publishes an annual electronic financial pass any resolutions with the intention of obstructing
calendar with an overview of dates for important events, the takeover offer unless this is approved by the
such as the annual general meeting, interim financial general meeting following announcement of the offer;
reports, and payment of dividends, if applicable.
→ the board of directors shall not undertake any
In addition to the board of directors’ dialogue with actions intended to give shareholders or others an
the company’s shareholders at general meetings, the unreasonable advantage at the expense of other
board of directors promotes suitable arrangements for shareholders or the company;
shareholders to communicate with the company at other
times. The board of directors has delegated this task to → the board of directors shall not enter into an
the IR team. Elkem has held regular investor meetings agreement with any offeror that limits the company’s
in connection with each of the quarterly presentations ability to arrange other offers for the company’s
in 2025 and attended several investor conferences. The shares, unless it is self-evident that such an agreement
IR team has conducted meetings with both domestic is in the common interest of the company and its
and international investors from for example the shareholders;
United Kingdom, the United States, Germany, France,
Switzerland, and Benelux. The plan is to arrange regular → the board of directors and executive management
investor meetings and capital market updates when shall not institute measures with the intention of
considered expedient, in order to keep the market protecting the personal interests of its members at the
updated on the company’s development, goals, and expense of the interests of the shareholders; and
strategies.
→ the board of directors must be aware of the particular
No deviations from the Code. duty it has for ensuring that the values and interests of
the shareholders are protected.
Elkem Annual report 2025 065
In the event of a takeover offer, the board of directors 15. Auditor
will, in addition to complying with relevant legislation and The board of directors is responsible for ensuring that the
regulations, seek to comply with the recommendations board and the audit committee are provided with sufficient
in the Code. This includes obtaining a valuation from an insight into the work of the auditor. In this regard, the board
independent expert. On this basis, the board of directors of directors ensured that the auditor submitted the main
will make a recommendation as to whether or not the features of the plan for the audit of the company to the
shareholders should accept the offer. audit committee in 2025. Further, the board of directors
invited the auditor to participate in the board meeting
A takeover process gives rise to a particular duty of care that dealt with the annual accounts and the sustainability
to disclose information, where openness is an important report. At these meetings, the auditor (i) reported on any
tool for the board of directors to ensure equal treatment material changes in the company’s accounting principles
of all shareholders. The board of directors shall strive to and key aspects of the audit and the ESG attestation, (ii)
ensure that neither inside information about the company, commented on any material estimated accounting figures,
nor any other information that must be assumed to be and (iii) reported all material matters on which there has
relevant for shareholders in a bidding process, remains been disagreement between the auditor and the executive
unpublished. management of the company.
There are no other written guidelines for procedures to Once a year, the board of directors reviews the
be followed in the event of a takeover offer. The company company’s internal control procedures with the auditor,
has not found it appropriate to draw up any explicit basic including weaknesses identified by the auditor and
principles for Elkem’s conduct in the event of a takeover proposals for improvement. In this regard, a review of the
offer, other than the actions described above. The board company’s internal control procedures with the auditor,
of directors otherwise concurs with what is stated in the including weaknesses identified by the auditor and
Code regarding this issue. proposals for improvement, was carried out by the board
of directors in 2025.
No deviations from the Code.
In order to ensure the auditor’s independence of the
company’s executive management, the board of directors
has established guidelines in respect of the use of the auditor
by the management for services other than the audit.
No deviations from the Code.
The board of directors of Elkem ASA
Oslo, 10 March 2026
Bo Li Dag Jakob Opedal Olivier Tillette de Clermont- Wei Yao
Chair Vice chair Tonnerre Board member
Board member
Dachuan Dong Grace Tang Nathalie Brunelle Marianne Elisabeth Johnsen
Board member Board member Board member Board member
Terje Andre Hanssen Marianne Færøyvik Thomas Eggan Helge Aasen
Board member Board member Board member CEO, Elkem ASA
066 Year in review | Corporate governance
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem Annual report 2025 067
Risk
Overview of main risk areas
Elkem’s board and management have implemented a thorough
approach to risk management that is central to the group’s
corporate governance, aiming to build trust and to enhance
value creation. To monitor the group’s risk profile and to
ensure that adequate risk management processes are in place,
Elkem carries out an annual risk mapping process based on
interviews with divisions and corporate staff functions.
By identifying the top risks for each division and corporate Risk assessments related to climate and ESG
function, the board and management gain a thorough (environmental, social and governance) are incorporated
understanding of the group’s risk profile and financial risk within these five categories, reflecting their potential
tolerance. impact on strategic positioning, raw material sourcing,
end-markets, and financial performance. Additional
Risks are assessed based on internal and external factors, information can be found in the sustainability statement.
including estimated likelihood, projected financial impact,
time horizon, and mitigating activities. These risks are The board is responsible for overseeing the group’s
distributed among five main categories that align with risk management activities, and line management is
Elkem’s value chain: strategic risks, financial risks, raw responsible for risk monitoring and handling of the day-
material risks, production and process risks, and market to-day activities.
and product risks. Individual risks are consolidated into
ten group risks. A summary of the consolidated group risks is presented
on the following pages.
068 Year in review
Table of contents Board of directors’ report Sustainability statement Financial statements
Risk descriptions
1. Black swan A “black swan” is a rare, unpredictable event with major impacts, such as the 2008
global financial crisis or the Covid-19 pandemic. These events highlight the need for
general risk preparedness, resilient supply chains, and a strong financial position.
Elkem’s global operations could expose the group to unforeseen risks on a local,
regional, and global level.
Elkem’s key mitigating actions include fostering a strong and competent
organisation to proactively manage changing conditions, having strong and
regionally independent value chains, and keeping a robust financial position to
minimise the risk of financial distress.
2. Geopolitical tensions Geopolitical tensions and sanction risks have increased in recent years. Tariffs and
and sanction risks trade sanctions could impact Elkem’s trade flows through access to raw materials
and/or attractive end-markets. There is also a risk that Elkem, or its business
partners, could inadvertently engage with sanctioned parties, leading to business
disruptions or other legal proceedings.
Elkem operates independent value chains in Europe and Asia, reducing reliance on
inter-regional shipments of raw materials, intermediaries, or finished goods. This
reduces the exposure to trade restrictions and tariffs. Elkem carefully monitors
prevailing sanction lists and trade-related restrictions to ensure compliance and to
avoid activities with sanctioned entities or individuals.
3. Trade restrictions and Elkem has global operations which expose the group to increasing trade
tariffs restrictions and tariffs. Recent examples include EU safeguards, countervailing
duties (CVD) in the US, and anti-involution measures in China. These measures
may have positive or negative implications for Elkem.
Elkem aims to mitigate the negative effects by combining strategic and operational
measures. These measures include keeping regionally independent value chains
and strategic sourcing to reduce volatility and manage contractual risks. The
management keeps open communication with relevant stakeholders to promote
fair and equal treatment. Maintaining a sound financial position is also one of the
measures to mitigate adverse impacts of trade and tariff risks.
Elkem Annual report 2025 069
4. Macroeconomic Elkem has been exposed to adverse macroeconomic conditions during 2023-2025,
conditions negatively impacting the group’s financial performance. High inflation combined
with high interest rates has resulted in slow growth, particularly in EU with weak
demand from key industrial sectors such as construction and automotive.
Market conditions are closely monitored to ensure adequate and timely response
to changes. Elkem aims to mitigate macroeconomic downturns through its global
presence and integrated value chains, and by maintaining its attractive cost
positions through operational excellence and a lean manufacturing model. Elkem
is actively working to ensure adequate financing and liquidity reserves to manage
fluctuations in earnings.
5. Sales volume and prices Elkem’s sales volume and sales prices may vary depending on the economic
conditions and the competitive environment. This constitutes one of the main
risks affecting the group’s financial performance. Commodity sales prices have
traditionally been volatile, depending on economic cycles and changes in demand.
In addition, sales volumes and prices are impacted by industry conditions and the
capacity situation. The silicones, silicon, and ferrosilicon related markets have in
general been characterised by oversupply combined with weak demand during
2025. This has led to historic low prices.
Elkem seeks to mitigate this risk by securing good cost positions and by developing
a diversified and specialised product portfolio. In addition, Elkem has diverse and
long-term customer relationships and a global presence. Elkem’s integrated value
chain also offers flexibility to extract value through the value chain. As a result of
the group’s strong cost positions, Elkem has managed to maintain good sales
volumes despite weak markets.
6. Regulatory framework Elkem’s global operations could be exposed to changes in regulatory framework
conditions conditions. Examples of such conditions are regulations related to the environment
and CO2, product-related regulations, anti-dumping duties, export taxes, export
control, sanctions, and electrical power regulations. Changes to regulatory
framework conditions could negatively affect the group’s competitive position,
profitability, and market access. Elkem seeks to manage and mitigate these risks
by securing supply chain resilience through diverse geographical presence and
integrated value chains. In addition, Elkem is closely monitoring the regulatory
landscape to ensure that the group complies with new requirements.
7. Cyber and IT risk Virtually all business-related activities, including sales, production systems,
planning, procurement, and financial management rely heavily on IT systems.
Increased digitalisation offers opportunities to enhance efficiency and optimise
operations but also increases the vulnerability to cyber incidents. The financial
impact of an IT or cyber incident could be significant, and the operations could
be severely halted. Many companies have experienced significant operational
disturbances and losses from cyberattacks.
Elkem maintains strong IT security procedures supported by mandatory training
of employees, segmentation of systems, up-to-date equipment, frequent software
updates, and contingency plans. In addition, Elkem has cyber insurance in place to
mitigate the financial impact in case of an incident.
070 Year in review | Risk
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8. Health and safety Elkem’s operations and working environment include a significant inherent risk
of injuries and even fatalities. This is due to high temperature smelting processes,
advanced chemical processes, potential leakages of hazardous substances, and
other potential hazards. Elkem has a zero-harm philosophy and targets zero
injuries. However, despite our efforts to create a safe working environment, the
group experienced three tragic fatalities in 2025– one at the Carbon China facility
in Ningxia, China and two following an explosion at a Silicones pilot workshop
in Lyon, France. These tragic incidents highlight the importance of continuous
improvement in safety culture, risk awareness, and preventive measures. In 2023,
there was a major fire at the Salten plant which caused material damage and
production losses, although fortunately no injuries.
Elkem invests significant resources in identifying hazards and implementing
measures to prevent incidents and reduce risk to an acceptable level. These
measures include safety instructions, training, physical safeguards, and strict
adherence to Elkem Business System (EBS) principles. In 2025, Elkem upgraded
and advanced its HSE programme named FORUS to improve awareness, precision
and follow-up of safe behaviour in operations. Processes have also been initiated to
improve fire safety at Elkem’s plants. Insurance and risk survey programmes are in
place to mitigate risks and financial exposure.
9. Compliance and legal Elkem has operations in many countries, including countries ranked high on
risks indices for corruption and human rights violations. This carries an inherent risk of
unacceptable business behaviour through corruption, breach of competition law,
breach of sanctions, human-rights breaches, or other unethical activities, either by
employees or business partners. Additionally, legal and litigation risks may arise
from contractual obligations or issues related to intellectual property. The negative
reputational and financial impact could be material.
Elkem has a high focus on compliance and internal control and has strengthened
these functions in recent years through ethical guidelines and mandatory training
of all employees. The group’s compliance programme has been reviewed by a third
party, which validated a strong level of compliance maturity. A visible and accessible
channel for reporting misconduct (whistleblowing) is in place. Insurance coverage is
in place for directors and officers, employment practices, liability, and crime.
10. Environment and Climate risks comprise transition and physical risks. Elkem’s production facilities
climate are generally located close to sea or river, or near cities or local communities. Rising
temperatures and extreme weather events may cause business interruptions and
damages to assets and are thus monitored continually. Exposure to climate change has
been assessed for each business unit according to the requirements in the Corporate
Sustainability Reporting Directive (CSRD). To mitigate transitional risks, Elkem seeks to
ensure a sustainable business model by reducing emissions and ensuring compliance
with regulations. Sustainable sourcing of raw materials and increased use of biogenic
materials are key initiatives to reduce fossil carbon emissions from the production
processes. Elkem is also working on energy recovery and efficiency.
Long-term initiatives include research and development of carbon capture projects
to eliminate direct CO2 emissions from the production process. Recycling and
reduction of waste are also key focus areas and an integrated part of Elkem Business
System (EBS).
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statement
072
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Table of contents
Introduction Elkem’s approach to sustainability 76
General disclosures 78
EU taxonomy 96
Environmental Climate change 103
Pollution114
Water and marine resources 118
Biodiversity and ecosystems 122
Resource use and circular economy 128
Social Own workforce 135
Workers in the value chain 146
Affected communities 152
Governance Business conduct 159
074 Sustainability statement
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Sustainability statement
Elkem’s approach to
sustainability
076 Sustainability statement
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Elkem’s products are foundational to a low-carbon society
and essential for the green transition. They support
various sectors, including renewable energy, energy
storage, mobility solutions, infrastructure improvements,
digitalisation, and healthcare. At the core of Elkem are
our people and our commitment to safe, sustainable
operations, conducted responsibly and with excellence.
Elkem develops silicon products, carbon solutions, and production efficiency and reducing emissions. Climate
silicones by combining natural raw materials, renewable change is one of our material topics, together with other
energy, and human resourcefulness. The production key topics such as HSE, water management, circularity,
requires significant amounts of energy, and a key and more. Our material topics are categorised into
component of our low CO2 footprint is due to most of environmental, social and governance areas.
our silicon production being located in areas where
hydropower being readily available. Still, the production In the following sections, we will describe how we identify,
of silicon requires reductants to free the silicon from the manage, and mitigate our impact, risks, and opportunities
quartzite. This, in addition to our scope 2 and scope 3 related to the topics identified in the double materiality
emissions, is the reason why Elkem focuses on improving analysis.
Sustainability foundation: Material topics
Elkem follows the principles, requirements, and guidelines of the Corporate Sustainability Reporting Directive (CSRD)
and the European Sustainability Reporting Standards (ESRS).
Environmental Social Governance
Climate action Safety first Responsible
business partner
→ Climate change (ESRS E1) → Own workforce (ESRS S1)
→ Pollution (ESRS E2) → Workers in the value chain → Business conduct (ESRS
(ESRS S2) G1)
→ Water and marine resources
(ESRS E3) → Affected communities
(ESRS S3)
→ Biodiversity and
ecosystems (ESRS E4)
→ Resource use and circular
economy (ESRS E5)
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ESRS 2
General disclosures
Elkem’s 2025 sustainability disclosures are prepared in In 2024, Elkem restructured its sustainability disclosures
accordance with the European Sustainability Reporting to align with the Corporate Sustainability Reporting
Standards (ESRS), as issued by the European Financial Directive (CSRD) implementation timeline and the
Reporting Advisory Group (EFRAG), and aligned with applicable European Sustainability Reporting Standards
the Corporate Sustainability Reporting Directive (CSRD). (ESRS). This transition enhances our ability to meet
These standards ensure transparency, comparability, evolving regulatory expectations and stakeholder
and accountability across environmental, social, and demands. Elkem continues to report and disclose
governance (ESG) dimensions. according to the requirements of the CSRD and relevant
ESRSs.
All data points presented in the E, S, and G sections
have been evaluated through Elkem’s double materiality As TCFD has been phased out, Elkem’s reporting should
assessment (DMA). This process identifies both financial also be in accordance with the disclosure requirements
and impact materiality, guiding our prioritisation of topics. with regard to climate risk outlined in IFRS 2.
For details on the scope limitations and methodology
of our DMA, please refer to the dedicated section in this Accounting estimates and judgements
report. Certain ESG metrics, such as taxonomy KPIs and scope
3 emissions, are based on estimates and judgements.
Greenhouse gas (GHG) emissions data—covering scope 1, These are regularly reviewed and updated based on
2, and 3—is reported in accordance with the Greenhouse experience, regulatory developments, and methodological
Gas Protocol. Scope 3 reporting includes categories improvements. Changes in estimates are recognised in
1–7, 11, and 12. Elkem also discloses data on grievances the reporting period in which they occur. Judgements
received, supply chain screening, and audit results, are also applied when interpreting and implementing
reflecting our commitment to responsible sourcing and accounting policies. For further details, please refer to the
stakeholder engagement. ESG data tables and accompanying notes.
This report covers the fiscal year 2025, and ESG data is Restatement thresholds
consolidated using the same principles as our financial Adjustments to financial data follow the principles
statements. The consolidated dataset includes the parent outlined in our financial statements. For ESG data,
company Elkem ASA and its controlled subsidiaries. restatements are made based on materiality and
Associates and joint ventures are excluded from the relevance. All restated data points are clearly marked and
consolidated ESG metrics unless otherwise specified in explained.
the accounting policies accompanying each data point.
External assurance
Statutory compliance and regulatory alignment Elkem’s 2025 sustainability statement has undergone
Elkem’s sustainability statement complies with the limited assurance by KPMG, in accordance with CSRD
Norwegian Accounting Act, the Norwegian Equality and requirements. The auditor’s assurance report is available
Anti-Discrimination Act, the UK Modern Slavery Act 2015, on page 168.
and the Norwegian Transparency Act 2021. Relevant
disclosures are included in the chapters Own workforce,
Workers in the value chain, and Affected communities.
078 Sustainability statement | Introduction
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General meeting
Board of directors Audit committee
Chief executive officer
Chief SVP SVP strategy SVP green
SVP SVP human SVP SVP Silicone SVP Carbon
financial innovation & business ventures &
technology resources Silicones Products Solutions
officer and R&D development digital*
VP HSE VP commercial
ESG and sustainability governance structure
Functions marked in blue are members of the ESG steering committee
*SVP Green ventures & digital stepped out of management in October 2025, and will not be replaced
Governance GOV-1, GOV-2, GOV-3
The board’s commitment to ESG and sustainability composition, individual member contributions, group
Environmental, social, and governance (ESG) dynamics, agenda management, and preparation
considerations, along with sustainability, are embedded in processes. The assessment also evaluates the board’s
Elkem’s overarching business strategy and are collectively alignment with current and emerging strategic objectives
overseen by the board of directors. ESG-related risks and regulatory requirements.
and opportunities are regularly included on the board’s
meeting agenda. Several board memebers have industry Management and operational oversight
experience, and are familiar with relevant sustainability At Elkem, the CEO holds overall operational responsibility
challenges. for ESG and sustainability, acting under the direction
and oversight of the board of directors. Day-to-day
Each year, the board conducts a strategic process that management of ESG-related activities is led by the CFO,
includes a comprehensive evaluation of the group’s who chairs the ESG steering committee, a dedicated
ESG strategy. Detailed updates on ESG performance management body composed of members from
and initiatives are consistently presented during board corporate leadership with specific ESG responsibilities.
meetings and reporting sessions. The committee operates on behalf of the CEO and plays a
central role in driving Elkem’s sustainability agenda.
The audit committee plays a key role in preparing the
board for oversight of sustainability and non-financial The board approves the group’s business strategy and
reporting. It is responsible for reviewing internal controls, corporate governance policy, establishing the framework
monitoring sustainability-related risk management, and for strategic direction and oversight. Within this
tracking Elkem’s performance in external sustainability framework, the ESG steering committee meets quarterly
ratings. These efforts help ensure robust governance and to review progress, discuss key issues, and propose
transparency in ESG and non-financial disclosures. actions aligned with the strategy. It also monitors the
development of key performance indicators (KPIs) and
In addition, the board performs an annual self-assessment recommends strategic adjustments to the board when
covering its overall performance, competence, necessary.
and effectiveness. This includes a review of board
Elkem Annual report 2025 079
ESRS 2
Implementation of the ESG strategy is carried out by Sustainability-related performance in
Elkem’s business units and divisions. The ESG steering incentive schemes GOV-3
committee includes senior management and invites The CEO and group management receive performance-
subject-matter experts to contribute to discussions based compensation linked to predefined metrics aligned
and decisions on critical ESG topics. The mandate and with their respective areas of responsibility. Short-term
composition of the committee are explained in the section incentives (STI) are capped at 100 per cent of the CEO’s
on governing documents. base salary and 50 per cent for other members of
corporate management.
The ESG office serves as the main coordinator of ESG
efforts across the organisation. Reporting to the ESG Group management is assessed on progress and
steering committee, it works closely with business achievement of ESG-related targets, including the
units and divisions to advise on sustainability issues, transition plan approved by the board. This progress is
set targets, and drive continuous improvement. As part validated through performance on selected ESG ratings*.
of the Elkem Business System (EBS), the ESG office ESG-related target achievement accounts for 1.5 per cent
emphasises the principle that “what gets measured gets of the variable bonus for group management.
managed,” focusing on the development and refinement
of KPIs monitored by corporate management. For 2025, corporate management’s bonus structure
aligns with the CEO’s metrics, including compliance
and sustainability. Additional criteria include completion
of compliance training by employees to strengthen the
compliance culture and reduce the risk of substantiated
misconduct cases.
For a detailed overview of remuneration practices, please
refer to the board of directors’ report on salary and other
remuneration for senior executives in 2025.
—
*The prioritised ESG ratings are Carbon Disclosure Project’s (CDP) scoring of Elkem, S&P’s Corporate Sustainability Assessment, and EcoVadis.
080 Sustainability statement | Introduction
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Strategy
Map sustainability ESG
areas that are important
to our business and
stakeholders, and
prioritise an annual list
of improvements.
Targets
Performance
Anchoring with those
Evaluate performance
responsible in the organisation,
to be able to map,
set targets and develop plans
adjust and prioritise
to improve.
again.
Reporting Action
Track progress in accordance Corporate ESG functions
with targets set, and support and advise line functions
communicate transparently. in improvement work.
Management and operational oversight
Governing documents globally. Where local laws differ from the Code of
E1-2, E2-1, E3-1, E4-2, E5-1, S1-1, S2-1, S3-1, G1-1 conduct, the highest standard will be applied. The
Elkem’s governing documents establish the guiding Code of conduct outlines Elkem’s ethical guidelines,
principles for the group’s business conduct. Central ensuring all representatives act ethically, exercising
to these documents are the Code of conduct and the good judgment and care. It serves as a framework for
Governance policy. All policies are available on our responsible conduct, supplemented by detailed policies
website. and procedures. All governing documents must align with
the Code of conduct, and it is reinforced by various group
The Governance policy provides direction for common policies, procedures, and supporting documentation.
objectives, commitments, and behaviours, defining
principles and commitments for Elkem’s governing The People policy outlines the principles, objectives, and
processes while allocating roles and responsibilities within commitments related to the people processes within
the group’s functions. This policy imposes mandatory Elkem. It aims to ensure standardised HR procedures
requirements on all Elkem group companies and across all business units, supporting employees
operational units, irrespective of division and geography. throughout their employment lifecycle. The policy
emphasises a sustainable working environment, equality,
Most group policies are available online, and all governing inclusion, and respect for human rights. It covers various
documentation is available to employees on our intranet. aspects such as recruitment, competency development,
Each policy owner formulates an implementation plan employment terms, diversity, and work-life balance.
tailored to specific target groups based on roles and The policy also details the roles and responsibilities
responsibilities. To ensure consistency in responsible for implementation, monitoring, and correction of HR
business conduct across all activities and relationships, practices, ensuring compliance with both global and local
all governing documents must align with the Code of regulations.
conduct.
Key components include the recruitment process, which
The Code of conduct is a cornerstone of Elkem’s culture, prioritises internal candidates and requires HR involvement
defining our business conduct based on honesty and in all stages, and the competency development cycle,
respect. It mandates compliance with all applicable which focuses on continuous improvement and regular
laws and regulations, upholding ethical standards, feedback. The policy also addresses employment terms,
and respecting the dignity and rights of individuals promoting diversity and inclusion, and ensuring fair
Elkem Annual report 2025 081
ESRS 2
treatment and equal opportunities for all employees. treatment and safe working conditions. Business partners
Additionally, it includes guidelines for handling exits, must also minimise environmental impact and ensure
maintaining employee data privacy, and ensuring a safe their own partners adhere to similar standards. The policy
and respectful working environment. The policy is reviewed includes provisions for audits and encourages reporting of
annually to remain current and relevant, with amendments misconduct through a confidential channel. By partnering
approved by the CEO. with Elkem, businesses commit to these principles,
ensuring responsible and sustainable operations.
The Elkem Health, safety, and environment (HSE)
policy outlines the group’s commitment to maintaining a The Elkem Human rights programme outlines the
safe and healthy working environment while minimising group’s commitment to supporting and respecting
environmental impact. It emphasises continuous internationally recognised human and labour rights. It
improvement, risk management, and adherence to applies to all employees, directors, and majority-owned
local and international regulations. The policy includes subsidiaries. The programme includes governance
principles such as Elkem’s “zero-harm philosophy” and structures, human rights due diligence, risk assessments,
the use of the FORUS HSE system to ensure consistent communication strategies, training, third-party risk
safety practices across all operations. It also highlights the management, and monitoring and reporting mechanisms.
importance of sustainability, with goals aligned with the It emphasises continuous improvement and adherence
Paris Climate Agreement to achieve net zero emissions to international guidelines, such as those from the UN
by 2050, and focuses on energy efficiency, biodiversity and OECD. The programme also includes mechanisms
conservation, and responsible resource management. for whistleblowing, grievance handling, and regular audits
to ensure compliance and address any human rights
The policy assigns clear roles and responsibilities for concerns effectively.
HSE management, from the group CEO to individual
employees, ensuring accountability at all levels. It The Elkem Anti-corruption compliance programme
mandates regular risk assessments, compliance outlines the group’s zero-tolerance approach to corruption
monitoring, and corrective actions to address any and facilitation payments, applicable to all employees,
non-compliance. The policy also includes specific directors, and majority-owned subsidiaries. It includes
commitments to sustainable practices, such as waste adherence to international and national anti-corruption
reduction, circular economy principles, and supply chain laws, risk assessments, training, and strict procedures
management. Overall, the HSE policy aims to integrate for gifts, hospitality, and third-party interactions. The
health, safety, and environmental considerations into all programme emphasises the importance of reporting
aspects of Elkem’s operations, promoting a culture of concerns through the Speak up channel, conducting
continuous improvement and sustainability. due diligence on third parties, and maintaining accurate
records. It also details the roles and responsibilities of
The Speak up policy at Elkem outlines the process management and employees in preventing, detecting,
for reporting suspected violations of the group’s Code and responding to corruption, with regular monitoring and
of conduct and how these reports are managed. It audits to ensure compliance.
encourages employees and stakeholders to report issues
such as bribery, fraud, discrimination, and environmental Elkem’s Procurement policy regulates all procurement
violations, ensuring reports are handled confidentially and activities to ensure effective processes and risk
professionally. The policy applies globally and provides management globally. It applies to all employees and
multiple reporting channels, including anonymous organisational units, promoting strong governance,
options. It emphasises good faith reporting, protection competition, sustainable practices, and supplier
against retaliation, and the importance of privacy for both management. The policy outlines principles for sourcing,
the reporter and the subject of the report. The policy contracting, and supplier management, emphasising
aims to maintain ethical standards and improve business transparency, integrity, due diligence, and compliance
practices through transparent and responsible conduct. with internal controls and international standards. Elkem
will implement sustainable procurement practices and
Elkem’s Code of conduct for business partners aligns manage its supplier relationships in accordance with the
with international standards and outlines expectations for UN Guiding Principles on Business and Human Rights,
ethical business practices, human rights, workers’ rights, aiming to optimise total cost of ownership, reduce risks,
and environmental protection. It mandates compliance and support Elkem’s long-term competitive position.
with laws, prohibits corruption, and promotes fair
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Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem’s Raw material sourcing and qualification regularly to review progress, propose actions, and support
procedure outlines the process for sourcing and external ratings, while day-to-day work is managed by the
qualifying raw materials, ensuring they meet the group’s ESG office.
environmental, social, and governance commitments.
It includes steps for market screening, integrity due The Communication and public affairs policy outlines
diligence, pre-qualification audits, trial planning, the principles, objectives, and commitments for
process verification, and commercial contracting. The managing communication and public affairs activities
procedure emphasises compliance with internal controls, within the organisation. It emphasises open, honest, and
risk management, and supplier management, with all accurate communication, with specific guidelines for
documentation stored in the Ivalua platform. It applies to authorised spokespersons and the handling of sensitive
all personnel involved in raw material procurement across information. The policy applies to all employees and
Elkem’s divisions and subsidiaries. organisational units, detailing roles and responsibilities
for implementation, monitoring, and corrective actions.
Elkem’s Corporate standard for sourcing of biocarbon It also includes guidelines for internal and external
outlines the group’s commitment to sustainable and communication channels, social media use, and
ethical sourcing of wood and charcoal for silicon alloy engagement with government and other stakeholders,
production. It mandates the use of legally established and ensuring alignment with Elkem’s global communications
sustainably managed wood sources, ensures acceptable strategy and compliance with relevant procedures and
working conditions and respect for human rights, and laws.
enforces zero tolerance for corruption and legal non-
compliance. The policy requires cooperation with NGOs Elkem’s Sponsoring and donations procedure ensures
and local authorities, regular audits, and adherence to that all sponsorships, charitable donations, and
international standards to maintain transparency and community support activities align with the group’s
traceability throughout the biocarbon value chain. values and compliance policies. It includes guidelines
on restricted organisations, conflict of interest, anti-
Elkem’s Conflict minerals policy ensures that the group corruption measures, and documentation requirements,
sources minerals such as tin, tantalum, tungsten, cobalt, with specific approval processes for contributions over
and gold responsibly, in alignment with the OECD Due EUR 5 000. The procedure promotes transparency,
Diligence Guidance. The policy prohibits procurement proper accounting, and due diligence to support ethical
from conflict-affected areas to avoid supporting human and compliant practices.
rights abuses or environmental degradation.
The group adheres to the principles outlined in “The
Elkem’s Third-party risk management procedure ensures Norwegian Code of Practice for Corporate Governance”
that all third-party relationships are managed to mitigate issued by the Norwegian Corporate Governance Board
risks related to corruption, human rights breaches, (“NUES” or the “Code”). This Code aims to ensure that
environmental impacts, and legal noncompliance. The companies listed on regulated markets in Norway adhere
procedure involves identifying, categorising, conducting to comprehensive corporate governance practices that go
due diligence, approving, and managing third parties beyond legal requirements. For further details on Elkem’s
throughout the business relationship. It applies to all Elkem corporate governance, refer to the board of directors’
employees and includes specific guidelines for different report on corporate governance in the annual report.
types of third parties, emphasising transparency, regular
audits, and adherence to international standards and This section covers all relevant governing documents
Elkem’s internal policies. requested in the different sections on the report. This
includes references E1-2, E2-1, E3-1, E4-2, E5-1, S1-1, S2-1,
The Mandate for the ESG steering committee outlines S3-1, and G-1.
the responsibilities of the ESG steering committee. The
ESG steering committee is an executive body reporting
to the CEO, responsible for integrating environmental,
social, and governance principles into Elkem’s strategy
and operations. Chaired by the CFO and composed of
senior leaders, it oversees ESG performance, ensures
compliance with frameworks, and drives preparation of
the annual sustainability report. The committee meets
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ESRS 2
Statement on due diligence GOV-4 Management conducts an annual enterprise risk
Elkem’s due diligence process is aligned with the OECD evaluation comprising the Elkem group. The risk
Guidelines for Multinational Enterprises and the UN assessments are based on interviews with divisions and
Guiding Principles on Business and Human Rights. We corporate staff functions. Risks are evaluated according
also seek to follow the OECD Due Diligence Guidance to internal and external conditions. The risk assessments
for Responsible Business Conduct. Our due diligence include estimated financial impact, assessed likelihood,
aims to address and prevent adverse impacts related to and risk mitigation activities. A summary of all principal
labour rights, human rights, environmental issues, bribery, risks is reported to the board and included in the annual
corruption, and corporate governance. report.
Due diligence is carried out for all new business ventures, Risks are categorised into five main areas, strategic,
such as mergers, acquisitions, and joint ventures, and is financial, raw material, production and process, and
particularly emphasised when engaging with business market and product, structured along the value chain.
partners, including suppliers, agents, customers, Environmental, social, and governance (ESG) risks,
and resellers. In these processes, we follow the steps including climate-related risks, are integrated into these
recommended by the OECD. categories as they influence strategic positioning, raw
material supply, end-markets, and financial performance.
Beyond assessing external ventures and partnerships, we Elkem follows the IFRS S2 (previously Task Force on
integrate the same due diligence principles into our own Climate-related Financial Disclosures (TCFD)) and CSRD
operations and projects. This includes comprehensive recommendations for climate risk reporting. The climate
assessments of environmental and social impacts across risk assessment is reviewed and updated annually.
all projects and operations. We have conducted a group- Biodiversity risks are also assessed at regular intervals,
wide double materiality assessment, a human rights risk but monitored continuously for our mining sites. An
assessment with an accompanying action plan, and a annual summary of climate risks are included in the
biodiversity risk assessment. Work is ongoing to develop Enterprise risk analysis presentation to the board.
an action plan and related initiatives for biodiversity.
The board regularly reviews ESG-related risks and
Risk management and internal controls over opportunities, evaluates the ESG strategy annually, and
sustainability reporting GOV-5 receives comprehensive updates on ESG performance.
Elkem’s board and management consider risk The audit committee ensures effective procedures and
management a core element of corporate governance, internal controls for sustainability and non-financial
essential for trust and long-term value creation. reporting. The board also conducts annual assessments
Elkem’s ESG due diligence process
Identify & assess adverse
Communicate how
impacts are addressed 5 2 impacts in operations, supply
chains and business relationships
1
Embed responsible Provide for or cooperate
business conduct into 6 in remediation when
policies and appropriate
management systems
Track implementation Cease, prevent, or mitigate
and results 4 3 adverse impacts
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of its performance and competence to ensure alignment The climate roadmap, Elkem’s transition plan, supports
with governance policies. these ambitions by aiming for climate-neutral production
across the entire value chain by 2050, with an interim
The CEO oversees ESG operations, supported by the goal of reducing absolute scope 1 and 2 emissions by
CFO-led ESG steering committee, which meets quarterly 25 per cent and the product carbon footprint by 32 per
to review progress and propose strategic actions. The cent from 2022 to 2030*. This roadmap is built on three
ESG steering committee is a key component in Elkem’s pillars: reducing emissions, supplying advanced materials
internal control on sustainability related topics as the for the green transition, and enabling circular economies.
committee will address deviance from targets and Elkem has already achieved an 11 per cent reduction in
policies. The mandate of the ESG steering committee is total greenhouse gas emissions from 2022 to 2025, while
formalised in appendix J “Mandate for the ESG steering the product footprint has increased by 30 per cent in the
committee” within the Governance policy. same period due to changes in sourcing.
Internal control over sustainability topics is embedded in As a leading provider of advanced silicon-based materials,
line management. The corporate internal control function Elkem plays a critical role in enabling low-carbon
support corporate management and the internal control technologies such as electric vehicles, renewable energy,
and internal audit committee in their responsibilities and energy storage. Its products, including silicone
related to design of an adequate internal control system solutions for EV battery protection and high-purity
and compliance with internal regulations, described ferrosilicon for electrical steel, enhance the performance
and deployed through group governing documents. The and sustainability of these applications. The growing
instructions of the function are formalised in appendix demand for solar panels, batteries, and other low-carbon
K “Instructions for corporate internal control” within the technologies is expected to drive further growth in
Governance policy. Elkem’s product segments.
In addition to the annual enterprise risk review, Elkem Elkem is committed to reducing its environmental
conducts a double materiality analysis (DMA) covering impact through improved water and waste management,
sustainability-related risks and impacts. Results are reducing local emissions to air, increasing recycling both
discussed in the topical sections ESRS E1–E5, S1–S3, and in its operations and with customers, and developing eco-
G1. designed products. The group is also expanding into new
green markets such as battery materials and biomass.
Strategy, business model, and value chain These efforts are aligned with global sustainability goals
SBM-1 and reinforce Elkem’s role in securing key materials for the
Elkem’s strategy is founded on dual-play growth and green transition, contributing to a more sustainable future.
green leadership, aiming to deliver sustainable value
creation across all three divisions while ensuring supply In January 2025, Elkem announced a strategic review
chain resilience through geographical diversification. of the Silicones division. At 13 February 2026, Elkem
The group has set ambitious targets, including five per announced an agreement to sell the majority of its
cent annual growth and a 25 per cent reduction in scope Silicones division to Bluestar to be settled with all Elkem
1 and 2 CO2 emissions by 2030, reinforcing its position shares held by Bluestar.
as an industry leader in low-carbon solutions and a
key contributor to the green transition. The strategy The transaction was approved by the extraordinary
emphasises balanced geographical growth and cost general meeting at 9 March 2026. Subject to customary
improvements in Silicones, selective growth combined closing conditions, the transaction is expected to close
with lower carbon emissions in Silicon Products, and by May 2026. A potential full review of Elkem’s material
maintaining sustainable low-cost positions in Carbon assessment, climate strategy, and transition plan is
Solutions. Elkem also targets a 15 per cent EBITDA margin contingent upon completion of the transaction.
annually and net zero emissions by 2050.
—
*This is a revised version of the strategy and transition plan launched in 2021. The revision is due to the reporting requirements of CSRD, and included a
new baseline (2022) and a shorter timeframe (from 2022 to 2030).
Elkem Annual report 2025 085
ESRS 2
Interests and views of stakeholders SBM-2
Engaging with stakeholders is essential for Elkem
to understand expectations, identify key issues, and
assess potential impacts. Through regular dialogue,
Elkem addresses social, health, safety, environmental,
and economic concerns, ensuring that stakeholder
perspectives inform action plans and are integrated
into sustainability reporting. The group is committed to Civil society
acting ethically and transparently, fostering a common
understanding, and integrity in decision-making.
Political authorities
Elkem’s stakeholder engagement spans a wide range
of groups, including employee unions, works councils,
local communities, NGOs, suppliers, business partners,
customers, and industry associations. The group also Regulatory authorities
collaborates with sustainability experts and maintains
active dialogue with authorities, banks, and investors
regarding sustainability commitments and progress. Customers and suppliers
Engagement takes place at both corporate and business
levels through local meetings, bilateral discussions, Employees and unions
multi-stakeholder forums, and participation in industry
associations. All business areas maintain structured
forums for dialogue between management and employee
Investors and shareholders
representatives. Insights gathered from these interactions
play a critical role in shaping Elkem’s double materiality
analysis and guiding the group’s overall strategy.
Key stakeholders
086 Sustainability statement | Introduction
Table of contents Board of directors’ report Sustainability statement Financial statements
Business model and value chain
Elkem’s business model and value chain focus on 4. Sustainability focus: A core aspect of Elkem’s
producing advanced silicon-based materials and are business model is its commitment to sustainability.
centred on the production and supply of advanced The group emphasises reducing CO2 emissions and
silicon-based materials. The group operates across the implementing sustainable practices throughout its
entire value chain, from raw material extraction to the operations. This includes energy-efficient production
production of specialised products. methods and recycling initiatives.
Here are the key components: 5. Innovation and R&D: Elkem invests significantly in
research and development to drive innovation. This
1. Raw material sourcing: Elkem sources, extracts, and focus on R&D helps the group develop new products,
refines high-quality raw materials such as quartz, improve existing ones, and enhance production
coal, and wood, which are essential for producing processes, ensuring it remains at the forefront of
silicon and its derivatives. technological advancements.
2. Production process: The group operates state-of- 6. Integrated value chain: By controlling the entire
the-art manufacturing facilities to produce silicon, value chain, from raw material extraction to the
silicones, and carbon solutions. This includes refining production of finished goods—Elkem ensures high
raw materials and transforming them into high-purity standards of quality, efficiency, and sustainability.
silicon and specialised products. This integration also allows for better cost
management and responsiveness to market changes.
3. Specialisation and customisation: Elkem develops
customised products tailored to the needs of various Elkem’s business model is designed to create value
industries, including renewable energy, electronics, for stakeholders by delivering high-quality, sustainable
automotive, and construction. This specialisation products while maintaining a strong focus on innovation
allows Elkem to meet specific customer requirements and environmental responsibility.
and market demands.
Elkem Annual report 2025 087
ESRS 2
Key impacts in Elkem’s value chain
Positive impacts
1 Production in areas where renewable energy is 3 Sustainably sourced, and certified, biocarbon reduces
abundant emissions (SO2) and does not deplete nature’s ability
to absorb CO2 emissions
2 Silicon and silicones are enablers for the green
transition, and help reduce emissions and generate 4 Circularity in production reduces the product impact
energy savings
5 Elkem sites create jobs and education opportunities,
and Elkem is often a cornerstone employer
Quartz mining Smelters producing silicon-
5 2 7
based products
1 5 1 5 8 9
2
Quartzite extraction
Electrode
Other input factors paste
Renewable Heat and
hydropower energy recovery
Possible CO2 capture and
storage
Carbon and
biocarbon
3 10
Research and innovation throughout value chain
088 Sustainability statement | Introduction
Table of contents Board of directors’ report Sustainability statement Financial statements
Negative impacts
1 Use of reductants in the production of silicon results 6 Water consumption in silicones production
in CO2 emissions
7 Mining operations use land area, and pose a risk to
2 Transportation of raw materials and products results biodiversity through pollution, waste, and noise
in emissions
8 Production involves hazardous operations, moving
3 Energy consumption results in scope 2 emissions in equipment, and working at height
China
9 Risk of exposure to hazardous substances
4 Hazardous chemicals in production pose a risk to
biodiversity if not managed properly 10 Risk of forced labour and child labour in the value chain
5 Local emissions of SO2, NOX, and dust from production 11 Risk of corruption and sanction-breaking dealings
Silicones plants Output
4 5 3 4 6 9
Silicones
End markets include automotive,
2
construction, electronics, health care,
personal care, textiles
2 11
Carbon solutions
End markets include aluminium,
ferroalloys, iron foundries, silicon
4 11
Silicon products
End markets include automotive,
construction, electronics, refractories,
specialty steel, solar and wind turbines
2 11
Elkem Annual report 2025 089
ESRS 2
The Elkem house
The Elkem House serves as a visual representation of the
fundamental components of Elkem’s business model.
At its core, our mission and values form the foundation
for our working practices and defines our organisational
culture. These elements, mission, values, and working
practices, combine to strengthen and advance our
corporate strategy.
Corporate strategy
Dual-play growth and green leadership
Culture
Working practices
EBS HSE ESG
Elkem Business Health, safety, Environmental, social,
System environment governance
Values
Continuous
Respect Involvement Precision
improvement
Foundation
Mission
Our mission is to produce advanced silicon-based
materials shaping a better and more sustainable future
The Elkem house
090 Sustainability statement | Introduction
Table of contents Board of directors’ report Sustainability statement Financial statements
Impact materiality
Inside-out
Elkem Planet and society
Financial materiality
Outside-in
Double materiality approach
Double materiality assessment – Material We believe the outcome presented below offers a true
impacts, risks, and opportunities SBM-3, IRO-1 and fair representation of Elkem’s material impacts,
The cornerstone of Elkem’s sustainability approach is the risks, and opportunities, while acknowledging certain
double materiality assessment (DMA), conducted in line methodological limitations. The following pages provide
with ESRS requirements. This methodology evaluates detailed insights into the results of our double materiality
both impact materiality, which considers Elkem’s effects assessment and the process applied.
on the environment and society, and financial materiality,
which assesses how sustainability-related factors affect Double materiality analysis results
Elkem’s business. We have identified our impacts on the environment and
society through an impact materiality assessment, as
Our process began with an inside-out impact assessment well as the sustainability-related risks we face through a
of Elkem’s environmental and social effects across financial materiality assessment. The results, aggregated
operations and the value chain, building on previous by ESRS topic, indicate that all main topics, apart from
evaluations of sustainability impacts. In parallel, we consumers and end-users (S4), are material to Elkem. As
carried out an outside-in financial assessment of Elkem only sells business-to-business, it has little direct
sustainability-related risks and opportunities facing the impact on consumers. Since the different ESRSs have
group. Where possible, these assessments were quantified several sub-topics and sub-sub-topics, these have been
and complemented by qualitative analysis. Given the assessed, and not all sub-topics are material to Elkem.
complexity of measuring sustainability-related risks, this
year’s efforts focused primarily on impact materiality. Given the nature of Elkem’s operations, the environmental
risks and impacts in E1, E2, and E3 are especially
Due to the comprehensive ESRS principles and important to Elkem. We have significant emissions,
requirements, stakeholder involvement was limited to consumption, and use of energy and water, and the
internal subject-matter experts. To validate and calibrate potential and actual impact of local emissions and
the results, we performed a light update of our previous pollutants are important to mitigate. These topics are also
materiality assessment using the former approach, related to transitional risks related to regulation changes
serving as a proxy for external stakeholder input and and emission costs.
helping us reflect stakeholder interests and views relevant
to our business.
Elkem Annual report 2025 091
ESRS 2
Own workforce, and especially HSE, is a topic that
does not rank very high on financial impact, but it is Methodology
still a key topic for Elkem. This is an area where we have All assessed impacts and risks have been aligned
invested significant resources and time to improve our with the relevant topical ESRS standards. We
performance. This is a tendency that we find when have assessed whether the topics have an actual
analysing several of the topics. The financial impact, or a potential impact, what stakeholder would be
meaning the outside-in impact, is limited, but we still affected, the relevant time horizon, irremediability,
consider it important, and we acknowledge that there scale, scope, and likelihood. This has given us an
is considerable risk, and some opportunities, related to impact score. We have applied a similar approach
these topics. for our positive impacts. For the opportunities
we have mapped the topics, the source of the
The material impacts, risks, and opportunities (IROs) are opportunity, time horizon, financial impact, and
disclosed in the various chapters on the material topics likelihood. We have assessed the value chain where
(ESRS E1, E2, E3, E4, E5, S1, S2, S3, and G1). Here we required, or we have deemed it prudent.
also go into detail on how these IROs shape our actions,
investments, and how they are integrated into our
business model.
High
Financial materiality
Climate change
Pollution
Water and marine resources
Resource use and circular economy
Business conduct
Biodiversity and ecosystems
Affected communities
Consumers and end-users
Own workforce Workers in the
value chain
Low
Low Impact materiality High
Double materiality matrix
092 Sustainability statement | Introduction
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Sustainable Development Goals (SDGs)
Elkem is a signatory to the UN Global Compact and SDG 12 – Responsible consumption and production
applies sustainability in line with the principles of the Our commitment to resource efficiency and circularity is
UN Global Compact. Elkem is committed to develop its reflected in ESRS E2, E3, E4, E5, S1, and S2. Elkem works
business in support of the ambitions of the Paris Climate to minimise environmental impacts through responsible
Agreement and the UN Sustainable Development Goals sourcing of raw materials, reducing waste, and improving
(SDGs). Elkem’s sustainability strategy is aligned with water and energy efficiency. We actively engage suppliers
the United Nations Sustainable Development Goals, to uphold sustainability standards and implement
with particular emphasis on SDG 8 (Decent work and measures to reduce hazardous substances and promote
economic growth), SDG 12 (Responsible consumption recycling. These actions support a more sustainable
and production), and SDG 13 (Climate action). These production model and responsible consumption patterns
goals are embedded throughout our disclosures under the across our markets.
European Sustainability Reporting Standards (ESRS).
SDG 13 – Climate action
SDG 8 – Decent work and economic growth Climate responsibility is a cornerstone of Elkem’s
Elkem promotes safe, inclusive, and fair working strategy, as outlined in ESRS E1 and E2. We have set
conditions across its global operations, as detailed in ambitious targets to reduce greenhouse gas emissions
ESRS S1, S2, and S3. Our approach includes strong health in line with global climate goals and are implementing
and safety management systems, continuous workforce a comprehensive climate roadmap to achieve these
development, and respect for human rights in our own objectives. Our efforts include transitioning to renewable
operations and throughout the value chain. We strive energy, improving energy efficiency, and developing
to create long-term economic value while ensuring that low-carbon technologies. Through these initiatives, Elkem
growth is socially responsible and benefits employees, contributes to mitigating climate change and building
suppliers, and local communities. resilience in our operations and value chain.
Elkem Annual report 2025 093
ESRS 2
Disclosure requirements in ESRS covered by the sustainability statement IRO-2
Standard Pages
ESRS E1 Climate change 103-113
ESRS E2 Pollution 114-117
ESRS E3 Water and marine resources 118-121
ESRS E4 Biodiversity and ecosystems 122-126
ESRS E5 Resource use and circular economy 128-132
ESRS S1 Own workforce 135-145
ESRS S2 Workers in the value chain 146-151
ESRS S3 Affected communities 152-163
ESRS G1 Business conduct 159-163
Disclosure of topics assessed not to be material
Standard Explanation
ESRS S4 Consumers and end-users ESRS S4 is omitted and assessed as not material to Elkem. Elkem
sells its goods to other companies who in turn produce consumer
goods. Thus, we have deemed our direct impact on consumers and
end-users as non-existent, and our possibility to affect our indirect
impact as very limited. This means that the associated risks and op-
portunities are also limited.
Minimum disclosure requirements –
policies, actions, metrics, and targets
MDR-P, MDR-A, MDR-M, MDR-T
All policies, actions, metrics and targets relevant to the
different topics are described in the different sections
covering ESRS 2 (policies): E1, E2, E3, E4, E5, S1, S2, S3,
and G1.
094 Sustainability statement | Introduction
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Elkem Annual report 2025 095
Statement on the EU
taxonomy for sustainable
economic activities
The EU taxonomy is a classification framework for environmentally
sustainable economic activities, aiming to direct investments toward
initiatives that support the EU’s climate and environmental objectives
for 2050 and the European Green Deal.
As the strategic review of the Silicones division was ongoing during
the assesment of the EU taxonomy, no further mapping of alignment
has been made. Silicone production is still not defined in the EU
taxonomy and lacks threshold values, which limits Elkem’s eligibility
and alignment.
The EU taxonomy Scope
The regulation specifies six environmental objectives: Elkem is within the scope of the EU taxonomy regulation,
applying to large public interest entities with more than
1. Climate change mitigation (CCM) 500 employees. Elkem’s financial year runs from 1 January
to 31 December, and taxonomy disclosures in this report
2. Climate change adaptation (CCA) cover the period 1 January 2025 to 31 December 2025.
For 2025, companies must report eligibility against all six
3. Sustainable use and protection of water and marine environmental objectives.
resources (WTR)
Disclosure requirements
4. Transition to a circular economy (CE) Companies must report performance indicators on net
turnover, capital expenditure (CapEx), and operational
5. Pollution prevention and control (PPC) expenditure (OpEx) for both taxonomy-eligible and
taxonomy-aligned activities across the environmental
6. Protection and restoration of biodiversity and objectives.
ecosystems (BIO)
Elkem’s taxonomy-eligible and taxonomy-aligned
Activities are taxonomy-eligible if listed in the European activities
Commission’s delegated acts, regardless of technical criteria. The following section details the percentage of Elkem’s
Non-eligible activities are those not described in these acts. net turnover, CapEx, and OpEx attributed to activities
Taxonomy-aligned activities meet technical criteria, do eligible for the EU taxonomy and aligned with its six
no significant harm (DNSH), and comply with minimum environmental goals, for the 2025 reporting period.
safeguards (including human rights, labour rights, consumer
interests, anti-corruption, taxation, and fair competition).
096 Sustainability statement | Introduction
Table of contents Board of directors’ report Sustainability statement Financial statements
Taxonomy-eligible activities 3.6 Manufacture of other low carbon technologies
→ 3.17 Manufacture of plastics in primary form → Substantial contribution
Silicone products are considered eligible under NACE Elkem Microsilica® improves concrete durability and
code C20.16. Relevant objectives: climate change reduces carbon footprint. A life cycle analysis (LCA)
mitigation and adaptation. Please note that revenue has been performed but is not yet third-party verified;
from silicones are kept out of the taxonomy report due therefore, not aligned.
to the strategic review.
→ DNSH
→ 3.1 Manufacture of renewable energy technologies DNSH assessment is ongoing; zero alignment is
Ferrosilicon and foundry alloys for wind power reported.
equipment qualify as eligible. Relevant objectives:
climate change mitigation and adaptation. Minimum safeguards
Elkem’s compliance with minimum safeguards covers
→ 3.6 Manufacture of other low carbon technologies human rights, anti-corruption, taxation, and fair
Elkem Microsilica® reduces carbon impact in cement competition:
production, meeting the definition for this activity.
Relevant objectives: climate change mitigation and → Human rights
adaptation. Elkem follows a six-step approach based on the
UNGPs and OECD guidelines, with regular internal
Assessment of taxonomy alignment reviews and remedial actions as needed. The human
Many upstream products are non-eligible, as they are not rights programme is available on Elkem’s website
described in the Delegated Acts. Silicon-based advanced and detailed in the annual ESG report, fulfilling the
materials are essential to the green transition, with silicon requirements of the Norwegian Transparency Act.
metal on the EU’s 2023 list of critical raw materials. Since
the EU taxonomy does not cover silicon-based materials, → Corruption and bribery
Elkem’s assessment of aligned activities is limited. Elkem Elkem has implemented a risk-based anti-corruption
has conducted initial assessments to determine eligibility programme, with mandatory training and zero
and has expanded its review of alignment. Activities that tolerance communicated to all partners.
are not assessed as core and material are excluded from
the 2025 reporting. → Taxation
Elkem’s tax strategy is transparent, sustainable, and
3.17 Manufacture of plastics in primary form embedded in risk management, overseen by qualified
→ Substantial contribution experts.
Silicones derived partly from silicon metal produced
with biocarbon qualify as aligned for climate change → Fair competition
mitigation. Compliance with competition laws is ensured through
guidelines, training, and a culture promoting fair
→ DNSH market practices.
Elkem has reviewed activities against DNSH criteria and
identified areas needing further evaluation. As of the KPIs and accounting policy
reporting date, Elkem reports zero alignment with DNSH.
3.1 Manufacture of renewable energy technologies
→ Substantial contribution
This activity complies with the criteria.
→ DNSH
The DNSH assessment is ongoing; zero alignment
reported.
Elkem Annual report 2025 097
EU Taxonomy
→ Turnover KPI → OpEx KPI
The denominator is based on consolidated net Defined as eligible and aligned OpEx divided by total
turnover per IAS 1. For activity 3.1, customer OpEx, covering direct non-capitalised costs for R&D,
information is used; for 3.6, volume sold to the maintenance, and short-term leases. R&D expenditure
construction sector is used. As at 31 December 2024, is recognised as an expense (see page 212). Non-
business related to activity 3.17 is classified as held for capitalised leases are determined per IFRS 16 (see
sale and presented as discontinued operations (see page 212). Maintenance and repair costs are allocated
note 38, page 266). Revenue from this activity is set to to internal cost centres and can be found in various
zero in the taxonomy KPI. income statement lines. Building renovation measures
are currently of limited relevance. Staff costs, services,
→ CapEx KPI and material costs for daily servicing and maintenance
Defined as eligible and aligned CapEx divided by total are included. Amortisation and depreciation are
CapEx. Total CapEx includes additions to tangible excluded.
and intangible fixed assets before depreciation, — Research and development costs: NOK 416 million
amortisation, and remeasurements, including (note 13)
acquisitions and business combinations (see page — Short-term leases: NOK 56 million (note 13)
230). CapEx related to the production of silicone — Maintenance and repair: NOK 766 million (note 13)
within the Silicone division is included as eligible; for — OpEx for activities in the Silicones division is set to
other activities, a revenue split is used as a proxy. zero, and a revenue split is used as a proxy.
Turnover KPI
2025 Substantial contribution criteria DNSH criteria (Do no significant harm)
Proportion of taxonomy aligned (A.1.) or
Category transitional activity (20)
eligible (A.2.) turnover, 2024 (18)
Proportion of turnover, 2025 (4)
Climate change adaptation (12)
Climate change adaptation (6)
Climate change mitigation (5)
Category enabling activity (19)
Climate change mitigation (11)
Minimum safeguards (17)
Circular economy (15)
Circular economy (9)
Biodiversity (10)
Biodiversity (16)
Pollution (14)
Turnover (3)
Pollution (8)
Code (2)(a)
Water (13)
Water (7)
Economic activities (1)
A. Taxonomy-eligible activites
A.1. Environmentally sustainable activities (Taxonomy-aligned)
Turnover of environmentally sustainable
0 0% 0% 0% 0% 0% 0% 0% 0%
activities (Taxonomy-aligned) (A.1)
of which enabling 0 0% 0% 0% 0% 0% 0% 0% 0%
of which transitional 0 0% 0% 0%
A.2 Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned (f) (f) (f) (f) (f) (f)
activities) (g)
3.17 Manufacture of plastics in
CCM 0 0.0% (40%)
primary form
3.1 Manufacture of renewable
CCM 249 1.5% 1%
energy technologies
3.6 Manufacture of other low
CCM 450 2.7% 1%
carbon technologies
Turnover of Taxonomy-eligible but not
environmentally sustainable activities (not 699 4.2% 42% 0% 0% 0% 0% 0% (38%)
Taxonomy-aligned activities) (A.2)
A. Turnover of Taxonomy-eligible activities
699 4.2% 42% 0% 0% 0% 0% 0%
(A.1+A.2)
B. Turnover Taxonomy-non-eligible activities 15 835 95.8%
Total 16 535 100%
098 Sustainability statement | Introduction
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Elkem Annual report 2025 099
EU Taxonomy
OpEx KPI
2025 Substantial contribution criteria DNSH criteria (Do no significant harm)
Proportion of taxonomy aligned (A.1.) or
Category transitional activity (20)
eligible (A.2.) turnover, 2024 (18)
Climate change adaptation (12)
Climate change adaptation (6)
Climate change mitigation (5)
Category enabling activity (19)
Climate change mitigation (11)
Proportion of OpEx, 2025 (4)
Minimum safeguards (17)
Circular economy (15)
Circular economy (9)
Biodiversity (10)
Biodiversity (16)
Pollution (14)
Pollution (8)
Code (2)(a)
Water (13)
Water (7)
OpEx (3)
Economic activities (1)
A. Taxonomy-eligible activites
A.1. Environmentally sustainable activities (Taxonomy-aligned)
OpEx of environmentally sustainable
0 0% 0% 0% 0% 0% 0% 0% 0%
activities (Taxonomy-aligned) (A.1)
of which enabling 0 0% 0% 0% 0% 0% 0% 0% 0%
of which transitional 0 0% 0% 0%
A.2 Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned (f) (f) (f) (f) (f) (f)
activities) (g)
3.17 Manufacture of plastics in
CCM 0 0.0% (40%)
primary form
3.1 Manufacture of renewable
CCM 0 0.0% 1%
energy technologies
3.6 Manufacture of other low
CCM 44 4.2% 1%
carbon technologies
OpEx of Taxonomy-eligible but not
environmentally sustainable activities 44 4.2% 42% 0% 0% 0% 0% 0% (38%)
(not Taxonomy-aligned activities) (A.2)
A. OpEx of Taxonomy-eligible activities
44 4.2% 42% 0% 0% 0% 0% 0%
(A.1+A.2)
B. OpEx Taxonomy-non-eligible activities 991 95.8%
Total 1 035 100%
100 Sustainability statement | Introduction
Table of contents Board of directors’ report Sustainability statement Financial statements
CapEx KPI
2025 Substantial contribution criteria DNSH criteria (Do no significant harm)
Proportion of taxonomy aligned (A.1.) or
Category transitional activity (20)
eligible (A.2.) turnover, 2024 (18)
Climate change adaptation (12)
Climate change adaptation (6)
Climate change mitigation (5)
Category enabling activity (19)
Proportion of CapEx, 2025 (4)
Climate change mitigation (11)
Minimum safeguards (17)
Circular economy (15)
Circular economy (9)
Biodiversity (10)
Biodiversity (16)
Pollution (14)
Pollution (8)
Code (2)(a)
Water (13)
CapEx (3)
Water (7)
Economic activities (1)
A. Taxonomy-eligible activites
A.1. Environmentally sustainable activities (Taxonomy-aligned)
CapEx of environmentally sustainable
0 0% 0% 0% 0% 0% 0% 0% 0%
activities (Taxonomy-aligned) (A.1)
of which enabling 0 0% 0% 0% 0% 0% 0% 0% 0%
of which transitional 0 0% 0% 0%
A.2 Taxonomy-eligible but not environmentally
sustainable activities (not Taxonomy-aligned (f) (f) (f) (f) (f) (f)
activities) (g)
3.17 Manufacture of plastics in
CCM 0 0.0% (40%)
primary form
3.1 Manufacture of renewable
CCM 44 3.3% 1%
energy technologies
3.6 Manufacture of other low
CCM 12 0.9% 1%
carbon technologies
CapEx of Taxonomy-eligible but not
environmentally sustainable activities 56 4.2% 42% 0% 0% 0% 0% 0% (38%)
(not Taxonomy-aligned activities) (A.2)
A. CapEx of Taxonomy-eligible activities
56 4.2% 42% 0% 0% 0% 0% 0%
(A.1+A.2)"
B. CapEx Taxonomy-non-eligible activities 1 261 95.8%
Total 1 317 100%
Nuclear and fossil gas related activities
Row Nuclear related activities Elkem
1 The undertaking carries out, funds or has exposures to research, development, demonstration and deployment of NO
innovative electricity generation facilities that produce energy from nuclear processes with minimal waste from the
fuel cycle.
2 The undertaking carries out, funds or has exposures to construction and safe operation of new nuclear installations NO
to produce electricity or process heat, including for the purposes of district heating or industrial processes such as
hydrogen production, as well as their safety upgrades, using best available technologies.
3 The undertaking carries out, funds or has exposures to safe operation of existing nuclear installations that produce NO
electricity or process heat, including for the purposes of district heating or industrial processes such as hydrogen
production from nuclear energy, as well as their safety upgrades.
Fossil gas related activities
4 The undertaking carries out, funds or has exposures to construction or operation of electricity generation facilities NO
that produce electricity using fossil gaseous fuels.
5 The undertaking carries out, funds or has exposures to construction, refurbishment, and operation of combined heat/ NO
cool and power generation facilities using fossil gaseous fuels.
6 The undertaking carries out, funds or has exposures to construction, refurbishment and operation of heat generation NO
facilities that produce heat/cool using fossil gaseous fuels.
Elkem Annual report 2025 101
Environmental
Social
Governance
E
102 Sustainability statements
statement | Environmental
Table of contents Board of directors’ report Sustainability statement Financial statements
ESRS E1
Climate change
As an operator in the process industry, Elkem recognises the critical
importance of its environmental footprint, particularly greenhouse
gas (GHG) emissions. Converting quartz to silicon is highly energy-
intensive and relies on carbon sources such as fossil coal, charcoal,
and wood chips, which result in emissions of CO2, NOX, SO2, and dust.
While the CO2 emissions are inherent to the chemical reactions of the
production process, Elkem is committed to reducing its fossil CO2
footprint by increasing the share of renewable carbon and renewable
energy and developing innovative production methods.
In alignment with the Paris Climate Agreement goal to limit global
warming to well below 2°C, Elkem’s strategy focuses on improving
material and energy efficiency, replacing fossil carbon with biocarbon,
and developing carbon-neutral smelting technologies.
Material impacts, risks, and opportunities - At the same time, Elkem’s products play a vital role in
Resilience of strategy and business model enabling the green transition. Our silicone solutions
ESRS 2, SBM-3 provide reliable protection for EV batteries, while silicon-
Elkem’s operations influence the climate both directly enhanced aluminium supports lightweight, energy-
and indirectly. Scope 1 emissions arise from the use of efficient vehicles. We supply high-purity ferrosilicon for
carbon-based reduction agents in the smelting process, electrical steel used in EVs, wind turbines, and power
generating CO2 emissions. In addition, the significant infrastructure. Additionally, our Elkem Microsilica® brand
electricity demand for furnace operations contributes to improves concrete sustainability, and we deliver cost-
scope 2 emissions. However, Elkem’s silicon production effective materials for durable photovoltaic panels.
is largely located in regions with abundant renewable
energy, primarily hydropower, which helps reduce overall Climate-related risks and opportunities are fully integrated
climate impact. We also recognise the broader effects of into Elkem’s governance and strategic processes.
our value chain, from upstream sourcing of raw materials Oversight of climate strategy rests with the board of
to downstream applications of our products in carbon- directors, which conducts annual reviews of climate risks
intensive industries. and opportunities as part of the overall business strategy.
Elkem Annual report 2025 103
ESRS E1
ESRS topic: E1 Climate change
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Climate
change
adaptation
Climate Use of reductants in production of Actual Yes Yes Negative High Short OO, VC
change silicones results in CO2-emissions
mitigation
Use of coal in various in own products Actual Yes Yes Negative High Short OO, VC
(e.g. carbon paste), and used in value
chain (e.g. steel, aluminium)
Transportation of quartz and other Actual Yes Yes Negative High Short OO, VC
purchased goods
Silicon and related products (Si, FeSi, Actual Yes Yes Negative High Short VC
Elkem Microsilica®) are used in high-
emitting products (e.g. concrete, steel,
aluminium)
Production of silicon is mainly based Actual Yes Yes Positive High Short VC
in regions (Norway, Iceland, Paraguay)
where renewable energy is abundant
Silicon and silicone products are enablers Actual Yes Yes Positive High Short VC
for the green transition and help reduce
emissions through other technologies
and products (e.g. EV production, more
sustainable construction, renewable
power construction and infrastructure)
Energy Production of silicon and silicones is Actual Yes Yes Negative High Short OO
energy intensive
The use of silicones, siloxanes and silanes Actual Yes Yes Positive High Short VC
generates energy savings and reductions
in greenhouse gas emissions that exceed
the impacts of production and end-of-life
disposal. The durability makes silicone
result in less waste over time.
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
The audit committee supervises sustainability reporting Transition risks primarily relate to regulatory changes
and monitors progress towards emission reduction in emissions trading systems (ETS) and carbon pricing
targets. Risk management spans short-, medium-, mechanisms, given the inherent CO2 emissions from
and long-term horizons and addresses both transition silicon production. Technological risks, such as shifts
and physical risks. The CFO presents comprehensive in demand driven by EU taxonomy requirements, are
risk assessments, including climate factors, at board also relevant. Elkem mitigates these risks by increasing
meetings. Risks are categorised as low, medium, or high biocarbon use, developing low-GHG technologies, and
based on probability and potential financial impact on exploring carbon capture and storage (CCS). Conversely,
EBIT, cash flow, and equity, enabling informed decisions the green transition creates significant opportunities.
across time horizons. Our advanced silicon-based materials position Elkem to
benefit from growing demand for EVs, energy storage,
and renewable power. Products such as EV battery
components, silicone insulation, and low-carbon graphite
enable us to support decarbonisation while expanding
market share.
104 Sustainability statements | Environmental
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Transitional risks
Potential
financial Time
Risk type Probability impact horizon Description Mitigation
Regulatory High Medium Short Elkem produces silicon and ferrosilicon Increase the share of biocarbon as a
in Norway and Iceland and silicones reduction agent in silicon production
in France, all under the EU's emission
trading system (ETS). Changes in free
allowances or higher prices may raise
Elkem's direct costs. In China, Elkem
has silicon and silicones production,
and the evolving quota system could
potentially increase operational costs.
The introduction of CBAM will also pose
challenges to Elkem as we compete in a
global market.
Technological Medium High Medium Elkem faces potential impacts from the Reinforce efforts to reduce energy
EU taxonomy, requiring technological consumption, reduce GHG emissions, and
upgrades for sustainability. Global continue to develop products that enable
efforts to reduce fossil GHG emissions GHG emission reductions
could diminish Elkem’s product
Increase the share of biocarbon as a
attractiveness, leading to substitutes.
reduction agent
The cost of transitioning to low-emission
technologies such as CCS, is significant. Continue research and development of
Additionally, reliance on coal and char CCS and CCU
as reduction agents poses a risk due to
potential scarcity, affecting access to
critical raw materials.
Political High Medium Short Political instability, and uncertainty Efforts to explain Elkem’s competitive
related to framework conditions, such situation through industrial organisations
as the CO2 compensation scheme, may (i.e. Norsk Industri, Eurometaux).
increase the costs for Elkem.
Market Medium Medium Medium Increased cost of lower-emitting raw Develop good relationships with reliable
materials, such as certified biocarbon, suppliers
lower emitting coal and iron, due to
increased demand (i.e. biocarbon) as
more companies compete over the same
sources.
Market Medium High Medium Electrification of our society may lead to
an increase in demand and thus result
in increased power prices, and this will
affect all Elkem’s locations.
Regulatory Low Low Short More regulatory requirements and
directives to follow resulting in increased
operational costs to monitor and meet
requirements.
Elkem Annual report 2025 105
ESRS E1
Transitional opportunity
Potential
financial Time
Risk type Probability impact horizon Description Mitigation
Products High High Short Silicon is vital for EV performance Elkem is capitalising on the EV
and services and safety. Silicones, derived from opportunity by supplying critical silicon-
silicon,provide insulation, sealing, and based materials and solutions across
fire protection for battery packs and the EV value chain. The group provides
electronics, with EVs using about four advanced silicones for battery pack
times more silicone than conventional encapsulation, thermal management, wire
cars. In batteries, silicon is added to and cable insulation, and sealing – areas
lithium-ion anodes to boost energy where EVs use roughly four times more
density and reduce charging time. silicones than ICE cars. It also delivers
Silicon alloys strengthen lightweight silicon and high-purity ferrosilicon that
structures, while coatings and ceramics strengthen lightweight aluminium parts
improve durability and thermal and feed electrical steel used in e-motors,
management. plus specialty inputs for components like
ceramic brake discs and heat exchangers.
In power electronics, silicon carbide
On the battery side, Elkem has developed
(SiC) semiconductors in inverters and
and qualified materials for battery
chargers deliver higher efficiency,
and wiring insulation and has pursued
faster switching, and better thermal
innovations around higher-performance
performance, enabling fast charging
anodes (while previously incubating
and extended range. Emerging trends
low-mission anode technology through
include silicon anode batteries and
Vianode). In parallel, Elkem advances a
recycling initiatives, reinforcing silicon’s
circular approach, leveraging by-products
role as a key enabler of sustainable
such as Elkem Microsilica® and exploring
mobility.
silicone recycling, to lower footprints for
automotive customers. Together, these
capabilities position Elkem as a key
materials partner enabling safer packs,
lighter structures, and more efficient
powertrains in EVs.
Products High High Medium Circular economy and increased Elkem is exploring the possibilities to
and services recycling and reuse. In silicones recycle silicone through projects such as
production there are opportunities REPOS and RENOV
to recycle silicones in order to
Elkem is looking into opportunities to
reduce emissions, up to as much
increase the use of recycled packaging
as 65 per cent. By-products from
materials and the reuse of wooden pallets
silicon production also represent an
used in transport
opportunity for Elkem.
Elkem has developed products such as
Elkem Microsilica®, a by-product from
silicon production, that makes concrete
less brittle and increases the lifespan of
concrete constructions.
Elkem has increased its use of biocarbon
as a reduction agent in the silicon
production, and the biogenic share of
emissions was 21 per cent in 2025.
Elkem was awarded NOK 33 million
from Innovation Norway to develop
low-emission products that support a
circular economy in the automotive and
construction industries.
Products High Medium Short Increased demand for renewable power, Elkem supplies products that enable these
and services power storage, electrification, and developments to aid in the transition to
improvement of electrical infrastructure. a more sustainable society, and one of
Elkem’s goals is green leadership that
entails growing our deliveries to these
sectors.
Technology Medium Low Long Most of Elkem’s silicon production is Elkem continues its research on CCS
located in industrial clusters in Norway, to assess new and more cost-effective
which are suitable for installation of options.
CCS facilities, and there is a positive
sentiment towards CCS in Norway.
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Overview of physical climate risk
Low-emission scenario
Low- Norway
Iceland Low
medium (country average)
Canada (Elkem Medium Low
Netherlands (Elkem
Chicoutimi) distribution center)
USA (Elkem Low- Low- China
Silicones NA plant) medium medium (country average)
Brazil (Elkem Low-
Low
France (Saint Fons
Carbon Brazil) medium & Roussillon plant)
High-emission scenario
Low- Norway
Iceland medium
Medium
(country average)
Canada (Elkem Medium
Low- Netherlands (Elkem
Chicoutimi) medium distribution center)
USA (Elkem Medium
Medium China
Silicones NA plant) -high (country average)
Brazil (Elkem Medium
Medium
France (Saint Fons
Carbon Brazil) -high & Roussillon plant)
The maps shows an average country score for all risks across both time horizons, with each risk weighted
Low Medium High
equally. The values in this heatmap exclude the metrics related to sea level rise, storm surge, and river flood. risk risk risk
These metrics are based on a location specific assessments note related to emission scenarios or time horizons.
Physical climate risks have been systematically assessed further develop the scenario analysis using ArcGIS. These
since Elkem’s first TCFD report in 2021, with regular steps, combined with continuous monitoring of weather
updates informed by research and tools such as the patterns and temperatures at the sites, ensures sound
World Bank Group’s Climate Change Knowledge Portal. management of physical climate risks.
As the TCFD has been disbanded, Elkem now looks
to CSRD and IFRS S2 to guide climate risk related Water access is a key physical risk for certain operations. In
disclosure. The disclosure in climate risk adheres to IFRS France, prolonged dry periods have prompted government
S2 as it describes how governance and strategy relate directives allowing restrictions on industrial water
to climate risk (ESRS 2), and the risks and opportunities withdrawal, though Elkem’s site has not yet been affected.
management and emissions disclosure are addressedin We continue to monitor developments closely. In Brazil,
this chapter. drought-related water scarcity remains a concern, and
we are actively assessing measures to ensure operational
The annual review of the physical climate risk for resilience. Using World Resources Institute’s (WRI) Water
Elkem sites revealed no changes in temperature and Risk Atlas tool ‘Aqueduct, we have identified the sites
precipitation patterns, or in the frequency and severity located in areas with water stress. These are Carbon
of extreme weather events that warrants investments Ningxia (CN), Foundry Ningxia (CN), Tianjin (CN), Chakan
or changes to site infrastructure. Long-term planning (IN), Nagpur (IN), York (US), Ferroveld (ZA) and Santa
incorporates hypothetical scenarios, including 2°C Perpetua (ES). We monitor these sites as well and report
and 4°C global warming pathways. Elkem is looking to water consumption for these separately under ESRS E3.
Elkem Annual report 2025 107
ESRS E1
Elkem’s transition plan
-25%
2022 Growth Silicone Biomass in More Phase 1 2030 Phase 2 CCS at CC, 2050 net
process smelters Chinese low-carbon target low-carbon smelters recycling zero target
efficiency renewables supply chain supply chain and other
Transition plan for climate change Beyond reducing its own emissions, Elkem is expanding
mitigation E1-1 its supply of advanced materials critical to a sustainable
Elkem’s climate roadmap is aligned with the Paris Climate economy. Demand for silicon and electrical steel, essential
Agreement goal of limiting global warming to well below for renewable energy, energy storage, and electric
2°C. The group targets a 25 per cent reduction in scope vehicles, is growing, and Elkem is well positioned to meet
1 and 2 emissions by 2030 compared to 2022 levels, it. Key contributions include silicone solutions for EV
equivalent to approximately 840 000 tonnes CO2e. In battery protection, silicon alloys for vehicle electrification,
addition, Elkem aims to reduce the carbon intensity of and high-purity ferrosilicon for electrical steel, along with
its main products by 32 per cent over the same period, innovations that enhance photovoltaic panel durability
with a long-term ambition of achieving net zero by and improve concrete structures. Elkem is also committed
2050. To reach these goals, Elkem is implementing key to water and waste management improvements, recycling
decarbonisation levers, including transitioning to biomass initiatives, and developing products based on circular
in smelting processes, reducing emissions across the economy principles. For example, Elkem Microsilica® is
supply chain, increasing renewable energy use in China, widely used in major construction projects, and Elkem is
and deploying carbon capture and storage (CCS). working on reducing the carbon footprint of silicones by
over 65 per cent through chemical recycling.
Elkem introduced its global climate roadmap and transition
plan in 2021*, aligned with its strategy of green leadership. Elkem’s absolute CO2 reduction target—25 per cent by
By 2025, the group has continued to advance these efforts. 2030 for scope 1 and 2—is complemented by a 32 per
From 2022 to 2025, scope 1 emissions were reduced by 19 cent reduction in carbon intensity for its main products.
per cent (460 000 tonnes CO2e), while scope 2 emissions This intensity target covers scope 1, scope 2, and upstream
increased by 11 per cent (110 000 tonnes CO2e) due to scope 3 emissions for two key product categories:
higher production, and outsourcing of steam production, upstream production of silicones (siloxane) and tapped
at our Xinghou plant. The roadmap focuses on three pillars: silicon and ferrosilicon metal. These categories represented
reducing fossil CO2 emissions, supplying materials for the 93 per cent of Elkem’s operating income in 2022. Carbon
green transition, and enabling circular economies. intensity is measured in CO2e per kilogram of product
—
*The current transition plan and targets are a revision of the transition launched in 2021. The revision was done to comply with the requirements in CSRD. We
have adjusted the baseline year to 2022 and the target year to 2030, but staying on the same absolute emissions linear reduction trajectory and target.
108 Sustainability statements | Environmental
Table of contents Board of directors’ report Sustainability statement Financial statements
produced. The intensity, or the product group carbon Policies related to climate change mitigation
footprint (PGCF), was 9 kilograms CO2e per kilogram of and adaptation E1-2
product in 2025. Elkem’s policies address climate mitigation through GHG
emissions reduction, adaptation to climate impacts,
Scope 3 reductions will be achieved through supply chain and promoting energy efficiency and renewable energy.
decarbonisation, primarily in raw material sourcing and The group’s emissions reduction policy emphasises
efficiency. While market conditions have made sourcing replacing fossil-based reduction materials with biocarbon.
challenging, improved value chain data is enabling better Additionally, policies support circular economy, aligning
target design and follow-up. Elkem was planning to with EU critical raw material priorities for products
launch an absolute scope 3 target in 2025, but this has like silicon. Please refer to the section on governing
been postponed due to the strategic review (see ESRS 2 documents under ESRS 2 for more details.
for more information).
Actions and resources in relation to climate
Description of methodologies and significant policies E1-3
assumptions used to define the target E1-2 MDR-T 80f Elkem is actively implementing initiatives to improve
Elkem’s GHG emission intensity targets are defined using energy efficiency and reduce its environmental
methodologies aligned with the GHG Protocol Corporate footprint. A major focus is upgrading existing facilities
Accounting and Reporting Standard and the GHG and equipment, including replacing outdated electrical
Protocol Scope 2 Guidance, applied consistently across motors with high-efficiency models equipped with
reporting periods. The targets cover scope 1 and scope variable frequency drives. At the Xinghuo site, Elkem has
2 emissions, and, where relevant, are complemented by transitioned from inefficient coal boilers to cogeneration
product‑level carbon intensity metrics that reflect material technology, reducing coal consumption while expanding
scope 3 emissions along the value chain. Emissions are siloxane capacity at a lower energy intensity.
expressed in CO2‑equivalents, and intensity is calculated
as kilograms CO2e per kilogram of product, ensuring Another important initiative is energy recovery from
comparability over time. Scope 2 emissions are calculated processes that generate surplus heat. Elkem has been a
on a location‑based basis, reflecting the physical pioneer in waste heat utilisation since the 1970s, using
emission intensity of electricity and steam consumed. Key recovered heat for district heating, steam for production
assumptions include stable organisational and operational processes, and generating electricity. This approach
boundaries, the use of recognised emission factors, and significantly improves energy efficiency and reduces the
recalculations only in the event of material structural or overall environmental impact.
methodological changes, in line with ESRS requirements.
Elkem is also advancing innovative projects to cut CO2
Confirmation that the target is based on conclusive emissions, such as the Elkem Sicalo® project, which
scientific evidence E1-2 MDR-T 80g aims for zero emissions by 2050. The project seeks to
Elkem’s scope 1 and scope 2 emission reduction and create a CO2-free silicon production process, involving
intensity targets are designed to be consistent with a carbon looping concept that captures and recycles
climate science and the objectives of the Paris Climate carbon emissions from the silicon furnace, eliminating
Agreement, aiming to limit global temperature increase the need for external carbon as a reductant and aiming
to well below 2°C. The targets reflect de-carbonisation for net zero emissions in silicon production. Conducted
pathways that are consistent with science‑based in collaboration with SINTEF and supported by the
transition trajectories for energy‑intensive industries, Research Council of Norway and the EU, the project
taking into account Elkem’s industrial footprint, regional involves medium-scale pilot testing and the development
energy systems, and transition risks. The level of ambition of new technologies to eliminate CO2 emissions in silicon
is informed by internal scenario analyses assessing production.
feasible annual reduction rates and abatement levers,
rather than short‑term activity effects. For product carbon In 2025, Elkem invested NOK 14.7 million in Sicalo and
intensity, improvements are supported by life‑cycle‑based received NOK 15.4 million in government grants. The
analyses to ensure that reductions reflect real emission group also pursued several other research projects to
decreases across the value chain. Elkem continues reduce greenhouse gas emissions, with total spending of
to assess the conditions for extending science‑based NOK 15.2 million in 2025.
target setting to scope 3 emissions, in line with evolving
scientific guidance and data availability.
Elkem Annual report 2025 109
ESRS E1
In Q2 2025, Elkem completed a concept (FEL2) study Targets for climate change mitigation and
on energy recovery from excess heat and carbon capture adaptation E1-4
and storage for its site in Mo i Rana, Norway, together Elkem’s climate targets address both absolute
with the neighbouring company Ferroglobe, aiming to greenhouse gas emissions and the carbon intensity of
capture in total 412 kilotonnes of CO2 per annum. The its main products. By 2030, the group aims to reduce
study concluded on that the project is technically feasible, scope 1 and 2 emissions by 25 per cent compared to 2022
though the economic feasibility is dependent on frame levels and achieve a 32 per cent reduction in the carbon
conditions, which today are not in place. intensity of its core product portfolio. Elkem had planned
to establish an absolute scope 3 emissions target in 2025,
To replace fossil carbon sources, Elkem is working toward but this has been postponed due to the strategic review.
achieving a 50 per cent biocarbon share in smelting
operations by 2031. The group is actively sourcing Energy consumption and mix E1-5
sustainable and financially viable biocarbon, including Elkem’s total energy consumption in 2025 amounted
pioneering production technologies in Canada that utilise to 7 121 GWh, with the majority sourced from regions
sawmill residues. All biocarbon is sourced in compliance where renewable power is abundant. All smelting
with certification schemes such as FSC, SFI, SVLK, and facilities, except one in China, operate on renewable
PEFC. In 2025, the biogenic share of emissions was 21 electricity (Norway, Iceland, Canada, and Paraguay). The
per cent, reflecting ongoing efforts to scale up supply. group continues to implement energy-saving measures,
Operating expenses related to the transition from fossil focusing on reducing fossil fuel use and adopting more
to biocarbon reductants have amounted to NOK 3 275 efficient production technologies. Energy intensity per
million over the past four years. net revenue is monitored annually, with a clear ambition
to enhance efficiency in high-impact areas such as silicon
Elkem has received NOK 33 million from Innovation and ferrosilicon production.
Norway to develop low-emission products that support
a circular economy in the automotive and construction Energy-intensive processes remain a defining feature
industries. The project will be piloted at the Fiskaa site in of Elkem’s value chain, particularly in the production
southern Norway, where Elkem is applying the “three Rs”, of silicon, ferrosilicon, and foundry alloys using high-
reduce, reuse, recycle, at industrial scale: temperature electric arc furnaces. While these processes
present both impacts and risks, they also create
→ Reduce: By-products from silicon production will be opportunities. Elkem is a frontrunner in waste heat
used to develop a cement alternative with a carbon recovery, converting excess heat into valuable resources.
footprint about one-third that of traditional cement. Recovered heat is utilised for district heating, steam for
industrial processes, and electricity generation.
→ Reuse: Silicon from old solar panels will be repurposed
into new alloys for the aluminium industry. We are also In 2025, Elkem recovered 928 GWh of energy from its
reusing equipment and expertise from the former REC facilities, up from 738 GWh in 2024. As mentioned in E1-3,
Solar site to accelerate testing. Elkem completed, in Q2 2025, a concept (FEL2) study
on energy recovery from excess heat and carbon capture
→ Recycle: Slag and other by-products will be and storage for its site in Mo i Rana Norway, together with
transformed into valuable construction materials. the neighbouring company Ferroglobe. The combined
energy recovery and carbon capture project will deliver a
Powered by Norwegian hydropower and collaborative net increase in district heating and electricity than today,
innovation, the project supports Norwegian and European all while powering the totality of the carbon capture
climate goals. Looking ahead, Elkem will continue to and liquefaction. Elkem has a target to increase energy
increase the share of biocarbon in its smelters, improve recovery year on year, and from 2024 to 2025 the energy
the efficiency of silicones production, reduce supply recovery increased by 26 per cent.
chain emissions, explore carbon capture opportunities
at its smelting facilities, and focus on circular product
innovation for the construction and automotive industries.
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Energy consumption and mix
Base year Development
Energy consumption and mix (scope 2 market based reporting) 2025 2024 2023 2022 vs. base year
Fuel consumption from coal and coal products (GWh) - - 694 852
Fuel consumption from crude oil and petroleum products (GWh) 84 88 83 77 9%
Fuel consumption from natural gas (GWh) 415 497 434 499 (17%)
Fuel consumption from other fossil sources (GWh) - - - 1
Consumption of purchased or acquired electricity, heat, steam, and 4 780 5 101 4 717 3 913 22%
cooling from fossil sources (GWh)
Total fossil energy consumption (GWh) 5 279 5 686 5 928 5 341 (1%)
(calculated as the sum of lines 1 to 5)
Consumption from nuclear sources (GWh) 886 558 766 1139 (22%)
Fuel consumption for renewable sources, including biomass (also 0 0.35 0.21 -
comprising industrial and municipal waste of biologic origin, biogas,
renewable hydrogen, etc.) (GWh)
Consumption of purchased or acquired electricity, heat, steam, and 955 909 578 1 543 (38%)
cooling from renewable sources (GWh)
The consumption of self-generated non-fuel renewable energy (GWh) - - - -
Total renewable energy consumption (GWh) 955 909 578 1 543 (38%)
(calculated as the sum of lines 8 to 10)
Total energy consumption (GWh) 7 121 7 153 7 272 8 024 (11%)
(calculated as the sum of lines 6, 7 and 11)
Share of fossil sources in total energy consumption (%) 74% 79% 82% 67% 11%
Share of consumption from nuclear sources in total energy consumption (%) 12% 8% 11% 14% (11%)
Share of renewable sources in total energy consumption (%) 13% 13% 8% 19% (29%)
Energy consumption and mix (scope 2 location based reporting)
Total fossil energy consumption (GWh) 2 281 2 434 2363 2593 (12%)
Consumption from nuclear sources (GWh) 104 112 102 105 (1%)
Total renewable energy consumption (GWh) 4 736 4 607 4807 5325 (11%)
Share of fossil sources in total energy consumption (%) 32% 34% 32% 32% 0%
Share of consumption from nuclear sources in total energy consumption (%) 1% 2% 1% 1% 46%
Share of renewable sources in total energy consumption (%) 67% 64% 66% 66% 1%
Share of renewable electricity in total electricity consumption* 82% 80% 82% 81% 1%
Energy recovery (GWh)* 928 738 995 892 4%
Energy recovery percent of total energy consumption* 13% 10% 14% 11% 19%
Energy intensity based on net revenue (MWh/Net revenue NOK) 0.00023 0.00022 0.0002 0.00017
*These are Elkem specific KPIs.
Elkem Annual report 2025 111
ESRS E1
Gross scopes 1, 2, and 3 and total GHG
emissions E1-6
Scope 1 emissions, primarily from smelting operations, major production sites. Scope 2 emissions are calculated
accounted for approximately 90 per cent of Elkem’s using location-specific emission factors, notably for
direct emissions in 2025. Combined scope 1 and scope 2 electricity consumption in China. Scope 3 emissions,
location-based emissions totalled 3.01 million tonnes of reported since 2021, cover all relevant categories,
CO2e, reflecting a reduction of 11 per cent compared to the including purchased goods and services, transportation,
2022 base year, mainly due to changes in activity levels at and end-of-life treatment of products.
Gross scopes 1, 2, and 3 GHG emissions
Retrospective Milestones and targets
Base Annual %
year 2030 2050 target /
Scope 1 emissions 2025 2024 2023 2022 Development vs. base year target target base year
Gross scope 1 GHG emissions 1.96 2.03 2.21 2.42 -19% Decrease driven by the 1.82 0 -3.10%
(million tonnes CO2eq) decommissioning of the
Xinghuo coal fired boilers in
2023 and reduced activity at
some smelters
Percentage of scope 1 GHG 79% 69% 62% 67% 12% Increase driven by the
emissions from regulated emission decommissioning of the
trading schemes (%) Xinghuo coal fired boilers in
2023 and changes of activity
levels at different smelters
Biogenic CO2 share of total scope 1 21% 19% 20% 20% 5% Increase driven principally 47%
emissions by the decommissioning
of the Xinghuo coal fired
boilers in 2023
Scope 2 GHG emissions
Gross location-based scope 2 GHG 1.05 1.16 0.83 0.94 11% Increase driven by the start 0.71 0 -3.10%
emissions (million tonnes CO2eq) of the Xinghuo external
cogen plant in 2023
Gross market-based scope 2 GHG 3.19 3.42 2.89 2.64 21%
emissions (million tonnes CO2eq)
Scope GHG emissions
Gross scope 3 GHG emissions 8.93 8.34 6.81 7.38 21% Increase
(million tonnes CO2eq)
Scope 3 biogenic CO2 (uptake and 0.47 First year diclosing
removals) (million tonnes CO2eq)
Total scope 3 GHG emissions including 9.40 First year diclosing
biogenic CO2 (million tonnes CO2eq)
Total GHG emissions
Total GHG emissions (location based) 11.94 11.53 9.85 10.74 11% Increase
(million tonnes CO2eq)
Total GHG emissions (market based) 14.55 13.79 11.91 12.44 13% Increase
(million tonnes CO2eq)
Product Group Carbon Footprint 9.0 8.9 8 6.9 30% 4.8
(PGCF) (kg CO2e/kg product)
GHG Intensity based on net revenue 0.00039 0.00035 0.00028 0.00023
(location based) (tonnes CO2e/
Net revenue NOK)
GHG Intensity based on net revenue 0.00047 0.00042 0.00034 0.00027
(market based) (tonnes CO2e/
Net revenue NOK)
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GHG removals and carbon credits E1-7
While Elkem’s core strategy focuses on reducing
emissions at source, the group also assesses
opportunities related to carbon credits and greenhouse
gas (GHG) removal projects. Current initiatives include
advancing research on carbon capture and storage
(CCS), and carbon capture and utilisation (CCU), for
smelting operations and scaling up the use of sustainable
biocarbon. All carbon credits adhere to recognised third-
party verification standards to ensure credibility and
transparency.
Internal carbon pricing E1-8
Elkem applies an internal carbon price to incorporate
the true cost of emissions into decision-making. This
mechanism is aligned with prevailing market prices,
ensuring that our internal pricing reflects current market
conditions and the real alternative cost of reducing carbon
emissions. By using the market price, we leverage the
collective insight of market participants rather than relying
on the perspective of a single analyst, thereby ensuring a
robust and credible approach to carbon valuation.
Financial effects of climate-related risks and
opportunities E1-9
Climate-related risks, such as changes in energy policy,
may affect Elkem’s long-term financial position. At the
same time, the growing demand for green materials
creates significant opportunities for revenue growth.
Elkem expects cost savings through enhanced energy
efficiency and increased reliance on renewable energy,
while anticipating higher revenues from low-carbon
products, including materials for electric vehicles and eco-
designed silicones. Quantitative assessments of these
financial impacts are ongoing.
None of Elkem’s assets are currently considered
exposed to material physical climate risks, and no site
improvements or operational changes have been required
to address such risks. Transitional risks related to our
assets are detailed in the section on climate risk.
Elkem’s climate roadmap, policy framework, and annual
disclosures reflect our commitment to transparency and
alignment with ESRS E1 standards. Our strategy and
targets for climate neutrality by 2050 ensure compliance
with EU regulations and support global climate objectives.
Elkem Annual report 2025 113
ESRS E2
Pollution
Pollution of air, soil, and water is a key environmental aspect of
Elkem’s operations and is closely monitored across all sites. Local
emissions are inherent to several core production processes and
are therefore considered material to the group. Reducing and
controlling these emissions is a strategic priority, as they can
affect both employee health and surrounding ecosystems.
Elkem is committed to continuous improvement and to
implementing measures that minimise emissions and mitigate
their impact on people and nature.
Material pollution-related impacts, risks, and proactive compliance with evolving regulations.
opportunities IRO-1 Engagement in regional and international industry
Elkem’s operations and products depend on specific associations enables Elkem to anticipate regulatory
raw materials and industrial processes where emissions developments and emerging standards. Through this
to air, water, and soil can occur. These emissions process, the group gains a clear understanding of both
originate primarily from the raw materials used and are negative environmental impacts and potential positive
subject to strict permitting and continuous monitoring. contributions of its products and processes.
Pollutants such as heavy metals and polycyclic aromatic
hydrocarbons (PAHs) are regulated under international Key risks include regulatory non-compliance, reputational
and local frameworks, requiring robust control measures. damage, and operational disruptions. Conversely,
For example, the production of carbon products opportunities arise from growing market demand
involves raw materials that inherently contain hazardous for sustainable practices and products aligned with
substances, necessitating stringent mitigation actions to environmental standards. By addressing these risks and
minimise environmental impact. pursuing innovation, Elkem aims to reduce pollution-
related impacts while creating value for stakeholders
Elkem systematically identifies and assesses pollution- and the environment. In addition to supplying critical
related impacts, risks, and opportunities in line with ESRS materials for the green transition, Elkem actively supports
E2 and IRO-1. This includes leveraging scientific research, customers with expertise to improve production efficiency
collaborating across the value chain, and maintaining and sustainability.
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ESRS topic: E2 Pollution
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Pollution of Tailings from mining operations polluting Potential Yes Yes Negative Low Short OO, VC
water water bodies.
Production of carbon products use Actual Yes Yes Negative Medium Short OO
raw materials that contain hazardous
substances (e.g. heavy metals, PAHs) that
can pollute water bodies if not managed
properly.
The process to produce silicones involves Potential Yes Yes Negative Medium Short OO
substantial quantities of water effluent
that is treated before discharge to remove
residuals from the process (e.g. COD). If
not managed properly, this could lead to
anaerobic conditions, which are harmful
to fish and biota.
Pollution Use of fossil based reductants in Actual Yes Yes Negative High Short OO
of air production of silicon and carbon products
result in local emissions of SO2, NOX and
dust.
Local emissions of SO2 and NOX can lead Potential Yes Yes Negative Low Short OO
to acid rain.
If not handled correctly, silicon powder Potential Yes Yes Negative Low Long OO
can result in diseases. The severity
depending on levels of crystalline silica,
and exposure.
Pollution of Silicon products are often combined with Potential Yes Yes Negative Low Medium VC
soil graphite, that are produced in China. The
air pollution from the mines impact the
drinking water, the air quality etc. and
impact the biodiversity in the area. The
mines are shown to damage crops.
Substances PAHs released from coke manufacturing, Potential Yes Yes Negative Low Short VC
of very high sintering, iron making, casting, mold
concern poring and cooling, and steel making,
causing health issues to downstream
workers. Health issues depend on the
levels and exposure.
Cyclotetrasiloxane (D4) from silicone Actual Yes Yes Negative Low Long VC
products ends up and accumulating in
nature, compromising ecosystems.
Improper management of D4, D5 and Potential Yes Yes Negative Medium Long OO
D6 leads to soil contamination and
water pollution, due to strong absorbing
potential to organic matter.
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
Policies related to pollution E2-1 Actions and resources related to pollution E2-2
The HSE principles in Elkem highlight our pollution Local air emissions are systematically monitored to ensure
strategy: “Focus on hazard identification, risk analysis, compliance with public permits. At applicable sites, 17
action implementation through understanding and parameters related to air emissions are reported quarterly
removing causes.” Please refer to the section on to the corporate HSE function. Site HSE managers are
governing documents under ESRS 2 for more details. responsible for collecting and submitting this data, which
is reviewed by the corporate HSE team and escalated
Elkem Annual report 2025 115
ESRS E2
to the vice president HSE for oversight. This structured Targets related to pollution E2-3
process ensures transparency and adherence to Elkem will develop new targets related to pollution in
regulatory requirements. 2026. The previous voluntary target has been to:
Elkem maintains strict compliance with chemical product → Reduce dust by 30 per cent by 2025 from baseline
regulations globally, covering registrations, authorisations, year 2015 (1 970 metric tonnes). In 2025, Elkem’s
safety data sheets (SDS), and labelling. All SDS are dust emissions is reduced by 55.4 per cent, and new
prepared in accordance with the UN Globally Harmonised targets will be considered after strategic review is
System (GHS) of classification and labelling of chemicals. concluded.
Products must meet technical, regulatory, health, and
environmental standards in every market, with additional → Reduce SO2 emissions by 3 000 tonnes from
requirements for applications involving food, water, or baseline year 2015 (7 392 metric tonnes). By 2025
healthcare. With a portfolio of more than 4 000 products, we have reduced SO2 emissions by 21.2 per cent. The
regulatory and product compliance is a core priority. development is closely linked to the introduction of
biocarbon reductants.
The group continuously monitors its product portfolio
for substances of very high concern (SVHC) that are → Elkem has reduced its NOX emissions by 22.1 per cent
subject to current or emerging regulatory requirements since the baseline year of 2015 (7 049 tonnes). New
or associated with specific risks. Management plans targets will be considered after strategic review is
are regularly reviewed to define risks and mitigation concluded.
measures for each identified SVHC. Actions include
substitution where feasible, phasing out substances → Elkem has a target of full discharge permit
posing unacceptable risks, or limiting exposure when compliance, meaning no significant spills to water.
substitution is not possible. No SVHCs listed on REACH
Annex XIV are intentionally added to Elkem’s silicon or
ferroalloy products.
Pollution
Metric 2025 2024 2023
Dust to air Tonnes 878.0 789.0 1 012.0
SO2 to air Tonnes 5 822.0 6 440.0 6 700.0
NOX to air Tonnes 5 490.0 5 460.0 5 830.0
COD to water Tonnes 248.0 238.0 237.0
PAH to air* Kg 960.0 686.2
PAH to water* Kg 15.6 35.5
Nickel to water* Kg 90.0 43.3
HFC-134 to air* Kg 20.0 2 900.0
HCFC to air* Kg 2 810.0 619.6
Copper to air* Kg 162.0 136.0
Copper to water* Kg 207.3 126.4
Chrome to water* Kg 156.4 110.2
Arsenic to air* Kg 92.0 65.2
Arsenic to water* Kg 15.7 7.1
*Reportable emissions
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Pollution of air, water, and soil E2-4 → In silicones: D4, D5, and D6 are key intermediates
Previous variations in emissions are primarily tied to (building blocks) in the production of silicones-based
production volume changes inherent to the process, polymers. In addition, some other essential SVHC
influenced by raw material quality, process control, and substances are used under strict conditions in a
investments in filtration or scrubber systems, all regulated limited number of products.
by public permits. All production sites with emissions to
air/water are ISO 14001 certified and subject to regularly → In silicon products and ferroalloys: These are made
third-party audits and control. from natural raw materials, such as quartz, carbon,
and iron oxide, which often contain trace amounts of
Substances of concern and substances of heavy metals. Cadmium and lead are listed as SVHC,
very high concern E2-5 but their concentrations in Elkem’s products are far
A vital part of the European REACH regulation (Regulation below the generic threshold limit value of 0.1 per cent
(EC) 1907/2006 on the Registration, Evaluation, weight per weight and do not trigger regulatory action.
Authorisation and Restriction of Chemicals) is the
identification and authorisation of substances of very The only exception is Søderberg electrode paste from
high concern (SVHC). The European Chemicals Agency the Carbon Solutions division, which is used as an
ECHA regularly updates its SVHC candidate list for intermediate and which is as such exempted from
authorisation. authorisation requirements. Elkem Carbon is successfully
developing alternative products with new and safe
Elkem has three main product areas where SVHC occur: binders.
→ In carbon products: High-temperature coal tar pitch
(CAS no. 65996-93-2) is used as an intermediate in
the production of Søderberg electrode paste. The
pitch is transformed into coke in the following process.
Elkem Annual report 2025 117
ESRS E3
Water and marine
resources
Elkem recognises the importance of efficient water and marine
resource management as part of its responsibility as a leading
provider of advanced silicon-based materials. While Elkem’s
production processes have limited direct water consumption,
the group is indirectly dependent on water through its use of
hydropower and upstream activities.
Elkem is committed to maintaining a sustainable water footprint
across its operations and value chain, ensuring responsible
sourcing, compliance with local regulations, and continuous
improvement to minimise environmental impact.
Material water and marine resources-related While most major production sites are located in water-
impacts, risks, and opportunities IRO-1 abundant regions, the primary environmental risk
Water is a critical resource for Elkem’s production processes, relates to water discharge. Elkem maintains stringent
and the group is indirectly dependent on water through its water management practices, including monitoring and
reliance on hydropower, which accounts for over 80 per cent treatment systems to comply with permits and reduce
of electricity consumption. Ensuring a sustainable water harmful substances. Violations of water quality or marine
footprint is therefore essential. Water-related challenges conservation regulations could lead to reputational
vary across Elkem’s value chain, with the main focus on damage, community conflicts, and health risks for
preventing hazardous discharges and managing cooling workers. Financial impacts may arise from stricter
water to minimise impacts on marine ecosystems. As regulations, increased treatment costs, or technology
water is a key component in silicone production, prolonged upgrades. Climate change-related droughts and water
droughts in production regions could pose operational risks. rationing could disrupt production and supply chains,
while water stress at supplier locations may affect raw
Elkem operates in areas with water stress, but these material availability and pricing.
sites represent less than 0.2 per cent of total water
withdrawals. Nevertheless, Elkem works to minimise Elkem identifies significant opportunities to strengthen
water use and ensure proper discharge treatment at all stakeholder trust through transparent water management,
sites. The group uses the WWF Water Risk Filter and the improve resource efficiency, and advance innovative
Aqueduct tool from World Resource Institute annually to water treatment solutions. The expansion project at
assess water stress at existing and potential new sites the Xinghuo plant in China integrates advanced water
and conducts scenario analyses in line with CSRD and the handling systems designed to optimise efficiency and
Commission Delegated Regulation (EU, 2022/1288). reduce freshwater dependency. These measures enhance
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ESRS topic: E3 Water and marine resources at Elkem
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Water Water is a component in the production of Potential Yes Yes Negative Medium Medium OO
consumption silicone products. Water consumption in
areas more prone to prolonged periods of
drought, and in areas where water can be
scarce could have a negative impact on
surroundings and access to water.
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
operational resilience by ensuring stable production even effective waste-water discharge to ensure that Elkem is
under water scarcity conditions, reducing exposure to always compliant with applicable effluent and discharge
physical climate risks, and safeguarding critical processes regulations wherever it operates.
against disruptions. At the same time, Elkem’s approach
to water stewardship extends beyond compliance, Elkem has outlined our commitments for sustainable
focusing on responsible sourcing, minimising impacts water stewardship in our HSE and Elkem corporate
on local ecosystems, and contributing to biodiversity policies. Please refer to the section on governing
protection. By embedding water efficiency and risk documents under ESRS 2 for more details.
management into its value chain, Elkem supports long-
term sustainability objectives while reinforcing its role as a Actions and resources related to water and
trusted partner in global supply chains. marine resources E3-2
Recognising water as a vital shared resource, Elkem has
Policies related to water and marine resources established programmes to strengthen corporate water
E3-1 stewardship across its operations. The group monitors
Elkem is committed to responsible consumption of water water withdrawal, consumption, and discharge to ensure
and marine resources. Water and marine resources- responsible management and compliance with regulatory
related policies focus on driving Elkem’s overall requirements. Most production units are located in water-
consumption down, providing facilities that adhere to the abundant regions, which is essential for both process
UNICEF WASH principle and continuously making sure needs and hydropower-based electricity. As mentioned, a
that no deviations occur in any of Elkem’s sites globally. few sites in north-east China, South Africa, and India are
Furthermore, policies outline water maintenance and situated in water-stressed areas.
Elkem Annual report 2025 119
ESRS E3
In these areas, Elkem applies water-saving measures, The target is aimed at water withdrawals at Elkem sites
conducts systematic risk assessments, and limits in Roussillon, Saint-Fons, and Xinghuo per tonne silox
withdrawals to minimise impact, and has reduced water produced. In 2024, an increase in production capacity at
consumption by 74 per cent over the last five years. site Xinghuo, without a corresponding increase in water
withdrawals, shows Elkem’s commitment to increasing
All Elkem sites provide free potable water and sanitary water efficiency and driving down overall consumption.
facilities for employees and contractors, with showers and The effect of this is evident in 2025.
changing rooms available where required, thus adhering
to the UNICEF WASH principle. Working uniforms are Elkem has implemented targets that include having fully
supplied and cleaned by the group to maintain hygiene functioning WASH services on all Elkem facilities, and at
standards. Indirect water use in the value chain is under all sites adhere to production permits on thresholds for
ongoing evaluation, with particular attention to the role of discharge pollutants. Any non-compliance with these
hydroelectric power as a key energy source for Elkem’s targets is treated as an HSE deviation, reported, and
smelters. While developments in water reservoirs are corrected in accordance with Elkem’s internal procedures.
monitored as part of physical climate risk mapping, this is
currently assessed as a low-risk factor. Water consumption E3-4
Elkem’s primary water consumption is linked to silicone
Key enablers to attain strategic water-related goals production, representing 71 per cent of total withdrawals.
include:
→ Substitution of raw materials → Freshwater intensity for silicone production decreased
→ Implementation of good housekeeping practices by 22 per cent in 2025 to 67.8 m3 per ton silox
→ Continuous development of new processes and compared to the 2020 base year value of 87.3 m3 per
production technology ton silox, mainly driven by improved water efficiency in
→ An advanced control programme incorporating Xinghuo.
environmental monitoring
→ Wastewater treatment and reduction through → Elkem achieved a CDP Water Security score of A in
recycling or reuse 2025, maintaining the score from 2024.
→ Transparency, including participation in CDP Water
(A obtained for 2025) Freshwater is used as a raw material in silicone
production, for cooling equipment and products, cleaning,
Targets related to water and marine resources and emergency preparedness. The majority of usage falls
E3-3 under raw material and cooling, requiring high-quality
Ensuring Elkem’s commitment to safe and sustainable water to prevent contamination, corrosion, and clogging.
water management, KPIs and targets are continuously Water withdrawals and discharges are monitored and
implemented and updated with regard to water reported quarterly to corporate, using in-line meters or
consumption, water pollution, the provision of WASH capacity-based calculations. In water-scarce regions,
facilities, and compliance with applicable regulations. withdrawals are managed by third-party suppliers.
Elkem follows the outlines of the Sustainable Cooling water is returned to its source at similar quality.
Development Goal 6: Clean water and sanitation, and
the Sustainable Development Goal 12: Sustainable All sites comply with discharge permits and report
consumption and production. 17 parameters quarterly. The most critical discharges
include:
Key targets for water consumption:
→ Reduce water used per unit of produced silicones → COD (Chemical Oxygen Demand): Managed through
by 12 per cent by 2031 from baseline year 2020. process control, infrastructure maintenance, and
Production of silicones accounts for 71 per cent of on-site treatment. COD is reported in the chapter on
Elkem’s total water consumption pollution (ESRS E2).
→ Reduce water consumption in areas at material water → Silicone cyclics (D4, D5, D6): Controlled via spill
risk by 20 per cent from 2020 to 2031* prevention, process optimisation, R&D collaboration,
and major investments in China to replace cyclic
materials.
—
*This is an internal Elkem KPI.
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→ PAHs (Polycyclic Aromatic Hydrocarbons): and accounts for the majority of reported data, ensuring
Originating from coal-tar pitch in carbon products, a high level of accuracy and consistency across sites.
mitigated through process control, water treatment, Sampling and extrapolation are applied only where
and R&D on alternative binders. continuous measurement is not feasible, while estimates
are used in limited cases supported by operational
Elkem determines its water withdrawal and discharge knowledge and historical performance. This blended
figures using a combination of direct measurement, approach enables reliable, comparable water records
sampling with extrapolation, and best estimate that meet reporting requirements and reflect Elkem’s
calculations. Direct measurement is the primary method commitment to robust environmental data management
Water consumption
Metric 2025 2024 2023 Development
Withdrawal
Withdrawal of fresh surface water, including rainwater, water Megalitres 43 859 46 358 39 385 (5.4%)
from wetlands, rivers, and lakes
Withdrawal of groundwater – renewable Megalitres 2 948 3 059 2 321 (3.6%)
Withdrawal from third party sources Megalitres 25 941 28 064 38 931 (7.6%)
Total freshwater withdrawal Megalitres 72 748 77 481 80 636 (6.1%)
Discharge
Discharge of cooling water Megalitres 61 217 63 848 60 423 (4.1%)
Discharge of process water Megalitres 6 861 6 684 7 766 2.7%
Discharge to fresh surface water Megalitres 8 618 8 537 4 621 0.9%
Discharge to brackish water or seawater Megalitres 19 231 19 208 36 961 0.1%
Discharge to third-party destinations Megalitres 40 229 42 787 13 416 (6.0%)
Total water discharge Megalitres 68 078 70 532 70 923 (3.5%)
Total water consumption (fresh water) Megalitres 4 671 6 949 9 713 (32.8%)
*Sea water used for cooling purposes only is excluded from the reporting
Water measurement methods
Direct Sampling and
measurements extrapolation Best estimates
2025 2024 2025 2024 2025 2024
Water withdrawals 68% 69% 0% 1% 32% 30%
Water discharges 57% 56% 1% 0% 43% 44%
Water consumption
2020 % change
2025 2024 2023 (base year) vs. base year Comment
Fresh water withdrawal m3 per ton Silox 67.8 82.9 94.3 87.3 (22%) Target achieved
Water consumption in areas at material water risk 180 530 596 706 (74%) Target achieved
Internal Elkem KPI, defined as the water consumption
of Carbon Ningxia, Foundry Ningxia, Yongdeng, and
Nagpur*
*According to Commission Delegated Regulation (EU) 2022/1288): (13) ‘areas of high water stress’ means regions where the percentage of total water
withdrawn is high (40-80%) or extremely high (greater than 80%) in the World Resources Institute’s (WRI) Water Risk Atlas tool ‘Aqueduct’. For Elkem
this gives the following sites: Carbon Ningxia, Ferroveld, Tianjin, Foundry Ningxia, Nagpur, Chakan, York, Santa-Perpetua, and Shanghai.
Elkem Annual report 2025 121
ESRS E4
Biodiversity and
ecosystems
Elkem recognises the vital role of biodiversity and environmental
stewardship in securing a sustainable future. With operations
across diverse ecosystems, the group is committed to proactively
managing biodiversity impacts and addressing ecosystem
challenges throughout its entire value chain.
Material impacts, risks, and opportunities, internationally, and the group adheres to IMA-Europe’s
and their interaction with strategy and sustainability charter and the Towards Sustainable Mining
business model E4 SBM-3 Initiative. Annual contributions to restoration funds ensure
Elkem works to deepen its understanding of biodiversity- post-mining rehabilitation.
related impacts, risks, and opportunities across its
operations and value chain. While some sites are located Smelting and calcination
near key biodiversity areas, none are within protected Smelting and calcination processes can affect biodiversity
zones. Core industrial activities, such as quartz mining, through SO2, NOX, dust emissions, noise, and heat.
high-temperature calcination and smelting, and chemical The radius of impact is limited, and advanced emission
production, carry potential biodiversity risks, primarily control technologies are deployed to mitigate risks. Major
through emissions, resource use, and accidental incidents. biodiversity concerns relate to operational incidents,
Pollution of air, soil, and water has historically been a which are addressed through strict safety and emergency
concern but is strictly regulated and has been consistently protocols.
reduced over decades. Today, the main risks are linked to
operational incidents such as fires or chemical spills. Chemical production
Silicone production involves biodiversity risks associated
Quartz mining with water withdrawal, process water discharge, and
Environmental and biodiversity risk assessments are potential release of hazardous air pollutants (HAPs) and
integral to mining permit applications, and Elkem persistent organic pollutants (POPs) during accidents.
excludes protected areas from operations. Monitoring Elkem mitigates these risks through rigorous water
programmes track emissions to air and water, as well management, chemical safety protocols, and biodiversity
as impacts on soil, vegetation, and landscapes. While risk assessments for new plants. Collaboration with local
quartz mining presents inherent biodiversity risks, its authorities and biodiversity experts ensures minimal
ecological footprint is comparatively lower than that environmental impact. Elkem aligns with the Responsible
of other mining practices. Key risks include water and Care Global Charter and actively engages in scientific
terrestrial ecosystem disturbances, GHG emissions, research through Silicones Europe.
soil contamination, and solid waste generation. Elkem’s
sustainable mining practices have been recognised
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ESRS topic: E4 Biodiversity and ecosystems
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Direct impact If not managed properly Elkem's intervention Potential Yes Yes Negative Low Short OO
drivers of with nature, through mining operations,
biodiversity could impact biodiversity at sites. The
loss negative impact on the local biodiversity and
ecosystems can come from heavy metals,
noise, light pollution, waste, effluent etc.
If not sourced from trusted and certified Potential Yes Yes Negative Low Short VC
sources the use of biocarbon can have an
indirect negative impact on biodiversity
and soil quality through deforestation.
Hydropower production can have adverse Potential Yes No Negative Medium Short VC
effects on marine life in rivers and lakes
if production has large fluctuations.
Installation of new hydropower will also
effect biodiversity.
Effluent and spills of hazardous substances Potential Yes Yes Negative Low Short OO, VC
may cause harm to ecosystems through
pollution or bioaccumulation. E.g.
accumulation of heavy metals from silicon
production and mining, toxic by-products
from carbon solutions, and hydrogen
chloride from hydrolysis and cyclosiloxanes
from silicone production.
Local emissions of SO2, NOX, and dust Actual Yes Yes Negative Low Short OO
can damage surrounding areas and
ecosystems.
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
Elkem Annual report 2025 123
ESRS E4
In the vicinity (5-15 km) Assets
→ of protected areas 6
→ of key biodiversity areas 5
Close (1-5 km)
→ of protected areas 14
→ of key biodiversity areas 7
Adjacent (<1 km)
→ of protected areas 4
→ of key biodiversity areas 2
Inside
→ of protected areas 3
→ of key biodiversity areas 0
If several protected areas (PA) or Key Biodiversity Areas (KBA) are pres-
ent within a proximity category around a given asset or operation, they
are counted as one. If a given PA or KBA are within proximity categories
for several assets or operations, it is counted in for each of these assets or
operations.
Closure planning Description of processes to identify and
Although site closures are rare, Elkem integrates closure assess material biodiversity and ecosystem-
planning early in the site lifecycle. Plans include short-, related impacts, risks, dependencies, and
medium-, and long-term measures to rehabilitate land and opportunities E4 IRO-1
minimise impacts on water, soil, habitats, and landscape Elkem systematically identifies and assesses biodiversity-
stability. related impacts, risks, and opportunities across its
operations. In 2023, the Integrated Biodiversity Risk
Value chain Assessment Tool (IBAT) expanded reporting to include
Biodiversity considerations extend across Elkem’s proximity to protected areas and key biodiversity areas
value chain. Upstream, the group emphasises (KBAs). Data were collected at 5 km, 15 km, and 50 km
sustainable biocarbon sourcing, wood, wood waste, intervals for all sites, prioritising those with the highest
and charcoal, aligned with international standards to exposure to protected species, proximity to sensitive
prevent deforestation, ecosystem conversion, and soil ecosystems, and preparedness to manage biodiversity
degradation. Risks related to coal and char sourcing risks. Focus sites have been identified where risks are
are managed through strict supplier assessments. most significant, primarily linked to carbon solutions,
Downstream, Elkem works to minimise biodiversity silicon and silicone production, and mining. For security
impacts while enabling positive contributions, such as reasons, specific site locations are not disclosed.
products that replace resource-intensive materials, extend
product lifespans, and support customer sustainability While silicon and silicone production can negatively
initiatives. impact biodiversity through emissions and water use,
Elkem has implemented measures to reduce SO2, NOX,
and dust emissions and improve water management.
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Mining operations present risks related to land use and Policies related to biodiversity and
tailings, though these are limited due to the nature of ecosystems E4-2
quartz mining and managed through strict controls. Elkem has an HSE and sustainability policy covering
Incident risks remain for sites handling hazardous biodiversity and ecosystem. For sourcing of biocarbon, a
substances, and mitigation actions are in place to avoid separate policy document is available. Please refer to the
or minimise impacts. Focus sites include locations in section on governing documents under ESRS 2 for more
Norway, France, and Brazil, with ongoing monitoring at details.
remining sites.
Actions and resources related to biodiversity
Continual updates and advanced mapping and ecosystems E4-3
To ensure up-to-date biodiversity risk management, Elkem is implementing a range of actions to identify,
Elkem uses ArcGIS-based mapping integrated with mitigate, and manage biodiversity and ecosystem impacts
IBAT data. This approach enables continuous updates across its operations and value chain:
on proximity to protected areas and KBAs and supports
field studies for validation. By leveraging geospatial → Mapping and risk assessment
analysis, Elkem can identify emerging risks, prioritise To strengthen biodiversity risk management, Elkem
mitigation actions, and maintain compliance with evolving uses advanced geospatial tools such as ArcGIS
biodiversity standards. Dedicated resources oversee combined with IBAT data to map potential impacts
mapping and stakeholder engagement, including dialogue from existing and future mining operations. This
with local communities. For example, Elkem’s agreement approach enables real-time updates on proximity to
with reindeer grazing district 7 (Rákkonjárga) in Tana, protected areas and key biodiversity areas (KBAs)
Norway, facilitates mining expansion while safeguarding and supports field studies for validation. Dedicated
biodiversity in one of the world’s largest quartzite resources oversee this process and maintain active
deposits. dialogue with local stakeholders to ensure responsible
land use and ecosystem protection.
Transition plan on biodiversity and
ecosystems in strategy and business model → Water efficiency improvements
E4-1 Elkem continues to invest in water stewardship
Industrial processes inherently affect biodiversity through initiatives, including advanced water handling systems
emissions to air, water, and soil. Elkem complies with at the Xinghuo plant in China. These upgrades aim to
all applicable regulations and continuously implements reduce freshwater dependency and improve overall
measures to mitigate and reduce these impacts. Most water efficiency, thereby mitigating physical climate
production facilities are located near rivers, coastal risks and biodiversity impacts associated with water
regions, or urban areas, making stringent environmental scarcity.
safeguards essential. The group also acknowledges the
potential risk of incidents, such as fires or chemical spills, → Emission reduction and spill prevention
which could negatively impact surrounding ecosystems. Aligned with the commitments outlined in the
To address these risks, Elkem applies strict pollution ESRS E2 chapter, Elkem prioritises minimising local
control and emergency response protocols. emissions and preventing pollutant spills across its
operations. Actions include deploying advanced
Elkem’s approach is grounded in the mitigation hierarchy, emission control technologies to reduce SO2, NOX,
prioritising avoidance and reduction of impacts, followed and dust emissions, implementing rigorous chemical
by restoration where feasible. These principles are safety protocols, and maintaining emergency
embedded in operational practices and have delivered preparedness plans to address potential incidents.
measurable improvements over time. While Elkem’s These measures are supported by continuous
business model is generally resilient to biodiversity and monitoring and maintenance programmes to ensure
ecosystem changes, given its limited dependence on compliance and reduce ecological risks.
vulnerable natural resources, the group recognises its
responsibility to minimise negative impacts and enhance Through these initiatives, Elkem demonstrates its
positive contributions. commitment to proactive biodiversity management,
operational resilience, and sustainable development.
Elkem Annual report 2025 125
ESRS E4
Targets related to biodiversity and Impact metrics related to biodiversity and
ecosystems E4-4 ecosystems E4-5
Elkem is committed to achieving zero net loss of Elkem has several sites near protected and key
biodiversity in new projects, including mining operations. biodiversity areas, increasing exposure to biodiversity
This ambition aligns with the EU Biodiversity Strategy risk. To address this, we focus on securing sites, reducing
for 2030, which focuses on preventing and restoring incident risk, and minimising negative impacts through
biodiversity loss, and with Goal A of the Kunming- strict compliance with effluent and emission regulations
Montreal Global Biodiversity Framework (GBF), aimed at (see ESRS E2). High-risk sites have been identified, and
halting biodiversity decline globally. mapping of impacts from land use and local emissions
is ongoing. Elkem is committed to achieving zero net
Our approach incorporates ecological thresholds and loss of biodiversity in all new projects, including mining
prioritises reducing pollutants such as PAHs (Polycyclic operations. Following the closure of the strategic review to
Aromatic Hydrocarbons) and VOCs (Volatile Organic transfer the majority of the Silicones division to Bluestar,
Compounds), which can accumulate in ecosystems and we will update our biodiversity approach and develop
adversely affect biodiversity. Guided by the precautionary clear targets and metrics to strengthen risk management
principle, Elkem implements preventive actions to and align with global biodiversity goals.
mitigate these risks before they materialise.
The mitigation hierarchy forms the foundation of our
strategy, emphasising avoidance and minimisation
of impacts as the most effective means of protecting
biodiversity. These principles are integrated throughout
our operations, including mine and plant closures, where
restoration and rehabilitation efforts are key. At present,
Elkem does not engage in biodiversity offsets but focuses
on preventive and restorative measures to minimise
impacts.
Strategic review and target setting
Elkem is currently conducting a strategic review of
its Silicones division (please see ESRS 2). As part of
this process, we have postponed setting additional
biodiversity-related targets to ensure alignment with long-
term business objectives and global frameworks. Once
the review is complete, Elkem will update its biodiversity
strategy and define clear, measurable targets that reflect
both operational realities and stakeholder expectations.
These actions, guided by the mitigation hierarchy and
precautionary approach, reinforce Elkem’s commitment
to sustainable development and biodiversity conservation,
ensuring that our operations contribute to halting
biodiversity loss.
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ESRS E5
Resource use and
circular economy
Circularity is one of Elkem’s three core pillars in the green
transition. Through the Elkem Business System (EBS), we apply
a zero-waste philosophy that prioritises efficient resource use,
minimisation of waste generation, and the reuse, recycling, or
sale of residual materials. These efforts are fully aligned with
circular economy principles and support our ambition to reduce
environmental impact across the value chain.
Elkem continues to explore innovative opportunities for recycling
and product reuse, reinforcing our commitment to sustainable
production and resource efficiency.
Material impacts, risks, and opportunities Carbon production
related to resource use and circular economy Carbon production involves high-temperature treatment
IRO-1 of anthracite and petroleum coke to create pastes for
Elkem’s value chain spans multiple process flows, metallurgical smelting. Off-spec production and degraded
including mining, high-temperature calcining, smelting, raw materials are largely reprocessed into new batches,
and chemical processing. These activities create diverse while remaining waste is sent to certified suppliers for
impacts, risks, and opportunities related to resource use hazardous waste treatment.
and circularity. Our R&D teams continuously explore ways
to reduce waste and improve resource efficiency, key Elkem has successfully developed and tested a coal tar
priorities for achieving emission reduction targets and pitch-free solution called ELSEP® G electrode paste,
enabling customers to meet their sustainability goals. and this represents a significant step forward for the
smelter industry as coal tar pitch (CTPht) is categorised
Quartz as a substance of very high concern (SVHC) due to its
Quartz is extracted from mountain seams using carcinogenic and mutagenic properties.
explosives or from riverbeds with diggers, followed
by washing, crushing, and sizing without hazardous Shipment and packaging
chemicals. Waste streams include tailings and off- Primary raw materials are shipped in bulk, minimising
spec material, most of which are repurposed for mine packaging needs. Finished products use big bags or
restoration or sold as by-products such as construction pallets designed for multiple reuse cycles.
sands and gravels. Some off-spec quartz is used for site
rehabilitation, and Elkem is investigating alternative uses
for sands in agriculture and sports.
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ESRS topic: E5 Resource use and circular economy
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Waste Improper handling of material at the end Potential Yes Yes Negative Low Short OO
of life, causing hazardous waste to end up
in landfills (causing probable damage to
environment and local communities).
Improper handling of waste resources Actual Yes Yes Negative Medium Short OO
leads to inefficient use of materials and
more impact on environment.
Resource Increasing the share of sustainably Actual Yes Yes Positive Low Short OO, VC
inflow, sourced, and certified, biocarbon as
including a reductant in the silicon production,
resource use reduces the environmental impact of
the production (reducing emission of
SO2) and ensuring that Elkem does not
contribute to deforestation or conversion.
Circular product innovation to develop Potential (in Positive OO, VC
low-emission products that support a progress)
circular economy in the automotive and
construction industries. By-products
from Elkem's silicon and ferrosilicon
production, as well as silicon from old
solar panels, will be repurposed or reused
to develop alternative products for
downstream industries.
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
Hazard classification Silicone formulation
Degraded raw materials and off-spec products may Silicone production involves complex chemical processes
contain CTPht binders, classified as substances of very generating hazardous and non-hazardous waste streams,
high concern. including acid water, solvents, hydrolysis by-products,
sludge, and waste masses. Waste reduction is embedded
Silicon smelting in annual objectives and improvement plans.
Silicon smelting transforms quartz and carbon into
silicon through high-temperature reactions, followed by Shipment and packaging
alloying, crushing, and sizing for electronics, foundry, and Significant packaging is required for raw materials and
chemical industries. Key waste streams include degraded finished products, with reuse and recycling of IBCs,
raw materials, smelting slag, off-gas particles, and fines. pallets, and drums prioritised.
Since the 1970s, Elkem has pioneered off-gas capture,
converting waste into valuable products, 150 000 tonnes Hazard classification
annually. Utilisation of other waste streams has increased A substantial portion of waste is hazardous and treated
significantly, recovering over 100 000 tonnes per year for on-site (incineration, neutralisation, reuse) or sent to
reuse or sale, reducing costs and creating new solutions. certified providers for destruction.
Shipment and packaging Recycling – mechanical or chemical – remains a focus
Most raw materials are shipped in bulk; finished products for increasing circularity. While end-of-life recycling for
use big bags on reusable pallets. silicones is challenging due to their durability, Elkem
prioritises recycling waste from its own processes.
Hazard classification
Major waste streams are non-hazardous; hazardous Generic waste streams
materials from post-smelting processes are sent to Generic waste streams include used oil from vehicles and
certified disposal providers equipment and packaging from sourced goods. Each site
applies dedicated sorting systems and delivers waste to
approved providers for recycling or reuse wherever possible.
Elkem Annual report 2025 129
ESRS E5
Mechanical recycling
ECO-design New products
Raw materials Metallurgical Silicone Customers End Landfill
production sites production sites production sites products
From past consumers
Chemical recycling
Fuel pellets recycling
From other value chains
Other industries’
production sites
Policies related to resource use and circular waste, and collaborating with customers on circular
economy E5-1 designs and materials that extend product lifespans.
Please refer to the section on governing documents under
ESRS 2 for more details on our policies related to resource Biocarbon
use and circular economy. A key initiative is the integration of biocarbon into silicon
and ferrosilicon production to reduce reliance on fossil
Actions and resources related to resource use reductants. By using a higher share of biomass-based
and circular economy E5-2 reductants, SO2 emissions are reduced. Furthermore,
At the core, all Elkem units are required to maintain if the biomass is sourced from certified sources, we
an updated HSE management system that includes introduce circularity as the biomass is from waste or from
documented processes, risk assessments, applicable sustainable forestry.
regulatory requirements, and controls demonstrating
compliance. This framework covers waste‑related Packaging
risks and establishes the expectation that each site Elkem has implemented measures to minimise packaging
documents its activities, identifies waste‑related hazards, waste through process improvements focused on
and implements measures to keep those risks at an reduction, reuse, and recycling. In line with the EU
acceptable level. Packaging Directive, we have introduced big bags
containing at least 30 per cent recycled polypropylene
Elkem is committed to invest in sustainable and (rPP), cutting the carbon footprint by around 15 per cent
renewable sources. Developing a three R’s culture to annually. This initiative, developed with Accon, includes
reduce, reuse, and recycle will be key to protecting and a closed-loop recycling system and advanced bio-water
preserving rare resources. Our research and innovation treatment technology to ensure quality and sustainability.
teams are already integrating eco-design principles into
current and future projects, with significant successes Additionally, the DISH programme promotes pallet reuse
from bio-based solutions, design for recycling projects, and repair, reducing the need for new materials. At Elkem
and reprocessing services. Nagpur in India, this approach repurposes about 6 000
pallets annually, demonstrating our commitment to
Elkem is committed to enabling circular economies as a circular solutions and resource efficiency.
core pillar of its green transition. Across our value chain,
we focus on enhancing resource efficiency, minimising
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Waste becomes products: Circularity and innovation at Elkem Microsilica®, also known as silica fume, is a
Elkem byproduct of the carbothermic reduction of high-purity
Elkem prioritises eco-design principles throughout its quartz in electric arc furnaces. Originally considered
products and processes, embedding environmental a residual product and emitted into the air until the
considerations from concept to end-of-life. By 1980s, Elkem pioneered the capture and transformation
collaborating closely with customers and researchers, of microsilica into a valuable resource. Today, Elkem
Elkem applies the three R’s of the circular economy, Microsilica® is used globally as a performance-enhancing
reduce, reuse, and recycle, recognising that up to 80% additive in concrete and construction materials,
of a product’s environmental impact is determined at contributing to the strength and durability of some of the
the design stage. This approach minimises material world’s tallest buildings and longest bridges. By turning
and energy consumption while maximising resource what was once waste into a sought-after product, Elkem
efficiency. has set a benchmark for industrial symbiosis and resource
efficiency.
A key milestone is the launch of Sircle™ in 2025, Elkem
Silicones’ dedicated trademark for circular silicone In 2024, Elkem successfully scaled its chemical silicone
solutions. Sircle™ identifies products designed and waste upcycling project from laboratory to pilot unit,
manufactured with reduced fossil resources, reflecting enabling high conversion rates and lower emissions. The
Elkem’s ambition to lead in circularity. The initiative Elkem Sicalo® project, another milestone, explores carbon
began with in-house industrial waste and is expanding capture and reuse as a reductant in silicon production,
to include broader silicone waste streams, diverting further closing the loop on resource use.
valuable materials from incineration and landfill. Sircle™
will be progressively featured across communications, In august 2025, Elkem was awarded a grant of NOK 32.8
product literature, and a dedicated platform for lower CO2 million by Innovation Norway to develop green products
footprint and circular silicone solutions. through the recycling of slag and silicon materials.
Elkem’s SILCOLEASE™ RE range exemplifies this Through these initiatives, Elkem demonstrates leadership
commitment, having been recognised as “Sustainability in the circular economy, turning waste into valuable
Product of the Year” by the Business Intelligence Group. products and advancing towards a more sustainable, low-
SILCOLEASE™ RE is the first commercially available, carbon future.
fully recycled, silicone-based, solvent-free release liner
technology for the label and tape markets. Developed Targets related to resource use and circular
through collaborative research and supported by economy E5-3
France 2030 and NextGenerationEU, it achieves a Elkem is committed to advancing sustainability through
carbon footprint of just 1.1 kg CO2e per kg, significantly ambitious biocarbon and waste management targets.
below the industry average. The technology enables
customers to advance their environmental strategies → By 2031, the group aims to achieve a 50 per cent
without compromising performance, and its scalable pilot biocarbon share at its smelters, ensuring that 100 per
line at Saint-Fons, France, supports early commercial cent of the biocarbon used annually is sourced from
deployment. verified, deforestation-free suppliers.
BRIQSIL™ is another example of Elkem’s innovation → For waste management, Elkem targets a year-on-year
in material reuse. This ferrosilicon substitute is crafted reduction of 10 per cent in hazardous waste sent to
from fine materials generated during quartz and coal landfill and waste to disposal, alongside a 10 per cent
processing. The durable briquettes are designed annual increase in waste recycled.
to withstand handling and transportation and are
reintegrated into furnaces, boosting production efficiency In 2025, Elkem achieved a 57 per cent reduction in
while significantly reducing associated waste. hazardous waste to landfill compared to the previous
year. The group increased the amount of waste recycled
by 18 per cent, and while we saw a marginal decrease in
hazardous waste recycled, 27 per cent of non-hazardous
waste was recycled. These substantial shifts reflect both
improved data quality and dedicated efforts to reduce and
recycle waste. Overall, Elkem recorded a notable decrease
in total waste generated in 2025.
Elkem Annual report 2025 131
ESRS E5
Reducing the carbon footprint per product remains a key Certified biocarbon
objective, with a strong focus on recycling and reusing 100 per cent since 2022. In 2025, 100 per cent of the
existing materials. Specific product-level targets are biocarbon was based on verified sources as deforestation-
under development as Elkem continues to enhance its free. 94 per cent of the biocarbon was under certification
sustainability strategy. schemes (FSC/PEFC/ SFI/SVLK), while the remaining six
per cent were followed up with regular audits including
Elkem keeps records of waste by systematically tracking traceability checks.
waste streams at site level. This includes documenting
waste generated and handled on site, recording all waste Resource outflows E5-5
delivered to external waste management providers, Elkem has a product line of about 4 000 products, and
registering by products that are sold for reuse, and no metric currently exists for the number of products
accounting for waste that is recycled. Together, these designed according to circular principles. However, most
records ensure full traceability of waste flows and support of our products are results of our three main product
Elkem’s broader commitments to waste reduction, divisions, which implement circular principles. The results
circularity, and responsible disposal. will be reflected in our product carbon footprint over time.
Resource inflows E5-4
Biocarbon as a reductant is a key tool for Elkem to
reduce scope 1 emissions. By sourcing deforestation and
conversion free biomass and using this as a reductant we
reduce the need for fossil-based carbon reductants and
reduce our emissions. In 2024, the biogene share of scope
1 emissions slipped to 19 per cent, from 20 per cent in
2023, due to shifts in production.
Resource use and circular economy
2022 Development vs.
Metric 2025 2024 2023 (base year) previous year
Total waste generated tonnes 343 724 348 243 353 992 462 745 (1%)
Non-recycled waste tonnes 85 228 111 595 123 337 121 225 (24%)
Non-hazardous waste to landfill tonnes 28 325 53 407 55 163 45 273 (47%)
Hazardous waste to landfill tonnes 1 116 2 617 7 781 6 301 (57%)
Non-hazardous waste to incineration tonnes 2 025 3 173 1 718 2 485 (36%)
Hazardous waste to incineration tonnes 53 761 52 397 58 674 67 166 3%
Changes
Recycled waste tonnes 41 215 34 788 70 825 74 784 18% in waste
tonnages
Non-hazardous waste recycled tonnes 30 393 23 860 65 071 65 386 27%
are linked
Hazardous waste recycled tonnes 10 823 10 928 5 754 9 398 (1%) principally
to changes
By-products excl. Elkem Microsilica , sold to customers tonnes
®
105 888 90 171 53 503 129 318 17% in business
Elkem Microsilica sold to customers
®
tonnes 111 393 111 689 106 327 137 418 0% activity
Total recycled waste, incl. by-products and Elkem
Microsilica® tonnes 258 497 236 648 230 655 341 520 9%
Percentage of non-recycled waste % 25% 32% 35% 26% (23%)
Mining ativities (Quartz rock fines for landscape
restoration) tonnes 423 217 400 964 332 717 354456 6%
Total waste including mining activities tonnes 766 941 672 449 686 709 817201 14%
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Elkem Annual report 2025 133
Environmental
Social
Governance
S
134 Sustainability statement | Social
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ESRS S1
Own workforce
Elkem’s people are its most valuable asset, and the group
remains committed to fostering a strong, inclusive culture
built on safety, equity, empowerment, and continuous
improvement. Organisational optimisation, competency
development, and performance management are key drivers
of growth, supported by respect, involvement, and a focus on
lifelong learning.
Health and safety are at the core of Elkem’s operations, guided
by a zero-harm philosophy and systematic HSE practices.
Despite Elkem’s strong emphasis on safety, three fatalities and
one life‑changing injury occurred in two separate incidents in
China and France. These tragedies underscore the critical need
to ensure that every employee understands that safety must
always come before any other task or priority. While the total
recordable injury rate (TRIR) for employees remained stable,
we are encouraged by a decline in the TRIR for contractors,
reflecting the impact of proactive HSE work and dedicated
follow-up at sites.
Elkem continues to strengthen preventive measures and
embed safety into every aspect of its operations. Diversity and
inclusion remain central to Elkem’s culture, driving innovation,
collaboration, and customer focus. Through these efforts,
Elkem strives to create a workplace where every employee
feels valued, empowered, and safe.
Elkem Annual report 2025 135
ESRS S1
Material impacts, risks, and opportunities actively encouraged. As many of Elkem’s operations
- resilience of strategy and business model are hazardous, health and safety risks are among the
S1, SBM-3 most critical, including working at height, exposure to
Elkem’s operations involve handling and storage of hazardous substances, and moving equipment. Adequate
hazardous substances and performing hazardous tasks training is a key mitigating factor, alongside a strong
such as smelting, moving equipment, and working at safety culture that depends on reliable reporting of
height. These activities carry potential negative impacts incidents and near misses. Failure to report represents
for employees and contractors, including injuries or, an additional risk. Continuous development of FORUS,
in the worst case, fatalities. While the impact score for Elkem’s HSE management system, is essential to
these risks is low, the irremediability and scale (gravity of strengthening these controls.
impact) are assessed as high or highest. The scope and
likelihood of severe injuries or fatalities remain very low. In The number of recordable injuries decreased from
the unlikely event of child or forced labour in operations, the previous year, indicating that improvements in
the impact would be severe; however, Elkem maintains training and heightened awareness among employees
strict controls and has not identified any such cases. and contractors have already contributed to better
performance in 2025. Notably, the total recordable
On the positive side, Elkem offers a stable, secure, and injury rate (TRIR) for contractors has declined, reflecting
flexible workplace, with opportunities for career growth the impact of targeted training and proactive HSE
and competency development. Direct involvement in measures. Sharing learnings from injuries and high-
decisions affecting individual work is highly valued and risk incidents enables Elkem to prevent recurrence
ESRS topic: S1 Own workforce
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Working Various parts of Elkem's production Potential Yes Yes Negative Low Short OO
conditions processes involve hazardous substances (injuries)
that may cause damage or health issues, and long
depending on exposure, for employees, (health
contractors, and local communities. E.g. issues)
silica dust and heavy metals from silicon
production, coal tar pitch (carbon solutions),
VOC, methyl chloride, and chlorosiloxanes
from silicone production.
Elkem's production processes often Potential Yes Yes Negative Low Short OO
involve hazardous operations, moving
equipment, and working at height. This
represents a potential negative impact
on employees and contractors through
injuries or fatalities.
Secure employment and flexible Actual Yes Yes Positive High Short OO
workplace for our employees
Career development and progression Actual Yes Yes Positive High Short OO
through competency development,
development discussions, and leadership
development
Child or forced labour in own operations Potential Yes Yes Negative Low Short OO
through contractors
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
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and embed best practices across the organisation.
Continued implementation of FORUS, Elkem’s global HSE
management system, provides a strong foundation for
ongoing HSE improvements and offers an opportunity for
Elkem to differentiate itself from competitors.
Additional risks include the availability of qualified personnel,
particularly in rural locations, and the challenge of replacing
an aging workforce in some units. Loss of critical knowledge
and difficulty in attracting skilled replacements underscore
the importance of retaining talent and investing in internal
competency development. Elkem’s global footprint offers
opportunities for employees willing to relocate, supporting
both retention and career progression. Compliance risks
related to HSE regulations and Elkem’s Code of conduct
could result in fines or reputational damage. These risks
are mitigated through continuous, risk-based training and a
robust internal compliance function.
Elkem invests in leadership development at all levels
globally, enhancing performance and motivation while rollout of training programmes and alignment with life
maintaining a strong focus on diversity and inclusion. saving rules have contributed to a continued reduction
These efforts are key to attracting and retaining talent and in injury severity. The organisation continues to assess
contribute to improved team performance and employee the effectiveness of the implementation of the FORUS
well-being. Looking ahead, Elkem remains committed to system through continuous assessments and audits to
its zero-harm ambition and will continue to strengthen ensure continuous improvement in the system and the
digital tools and training programmes to embed safety focus areas for the year. The alignment of HSE training
and sustainability into every aspect of its operations. through the learning management system ensures that
the organisation can target training to the high-risk areas
Policies related to own workforce S1-1 and the employees that work in these areas.
Topics related to our workforce are covered in our People
policy, our HSE policy, our Code of conduct, and related Despite these efforts, Elkem experienced a tragic fatal
procedures. Please refer to the section on governing accident at one of its sites in 2025, where an employee
documents in the chapter on ESRS 2. was struck by a forklift. The incident was thoroughly
investigated by the corporate HSE team and the plant
Health and safety S1-5, S1-14 organisation. Findings reinforced the critical importance
Elkem’s production activities involve inherently high risks, of pedestrian segregation from vehicles in all areas at all
including high-temperature smelting and hazardous times, as mandated by Life Saving Rule No. 9. Lessons
chemicals. The group is committed to a zero-harm learned have been shared across all sites to prevent
philosophy, prioritising the health and safety of employees recurrence. The use of automated pedestrian safety
and contractors across all operations. systems has been mandated and installed on the forklifts
in the organisation.
Each site operates under a tailored HSE organisation,
overseen by a Divisional HSE structure and ultimately Elkem experienced a tragic accident at the Saint Fons
by the corporate vice president for HSE. Regular audits Sud site in France on 22 December, when an explosion
ensure compliance with internal standards and regulatory in the pilot workshop (APIL) resulted in the loss of two
requirements. Elkem invests significantly in training for colleagues. Two additional colleagues were seriously
employees and contractors, supported by comprehensive injured, with one sustaining life-changing injuries and
risk management systems. remaining in intensive care in the days following the
incident. The event had a profound impact across the
In 2025, Elkem advanced the development and organisation and reinforced the critical importance of
implementation of the FORUS HSE management system, ensuring that safety always comes before any task or
aimed at strengthening awareness of HSE principles. The operational priority.
Elkem Annual report 2025 137
ESRS S1
Employees
Work-related injuries Metric 2025 2024 2023 2022 2021
Fatalities Absolute numbers 3 0 0 0 0
Rate 0.22 0 0 0 0
High-consequence work-related injuries Absolute numbers 4 0 0 1 0
Rate 0.3 0 0 0.1 0
Lost workday injuries Absolute numbers 26 20 11 13 21
Rate 1.9 1.3 0.7 0.9 1.5
Other recordable injuries Absolute numbers 22 32 31 31 30
Rate 1.6 2.1 2.2 2.2 2.2
Total recordable injuries Absolute numbers 48 52 42 44 51
Rate 3.6 3.5 3 3.2 3.7
Hours worked Number 13 355 694 15 042 063 14 216 585 13 936 109 13 706 429
Contractors
Work-related injuries Metric 2025 2024 2023 2022 2021
Fatalities Absolute numbers 0 0 4 2 0
Rate 0 0 0.4 0.3 0
High-consequence work-related injuries Absolute numbers 0 0 4 2 0
Rate 0 0 0.4 0.3 0
Lost workday injuries Absolute numbers 2 12 24 14 7
Rate 0.6 2.6 2.1 2.4 1.5
Other recordable injuries Absolute numbers 11 13 14 9 10
Rate 3.1 2.8 1.3 1.4 2.1
Total recordable injuries Absolute numbers 13 25 38 22 17
Rate 3.7 5.4 3.4 3.8 3.5
Hours worked Number 3 505 501 4 596 943 11 176 605 5 722 932 4 797 159
Collective bargaining coverage
Employees EEA Employees non-EEA Total
2025 2024 2025 2024 2025 2024
Coverage rate 71% 71% 12% 12% 39% 39%
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Elkem maintains strict reporting and investigation programmes are complemented by diverse professional
procedures for all incidents, ensuring transparency, training opportunities delivered through digital and
accountability, and continuous improvement, and the physical channels. Employees are encouraged to take
December 2025 accident was still under internal and ownership of their learning, supported by a global
external investigation when Elkem’s annual report 2025 learning management system. Development discussions
was finalised in February 2026. These measures reflect between leaders and employees provide a framework
Elkem’s unwavering commitment to protecting people for feedback, goal setting, and identifying growth needs.
and fostering a safe workplace. Elkem’s People policy ensures consistent HR practices,
while EBS fosters a culture of continuous improvement,
Processes to engage with own workforce flexibility, work-life balance, and strong diversity, equity,
S1-2, S1-3, S1-5, S1-13 and inclusion principles.
Health and safety on site, along with the well-being
and development of our people, are core priorities for Beyond training and safety measures, Elkem promotes
Elkem. To engage employees on these topics, Elkem engagement through employee representation on the
applies a range of tools designed to mitigate risks and Board of Directors, open dialogue and negotiations with
negative impacts while capitalising on opportunities for unions, and internal communication channels such
improvement. The group emphasises active employee as intranet and town hall meetings. A global Speak up
involvement in health and safety management and channel allows employees to report suspected violations
expects its workforce to contribute to maintaining a safe of Elkem’s Code of conduct anonymously, without fear
and healthy workplace. This commitment is reinforced of retaliation, ensuring privacy for all parties. Details of
through tailored HSE organisations at each site, this process are outlined in Elkem’s Speak up policy,
comprehensive training programmes, and the FORUS referenced in ESRS 2 governing documents.
HSE management system, which requires all employees
to complete both basic and role-specific training. These All data reported is extracted from different HR systems,
measures ensure that employees understand workplace and complied and quality assured by the HR department
hazards and how to mitigate them. Regular audits, and SVP for HR.
internal self-assessments, and continuous improvement
initiatives further strengthen this approach. Collective bargaining coverage and social
dialogue S1-8
On the organisational side, Elkem values its employees All employees are free to join unions, and 39 per cent of
as its most critical asset and focuses on building one the global workforce is covered by collective bargaining
group culture through the Elkem Business System agreements that define salary and working conditions.
(EBS). Leadership development at all levels, continuous See the table on the right for coverage in each region.
competency building, and standardised global leadership
Elkem Annual report 2025 139
ESRS S1
Training and skills development
Female Male Total
Metric 2025 2024 2023 2025 2024 2023 2025 2025 2024
Percentage of employees that participated in % - - - - - - 94% 96% 78%
regular performance and career development
reviews
Average number of training hours per employee Hours 12.1 23.5 7.4 10.7 18.3 9.8 11 19.3 9
Participation in internal leadership % 22% 37.5% 25% 78% 62.5% 75% 100% 100% 100%
development programmes
Training and skills development metrics Targets related to managing material negative
S1-5, S1-13 impacts, advancing positive impacts, and
Percentage of employees participating in regular managing material risks and opportunities
performance and career development reviews S1-4, S1-5
This metric reflects Elkem’s commitment to engaging Elkem is committed to a zero-harm philosophy, aiming
its workforce in structured performance and career to reduce frequency rates by 10 per cent from the 2022
development discussions. A high participation rate baseline and ensuring that all site personnel meet
demonstrates that employees are actively involved in the required training hours for their job level. On the
evaluating their performance, setting goals, and planning organisational side, we target 100 per cent completion
career paths. Such engagement fosters job satisfaction, of annual development discussions, which serve as the
aligns individual objectives with organisational priorities, primary mechanism for providing and receiving feedback
and drives overall performance. Consistent participation on employee and leader performance, setting goals aligned
across gender categories and disclosure statuses with organisational priorities, and planning individual
underscores Elkem’s dedication to inclusivity and equal development and career progression. In addition, Elkem
opportunities for growth. has established specific targets to strengthen diversity,
equity, and inclusion across the group.
Average number of training hours per employee and
non-employee Workforce distribution
This indicator measures the average time invested in Balanced gender distribution: Elkem strives to increase
training and development activities. An increase in training the proportion of women in the total workforce and
hours signals Elkem’s focus on continuous learning and across all leadership levels. Our goal is to achieve a
skill enhancement, enabling employees to maintain high gender balance where female representation in leadership
competency levels, improve job performance, and adapt reflects the overall workforce composition.
to evolving business requirements.
Age distribution: We aim to maintain a balanced age
Elkem leadership programmes profile across the workforce, including blue- and white-
Elkem’s leadership programmes aim to strengthen collar positions and management teams, ensuring a
diversity by ensuring broad geographical representation diversity of perspectives and experiences.
and age distribution, and by increasing the share of
female participants. The group believes that diverse Nationality distribution: Elkem is committed to fostering
leadership teams contribute to better decision-making, a culturally diverse workforce, emphasising inclusion and
higher engagement, and improved well-being. Promoting global collaboration.
gender diversity in leadership is also essential for career
development and talent retention, ensuring that Elkem
builds a strong and inclusive leadership pipeline for the
future.
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Recruitment Introduction to FORUS (Elkem HSE system): Our goal
Diverse applicant pool: We seek to attract a broader and is full completion of the FORUS Introduction programme
more diverse group of applicants, with a particular focus across the organisation. The next phase is the targeted
on increasing female candidates. Where data is available, training of the Life Saving Rule awareness programme
we actively monitor the proportion of female applicants. to relevant groups of employees across the organisation.
Further to this will be the theoretical and on the job
Unbiased recruitment: Elkem ensures that recruitment competence training that is under development and will
decisions are objective and fair, providing equal be rolled out during 2026.
opportunities for all candidates and supporting diversity
within teams. Turnover
Elkem conducts detailed turnover analyses to understand
Internal mobility: Through our global HR system, we trends across units, including gender distribution among
track and analyse internal recruitment and promotions leavers, years of service, and average age. These insights
to ensure employees have opportunities for growth and help us address retention challenges proactively.
career development.
Pay equity
Succession planning We are dedicated to promoting pay equity at all levels.
Systematic development of female leaders: Elkem Regular pay equity audits and external benchmarks
aims to identify female successors for each corporate help identify and address disparities, ensuring a fair and
and divisional management position, ensuring a strong inclusive workplace where all employees feel valued and
pipeline of future female leaders. compensated equitably.
Critical position planning (CPP): We continue to Health and well-being
strengthen our CPP process for strategic workforce Elkem aims to achieve high engagement scores on
planning and competency development, building a robust dimensions related to employee satisfaction and
bench of future leaders and enhancing diversity within the organisational health. Targets include reducing both short-
talent pool. term and long-term sick leave, supporting overall well-
being and productivity.
Training
Mandatory training: Our target is 100 per cent These targets reflect Elkem’s commitment to fostering
completion of all mandatory training programmes. a culture of continuous improvement, professional
development, and inclusivity. By prioritising health
Human and organisational performance (HOP) and safety, promoting diversity, and investing in
and safety leadership: We aim to increase leaders’ training and career development, we aim to enhance
competence in fostering a strong safety culture, tracking employee engagement, satisfaction, and organisational
completion rates for relevant training programmes. performance.
Elkem leadership programmes: We are committed to
increasing female participation and overall diversity in all
internal leadership programmes.
Elkem Annual report 2025 141
ESRS S1
Our workforce
Metric 2025 2024 2023 2022
Female share
In the group % 25% 25.4% 25.1% 25%
In the management (corporate mgmt, div. mgmt, plant mgmt) % 21% 27% 24% 30%
Among all leaders with personnel responsibility % 27% 27% 25% 22%
In the Elkem leadership -programmes % 22% 38% 32% 36%
In the global technical trainee programmes % 33% 41% 31% 38%
Among blue collar % 16% 17% 14% 17%
Among white collar % 36% 36% 32% 35%
Among part time workers % 64% 44% 42% 31%
Among temporary workers % 28% 31% 27% 25%
Among new hires % 26% 33% 30% 26%
Among leavers % 28% 31% 29% 27%
Parental leave - average women (Norway only) Weeks 41.8 39 37.3 38.3
Parental leave - average men (Norway only) Weeks 17.6 18.6 21 17.5
Age distribution, employees
< 30 years of age % 15% 16% 17% 16%
30 - 50 % 57% 55% 53% 56%
> 50 % 28% 29% 30% 28%
Age distribution, managers
< 30 years of age % 2% 2% 2% 3%
30 - 50 % 60% 60% 56% 59%
> 50 % 38% 38% 42% 38%
Salary: CEO to median employee in Norway ratio 11:1 11:1 11:1 10:1
Other key KPIs
Metric 2025 2024 2023 2022
Turnover rate % 7.7% 6.7% 4.5% 6%
Blue collar / operators % 60% 59% 55% 59%
White collar / staff % 40% 41% 45% 41%
Temporary hire rate (%) to permanent employment % 5% 4% 5.5% 5%
Part time workers rate (%) to permanent employment % 2% 2% 3.9% 1%
Development discussions % 94% 96% 78% 89%
Contractors
Metric 2025 2024 2023 2022
Europe (EMEA) Number 137 149 96 125
Asia (APAC) Number 135 167 160 171
Americas (AMER) Number 23 26 27 35
Africa (EMEA) Number 0 0 0 0
Total Number 295 342 283 331
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Regions
APAC EMEA AMER Total
Number of employees 3082 3039 879 7000
Number of permanent employees 3071 2706 803 6580
Number of temporary employees 11 105 72 188
Number of non-guaranteed hours employees 0 228 4 232
Number of full-time employees 3070 2574 799 6443
Number of part-time employees 1 131 4 136
Explanation
→ Number of permanent employees: These are employees who have an ongoing employment contract with the group,
typically without a predetermined end date. They usually receive full benefits and job security.
→ Number of temporary employees: These employees are hired for a specific period or project. Their employment has
a set end date, and they might not receive the same benefits as permanent employees.
→ Number of non-guaranteed hours employees: These employees do not have a fixed number of working hours
guaranteed by their contract. Their work hours can vary based on the group’s needs, and they are often called in as
needed.
→ Number of full-time employees: These employees work the full number of hours defined as full-time by the group,
typically around 35-40 hours per week. They usually receive full benefits.
→ Number of part-time employees: These employees work fewer hours than full-time employees, often less than 35
hours per week. They may receive partial benefits depending on the group’s policies.
Elkem employs persons with disabilities (S1-12), but we
do not collect this kind of data nor report on the number
of individuals with disabilities. Our office spaces are
adapted to be used by persons with disabilities, and in
Norway we follow the requirements in the Norwegian
Equality and Anti-Discrimination Act and other relevant
requirements. The same applies for other countries where
Elkem operates, i.e. we always comply with local rules
and regulations. Some of the operations at our production
sites are exempt from the requirements due to the nature
of the operations and are thus not suitable for persons
with disabilities.
Elkem Annual report 2025 143
ESRS S1
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Adequate wages, social protection,
remuneration metrics, and incidents and
complaints S1-10, S1-11, S1-16, S1-17
Elkem strives to offer competitive salaries aligned with
local market standards, without positioning itself as a
leading pay provider. To ensure fairness, annual reviews
of base salaries are conducted, supported by surveys
that verify equal pay for equal responsibilities. Additional
compensation elements, such as bonus programmes,
follow established corporate guidelines.
All employees, including part-time and temporary
staff, receive written documentation detailing their
compensation, benefits, and working hours. This
documentation complies with national legislation, industry
standards (whichever provides greater protection), and
internal agreements. Employees are guaranteed at
least one day off in every seven-day period. Full-time
employees must receive wages and benefits sufficient
to cover basic needs such as food, clothing, and
housing. Pension and insurance coverage are provided in
accordance with local legal requirements.
For more information on Elkem’s efforts to ensure a safe
working environment, please refer to the sections on
health, safety, and environment (HSE). Details of our pay
gap analysis for Norway can be found in the ARP report.
Incidents and complaints
2025 2024 Note/comment
Number of substantiated incidents of 0 0
discrimination
Number of complaints filed through 45 26 Total number of cases registered in Speak Up case
channels for own workers to raise management system from 1 January 2025 to 31 December
concerns 2025. Includes both unsubstantiated and fully or partially
substantiated cases.
Number of severe human rights issues and 0 0
incidents connected to own workforce
Number of severe human rights issues 0 0 No mention of “Elkem” in the OECD Database of Specific
and incidents connected to own workforce Instances
that are violations of UN Global Compact
Principles and OECD Guidelines for
Multinational Enterprises
Elkem Annual report 2025 145
ESRS S2
Workers in the
value chain
Responsible sourcing is a strategic priority for Elkem. Elkem
purchases raw materials, energy, goods, and services from more
than 16 000 suppliers worldwide, and solid management of the
value chain is key to reduce the risk of breaches of our Code of
conduct for business partners.
Material impacts, risks, and opportunities, Supply chain resilience is another concern. Dependence
and their interaction with strategy and on key raw materials sourced from limited geographic
business model S2-1, S2-SBM3 regions creates vulnerability to geopolitical instability,
There are potential negative impacts related to Elkem’s trade restrictions, and logistical disruptions. In addition,
operations that could affect workers throughout our operations in remote areas can affect local communities,
value chain. Elkem operates globally, with a value chain raising issues such as displacement, cultural heritage
extending into regions where human rights violations can preservation, and potential social tensions.
be systemic and widespread. Although the number of raw
material suppliers is relatively small, the associated spend Finally, sourcing from high-risk jurisdictions introduces
is substantial, and this category carries higher risk levels. governance challenges, including exposure to sanctions,
Given the nature of the raw materials we source, there is bribery, corruption, and weak regulatory frameworks.
an inherent risk of health, safety, and environmental (HSE) These risks underscore the importance of robust
incidents, as well as violations of workers’ rights, including due diligence, transparent practices, and proactive
child or forced labour. engagement with stakeholders to ensure sustainable and
ethical sourcing across the value chain. More information
The mining and processing of quartz and other raw on governance risks can be found in the section on ESRS
materials can lead to land degradation, water pollution, G1: Business conduct.
and biodiversity loss if not conducted responsibly. These
impacts are compounded by the energy-intensive nature Despite these challenges, Elkem’s production also
of silicon production, which contributes significantly to presents significant opportunities for advancing
greenhouse gas emissions and exposes the industry to sustainability and creating long-term value. By
tightening climate regulations and carbon compliance implementing responsible mining and processing
requirements. practices, Elkem can minimise environmental impacts
while strengthening its licence to operate. Investments in
In addition, Elkem engages independent contractors energy efficiency and low-carbon technologies offer the
across its sites—a practice that has proven to present potential to reduce greenhouse gas emissions, improve
significant HSE risks. For further details on contractor- compliance with climate regulations, and position Elkem
related HSE risks and data, please refer to the section on as a leader in the transition to a low-carbon economy.
ESRS S1: Own workforce.
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ESRS topic: S2 Workers in the value chain
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Working Mining of quartz and coal could lead to Potential Yes No Negative Medium Long VC
conditions third-party workers developing health
issues (i.e. silicosis and black lungs) due
to inhalation of silica dust or float coal
Improper handling of hazardous materials Potential Yes No Negative Medium Short VC
and substances in transportat or handling
at suppliers may lead to incidents that can
cause harm
Chinese internal migrant construction Actual Yes No Negative High Short VC
workers are often informally employed,
and have no right to collective bargaining
Other work- Downstream violations of workers' rights Potential Yes No Negative Medium Short VC
related in the construction industry (downstream)
rights
Child labour or forced labour in Elkem's Potential Yes No Negative Medium Medium VC
upstream or downstream value chain
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
Diversifying supply sources and building strategic complying with maximum working hours, minimum age
partnerships can enhance resilience against geopolitical standards, and recognising the rights to organise and
and logistical disruptions, while fostering innovation bargain collectively where legally permitted. Please refer
and shared sustainability goals. Engagement with local to the section on governing documents under ESRS 2 for
communities provides an opportunity to create positive more details.
social impact through employment, infrastructure
development, and respect for cultural heritage. Processes for engaging with value chain
workers about impacts S2-2
Finally, robust governance frameworks and transparent We recognise the responsibility of businesses to respect
sourcing practices can mitigate corruption risks and human rights and remain dedicated to the UN Declaration
reinforce trust among stakeholders. These measures not and International Conventions on Human Rights, the
only reduce exposure to ESG-related risks but also create ILO Declaration on Fundamental Principles and Rights
competitive advantage in a market increasingly driven by at Work, the ILO’s core conventions, and applicable local
sustainability performance. legislation in the countries where we operate. Elkem’s
approach to human rights due diligence is guided by
Policies related to value chain workers S2-1 the United Nations Guiding Principles on Business and
Elkem’s policies and statements regarding value chain Human Rights and the OECD Guidelines for Multinational
workers are supported by multiple governing documents Enterprises.
including the Code of conduct, HSE policy, Third-
party risk management procedure, and Human rights To mitigate the risks arising from our supply chain, Elkem
programme. Our Code of conduct and Code of conduct has implemented robust measures, including integrity
for business partners are aligned with the UN Guiding due diligence for raw material suppliers (intermediaries
Principles on Business and Human Rights and are based and producers), pre-qualification audits, and on-site visits
upon internationally recognised standards, including the for critical raw material suppliers. Elkem aims to audit its
ILO Declaration on Fundamental Principles and Rights at most critical raw material suppliers prior to purchasing.
Work. They communicate our expectation for suppliers The purpose of the pre-qualification audit is to verify that
and contractors to uphold fair employment practices, the potential supplier meets Elkem’s Code of conduct
including offering transparent employment contracts, requirements, including ensuring the supplier maintains
complying with standards for minimum living wage, ethical and legally compliant business practices, respects
Elkem Annual report 2025 147
ESRS S2
Processes to remediate negative impacts
and channels for value chain workers to raise
concerns S2-3
Elkem is dedicated to fostering trust with stakeholders
and addressing concerns related to our operations.
Elkem’s grievance mechanism is designed for individuals
and communities affected by our plants, projects, or other
business activities worldwide. This mechanism enables
stakeholders to provide feedback or raise concerns
that are not related to compliance with the Elkem Code
of conduct. The grievance mechanism is managed by
Elkem’s environmental, social, and governance (ESG)
team, which coordinates with relevant parts of the
organisation to resolve issues effectively. Each grievance
is monitored and followed up by the ESG team to ensure
timely and appropriate resolution.
human rights, and acts in accordance with the applicable The Speak up channel is a secure reporting platform
statutory and international standards relating to for external and internal parties to report potential
environmental and climate protection. noncompliance with Elkem’s Code of conduct. This
channel is hosted by an independent external supplier,
Elkem maintains regular engagement with suppliers to ensuring anonymity for whistleblowers. Investigations
reinforce its expectations and commitment to ethical related to Speak Up channel reports are led by Elkem’s
practices throughout the value chain. Health and safety Head of Investigations and are conducted following
remain essential components of labour rights for Elkem’s strict confidentiality protocols. The Speak up channel is
suppliers and customers, reflecting the inherent risks of available in multiple Elkem languages, and available to
the industry. The group enforces stringent HSE standards, both internal and external parties.
particularly for high-risk suppliers.
Elkem strongly encourages stakeholders to report
When working with high-risk suppliers, Elkem conducts any behaviour that violates our ethical guidelines. The
supplier audits according to an annual audit plan. In group is fully committed to protecting whistleblowers
cases of non-compliance, the group issues warnings from retaliation and ensures all reports are handled
and requires immediate corrective actions. Persistent with confidentiality. Any incidents or investigations
violations are addressed decisively through improvement revealing practices that could lead to human rights
plans, financial penalties, or contract termination. These violations trigger corrective actions, including updates
measures underscore Elkem’s dedication to upholding a to governing documents, introduction of new internal
responsible and sustainable value chain. controls, enhanced training, and adjustments to roles and
responsibilities. Our processes ensure that remedial action
The head of the compliance function is responsible for is taken promptly in the event of an acute human rights
the development and maintenance of Elkem’s Human violation and, if necessary, compensation is provided to
rights programme. Elkem’s procurement council shapes affected individuals.
and implements the group’s global procurement and
logistics strategy, policies, and procedures. The corporate Taking action on material impacts on value
compliance team works closely with procurement teams chain workers, and approaches to managing
in all divisions to integrate human rights due diligence material risks and pursuing material
into supplier management procedures and processes. opportunities related to value chain workers,
Elkem has also allocated a dedicated resource to ensure and effectiveness of those actions S2-4
the sourcing of certified and deforestation-free biocarbon. Elkem has previously engaged independent third-party
These efforts reflect Elkem’s proactive approach to advisors to conduct a comprehensive human rights risk
embedding sustainability and ethical practices across its assessment to evaluate the effectiveness of existing
value chain. due diligence processes. The results of this assessment
confirmed that Elkem faces a high inherent risk of
adversely affecting human rights due to the nature of
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its operations, geographic footprint, and the size and arising from an IDD in Elkem’s SRM system, and monitors
complexity of its supply chain. closure of actions. Elkem’s raw material procurement
team is then responsible for responding to these findings
The review concluded that Elkem has strong systems in writing within pre-set deadlines, and upload supporting
and processes to manage risks within its own operations. evidence where relevant. Once all actions arising from the
However, the main gap identified was the absence of IDD are completed, corporate compliance will assess and
a global supplier management system, which limits determine whether the actions taken are appropriate to
the ability to apply a systematic, risk-based approach manage the identified risks. If risks are not satisfactorily
to human rights risks in the supply chain. The advisors mitigated, the matter is escalated. Suppliers that
further recommended more structured training and represent an unacceptable risk of linking Elkem directly to
awareness initiatives across the organisation. human rights violations risk deactivation unless practices
are improved.
To address these findings, Elkem has taken several steps,
including updates to training materials, and targeted In 2025, the corporate compliance department conducted
awareness efforts towards personnel in positions with 83 IDDs on raw material suppliers. 35 findings were
high risk exposure. related to Workers in the value chain (ESRS S2), such as
concerns regarding labour standards compliance and
Most importantly, in 2024, Elkem introduced a global investigation of labour infractions.
supplier relationship management (SRM) system, marking
a significant advancement in responsible sourcing. On-site audits are carried out for critical raw material
This platform enables systematic, risk-based supplier suppliers, and all new raw material suppliers undergo pre-
qualification and follow-up, streamlines screening audits. Where pre-audits are not feasible, documented
processes, standardises vetting procedures across divisions exemptions are granted based on clear criteria, such as
and jurisdictions, and monitors compliance throughout the security conditions, low risk and criticality, or equivalent
entire contract lifecycle. It also enforces our requirement for third-party certifications like ISO or EcoVadis. The raw
all new suppliers to sign our Code of conduct for business material supplier audit checklist includes checkpoints
partners or demonstrate equivalent internal standards. By aligned with the requirements codified in the Code of
integrating these capabilities, the SRM system has greatly conduct for business partners. Findings from supplier
strengthened Elkem’s ability to identify human rights risks audits are also followed up through action plans in the
and prioritising areas of highest impact. SRM. If severe breaches of human rights or the Code of
conduct for business partners occur, Elkem follows up
Throughout 2025, the implementation of the SRM system rigorously and discontinues purchases if improvements
has progressed further, providing Elkem with a much are not achieved.
deeper understanding of supply chain risks and the group’s
exposure through selected suppliers. The system now Elkem actively promotes sustainable mining practices
supports structured and detailed follow-up of high-risk through initiatives such as Towards Sustainable Mining,
suppliers, as well as those where audits have uncovered via Norsk Bergindustri, and IMA-Europe, driving
issues requiring corrective action. This enhanced visibility continuous improvement in environmental and social
and control represent a critical step toward mitigating risks performance. The group also prioritises sourcing
and ensuring accountability across Elkem’s global supply certified raw materials, including biocarbon verified as
base. We use the SRM to comply with the Corporate deforestation-free, protecting indigenous peoples and
Sustainability Reporting Directive (CSRD) and the European affected communities.
Sustainability Reporting Standards (ESRS), including
“Workers in the value chain” (ESRS S2). Currently, Elkem works with approximately 1 200 raw
material suppliers, of which about 200 are involved in the
Raw material extraction carries high environmental highest risk mining, processing, or forestry sectors. Of these
and social risks, and Elkem mitigates these through 200 raw material suppliers, 72 per cent hold ISO certification
a combination of governance measures and industry and this is up from 25 per cent of suppliers in 2024.
collaboration. All new raw material suppliers are subject
to an integrity due diligence (IDD) by the corporate Hazardous goods transportation is managed under
compliance department. If a supplier is a trader, we strict safety protocols, including vehicle and equipment
trace the product back to the original producer; both are checks, speed and alcohol controls, and ISPS-compliant
covered by the IDD. Compliance registers all findings port security. All personnel receive comprehensive
Elkem Annual report 2025 149
ESRS S2
Workers in the value chain
2025 2024 2023 2022
Share of new suppliers subjected to assessment and prequalification screening 100% 100% 80% 100%
No audits due
Share of new raw material suppliers subjected to supplier audit 60% 100% 50% to Covid-19
Adverse human rights concerns in supply chain reported 1 0 0 0
Reported confirmed cases of child or forced labour 0 0 0 0
Number of cases reported through grievance mechanisms 2 5 1 6
*The Chinese silicone division is excluded from this percentage, and they represent the remaining 40 per cent.
safety training, and transport companies participate in Elkem chose to upload all our 16 515 suppliers to our
emergency drills with plant fire brigades. International SRM system. This ensures a single, reliable source of
regulations, including UN Transport Regulations and IMO procurement information and strengthens our ability
standards, govern all operations, ensuring compliance for to monitor compliance. All these suppliers have been
packaged materials (IMDG), solid bulk cargoes (IMSBC), screened according to ESG criteria to identify high-risk
and bulk liquids (IBC). suppliers.
Safety Data Sheets aligned with the UN Globally All new suppliers must sign our Code of conduct for
Harmonised System ensure safe product handling, business partners or provide an equivalent approved by
and advanced document management systems in the Elkem’s compliance department. Signed codes are stored
Silicones division provide easy access to regulatory in the SRM. Our goal is to have all “legacy” suppliers
compliance information and certifications. To stay ahead (those added before May 2024) also sign the Code of
of emerging regulations, Elkem actively participates in conduct for business partners, unless exempted for
international trade associations and collaborates with special cases (e.g. banks, public utilities).
customers and researchers to innovate sustainable
solutions, including eco-design and safer alternatives to 16 515 suppliers is a large number. In 2025, our priority
cyclic silicones (D4, D5, D6). was to focus on suppliers at highest risk of breaching
sanctions, human rights, or anti-corruption standards,
By embedding transparency, governance, and innovation especially those in countries on the UN’s Trade Sanctions
across its value chain, Elkem strengthens its ability Risk List. This high-risk group comprises 8 300 suppliers,
to mitigate risks and negative impacts while driving including those providing raw materials, logistics, financial
continuous improvement in human rights, environmental services, marketing, and other key operations.
performance, and responsible sourcing.
Throughout 2025, our employees globally have been
Targets related to managing material negative contacting our suppliers individually and requesting
impacts, advancing positive impacts, and they sign. Those who refuse to sign are “deactivated”
managing material risks and opportunities as suppliers in the SRM; therefore, no longer able to do
S2-5 business with Elkem.
Elkem aims to assess and screen all suppliers, and all
raw material suppliers are subject to audits. This is done To date, 41 per cent (3 500) of Elkem’s high-risk suppliers
to reduce the risk of breaches of our Code of conduct have signed our Code of conduct. All 600 suppliers to
for business partners. In 2024, Elkem introduced a new our plant in India have signed. 80 per cent of our high-
supplier relations management system (SRM), to better risk suppliers in China have signed and the goal is 100
manage our suppliers and the associated risks. 60 per cent per cent. Overall, approximately 6 000 suppliers (36 per
of all new raw material suppliers were audited in 2025. cent of all suppliers) have signed the Code of conduct for
business partners.
Elkem’s Code of conduct for business partners forms the
foundation of our supplier compliance risk management. This represents a significant global commitment to
It outlines our expectations for supplier behaviour our fundamental values. Our efforts to ensure supplier
regarding human and labour rights, anti-corruption, compliance will continue in 2026 and beyond.
health & safety (HSE), competition law, and adherence to
international sanctions and trade controls.
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The Norwegian Transparency Act and similar legislation
The chapters Own workforce (ESRS S1) and Workers in the value
chain (ESRS S2) have been developed to comply with the legal
requirements to report/produce an annual statement as stated in the
Forced Labour in Canadian Supply Chains Act (2023), the Norwegian
Transparency Act (2021), and the UK Modern Slavery Act (2015). The
reporting requirements apply to Elkem as an enterprise resident in
Norway with total assets of more than NOK 35 million combined with,
on average, more than 50 full-time employees, a supplier of goods
with a total turnover of GBP 36 million or more in the UK, and as an
entity engaged in producing, selling or distributing goods in Canada
having with CAD 20 million or more in assets, CAD 40 million or
more in revenue, and/or an average of 250 or more employees. The
information is valid for Elkem ASA and its consolidated subsidiaries.
The statement is approved and signed by the board of directors of
the parent company Elkem ASA as part of their approval of the annual
sustainability statement.
Elkem Annual report 2025 151
ESRS S3
Affected
communities
As an international organisation with operations across multiple
countries, Elkem recognises the importance of engaging with
and understanding the local communities where it operates. As
a cornerstone industrial operator in many regions, Elkem strives
to create positive contributions while advocating for responsible
business conduct and respect for human rights throughout its
operations and value chain.
In addition to these commitments, Elkem acknowledges
the critical importance of minimising its negative impact on
local biodiversity and ecosystems, integrating environmental
stewardship into its sustainability efforts to safeguard the natural
surroundings of the communities it serves.
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Interests and view of stakeholders ESRS 2 SBM-2 Identifying stakeholder interest, dialogue, and
Elkem actively identifies and addresses the interests and collaboration
concerns of stakeholders to ensure that its operations, Elkem maintains ongoing dialogue with a broad
strategies, and decisions reflect societal expectations range of stakeholders, including employees, local
and support responsible business conduct. This communities, academic institutions, industry partners,
commitment is embedded in Elkem’s approach to and environmental organisations. Input is gathered
stakeholder engagement, which combines structured through regular consultations, partnerships, and
dialogue, grievance management, and targeted action grievance mechanisms to identify material concerns such
plans to maintain trust and transparency. By integrating as climate change, resource efficiency, and community
stakeholder perspectives into decision-making, Elkem development. To address these concerns, Elkem fosters
strengthens its ability to deliver sustainable value and collaborative initiatives and partnerships that drive
uphold its responsibilities under SBM-2. collective action and create tangible benefits for local
communities.
Stakeholder engagement is carried out through several
channels and practices, including: Some examples from 2025:
→ After severe monsoon damage, Elkem Nagpur
→ Regular and scheduled meetings with key provided equipment to restore roads, enabling
stakeholders, such as biannual meetings with Sámi forest rangers to resume patrols and protect tiger
reindeer districts near mining operations populations. The plant has since launched a seven-
year reforestation project, planting over 2 000 trees
→ Ongoing dialogue with policymakers through to restore habitats and encourage the return of tigers,
industry organisations like Norsk Industri and showing Elkem’s commitment to biodiversity and
Eurometaux wildlife protection in Nagpur, India.
→ Ad-hoc meetings and continuous dialogue with → Elkem also invests in social development through
investors, banks, and other financial stakeholders the Wings Fly High project, which brings digital
education to children in under-resourced schools
→ Participation in workshops and forums with peers near Nagpur. By transforming buses into mobile
and NGOs, such as participation in Prosess21 computer classrooms, the programme has delivered
workshops on how to reduce emissions and facilitate thousands of sessions, improved exam results, and
sustainable transition, growth and value creation in the helped hundreds of children return to school, with
Norwegian process industry active involvement from Elkem employees and local
volunteers.
→ Accessible grievance mechanisms, including Elkem’s
Speak up channel, which is open to all stakeholders → Elkem Thamshavn has been named “Apprenticeship
and ensures confidentiality and secure handling of Company of the Year 2025” at the Thams Conference,
concerns in recognition of its long-term commitment to
apprentices and its positive impact on the local
In 2025, Elkem received two cases through its grievance community. The group offers a wide range of
mechanism, both were related to suppliers dissatisfied apprenticeship programmes and is praised for
with commercial conditions or contract outcomes. All fostering inclusion and well-being. As part of the
cases were investigated, and no further action was award, Elkem Thamshavn donated a NOK 25 000
deemed necessary. prize to Skattkammeret, supporting children and
youth in the Orkland region.
Elkem Annual report 2025 153
ESRS S3
ESRS topic: S3 Affected communities
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Communities’ Elkem plants are often cornerstone Actual Yes Yes Positive High Long OO, VC
economic, companies in small, underserved
social, and communities, and thus provide the basis to
cultural maintain the local communities
rights
Elkem plants create new jobs in Actual Yes Yes Positive High Short OO, VC
underserved communities, both through
own operations and among suppliers or
supporting sectors
Elkem sites represent significant tax Actual Yes Yes Positive High Long OO, VC
contribution to underserved communities
where Elkem is present, thus positively
contributing to local communities
Human rights violations and rights Potential Yes Yes Negative Low Short to VC
of indigentous people are a potential medium
negative impact through Elkem's
sourcing, e.g. quartz mining, biocarbon
sourcing, hydropower, by deforestation,
land and resource use
Poor water treatment at plants could Potential Yes Yes Negative Low Short OO
negatively affect the water quality around
the plant thus impacting local wildlife and
the drinking water of local communities
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
Material impacts, risks, and opportunities At the same time, Elkem recognises that its presence can
related to affected communities IRO-1, SBM-3 create meaningful opportunities for local communities.
Large-scale mining, smelting, and commercial operations, By investing in education and vocational training, the
as identified in Elkem’s double materiality assessment, group helps to build local skills and employability,
carry significant risks for affected communities. These supporting long-term economic development. Elkem
include the potential for pollution incidents—such as also collaborates with community organisations to
spills contaminating local water bodies or soil, and air co-create projects that address shared priorities, such
emissions impacting public health and the environment. as environmental restoration, health initiatives, and
There are also social risks, such as disruption to traditional cultural programmes. Furthermore, by supporting local
livelihoods, increased pressure on local infrastructure, infrastructure and promoting inclusive hiring practices,
and changes to the social fabric of communities. To Elkem strives to be an employer of choice and a positive
address these challenges, Elkem implements robust force for community well-being. Through these efforts,
risk management systems, including continuous Elkem seeks not only to mitigate risks but also to generate
environmental monitoring, emergency preparedness lasting value for both the group and the communities it
plans, and strict adherence to regulatory requirements. serves.
The group also prioritises transparent communication
and active engagement with local stakeholders to identify The results of our impact assessment can be found in
concerns early and develop effective mitigation strategies. the table above. For further details on Elkem’s double
By fostering a culture of accountability and continuous materiality assessment, please refer to the section on
improvement, Elkem aims to minimise negative impacts general disclosures ESRS 2.
and build trust within the communities where it operates.
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Policies related to affected communities S3-1 Recognising that each site has its own history and local
Relevant policies for affected communities are Elkem’s context, Elkem adapts its stakeholder dialogue and
HSE policy, our Speak up policy, the Communications and community engagement accordingly. The nature and
public affairs policy, and the Procedure for sponsoring and extent of involvement are tailored to local needs, ensuring
donations procedure. These, and other relevant policies, that engagement is meaningful and responsive. When
are described in detail in the section on governing significant operational changes are planned, Elkem
documents under General disclosures (ESRS 2). undertakes thorough stakeholder consultations to identify
potential impacts and agree on appropriate mitigation
Processes for engaging with affected measures. For example, in the case of the expansion of
communities S3-2 the quartzite mine in Tana, Norway, Elkem worked closely
Elkem maintains open channels for external stakeholders with local reindeer herding interests to reach a sustainable
to communicate with both local sites and corporate solution that balances industrial development with
offices, ensuring that concerns and feedback, whether traditional livelihoods.
positive or negative, are heard and addressed. The group
is committed to minimising adverse impacts on affected Elkem’s supplier relationship management (SRM) system
communities and strives to foster positive outcomes enables systematic, risk-based supplier qualification and
wherever it operates. This commitment is reflected in follow-up, streamlines screening processes, standardises
Elkem’s efforts to provide safe, stable employment and to vetting procedures across divisions and jurisdictions,
contribute to the economic and social development of its and monitors compliance throughout the entire contract
employees and surrounding communities. lifecycle. It also enforces our requirement for all new
suppliers to sign our Code of conduct for business
partners or demonstrate equivalent internal standards.
Elkem Annual report 2025 155
ESRS S3
In 2025, Elkem ran a supplier signing campaign focusing a doctor to visit the employees weekly, enabling easy
on suppliers at highest risk of breaching sanctions, access to medical assistance if required. The supplier
human rights, or anti-corruption standards, particularly had also set aside a room where employees could pray.
those suppliers registered in countries on the UN’s Trade Another supplier conducted consultative meetings with
Sanctions Risk List. This high-risk group comprised 8 local communities about an expansion of the mine.
300 suppliers, including those providing raw materials,
logistics, financial services, marketing, and other key Through these practices, Elkem demonstrates its
operations. Throughout 2025, Elkem employees globally dedication to responsible business conduct and to
contacted suppliers individually, requesting they sign. building trust and long-term value in the communities
Those who refused to sign were “deactivated” as where it operates.
suppliers; therefore, no longer able to do business with
Elkem. Almost 4 000 (44 per cent) of Elkem’s high- Processes to remediate negative impacts and
risk suppliers have now signed our Code of conduct or channels for affected communities to raise
demonstrated equivalent internal standards. All 600 concerns S3-3
suppliers to our plant in Nagpur, India, have signed. 33 Communication responsibility in Elkem is structured so
per cent of our high-risk suppliers in China have signed. that only designated spokespersons, such as the chief
In total, approximately 6 000 suppliers (34 per cent of all executive officer, the chief financial officer, and the vice
suppliers globally) have signed the Code of conduct. president for corporate communications & public affairs,
and relevant managers, may speak on behalf of the group,
All new raw material suppliers are subject to an integrity ensuring consistent and aligned external messaging. Elkem
due diligence (IDD) investigation by corporate compliance plant managers are authorised to speak on behalf of their
before approval in the SRM. As part of the IDD, if a local plants, but this shall be in alignment with the global
supplier is a trader, the product must be traced back to communications strategy and coordinated with the vice
the original producer. We use the SRM to comply with the president for corporate communications & public affairs in
Corporate Sustainability Reporting Directive (CSRD) and advance. Dialogue with external stakeholders is done by
the European Sustainability Reporting Standards (ESRS), various roles in the organisation, but it has to be in line with
including “Affected Communities” (ESRS S3) corporate guidelines and strategy.
Elkem’s corporate compliance department registers Elkem provides accessible channels for both internal and
all findings arising from an Integrity due diligence external stakeholders to submit feedback and resolve
(IDD) in Elkem’s SRM system, and monitors closure of issues. For detailed figures on grievances and reported
actions. Elkem’s raw material procurement team is then cases of misconduct, please refer to the Business
responsible for responding to these findings in writing conduct section (ESRS G1). External stakeholders can
within pre-set deadlines, and upload supporting evidence confidentially raise concerns through a public grievance
where relevant. Once all actions arising from the IDD mechanism available on Elkem’s website, while both
are completed, corporate compliance will assess and internal and external parties have access to a secure
determine whether the actions taken are appropriate to Speak up channel for reporting misconduct or operational
manage the identified risks. If risks are not satisfactorily issues. All reports received through these mechanisms
mitigated, the matter is escalated. are managed by Elkem’s ESG office and compliance
department, which oversee the resolution process
In 2025, our compliance department registered four in collaboration with relevant teams. This structured
IDD-related findings related to “affected communities”. approach ensures that every concern is addressed with
Elkem’s raw material procurement team was required the appropriate oversight and expertise, while ensuring
to respond to the status of the supplier’s relationship privacy and protection for stakeholders at risk, reinforcing
with and engagement with the local community. In one Elkem’s commitment to responsible business conduct
example, it was noted that our supplier had engaged and transparency.
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Taking action on material impacts on
affected communities, approaches to
managing material risks and pursuing
material opportunities related to affected
communities, and effectiveness of those
actions S3-4
Elkem has implemented tailored initiatives to address
the diverse priorities of its stakeholders. The group’s
sustainability policy, introduced in 2023, sets clear goals
for energy efficiency, biodiversity, water stewardship, and
waste management. In Tana, Norway, Elkem engaged
in extensive consultations with local reindeer herders
to mitigate the impacts of a quartzite mine expansion,
ensuring sustainable coexistence and respect for
traditional livelihoods.
In India, Elkem Nagpur demonstrated its commitment
to biodiversity and wildlife protection by providing
equipment to restore roads after severe monsoon
damage, enabling forest rangers to resume patrols and
safeguard tiger populations. The plant has since launched
a seven-year reforestation project, planting more than
2 000 trees to restore habitats and encourage the return
of tigers.
Elkem also invests in social development through align with stakeholder expectations for decarbonisation
initiatives like the Wings Fly High project, which delivers and a circular economy, underscoring Elkem’s
digital education to children in under-resourced schools commitment to driving the green transition.
near Nagpur. By transforming buses into mobile computer
classrooms, the programme has provided thousands of Targets related to managing material negative
sessions, improved exam results, and helped hundreds impacts, advancing positive impacts, and
of children return to school, with active involvement managing material risks and opportunities
from Elkem employees and local volunteers. Community S3-5
support remains a cornerstone of Elkem’s approach. Elkem has no explicit targets related to engagement with
Programmes such as the Ferroveld learnerships in South affected communities, but has set targets to minimise
Africa and the Colorir project in Brazil focus on education negative impacts (see chapters on climate change,
and skill-building, meeting local socio-economic needs pollution, and water). Elkem manages its material impact
while preparing future talent. by voluntary initiatives and maintaining strict compliance
with environmental permits and regulations. Measures
In Norway, Elkem Thamshavn was named to prevent pollution of soil, air, and water are rigorously
“Apprenticeship Company of the Year 2025” at the applied, and any deviations are addressed through
Thams Conference, recognising its long-standing established HSE processes. As a cornerstone employer
commitment to apprentices and its positive impact in several locations, Elkem plays a vital role in local
on the local community. The company offers a wide economies, providing jobs, tax revenue, and community
range of apprenticeship programmes and is praised support through programmes such as sponsorships for
for fostering inclusion and well-being. As part of the schools and sports teams. The group continuously works
award, Elkem Thamshavn donated a NOK 25 000 prize to strengthen dialogue and trust with communities and
to Skattkammeret, supporting children and youth in the is exploring the establishment of outcome-oriented,
Orkland region. time-bound targets to further enhance its commitment.
Elkem’s aim is to avoid conflicts with local communities,
Finally, innovation remains central to Elkem’s strategy. minimise negative impact, and promote strong
Collaborative projects such as Elkem Sicalo® and BioSiMS communities.
Elkem Annual report 2025 157
Environmental
Social
Governance
G
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ESRS G1
Business conduct
Elkem places strong emphasis on sound corporate governance
as a foundation for value creation and stakeholder trust. The
group upholds responsible economic practices, maintaining zero
tolerance for corruption and ensuring strict compliance with
international trade sanctions, anti-money laundering, and antitrust
regulations. Guided by principles of honesty, respect, and integrity,
Elkem is committed to conducting business responsibly and
ethically in a global marketplace shaped by evolving regulatory
requirements.
Role of administrative, supervisory, and committee reviews governance processes, internal control
management bodies GOV-1 systems, and risk management practices, reporting
Elkem’s governance policy clearly defines the roles and findings and recommendations to the audit committee
responsibilities of its administrative, supervisory, and and the board. The compliance committee monitors
management bodies in line with the Norwegian Code of adherence to regulatory requirements, advises on
Practice for Corporate Governance. The general meeting, compliance matters, and promotes a culture of integrity
as Elkem’s highest governing body, elects the board of across the organisation.
directors and makes key decisions such as approving the
annual report and determining dividends. The board sets Corporate governance at Elkem is closely linked to
the overall direction and strategy of the group, ensures sustainability and ESG principles. The board integrates
compliance with governance principles, and supervises environmental, social, and governance considerations
the management team to safeguard long-term value into strategic decision-making, ensuring that ethical
creation. standards, transparency, and accountability underpin all
operations. This approach supports Elkem’s commitment
The board is supported by specialised committees: the to responsible business conduct and sustainable
nomination committee recommends candidates for growth in a global marketplace with evolving regulatory
the board and other key positions; the audit committee requirements.
oversees financial reporting, internal controls, and risk
management; and the remuneration committee advises Material impacts, risks, and opportunities
on executive compensation to ensure alignment with related to business conduct IRO-1
shareholder interests. Elkem operates global value chains, which inherently
carry potential risks related to corruption, bribery, and
Elkem’s governance framework also includes the internal economic misconduct. These risks are present across
control and internal audit committee and the compliance our supply chain, particularly in interactions with external
committee. The internal control and internal audit distributors and sales agents. At the same time, Elkem
Elkem Annual report 2025 159
ESRS G1
creates positive impact through robust governance stringent EU regulations that may create unfavourable
and compliance practices. All employees receive framework conditions. These risks are assessed as
comprehensive training, with tailored programmes medium due to their potential financial impact.
for sales, procurement and other high-risk roles. The
group maintains strong internal controls and dedicated Together, these risks underscore the importance of robust
compliance expertise at both corporate and operational governance, comprehensive risk management, and
levels. A confidential Speak up channel is available to all proactive stakeholder engagement to safeguard Elkem’s
stakeholders, ensuring privacy for whistleblowers and integrity and support sustainable growth.
subjects, and Elkem reports transparently on suspected
misconduct. These measures form the foundation of Business conduct policies and corporate
a strong corporate culture aimed at reducing risk and culture G1-1
negative impact. Elkem’s governing documents establish clear principles
for responsible business conduct across all entities. The
Elkem faces several grouped risks that could affect Code of conduct and Governance policy are anchored at
operations and reputation. Increasing regulatory the highest level and approved by the board of directors.
requirements for due diligence and transparency demand Operational management of compliance is overseen
additional resources to monitor third-party relationships, by the corporate compliance team, which provides
including customers, intermediaries, and suppliers. employees and management with tools and guidance
Compliance with sanctions, trade regulations, financial to ensure actions align with Elkem’s standards. These
crime legislation, and human rights laws is critical. documents are described in detail under the ESRS 2
Breaches could result in severe financial penalties or, section on governing documents.
in extreme cases, direct sanctions on Elkem. However,
strong internal controls manage the risk reduces the Elkem invests significantly in developing relevant and
residual risk level to medium. engaging compliance training for its workforce and board
members. The training programme includes eLearning
Reputational and ethical risks also arise from growing courses on the Code of conduct, onboarding modules
stakeholder expectations for responsible sourcing. for newcomers, and anti-corruption training covering
Management of such risk is further elaborated in the high-risk areas such as gifts and hospitality, conflicts of
chapter “Workers in the value chain”. interest, and sponsorships and donations. Many modules
are available in multiple languages to reflect the group’s
Insufficient transparency in political engagement across global presence.
markets could harm reputation, though this is considered
low risk as Elkem primarily engages through transparent Code of conduct training is mandatory for all office-based
industry organisations. Operational and strategic risks employees and new hires, while additional modules
include supply shortages if key suppliers fail screening are required for specific roles based on risk exposure.
or compliance requirements, and challenges posed by Supported by a global learning platform and in-house
ESRS topic: G1 Business conduct
Impacts
Actual or Where
potential Material Financial Positive or Impact Time- in value
Sub-topic Description impact impact impact negative score1 frame chain2
Corruption Corruption taking place in our value chain, Potential Yes No Negative Medium Short VC
and bribery and thus contributing to shadow economies.
Solid corporate culture and training Actual Yes Yes Positive Low Short OO, VC
reducing the risk of bribery, and
established Speak up channels and
policy protecting internal and external
whistleblowers
1
Based on irremediability, scale, scope, and likelihood
2
Own operations (OO) or value chain (VC)
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content development tools, Elkem delivers tailored, risk- evaluating and monitoring supplier relationships. In
based training designed to meet the needs of diverse 2025, Elkem has focused on exploiting the opportunities
employee groups. provided by the SRM platform for improved supplier risk
management. Details are provided in the “Workers in
To mitigate risks of anti-competitive behaviour, human the value chain” chapter. We also advanced our efforts
rights breaches, or trade sanction violations, Elkem to mitigate the compliance risks associated with our
conducts assessments to identify high-risk jurisdictions distributors. We developed a more rigorous onboarding
and employee groups. Targeted eLearning and bespoke and approval process and enhanced our compliance
training sessions ensure compliance with established monitoring of intermediaries. Starting in 2026, selected
standards. Elkem’s commitment is reinforced by dawn raid intermediaries will be enrolled in our training program,
guidelines implemented across major sites and elearning is where they will receive comprehensive instruction in
distributed to targeted employees and management. sanctions and anti-corruption measures.
Prevention and detection of corruption and Elkem fosters a culture of openness where employees and
bribery G1-1, G1-3 external stakeholders can report potential misconduct
Elkem enforces a strict anti-bribery and corruption policy, securely and without fear of retaliation. A professionally
particularly in jurisdictions with elevated risk. A risk-based managed Speak up channel, hosted by a third party,
approach underpins continuous improvement of anti- enables confidential and anonymous reporting in
bribery measures, including regular risk assessments multiple languages via web or telephone. The channel is
that guide both existing operations and new business open both for internal and external parties. Significant
ventures. This proactive stance reinforces Elkem’s zero- matters may be escalated to senior management or the
tolerance policy and commitment to ethical business audit committee, and Elkem maintains a strict zero-
practices. tolerance policy against retaliation. Elkem is committed
to safeguarding anyone who raises concerns, and
Recognising the importance of business partners in our Speak up framework ensures that whistleblowers
upholding high standards, Elkem requires agents, are protected through strict confidentiality, the
consultants, suppliers, and joint ventures to comply option to remain anonymous, and a zero‑tolerance
with its Code of conduct for business partners. In 2024, policy for retaliation, as set out in the Speak up and
the group introduced a global supplier relationship investigation procedure. All reported concerns are
management (SRM) platform to strengthen risk handled independently by corporate compliance, which
management and provide a robust framework for operates outside the line‑management hierarchy to
Prevention of corruption and bribery
Number of people in Completion
Training module Target group Frequency Course type target group 2025 rate 2025
Introduction to Elkem’s All new employees At start of employment Elearning 81 66 95.06%
Code of conduct with Elkem (alternatively
classroom for blue
collar employees)
Compliance awareness All new white collar At start of employment Elearning 112 85.71%
training to newcomers employees with Elkem
Code of conduct All current white Twice a year Elearning 2 856 99.72%
refresher collar employees
Anti-corruption academy Risk based target Twice a year Elearning 1 123 99.02%
2025 group
Elkem sanctions Risk based target One-off risk-based Elearning 891 94.95%
school group campaigns
Introduction to human Risk based target Subsequent Elearning 482 96.06%
rights group assignment to new
employees meeting
target group definition
Anti-trust Risk based target Elearning 1051 96.19%
group
Elkem Annual report 2025 161
ESRS G1
secure an objective and unbiased assessment of each Our training programme will continue to evolve to deliver
case, and investigations follow a structured, fact‑based relevant and targeted content that increases effectiveness.
methodology in accordance with the Work instruction for In 2026, we will test out knowledge-based assignment of
internal investigators. Dedicated investigators, separate refresher compliance training, allowing for differentiation
from operational leadership, collect and analyse relevant based on the learners’ prior knowledge of the topic.
information, document findings rigorously, and report
outcomes only to those with a legitimate need to know, After five years of dedicated effort across the
ensuring that every case is examined impartially and in full organisation, Elkem’s compliance programme has
alignment with Elkem’s compliance standards. reached a significant milestone, now recognised by
Deloitte as one of the best among international peers.
Elkem is equally committed to full compliance with Since the initial audit in 2020, Elkem has advanced from
tax laws across its global operations, emphasising an informal maturity level to “operationally effective”
transparency and constructive engagement with tax status, driven by strong leadership, technology-enabled
authorities. With a low-risk tolerance in tax planning, controls, tailored training, and continuous improvement.
Elkem’s tax function aligns with the group’s risk Deloitte’s latest audit commends Elkem’s commitment
management framework and undergoes annual reviews. and progress, highlighting the group as a benchmark
External advisors are engaged when necessary to ensure in compliance. Elkem remains focused on further
adherence to legal requirements and maintain open strengthening automation, risk assessment, and cross-
relationships with authorities. functional collaboration to ensure continued resilience
and effectiveness in a changing environment.
In 2025, Elkem reported no significant legal or regulatory
violations resulting in material penalties. Significance Incidents of corruption or bribery G1-4, G1-MDR-T
is defined based on environmental impact, production In 2025, significant efforts were made to increase
continuity, and economic effects. Elkem maintains awareness and usage of the Speak up channel. A
stringent internal controls to prevent non-compliance and new requirement for local management to report
confirms that all subsidiaries have adopted the governing locally registered cases to corporate compliance was
documents approved by the board of directors. introduced to ensure group-wide learning and process
improvements. Units are now also obligated to display
Actions and resources related to business the Speak up poster in common areas, and awareness
conduct G1-MDR-A campaigns have been directed towards all employees.
To address identified impacts and risks, Elkem has The efforts have had the desired effect, with reported
strengthened internal training and implemented robust cases increasing from 2024 to 2025. The instances of
internal controls supported by dedicated compliance suspected misconduct recorded in 2025 is listed in the
resources. Our ambition is to continuously enhance the table on the opposite page.
compliance programme in line with evolving regulatory
requirements and best practices. Political influence and lobbying activities G1-5
Elkem maintains active dialogue with government
A key short-term priority is refining third-party risk policymakers, media, civil society, non-governmental
management processes, with particular focus on high-risk organisations, research institutions and international
intermediaries such as resellers, distributors, and sales agents. institutions to communicate its position on key
These efforts will build on our existing sanctions compliance industry issues. The group does not support political
programme and integrate anti-corruption controls, creating a or religious organisations, nor individuals or groups
holistic and streamlined approach for qualification, approval, outside recognised charities, and strictly prohibits
and ongoing management of high-risk third parties. contributions to discriminatory, harmful, or unlawful
activities. All sponsorships and donations are governed by
The compliance team will collaborate closely with the Elkem’s Sponsoring and donations procedure and must
procurement organisation to further enhance functionality comply with the Code of conduct and anti-corruption
within the SRM platform. Our goal is to strengthen risk- requirements. Exceptions are limited to small symbolic
based supplier qualification and follow-up requirements gestures related to employees’ religious holidays, which
to cover all relevant compliance risks, including sanctions, follow the gifts and hospitality procedure. Elkem primarily
corruption, and human and labour rights. Improvements represents its interests through industry organisations,
will be applied to all new suppliers and introduced gradually and any engagement with external lobbyists is conducted
for legacy suppliers, taking a risk-based approach. transparently, in accordance with legal requirements, and
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with prior approval from the vice president of corporate Payment practices G1-6
communications & public affairs, following the third-party Elkem strives to pay all invoices within reasonable time.
risk management procedure. Every sponsorship and The key guideline is to pay the invoice within 45 days of
social contribution is subject to rigorous due diligence and it being issued. This is regardless of whether it is a large
must uphold Elkem’s ethical standards and compliance corporate supplier or an SME.
commitments.
Incidents of misconduct
Metric 2025 2024 2023 2022
Total number and nature of Number 26 15 14
misconduct reports
Cases → Company/ → Inappropriate → Company/
professional code workplace professional code
violation: 11 behaviour and violation: 2
→ Inappropriate harassment: 13 → Conflict of interest:
workplace → HSE violation: 2 3
behaviour and → Corruption and → Corruption and
harassment: 10 fraud: 4 fraud: 4
→ HR case: 7 → Conflict of interest: → HSE violation: 1
→ Corruption and 3 → Inappropriate
fraud: 6 → Company/ workplace
→ Conflict of interest: professional code behaviour and
5 violation: 3 harassment: 2
→ Competition law: 2 → Sanction violation: 1 → Rights and
→ Cyber security & protection of
data protection: 1 individuals: 1
→ HSE violation: 1 → HR case: 2
→ Human rights
violation: 1
→ Sanction violation: 1
Number of confirmed cases of Number 0 1 1 6
corruption and fraud
Number of confirmed incidents in Number 0 1 0 2
which employees were dismissed
or disciplined for corruption
Public legal cases regarding Number 0 1 0 0
corruption brought against the
organisation or its employees
Confirmed incidents when Number 0 0 0 5
contracts with business partners
were terminated or not renewed
due to violations related to
corruption
Membership fees
Organisation Partnership/ Membership fee 2025
Norsk Industri NOK 1 066 623
Eurometaux EUR 63 251
Euroalliages EUR 310 401
Miljøstiftelsen ZERO (Zero Emission Resource Organisation) NOK 374 000
Silicones Europe/CEFIC Global EUR 556 000
Silicones Council /SEHSC (American Chemistry Council) EUR 932 000
SICOS (the French Syndicat des industries chimie fine et biotech) EUR 25 473
Norsk Bergindustri NOK 168 465
Elkem Annual report 2025 163
ESRS Index of material disclosures
ESRS Page
standard DR Description number
ESRS 2 BP-1 General basis for preparation of sustainability statement 78
BP-2 Disclosures in relation to specific circumstances 78
GOV-1 The role of the administrative, management and supervisory bodies 79
GOV-2 Information provided to and sustainability matters addressed by the undertaking's administrative, 79
management and supervisory bodies
GOV-3 Integration of sustainability-related performance in incentive schemes 80
GOV-4 Statement on due diligence 84
GOV-5 Risk management and internal controls over sustainability reporting 84
SBM-1 Strategy, business model and value chain 85
SBM-2 Interests and view of stakeholders 86
SBM-3 Material impacts, risks, and opportunities and their interaction with strategy and business model 91
IRO-1 Description of the process to identify and assess material impacts, risks, and opportunities 91
IRO-2 Disclosure requirements in ESRS covered by the undertaking's sustainability statement 94
ESRS E1 ESRS 2 Material impacts, risks, and opportunities - resilience of strategy and business model 103
SBM-3 Material impacts, risks, and opportunities - resilience of strategy and business model 103
IRO-1 Material impacts, risks, and opportunities - resilience of strategy and business model 103
E1-1 Transition plan for climate change mitigation 108
E1-2 Policies related to climate change mitigation and adaptation 81
E1-3 Actions and resources in relation to climate policies 109
E1-4 Targets for climate change mitigation and adaptation 110
E1-5 Energy consumption and mix 110
E1-6 Gross scopes 1, 2, and 3 ghg emissions 112
E1-7 GHG removals and carbon credits 113
E1-8 Internal carbon pricing 113
E1-9 Financial effects of climate-related risks and opportunities 113
ESRS E2 IRO-1 Description of processes to identify and assess material pollution-related impacts, risks and opportunities 114
E2-1 Policies related to pollution 81
E2-2 Actions and resources related to pollution 115
E2-3 Targets related to pollution 116
E2-4 Pollution of air, water and soil – general 117
E2-5 Substances of concern and substances of very high concern 117
ESRS E3 ESRS 2 Material water and marine resources-related impacts, risks, and opportunities 118
SBM-3 Material water and marine resources-related impacts, risks, and opportunities 118
IRO-1 Material water and marine resources-related impacts, risks, and opportunities 118
E3-1 Policies related to water and marine resources 81
E3-2 Actions and resources related to water and marine resources 119
E3-3 Targets related to water and marine resources 120
E3-4 Water consumption 120
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ESRS Page
standard DR Description number
ESRS E4 ESRS 2 Material impacts, risks, and opportunities and their interaction with strategy and business model 122
SBM-3 Material impacts, risks, and opportunities and their interaction with strategy and business model 122
IRO-1 Description of processes to identify and assess material biodiversity and ecosystem-related impacts, 122
risks, dependencies, and opportunities
E4-1 Transition plan on biodiversity and ecosystems in strategy and business model 125
E4-2 Policies related to biodiversity and ecosystems 81
E4-3 Actions and resources related to biodiversity and ecosystems 125
E4-4 Targets related to biodiversity and ecosystems 126
E4-5 Impact metrics related to biodiversity and ecosystems 126
ESRS E5 ESRS 2 Description of processes to identify and assess material resource use and circular economy-related 128
impacts, risks, and opportunities
SBM-3 Description of processes to identify and assess material resource use and circular economy-related 128
impacts, risks, and opportunities
IRO-1 Description of processes to identify and assess material resource use and circular economy-related 128
impacts, risks, and opportunities
E5-1 Policies related to resource use and circular economy 81
E5-2 Actions and resources related to resource use and circular economy 130
E5-3 Targets related to resource use and circular economy 131
E5-4 Resource inflows 132
E5-5 Resource outflows 132
ESRS S1 ESRS 2 Material impacts, risks and opportunities - resilience of strategy and business model 136
SBM-3 Material impacts, risks and opportunities - resilience of strategy and business model 136
IRO-1 Material impacts, risks and opportunities - resilience of strategy and business model 136
S1-1 Policies related to own workforce 81
S1-14 Health and safety 137
S1-2 Processes to engage with own workforce 139
S1-3 Processes to engage with own workforce 139
S1-13 Processes to engage with own workforce 139
S1-8 Collective bargaining coverage and social dialogue 139, 138
S1-13 Training and skills development metrics 140
S1-4 Targets related to managing material negative impacts, advancing positive impacts, and 140
managing material risks and opportunities
S1-5 Taking action on material impacts on own workforceand effectiveness of those actions 137, 139,
140
S1-6 Our workforce 142
S1-7 Our workforce 142
S1-9 Our workforce 142
S1-12 Our workforce 142
S1-10 Adequate wages, social protection, renumeration metrics, and incidents and complaints 145
S1-11 Adequate wages, social protection, renumeration metrics, and incidents and complaints 145
S1-16 Adequate wages, social protection, renumeration metrics, and incidents and complaints 145
S1-17 Adequate wages, social protection, renumeration metrics, and incidents and complaints 145
Elkem Annual report 2025 165
ESRS Page
standard DR Description number
ESRS S2 S1-17 Adequate wages, social protection, renumeration metrics, and incidents and complaints 146
SBM-3 Material impacts, risks and opportunities and their interaction with strategy and business model 146
IRO-1 Material impacts, risks and opportunities and their interaction with strategy and business model 146
S2-1 Policies related to value chain workers 81, 147
S2-2 Processes for engaging with value chain workers about impacts 147
S2-3 Processes to remediate negative impacts and channels for value chain workers to raise concerns 148
S2-4 Taking action on material impacts on value chain workers, and approaches to managing material risks 148
and pursuing material opportunities related to value chain workers, and effectiveness of those actions
S2-5 Targets related to managing material negative impacts, advancing positive impacts, and managing 150
material risks and opportunities
ESRS S3 ESRS 2 Interests and view of stakeholders 153
SBM-2 Interests and view of stakeholders 153
IRO-1 Material impacts, risks, and opportunities related to affected communities 154
SBM-3 Material impacts, risks, and opportunities related to affected communities 154
S3-1 Policies related to affected communities 81
S3-2 Processes for engaging with affected communities 155
S3-3 Processes to remediate negative impacts and channels for affected communities to raise concerns 156
S3-4 Taking action on material impacts on affected communities, approaches to managing material risks and 157
pursuing material opportunities related to affected communities, and effectiveness of those actions
S3-5 Targets related to managing material negative impacts, advancing positive impacts, and managing mate- 157
rial risks and opportunities
ESRS G1 GOV-1 Role of administrative, supervisory, and management bodies (GOV-1) 159
IRO-1 Material impacts, risks, and opportunities related to business conduct 159
G1-1 Business conduct policies and corporate culture 160
G1-3 Prevention and detection of corruption and bribery 161
G1- Actions and resources related to business conduct 162
MDR-A
G1-4 Incidents of corruption or bribery 162
G1- Incidents of corruption or bribery 162
MDR-T
G1-5 Political influence and lobbying activities 162
166 Sustainability statement
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Elkem Annual report 2025 167
KPMG AS Telephone +47 45 40 40 63
Dronning Eufemias gate 6A Internet www.kpmg.no
P.O. Box 7000 Majorstuen Enterprise 935 174 627 MVA
N-0306 Oslo
To the General Meeting of Elkem ASA
Independent Sustainability Auditor’s Limited Assurance Report
Limited Assurance Conclusion
We have conducted a limited assurance engagement on the consolidated sustainability statement
of Elkem ASA (the “Group”), included in the section Sustainability Statement of the Board of Directors'
report (the “Sustainability Statement”), as at 31 December 2025 and for the year then ended.
Based on the procedures we have performed and the evidence we have obtained, nothing has come
to our attention that causes us to believe that the Sustainability Statement is not prepared, in all
material respects, in accordance with the Norwegian Accounting Act section 2-3, including:
• compliance with the European Sustainability Reporting Standards (ESRS), including that the
process carried out by the Group to identify the information reported in the Sustainability
Statement (the “Process”) is in accordance with the description set out in the chapter ESRS 2
General Disclosures, subsection Double Materiality Assessment - Material impacts, risks and
opportunities; and
• compliance of the disclosures in the section Statement on the EU Taxonomy for Sustainable
Economic Activities of the Sustainability Statement with Article 8 of EU Regulation 2020/852
(the “Taxonomy Regulation”).
Basis for Conclusion
We conducted our limited assurance engagement in accordance with International Standard on
Assurance Engagements (ISAE) 3000 (Revised), Assurance engagements other than audits or
reviews of historical financial information (“ISAE 3000 (Revised)”), issued by the International Auditing
and Assurance Standards Board.
We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our
conclusion. Our responsibilities under this standard are further described in the Sustainability Auditor’s
Responsibilities section of our report.
Our Independence and Quality Management
We have complied with the independence and other ethical requirements as required by relevant laws
and regulations in Norway and the International Code of Ethics for Professional Accountants (including
International Independence Standards) issued by the International Ethics Standards Board for
Accountants (IESBA Code), which is founded on fundamental principles of integrity, objectivity,
professional competence and due care, confidentiality and professional behaviour.
The firm applies International Standard on Quality Management 1, which requires the firm to design,
implement and operate a system of quality management including policies or procedures regarding
compliance with ethical requirements, professional standards and applicable legal and regulatory
requirements.
168 Sustainability statement
Table of contents Board of directors’ report Sustainability statement Financial statements
Responsibilities for the Sustainability Statement
The Board of Directors and the Managing Director (Management) are responsible for designing and
implementing a process to identify the information reported in the Sustainability Statement in
accordance with the ESRS and for disclosing this Process in the section Double Materiality
Assessment - Material impacts, risks and opportunities of the Sustainability Statement. This
responsibility includes:
• understanding the context in which the Group's activities and business relationships take
place and developing an understanding of its affected stakeholders;
• the identification of the actual and potential impacts (both negative and positive) related to
sustainability matters, as well as risks and opportunities that affect, or could reasonably be
expected to affect, the Group's financial position, financial performance, cash flows, access to
finance or cost of capital over the short-, medium-, or long-term;
• the assessment of the materiality of the identified impacts, risks and opportunities related to
sustainability matters by selecting and applying appropriate thresholds; and
• making assumptions that are reasonable in the circumstances.
Management is further responsible for the preparation of the Sustainability Statement, in accordance
with the Norwegian Accounting Act section 2-3, including:
• compliance with the ESRS;
• preparing the disclosures in the section Statement on the EU Taxonomy for Sustainable
Economic Activities of the Sustainability Statement, in compliance with the Taxonomy
Regulation;
• designing, implementing and maintaining such internal control that Management determines is
necessary to enable the preparation of the Sustainability Statement that is free from material
misstatement, whether due to fraud or error; and
• the selection and application of appropriate sustainability reporting methods and making
assumptions and estimates that are reasonable in the circumstances.
Inherent limitations in preparing the Sustainability Statement
In reporting forward-looking information in accordance with ESRS, Management is required to prepare
the forward-looking information on the basis of disclosed assumptions about events that may occur in
the future and possible future actions by the Group. Actual outcomes are likely to be different since
anticipated events frequently do not occur as expected.
Sustainability Auditor’s Responsibilities
Our responsibility is to plan and perform the assurance engagement to obtain limited assurance about
whether the Sustainability Statement is free from material misstatement, whether due to fraud or error,
and to issue a limited assurance report that includes our conclusion. Misstatements can arise from
fraud or error and are considered material if, individually or in the aggregate, they could reasonably be
expected to influence decisions of users taken on the basis of the Sustainability Statement as a whole.
As part of a limited assurance engagement in accordance with ISAE 3000 (Revised) we exercise
professional judgement and maintain professional scepticism throughout the engagement.
Our responsibilities in respect of the Sustainability Statement, in relation to the Process, include:
• Obtaining an understanding of the Process, but not for the purpose of providing a conclusion
on the effectiveness of the Process, including the outcome of the Process;
• Considering whether the information identified addresses the applicable disclosure
requirements of the ESRS; and
• Designing and performing procedures to evaluate whether the Process is consistent with the
Company’s description of its Process set out in the section Double Materiality Assessment -
Material impacts, risks and opportunities.
2
Elkem Annual report 2025 169
Our other responsibilities in respect of the Sustainability Statement include:
• Identifying where material misstatements are likely to arise, whether due to fraud or error; and
• Designing and performing procedures responsive to where material misstatements are likely
to arise in the Sustainability Statement. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations, or the override of internal control.
Summary of the Work Performed
A limited assurance engagement involves performing procedures to obtain evidence about the
Sustainability Statement. The procedures in a limited assurance engagement vary in nature and timing
from, and are less in extent than for, a reasonable assurance engagement. Consequently, the level of
assurance obtained in a limited assurance engagement is substantially lower than the assurance that
would have been obtained had a reasonable assurance engagement been performed.
The nature, timing and extent of procedures selected depend on professional judgement, including the
identification of disclosures where material misstatements are likely to arise in the Sustainability
Statement, whether due to fraud or error.
In conducting our limited assurance engagement, with respect to the Process, we:
• Obtained an understanding of the Process by:
o performing inquiries to understand the sources of the information used by
management (e.g., stakeholder engagement, business plans and strategy
documents); and
o reviewing selected parts of the Group’s internal documentation of its Process; and
• Evaluated whether the evidence obtained from our procedures with respect to the Process
implemented by the Group was consistent with the description of the Process set out in the
section Double Materiality Assessment - Material impacts, risks and opportunities.
In conducting our limited assurance engagement, with respect to the Sustainability Statement, we:
• Obtained an understanding of the Group’s reporting processes relevant to the preparation of
its Sustainability Statement by:
o Obtaining an understanding of the Group's control environment, processes and
information system relevant to the preparation of the Sustainability Statement, but not
for the purpose of providing a conclusion on the effectiveness of the Group’s internal
control; and
o Obtaining an understanding of the Group’s risk assessment process;
• Evaluated whether the information identified by the Process is included in the Sustainability
Statement;
• Evaluated whether the structure and the presentation of the Sustainability Statement is in
accordance with the ESRS;
• Performed inquiries of relevant personnel on selected information in the Sustainability
Statement;
• Performed substantive assurance procedures on selected information in the Sustainability
Statement;
• Where applicable, compared disclosures in the Sustainability Statement with the
corresponding disclosures in the financial statements and other sections of the Board of
Directors' report;
• Evaluated the methods, assumptions and data for developing estimates and forward-looking
information;
3
170 Sustainability statement
Table of contents Board of directors’ report Sustainability statement Financial statements
• Obtained an understanding of the Group’s process to identify taxonomy-eligible and
taxonomy-aligned economic activities and the corresponding disclosures in the Sustainability
Statement;
• Evaluated whether information about the identified taxonomy-eligible and taxonomy-aligned
economic activities is included in the Sustainability Statement; and
• Performed inquiries of relevant personnel and substantive procedures on selected taxonomy
disclosures included in the Sustainability Statement.
Oslo, 13 March 2026
KPMG AS
Stian Tørrestad
State Authorised Public Accountant – Sustainability Auditor
4
Elkem Annual report 2025 171
Financial
statements
172
Elkem Annual report 2025 173
Elkem ASA Group
Financial statements
Consolidated statement of profit or loss 176
Consolidated statement of comprehensive income 177
Consolidated statement of financial position 178
Consolidated statement of cash flows 180
Consolidated statement of changes in equity 181
General information
Note 1 General information 182
Note 2 Basis for preparing the consolidated financial statements 183
Note 3 Accounting estimates 185
Group structure
Note 4 Composition of the group 185
Note 5 Equity accounted investments and joint operations 189
Information about statement of profit or loss
Note 6 Operating segments 193
Note 7 Revenue 200
Note 8 Other operating income 202
Note 9 Grants 202
Note 10 Raw materials and energy 204
Note 11 Employee benefits 204
Note 12 Share-based payments 210
Note 13 Other operating expenses 212
Note 14 Other items 213
Note 15 Finance income and expenses 214
Note 16 Taxes 215
174 Financial statements | Elkem ASA Group
Information about statement of financial position
Note 17 Property, plant and equipment 219
Note 18 Leases 222
Note 19 Other intangible assets 224
Note 20 Goodwill 227
Note 21 Impairment assessments 228
Note 22 Inventories 231
Note 23 Trade receivables 232
Note 24 Other assets 234
Note 25 Cash and cash equivalents and restricted deposits 235
Note 26 Interest-bearing liabilities 236
Note 27 Trade payables 239
Note 28 Provisions and other liabilities 240
Note 29 Financial assets and liabilities 243
Note 30 Hedging 249
Other information
Note 31 Financial risk 252
Note 32 Capital management 261
Note 33 Number of shares 262
Note 34 Earnings per share 263
Note 35 Supplemental information to the consolidated statement of cash flows 264
Note 36 Related parties 265
Note 37 Pledge of assets and guarantees 267
Note 38 Assets held for sale and discontinued operations 268
Note 39 Events after the reporting period 275
APM Alternative Performance Measures 329
Elkem Annual report 2025 175
Consolidated statement of profit or loss
Amounts in NOK million
1 January - 31 December Note 2025 2024
Revenue 7 16 535 17 810
Other operating income 8 172 1 066
Share of profit (loss) from equity accounted investments 5 20 (6)
Total operating income 6 16 727 18 870
Raw materials and energy 10 (7 631) (8 313)
Employee benefit expenses 11 (2 874) (2 766)
Other operating expenses 13 (4 159) (4 283)
Amortisation and depreciation 17, 18, 19 (1 008) (931)
Impairment losses 17, 18, 19 (7) (168)
Other items 14 258 (316)
Operating profit (loss) 1 307 2 094
Share of profit (loss) from equity accounted financial investments 5 - (143)
Finance income 15 61 107
Foreign exchange gains (losses) 15 (284) 247
Finance expenses 15, 18 (549) (778)
Profit (loss) before income tax 534 1 526
Income tax (expense) benefit 16 (149) 588
Profit (loss) for the year from continuing operations 385 2 115
Profit (loss) for the year from discontinued operations 38 (969) (1 538)
Profit (loss) for the year (584) 577
Attributable to:
Non-controlling interest share of profit (loss) 84 89
Owners of the parent's share of profit (loss) (668) 488
Earnings per share in NOK
Basic 34 (1.05) 0.77
Diluted 34 (1.05) 0.77
176 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Consolidated statement of comprehensive income
Amounts in NOK million
1 January - 31 December Note 2025 2024
Profit (loss) for the year (584) 577
Remeasurement of defined benefit pension plans 11 24 8
Tax effects on remeasurement of defined benefit pension plans 16 (2) (1)
Change in fair value of equity instruments 8 2
Share of other comprehensive income (loss) from equity accounted investments 5 - 0
Total items that will not be reclassified to profit or loss 30 9
Currency translation differences (1 214) 1 154
Hedging of net investment in foreign operations 30 (9) (128)
Tax effects hedging of net investment in foreign operations 16 2 28
Cash flow hedges 30 109 29
Tax effects on cash flow hedges 16 (24) (13)
Share of other comprehensive income (loss) from equity accounted investments 5 (4) 4
Total items that may be reclassified to profit or loss in subsequent periods (1 140) 1 074
Cash flow hedges 30 (41) 14
Tax effects on cash flow hedges 16 9 3
Total reclassification adjustments for the period (32) 17
Other comprehensive income (loss) for the year, net of tax (1 142) 1 100
Total comprehensive income for the year (1 726) 1 677
Attributable to:
Non-controlling interest share of comprehensive income 81 98
Owners of the parent's share of comprehensive income (1 807) 1 579
Total comprehensive income for the year (1 726) 1 677
Elkem Annual report 2025 177
Consolidated statement of financial position
Amounts in NOK million
Note 31.12.2025 31.12.2024
ASSETS
Property, plant and equipment 17, 21 8 568 8 405
Right-of-use assets 18, 21 402 403
Other intangible assets 19, 21 164 216
Goodwill 20, 21 305 329
Deferred tax assets 16 942 738
Equity accounted investments 5 210 230
Derivatives 29, 30 981 1 012
Other assets 24 1 011 985
Total non-current assets 12 583 12 320
Inventories 22 5 959 6 038
Trade receivables 23 1 852 1 960
Derivatives 29, 30 285 267
Other assets 24 1 231 1 254
Restricted deposits 25 1 7
Cash and cash equivalents 25 2 694 4 397
Total current assets 12 021 13 923
Assets classified as held for sale 38 22 878 27 189
TOTAL ASSETS 47 481 53 432
178 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Amounts in NOK million
Note 31.12.2025 31.12.2024
EQUITY AND LIABILITIES
Paid-in capital 33 3 508 3 502
Retained earnings 20 413 22 410
Non-controlling interest 104 109
Total equity 24 026 26 020
Interest-bearing liabilities 18, 26 9 648 11 817
Deferred tax liabilities 16 129 238
Employee benefit obligations 11 238 238
Derivatives 29, 30 350 485
Provisions and other liabilities 28 275 267
Total non-current liabilities 10 640 13 045
Trade payables 1 818 2 076
Income tax payables 43 106
Interest-bearing liabilities 18, 26 2 322 1 090
Employee benefit obligations 11 482 471
Derivatives 29, 30 115 140
Provisions and other liabilities 28 588 815
Total current liabilities 5 368 4 698
Liabilities classified as held for sale 38 7 447 9 668
TOTAL EQUITY AND LIABILITIES 47 481 53 432
Oslo, 10 March 2026
Bo Li Dag Jakob Opedal Olivier Tillette de Clermont- Wei Yao
Chair Vice chair Tonnerre Board member
Board member
Dachuan Dong Grace Tang Nathalie Brunelle Marianne Elisabeth Johnsen
Board member Board member Board member Board member
Terje Andre Hanssen Marianne Færøyvik Thomas Eggan Helge Aasen
Board member Board member Board member CEO, Elkem ASA
Elkem Annual report 2025 179
Consolidated statement of cash flows
Amounts in NOK million
1 January - 31 December Note 2025 2024
Operating profit (loss) from continuing operations 38 1 307 2 094
Operating profit (loss) from discontinued operations 38 (782) (1 382)
Amortisation, depreciation and impairment losses 17, 18, 19 2 741 2 852
Changes in working capital 35 (138) (629)
Equity accounted investments 5 13 27
Changes in fair value of derivatives (107) 475
Changes in provisions, bills and other (821) (27)
Interest payments received 84 119
Interest payments made (684) (885)
Income taxes paid (436) (614)
Total cash flow from operating activities 1 176 2 030
Investments in property, plant and equipment and intangible assets 17, 19 (2 359) (3 398)
Received investment grants 9 39 64
Proceeds from sale of property, plant and equipment 17, 19 71 17
Disposal of equity accounted investments 5 - 10
Acquisition of and capital contribution to equity accounted investments 5 - (4)
Other investments / sales 1 9
Total cash flow from investing activities (2 248) (3 303)
Dividends paid to non-controlling interest (85) (123)
Dividends paid to owners of the parent 32 (190) -
Net sale (purchase) of treasury shares 33 1 5
Payment of lease liabilities 18, 26 (151) (143)
New interest-bearing loans and borrowings 26 691 2 470
Payment of interest-bearing loans and borrowings 26 (1 186) (1 474)
Total cash flow from financing activities (921) 737
Change in cash and cash equivalents (1 993) (536)
Currency translation differences (271) 238
Cash and cash equivalents opening balance 6 070 6 367
Cash and cash equivalents closing balance 3 806 6 070
Of which cash and cash equivalents in assets held for sale 38 1 112 1 673
Of which cash and cash equivalents in continuing operations 25 2 694 4 397
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Table of contents Board of directors’ report Sustainability statement Financial statements
Consolidated statement of changes in equity
Amounts in NOK million
Foreign
Other Total currency Cash flow Other Total Total Non-
Share paid-in paid-in translation hedge retained retained owners controlling
2025 capital capital capital reserve reserve earnings earnings share interest Total
Opening balance 3 197 305 3 502 3 275 (46) 19 181 22 410 25 911 109 26 020
Profit (loss) for the year - - - - - (668) (668) (668) 84 (584)
Other comprehensive
income for the year - - - (1 217) 53 26 (1 139) (1 139) (4) (1 142)
Total comprehensive
income for the year - - - (1 217) 53 (642) (1 807) (1 807) 81 (1 726)
Share-based payments
(note 12) - 6 6 - - - - 6 - 6
Net movement treasury
shares (note 33) - 0 0 - - 1 1 1 - 1
Dividends to equity
holders (note 32) - - - - - (190) (190) (190) (85) (276)
Closing balance 3 197 311 3 508 2 058 7 18 349 20 413 23 922 104 24 026
Foreign
Other Total currency Cash flow Other Total Total Non-
Share paid-in paid-in translation hedge retained retained owners controlling
2024 capital capital capital reserve reserve earnings earnings share interest Total
Opening balance 3 197 301 3 498 2 231 (79) 18 675 20 827 24 325 133 24 458
Profit (loss) for the year - - - - - 488 488 488 89 577
Other comprehensive
income for the year - - - 1 044 33 13 1 090 1 090 10 1 100
Total comprehensive
income for the year - - - 1 044 33 501 1 579 1 579 98 1 677
Share-based payments
(note 12) - 2 2 - - - - 2 - 2
Net movement treasury
shares (note 33) - 1 1 - - 4 4 5 - 5
Dividends to equity
holders (note 32) - - - - - - - - (123) (123)
Closing balance 3 197 305 3 502 3 275 (46) 19 181 22 410 25 911 109 26 020
Elkem Annual report 2025 181
Elkem ASA Group
Notes to the
consolidated financial
statements
Amounts in NOK million
1 General information
Elkem ASA is a limited liability company located in Norway, and its shares are publicly traded on Oslo Stock Exchange.
Elkem ASA is owned 52.9 per cent by Bluestar Elkem International Co. Ltd S.A., Luxembourg, which is under the control
of Sinochem Holdings Co., Ltd (Sinochem), a company registered and domiciled in China.
Elkem is one of the world’s leading providers of advanced material solutions shaping a better and more sustainable
future. The company develops silicones, silicon products, and carbon solutions by combining natural raw materials,
renewable energy, and human ingenuity. Elkem helps its customers create and improve essential innovations like electric
mobility, digital communications, health and personal care, as well as smarter and more sustainable cities. With a strong
track record since 1904, its global team of more than 3 000 people has a joint commitment to stakeholders: Delivering
your potential. In 2025, Elkem achieved an operating income of NOK 16 727 million.
The consolidated financial statements for Elkem ASA (hereafter Elkem or the group), including notes, for the year 2025
were authorised for issue by the board of directors of Elkem ASA at 10 March 2026.
At 23 January 2025, the group announced its intention to perform a strategic review of the Silicones business area,
and it initiated an active program to locate a buyer for the Silicones division. At the end of 2024, it was assessed that
the Silicones division meets the criteria for ‘held for sale’. In February 2026, the group announced that an agreement
to sell the majority of the Silicones division to Bluestar had been made, see note 39 Events after the reporting period.
The Silicones division represents a major line of business and per 31 December 2024 a sale was regarded to be
highly probable to occur within one year. As such, the Silicones division is presented as discontinued operations in
the statement of profit and loss, and as held for sale in the statement of financial position in both the 2024 and 2025
financial statements. The statement of cash flows and some notes (including note 6 Operating segments and note 31
Financial risk) provide information for the entire Elkem group, including operations classified as discontinued (hereafter
Elkem group total). Unless otherwise specified, notes related to the statement of profit or loss reflect continuing
operations. See note 38 Assets held for sale and discontinued operations for further information.
182 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
2 Basis for preparing the consolidated financial
statements
Compliance
The consolidated financial statements are prepared in accordance with IFRS® Accounting Standards as endorsed by the
European Union (EU) and effective at 31 December 2025. All accounting policies are used consistently by all subsidiaries
in the consolidated financial statement.
Relevant financial reporting principles are described in each note to the consolidated financial statements.
Preparation of consolidated financial statements
The consolidated financial statements are prepared on a historical cost basis, with the exception of derivative financial
instruments and other financial assets measured at fair value.
The presentation currency of Elkem is Norwegian krone (NOK). All financial information is presented in NOK million,
unless otherwise stated. As a result of rounding adjustments, the amounts shown in one or more rows and columns
included in the consolidated financial statements, may not add up to the total.
In text, the current year’s figures are presented outside parentheses, followed by the comparative figures presented in
parentheses.
The consolidated financial statements have been prepared under the going concern assumption.
Foreign currency translation
Each entity in the group determines its functional currency based on the economic environment in which it operates,
and items included in the financial statements of each entity are measured using that functional currency. When
preparing the financial statements of each individual group entity, transactions in currencies other than the entity’s
functional currency are recognised in the functional currency, using the transaction date’s currency rate.
Monetary items denominated in foreign currencies are translated to each entity’s functional currency using the closing
rate at the end of the reporting period, and any gains (losses) are reported in the statement of profit or loss. Non-
monetary items that are measured at fair value in a foreign currency are translated using the exchange rate at the date
when the fair value was measured. Currency gains (losses) related to operating activities, i.e. receivables, payables,
cash, and cash equivalents for operating purposes, including current intragroup balances, are recognised as a part of
other items. Currency effects recognised in finance income and expenses are only related to intra-group receivables and
financing activities such as loans and lease liabilities.
Foreign currency differences are recognised in other comprehensive income for the following items:
→ a financial asset or liability designated as a hedging instrument in a cash flow hedge, to the extent that the hedge is
effective
→ loans in foreign currencies designated as hedging instruments in a hedge of a net investment in a foreign operation
In consolidation of the statement of profit or loss and the statement of financial position, separate group entities with a
functional currency other than the group’s presentation currency are translated directly into the presentation currency as
follows:
→ Assets and liabilities are translated using the exchange rate at the end of the reporting period
→ Income and expenses are translated using an average exchange rate per month
→ Equity transactions, except for profit or loss for the period, are translated using the transaction date rates
All resulting exchange differences are booked as a separate component in other comprehensive income (OCI).
Elkem Annual report 2025 183
Note 2 continued
Any goodwill arising on acquisition of a foreign operation and any fair value adjustment to the carrying amount of assets
and liabilities arising on the acquisition, are treated as assets and liabilities of the foreign operations. On disposal of a
foreign entity, the deferred cumulative amount recognised in other comprehensive income relating to that particular
foreign operation, is recognised in the statement of profit or loss.
Statement of cash flows
The statement of cash flows is prepared under the indirect method. Cash inflows and outflows are shown separately for
investing and financing activities, while operating activities include both cash and non-cash effect items. Interest received
and paid and other financial expenses, such as bank guarantee expenses, are reported as part of operating activities. Net
currency gains or losses related to financing activities are reported as part of financing activities. Dividends received from
joint ventures and associates that do not operate within Elkem’s main business areas are included in investing activities.
Dividend to shareholders
Dividend is recognised as a liability when the shareholders’ right to payment is established, which is when the dividend is
approved by the general meeting.
Changes in accounting policies and correction of material errors
Changes in accounting policies and correction of material errors are recognised retrospectively by restating the
comparative amounts for the prior period presented, including the opening balance of the prior year.
Changes in accounting policy
Elkem has changed how the chief operating decision maker follows up realised derivative effects, which has effect for
note 6 Operating segments and Elkem’s Alternative Performance Measures (APMs). From 2025, all realised effects from
derivatives not designated in a hedging relationship will be presented within operating expenses and included in Elkem’s
definition of normalised EBITDA. There is no change in the IFRS profit and loss statement. Comparative figures in note 6
Operating segments and impacted APMs have been restated for 2024.
New and revised standards - adopted
No new or revised standards have been adopted in 2025.
New standards, interpretations, and amendments - not yet effective
IFRS 18 will replace IAS 1 Presentation of financial statements, effective from 1 January 2027. The standard introduces
new requirements with the intention to achieve better comparability of the financial performance of similar entities and
provide more relevant information and transparency to users. Even though IFRS 18 will not impact the recognition or
measurement of items in the financial statements, the implementation will impact presentation and some disclosures.
Management has analysed the implications of applying the new standard on the group’s consolidated financial
statements and expects the following three effects for Elkem:
→ The statement of profit or loss will have to be changed, classifying income and expenses in one of five categories
(operating, investing, financing, income tax, and discontinued operations) with accompanying new subtotals.
→ To be able to comply with the new classification requirements in the statement of profit or loss, some of our present
line-items will have to be disaggregated, thereby leading to the need for some new financial accounts - particularly
regarding registration of foreign currency exchange effects.
→ The newly introduced term “Management-defined Performance Measures” as a sub-group of our present Alternative
Performance Measures, with accompanying notes disclosure requirements will have to be included in the financial
statements.
Other implications of the implementation of IFRS 18 are expected to be minor. Elkem expects to use IFRS 18 when
presenting the condensed interim financial statements from the first quarter of 2027, with retrospective implementation
(restating the comparable figures for 2026).
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3 Accounting estimates
The preparation of the consolidated financial statements according to IFRS requires management to make estimates
and use assumptions that affect the reported amounts of assets, liabilities, income, and expenses. Estimates are made
based on customised models, and the applied assumptions are derived from historical experience, external sources of
information, and other sources deemed reasonable under the current conditions and circumstances. Actual results may
differ from these estimates.
Estimates are continually evaluated and are based on historical experience and other factors, including expectations of
future events that are believed to be reasonable under the circumstances. Revisions of reported estimates are recognised
in the period in which the estimates are revised and in any future period affected. Changes in accounting estimates
are recognised prospectively by including them in the statement of profit or loss in the period of the change and future
periods if the change affects both.
The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of
assets and liabilities within the next financial year are addressed in the following notes:
→ Note 16 Taxes
→ Note 21 Impairment assessments
→ Note 28 Provisions and other liabilities
→ Note 29 Financial assets and liabilities
→ Note 38 Assets held for sale and discontinued operations
4 Composition of the group
Principle application and judgements
Consolidation
The consolidated financial statements include the financial statements of Elkem ASA and entities controlled directly or
indirectly by Elkem ASA.
Business combinations
The acquisition method of accounting is used to account for business combinations made by the group.
IFRS 3 allows two different approaches to accounting for an asset acquisition. Elkem has decided to first determine the
individual transaction price for each identifiable asset and liability based on their relative fair value and subsequently
apply the initial measurement requirements in applicable standards to each identifiable asset and liability. Any difference
between the amount at which the asset and liability is initially measured and its individual transaction price is accounted
for using the relevant requirements.
Elkem Annual report 2025 185
Note 4 continued
31.12.25 31.12.24
Functional Country of Equity Equity
Company currency incorporation interest interest Owner
Elkania DA (Joint operation) NOK Norway 50% 50% Elkem ASA
Elkem (Thailand) Co., Ltd. THB Thailand 100% 100% Elkem ASA
Elkem Carbon (China) Co., Ltd. CNY China 100% 100% Elkem Carbon Singapore
Pte. Ltd.
Elkem Carbon AS NOK Norway 100% 100% Elkem ASA
Elkem Carbon Malaysia Sdn. Bhd. MYR Malaysia 100% 100% Elkem Carbon AS
Elkem Carbon Singapore Pte. Ltd. SGD Singapore 100% 100% Elkem Carbon AS
Elkem Carbon Slovakia, a.s. EUR Slovakia 100% 100% Elkem Carbon AS
Elkem Chartering Holding AS NOK Norway 80% 80% Elkem ASA
Elkem Digital Office AS NOK Norway 100% 100% Elkem ASA
Elkem Distribution Center B.V. EUR Netherlands 100% 100% Elkem ASA
Elkem Dronfield Ltd. GBP United Kingdom100% 100% Elkem UK Holdings Ltd.
Elkem Egypt for Industry, Contracting & Trading S.A.E. USD Egypt 100% 100% Elkem International AS
Elkem Ferroveld JV (Joint operation) ZAR South Africa 50% 50% Elkem Carbon AS
Elkem Foundry (China) Co., Ltd. CNY China 100% 100% Elkem ASA
Elkem GmbH EUR Germany 100% 100% Elkem ASA
Elkem Iberia S.L.U EUR Spain 100% 100% Elkem ASA
Elkem International AS NOK Norway 100% 100% Elkem ASA
Elkem International Trade (Shanghai) Co., Ltd. CNY China 100% 100% Elkem International AS
Elkem Ísland ehf. NOK Iceland 100% 100% Elkem ASA
Elkem Japan K.K. JPY Japan 100% 100% Elkem ASA
Elkem Korea Co., Ltd. KRW Republic of 100% 100% Elkem ASA
Korea
Elkem Ltd. GBP United Kingdom100% 100% Elkem UK Holdings Ltd.
Elkem Madencilik Metalurji Sanayi Ve Ticaret Ltd. STI EUR Turkey 100% 100% Elkem International AS
Elkem Materials, Inc. USD USA 100% 100% NEH LLC
Elkem Materials Processing (Tianjin) Co., Ltd. CNY China 100% 100% Elkem ASA
Elkem Materials Processing Services BV EUR Netherlands 100% 100% Elkem ASA
Elkem Materials South America Ltda. BRL Brazil 100% 100% Elkem Materials, Inc.
Elkem Metal Canada Inc. CAD Canada 100% 100% Elkem ASA
Elkem Milling Services GmbH EUR Germany 100% 100% Elkem ASA
Elkem Nordic A.S. DKK Denmark 100% 100% Elkem ASA
Elkem Oilfield Chemicals FZCO Ltd. AED UAE 51% 51% Elkem ASA
Elkem Paraguay S.A. USD Paraguay 100% 100% Elkem ASA 1)
Elkem Participaçòes Indústria e Comércio Limitada BRL Brazil 100% 100% Elkem Carbon AS
Elkem Processing Services S.A. EUR Belgium 100% 100% Elkem ASA
Elkem S.à r.l. EUR France 100% 100% Elkem ASA
Elkem S.r.l. EUR Italy 100% 100% Elkem ASA
Elkem Silicon Materials (Lanzhou) Co., Ltd. CNY China 100% 100% Elkem ASA
186 Financial statements | Elkem ASA Group
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31.12.25 31.12.24
Functional Country of Equity Equity
Company currency incorporation interest interest Owner
Elkem Silicon Product Development AS NOK Norway 100% 100% Elkem ASA
Elkem Siliconas España S.A.U EUR Spain 100% 100% Elkem ASA
Elkem Silicones (UK) Ltd. GBP United Kingdom100% 100% Elkem UK Holdings Ltd.
Elkem Silicones Brasil Ltda. BRL Brazil 100% 100% Elkem ASA
Elkem Silicones Canada Corp. CAD Canada 100% 100% Elkem ASA
Elkem Silicones Czech Republic, s.r.o. CZK Czech Republic 100% 100% Elkem ASA
Elkem Silicones Finland OY EUR Finland 100% 100% Elkem ASA
Elkem Silicones France SAS EUR France 100% 100% Elkem ASA
Elkem Silicones Germany GmbH EUR Germany 100% 100% Elkem ASA
Elkem Silicones Guangdong Co., Ltd. CNY China 100% 100% Elkem ASA
Elkem Silicones Hong Kong Co., Ltd. HKD Hong Kong 100% 100% Elkem ASA
Elkem Silicones Korea Co., Ltd. KRW Republic of 100% 100% Elkem ASA
Korea
Elkem Silicones Material Zhongshan Co., Ltd. CNY China 100% 100% Elkem Silicones
Guangdong Co., Ltd.
Elkem Silicones México S. De R.L. De C.V. MXN Mexico 100% 100% Elkem ASA
Elkem Silicones Poland sp. z o.o. PLN Poland 100% 100% Elkem ASA
Elkem Silicones Scandinavia AS NOK Norway 100% 100% Elkem ASA
Elkem Silicones Services S.à r.l. EUR France 100% 100% Elkem ASA
Elkem Silicones Shanghai Co., Ltd. CNY China 100% 100% Elkem ASA
Elkem Silicones USA Corp. USD USA 100% 100% Elkem ASA
Elkem Siliconi Italia S.r.l. EUR Italy 100% 100% Elkem ASA
Elkem Singapore Materials Pte. Ltd. SGD Singapore 100% 100% Elkem ASA
Elkem South Asia Private Limited INR India 100% 100% Elkem ASA
Elkem UK Holdings Ltd. GBP United Kingdom100% 100% Elkem ASA
Elkem Uruguay S.A. USD Uruguay 100% 100% Elkem ASA
Euro Nordic Logistics BV EUR Netherlands 80% 80% Elkem Chartering Holding
AS
Euro Nordic Netherlands BV EUR Netherlands 80% 80% Euro Nordic Logistics BV
Explotación de Rocas Industriales y Minerales S.A. EUR Spain 100% 100% Elkem ASA
(ERIMSA)
Iniconce, S.L. EUR Spain 100% 100% Explotación de Rocas
Industriales y Minerales
S.A.
Jiangxi Bluestar Xinghuo Silicones Co., Ltd. CNY China 100% 100% Elkem ASA
NEH LLC USD USA 100% 100% Elkem ASA
NorenoComercial Importada e Exportadora Limitada BRL Brazil 100% 100% Elkem Participaçòes
Indústria e Comércio
Limitada
Norsil, S.A. EUR Spain 100% 100% Iniconce, S.L
Tifwer Trade S.A. USD Uruguay 100% 100% Elkem Uruguay S.A.
1) Elkem ASA owns 79% and Elkem Uruguay S.A owns 21%
Elkem Annual report 2025 187
Note 4 continued
Changes in the composition of the group in 2025
Elkem has not made any acquisitions in 2025. See note 39 Events after the reporting period for information regarding a
significant divestment in 2026.
Changes in composition of the group in 2024
At 14 May 2024 Elkem acquired Elkem Testvirksomhet AS (previously REC Solar Norway AS) for USD 22 million (NOK
238 million). Elkem Testvirksomhet AS was subsequently merged with Elkem ASA. The transaction gives Elkem control
of industrial areas and facilities in Norway, including areas next to Elkem’s activities at Fiskaa in Kristiansand. The
transaction is accounted for as an asset acquisition. NOK 245 million has been allocated to assets, of which NOK 108
million to property, plant and equipment and NOK 128 million to deferred tax asset and NOK 7 million has been allocated
to liabilities. The application of the initial measurement criteria for the respective assets and liabilities after the allocation
of the purchase price has resulted in the following effects in the statement of profit and loss for 2024:
Gain/(loss)
Other items (27)
Finance income 11
Income tax (expenses) benefits 1 067
Total 1 052
The net loss in other items relates to remeasurement after initial recognition of operating items such as provisions,
lease liabilities and right of use assets. Finance income relates to the remeasurement of financial instruments. The
income tax benefits relate to the remeasurement of deferred tax asset originating from tax loss carry forwards and
limitations on interest rate deductions. Deferred tax asset related to temporary differences of NOK 357 million has not
been recognised. The impact from temporary differences will be recognised over the period it is reversed. Property,
plant and equipment and inventory are measured at cost on initial recognition and are for this reason not subsequently
remeasured.
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5 Equity accounted investments and joint operations
Principle application and judgements
Share of profit (loss) from investments in associates and joint ventures
Share of profit (loss) from investments in associates and joint ventures is presented in the statement of profit or loss
depending on the purpose of the investments. Investments that are closely related to the group’s main activities are
presented as share of profit from equity accounted investments, included in total operating income. Investments in
associates and joint ventures that do not operate within Elkem’s main business areas are presented as share of profit
from equity accounted financial investments. Judgement is applied in determining the category of investment.
Elkem has interests in the following joint arrangements and associates:
% equity % equity
interest interest
Name of entity Business office Country Principal activities Classification 2025 2024
Elkem Ferroveld JV Ferrobank South Africa Electrode paste Joint operation 50% 50%
Emalahleni production
Elkania DA Hauge i Dalane Norway Microfine weighting Joint operation 50% 50%
material
North Sea Container Line AS Haugesund Norway Shipping services Joint venture 50% 50%
North-Sea Management AS Haugesund Norway Shipping services Joint venture 50% 50%
Klafi EHF Grundartangi, Iceland Transportation / Joint venture 50% 50%
Akranes harbour services
Weldermate AS Oslo Norway Robot welding systems Joint venture 50% 50%
Jiangxi Guoxing Intelligence Yangjialing China Energy production Joint venture - 35%
Energy Co. Ltd 1)
Jiangxi Ganjiang New District Ganjiang China Research center Joint venture - 30%
Silicones Innovative Research
Center Ltd. 1)
Euro Partnership BV Moerdijk Netherlands Ship management Associate 50% 50%
services
Combined Cargo Warehousing Moerdijk Netherlands Warehousing Associate 33% 33%
BV
Euro Nordic Agencies Belgium Antwerpen Belgium Ship agencies services Associate 50% 50%
NV
EPB Chartering AS Oslo Norway Deep sea charter Associate 25% 25%
services
Osiris GIE 1) Roussillon France Business supplies and Associate - 25%
equipment
3Deus Dynamics SAS 1) Lyon France 3D printing Associate - 21%
Future Materials AS Grimstad Norway Marketing of research Associate 20% 20%
facilities
1) The joint arrangements and associates are held by discontinued operations
Elkem Annual report 2025 189
Note 5 continued
The share of equity interest is equal to Elkem’s voting rights.
All of the entities above are classified to operate within Elkem’s main business areas.
There is no quoted market price for any of these investments.
In February 2024 Elkem group sold its shares in Vianode AS, a synthetic graphite manufacturer for a total nominal
amount of NOK 847 million to AV Anodos AS, a company controlled by Altor Equity Partners AS. NOK 10 million of the
compensation was received at closing while the rest is tied to Vianode meeting two future milestones. See note 29
Financial assets and liabilitiese for more details regarding the receivable. The sale resulted in a loss on disposal of NOK
128 million.
See note 36 Related parties for commitments and transactions related to the joint ventures and associates.
2025 2024
Joint Joint
Movements in equity accounted investments ventures Associates Total ventures Associates Total
Opening balance 81 149 230 1 054 242 1 296
Acquisition of and capital contribution to joint ventures - - - 4 - 4
Disposal of shares - - - (759) - (759)
Dividend received (3) (32) (36) (7) (17) (23)
Share of profit (loss) from equity accounted investments
from continuing operations 17 2 20 (8) 2 (6)
Share of profit (loss) from equity accounted investments
from discontinued operations - - - 4 - 4
Share of profit (loss) from equity accounted financial
investments from continuing operations - - - (15) - (15)
Amortisation of excess value from equity accounted
investments from discontinued operations - - - - (2) (2)
Gain (loss) on sales of shares - - - (128) - (128)
Part of other comprehensive income - (4) (4) 0 4 4
Assets classified as held for sale - - - (69) (88) (157)
Currency translation differences 0 0 0 5 7 12
Closing balance 95 115 210 81 149 230
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Table of contents Board of directors’ report Sustainability statement Financial statements
2025 31.12.25 2024 31.12.24
Share of Carrying Share of Carrying
Share of profit (loss) and carrying amount for equity accounted investments profit amount profit amount
North Sea Container Line AS 16 86 (10) 74
North-Sea Management AS 2 9 2 7
Klafi EHF (1) (0) (0) 0
Weldermate AS (0) 0 0 0
Vianode AS - - (15) -
Jiangxi Guoxing Intelligence Energy Co. Ltd - - - -
Jiangxi Ganjiang New District Silicones Innovative Research Center Ltd. - - - -
Euro Partnership BV 8 39 10 48
Combined Cargo Warehousing BV 2 6 (1) 4
Euro Nordic Agencies Belgium NV 2 8 1 6
EPB Chartering AS (10) 62 (8) 91
Osiris GIE - - - -
3Deus Dynamics SAS - - - -
Future Materials AS - - - 0
Total 20 210 (21) 230
Gain (loss) on disposal of equity accounted investments - - (128) -
Total 20 210 (149) 230
Cash-flow from operations, equity accounted investments 2025 2024
Share of profit (loss) from equity accounted investments from continuing operations (20) 6
Share of profit (loss) from equity accounted investments from discontinued operations - (2)
Dividend received 36 23
Equity accounted investments 16 27
Elkem Annual report 2025 191
Note 5 continued
Summary of unaudited financial information for joint ventures on a 100% basis Other Total 2025 Vianode AS Other Total 2024
Current assets, including cash and cash equivalents NOK 93 million
(NOK 73 million) 217 217 - 213 213
Non-current assets 38 38 - 18 18
Current liabilities, including current financial liabilities NOK 0 million
(NOK 0 million) 62 62 - 67 67
Non-current liabilities, including non-current financial liabilities NOK 0 million
(NOK 0 million) 2 2 - 2 2
Net assets/equity 191 191 - 162 162
Elkem's carrying amount 95 95 - 81 81
Total revenue 874 874 (0) 827 827
Total expenses, including depreciation and amortisation NOK 5 million
(NOK 3 million) and other items (839) (839) (35) (848) (884)
Financial income, including interest income NOK 2 million (NOK 10 million) 2 2 12 8 20
Financial expenses, including interest expenses NOK 0 million (NOK 2 million) (0) (0) (4) (0) (4)
Tax expense (1) (1) - (2) (2)
Total profit for the year 35 35 (27) (16) (43)
Other comprehensive income - 0 - 0
Total comprehensive income 35 35 (27) (16) (43)
Elkem's share of profit for the year 17 17 (15) (8) (23)
Elkem's share of other comprehensive income - - - - -
Summary of unaudited financial information for associates on a 100% basis Total 2025 Total 2024
Revenue 23 25
Profit for the year (13) (12)
Other comprehensive income (17) 16
Total comprehensive income (30) 4
Elkem's share of profit for the year 2 2
Elkem's share of other comprehensive income (4) 4
Net assets/equity 359 483
Elkem's carrying amount 115 149
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Table of contents Board of directors’ report Sustainability statement Financial statements
6 Operating segments
Principle application
Operating segments are components of a business that are followed up and evaluated regularly by the chief operating
decision maker, defined as the CEO, for the purpose of assessing performance and allocating resources. Elkem’s
operating segments represent separately managed business areas with unique products serving different markets.
Elkem’s operating segments are aligned with the three reporting segments.
Segment performance is evaluated based on normalised EBITDA and normalised EBIT, see definitions below. Elkem’s
financing and income tax are managed on group basis and are not allocated to operating segments.
Revenues are, in addition, disaggregated by geographical market based on the location of the customer.
Non-current assets by geographical areas are based on the location of the entity owning the assets.
The accounting policies applied in the segment reporting is consistent with the IFRS accounting policies applied for
the group except for realised effects from hedge ineffectiveness and from the discontinuation of hedging, which are
included in other items in the statement of profit and loss, but included in operating expenses in the segment reporting.
This is because management follows up the operating segments including the impact of the realised effects from power
contracts.
Lease payments under internal lease agreements are recognised as operating expenses on a straight-line basis over the
lease term.
Elkem’s operating segments
Elkem identifies its segments according to the organisation and reporting structure used by group management. Elkem
has three reportable segments; Silicones, Silicon Products, and Carbon Solutions. In the fourth quarter of 2024 the
Silicones segment was assessed to meet the criteria for held for sale and discontinued operations. However, the segment
will continue to be followed up by the chief operating decision maker in the same manner as before the reclassification.
The Silicones operating segment will therefore continue to be included in the segment disclosure. Please refer to note 38
Assets held for sale and discontinued operations. Elkem has signed an agreement to transfer the majority of its Silicones
division to Bluestar, see note 39 Events after the reporting period.
The Silicones division produces and sells a range of silicone-based products across various sub-sectors including release
coatings, engineering elastomers, healthcare products, specialty fluids, emulsions, and resins.
The Silicon Products division produces various grades of metallurgical silicon, ferrosilicon, foundry alloys, and Elkem
Microsilica® for use in a wide range of end applications.
The Carbon Solutions division produces carbon electrode materials, lining materials and specialty carbon products for
metallurgical processes for the production of a range of metals.
Other comprise Elkem group management and centralised functions within finance, logistics, power purchase,
technology, digital office, and strategic projects such as biocarbon.
Eliminations comprise intersegment sales and profit. Elkem follows internationally accepted principles for transactions
between related parties within the group. In general, Elkem seeks to use transaction-based methods (comparable
uncontrolled price, transactional net margin method, cost plus and resale price method) in order to set the price for the
transaction.
Elkem Annual report 2025 193
Note 6 continued
The main related party transactions between operating segments in Elkem can be divided as follows:
→ Silicon Products’ sale of metallurgical silicon to Silicones. Sales prices are based on sale to external customers and
CRU prices.
→ Carbon Solutions’ sale of electrode paste and lining material to Silicon Products. Sales prices are based on prices to
external customers.
→ Other sale of management services e.g., logistics, procurement, financial services, technical support and R&D
services. Prices are based on cost plus.
Major customers
Elkem has a range of customers, but no single customer amounts to 10 per cent or more of total operating income.
Silicon Carbon
Main items by operating segment 2025 Silicones Products Solutions Other Eliminations Total
Revenue from sale of goods (note 7) 14 720 12 620 2 884 (142) - 30 082
Other revenue (note 7) 81 68 12 354 - 514
Other operating income (note 8) 10 138 14 20 - 182
Share of profit from equity accounted investments (note 5) 7 (1) (0) 21 - 27
Total operating income from external customers 14 818 12 825 2 910 252 - 30 806
Operating income from other segments 123 855 362 599 (1 939) -
Total operating income 14 941 13 681 3 272 852 (1 939) 30 806
Operating expenses (13 846) (12 164) (2 364) (1 010) 2 019 (27 365)
Normalised EBITDA 1 095 1 517 908 (159) 80 3 440
Normalised EBIT (632) 717 765 (231) 80 699
Cash flow from operations 914 120 841 (66) (29) 1 779
Working capital 1 433 5 347 472 (147) (47) 7 058
Capital employed 17 607 12 642 1 766 753 (47) 32 722
Reinvestments (1 536)
Strategic investments (328)
Movement CAPEX payables (455)
Cash flow from investments in property, plant and equipment
and intangible assets, including received investment grants (2 319)
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Table of contents Board of directors’ report Sustainability statement Financial statements
Silicon Carbon
Main items by operating segment 2024 Silicones Products Solutions Other 1) Eliminations Total 1)
Revenue from sale of goods (note 7) 14 871 13 548 3 243 (167) - 31 495
Other revenue (note 7) 109 76 16 226 - 427
Other operating income (note 8) 20 1 023 26 17 - 1 086
Share of profit from equity accounted investments (note 5) 2 (0) 0 (6) - (4)
Total operating income from external customers 15 003 14 647 3 285 70 - 33 004
Operating income from other segments 88 859 364 592 (1 903) -
Total operating income 15 091 15 506 3 649 662 (1 903) 33 004
Operating expenses (14 570) (12 642) (2 518) (941) 1 857 (28 813)
Normalised EBITDA 521 2 864 1 131 (279) (46) 4 191
Normalised EBIT (1 233) 2 091 1 003 (476) (46) 1 339
Cash flow from operations (426) 1 398 1 139 (618) 36 1 529
Working capital 1 938 5 019 521 (44) (126) 7 308
Capital employed 19 612 12 178 1 754 960 (126) 34 377
Reinvestments (2 061)
Strategic investments (957)
Movement CAPEX payables (317)
Cash flow from investments in property, plant and equipment
and intangible assets, including received investment grants (3 334)
1) Figures have been restated, see note 2 Basis for preparing the consolidated financial statements
Definitions
The segments’ performance are evaluated based on normalised EBITDA and normalised EBIT.
Normalised EBITDA is defined as Elkem’s profit (loss) for the period, less income tax (expense) benefit, finance
expenses, foreign exchange gains (losses), finance income, share of profit from equity accounted financial investments,
other items (but including realised gains and losses from hedge ineffectiveness and discontinuation of hedging),
impairment losses, and amortisation and depreciation.
Normalised EBIT is defined as Elkem’s profit (loss) for the period, less income tax (expense) benefit, finance expenses,
foreign exchange gains (losses), finance income, share of profit from equity accounted financial investments and other
items (but including realised gains and losses from hedge ineffectiveness and discontinuation of hedging).
Cash flow from operations comprises normalised EBITDA adjusted for reinvestments, changes in working capital and
dividend received from equity accounted investments.
Reinvestments generally consist of capital expenditure to maintain existing activities or that involve investments
designed to improve health, safety, or the environment.
Strategic investments generally consist of investments which result in capacity increases at Elkem’s existing plants or
that involve an investment made to meet demand in a new geographic or product area.
Elkem Annual report 2025 195
Note 6 continued
Working capital is defined as accounts receivable, inventories, other current assets, accounts payable, current
employee benefit obligations, and other current liabilities. Accounts receivables are defined as trade receivables less bills
receivables. Other current assets are defined as other current assets less current receivables to related parties, current
interest-bearing receivables, tax receivables, grants receivable, assets at fair value through profit or loss and accrued
interest income. Accounts payable are defined as trade payables less CAPEX payables. Other current liabilities are
defined as provisions and other current liabilities less current provisions, contingent considerations, contract obligations,
and liabilities to related parties.
Capital employed consists of working capital as defined above, property, plant and equipment, right-of-use assets,
other intangible assets, goodwill, equity accounted investments, grants payable, trade payables and prepayments related
to purchase of non-current assets.
The definitions are not specified by IFRS Accounting Standards and therefore may not be comparable to apparently
similar definitions used by other companies.
Below is a reconciliation of profit (loss) for the year against normalised EBIT and normalised EBITDA:
Silicon Carbon
2025 Silicones Products Solutions Other Eliminations Elkem
Profit (loss) for the year 385
Income tax (expense) benefit 149
Finance expenses 549
Foreign exchange gains (losses) 284
Finance income (61)
Share of profit from equity accounted financial investments -
Other items (258)
Realised effects from hedge ineffectiveness and
discontinuation of hedging 266
Normalised EBIT from discontinued operations (615)
Normalised EBIT (632) 717 765 (231) 80 699
Impairment losses 7
Amortisation and depreciation 1 008
Amortisations, depreciations and impairment losses from
discontinued operations 1 726
Normalised EBITDA 1 095 1 517 908 (159) 80 3 440
196 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Silicon Carbon
2024 Silicones Products Solutions Other Eliminations Elkem
Profit (loss) for the year 2 115
Income tax (expense) benefit (588)
Finance expenses 778
Foreign exchange gains (losses) (247)
Finance income (107)
Share of profit from equity accounted financial investments 143
Other items 316
Realised effects from hedge ineffectiveness and
discontinuation of hedging 1) 167
Normalised EBIT from discontinued operations (1 237)
Normalised EBIT (1 233) 2 091 (1 003) (476) (46) 1 339
Impairment losses 168
Amortisation and depreciation 931
Amortisations, depreciations and impairment losses from
discontinued operations 1 754
Normalised EBITDA 521 2 864 1 131 (279) (46) 4 191
1) Figures have been restated, see note 2 Basis for preparing the consolidated financial statements
Below is a reconciliation of working capital and capital employed:
Capital employed and working capital 31.12.25 31.12.24
Inventories 5 959 6 038
Trade receivables 1 852 1 960
Bills receivables (283) (269)
Accounts receivable 1 569 1 691
Other assets, current 1 231 1 254
Grants receivables (774) (576)
Tax receivables (86) (241)
Accrued interest - (0)
Other current assets included in working capital 370 436
Trade payables 1 818 2 076
Trade payables related to purchase of non-current assets (149) (184)
Accounts payables included in working capital 1 668 1 892
Employee benefit obligations 482 471
Elkem Annual report 2025 197
Note 6 continued
Capital employed and working capital 31.12.25 31.12.24
Provisions and other liabilities, current 588 815
Provisions, contingent considerations and contract obligations (35) (19)
Liabilities to related parties - (0)
Other current liabilities included in working capital 553 795
Working capital assets and liabilities as held for sale 1 864 2 302
Working capital 7 059 7 309
Property, plant and equipment 8 568 8 405
Right-of-use assets 402 403
Other intangible assets 164 216
Goodwill 305 329
Equity accounted investments 210 230
Grants payable (16) (17)
Trade payables- and prepayments related to purchase of non-current assets (143) (171)
Other capital employed effects assets and liabilities as held for sale 16 173 17 674
Capital employed 32 722 34 378
The table below show realised effects from Elkem’s power and foreign exchange hedging programmes, including realised
effects from hedge ineffectiveness and discontinuation of hedging, on the different group segments.
Silicon Carbon
2025 Silicones Products Solutions Other Eliminations Total
Revenue from sale of goods (note 30) - 31 - (142) - (111)
Operating expenses (note 30) - 89 1 207 - 297
Total realised effects from derivatives included in
normalised EBITDA - 120 1 65 - 186
Silicon Carbon
2024 Silicones Products Solutions Other Eliminations Total
Revenue from sale of goods (note 30) 0 41 - (166) - (125)
Operating expenses (note 30) - 107 (9) 81 - 179
Total realised effects from derivatives included in
normalised EBITDA 0 148 (9) (85) - 55
Total revenue by geographic market based on customer location 2025 2024
Norway 1 113 978
Other Nordic countries 901 862
United Kingdom 368 408
Germany 1 621 1 917
France 901 1 092
Italy 767 742
Poland 160 328
Spain 498 441
Other European countries 1 414 1 305
Europe 7 743 8 073
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Total revenue by geographic market based on customer location 2025 2024
Africa 188 277
USA 2 099 2 309
Canada 215 177
Brazil 1 318 1 477
Other American countries 273 260
America 3 905 4 223
China 1 193 1 305
Japan 1 026 1 112
South Korea 254 329
India 988 1 049
Other Asian countries 1 258 1 448
Asia 4 719 5 243
Rest of the world 90 118
Total revenue before hedging effects 16 645 17 935
Realised effects from hedging programmes (note 30) (111) (125)
Total revenue 16 535 17 810
Non-current assets by geographic areas based on entity location 2025 2024
Norway 7 094 6 956
Other Nordic countries 932 1 045
United Kingdom 38 23
Germany 34 39
France 2 0
Italy 2 2
Spain 147 148
Other European countries 281 265
Europe 8 529 8 478
Africa 121 124
USA 113 129
Canada 474 548
Brazil 530 458
Other American countries 415 494
America 1 532 1 630
China 278 161
Japan 6 9
India 132 122
Other Asian countries 63 46
Asia 479 337
Total non-current assets 10 660 10 569
Non-current assets are presented less derivatives and deferred tax assets.
Elkem Annual report 2025 199
7 Revenue
Principle application
Revenue
Revenue is measured based on the consideration specified in a contract with a customer. Elkem recognises revenue
when Elkem transfers control over a goods or service to a customer.
A five-step process is applied before revenue can be recognised:
→ identify contracts with customers
→ identify the separate performance obligation
→ determine the transaction price of the contract
→ allocate the transaction price to each of the separate performance obligations, and
→ recognise the revenue as each performance obligation is satisfied.
Sale of goods
Elkem’s main performance obligation is related to sale of goods where the obligation is to deliver agreed volume of
products with the agreed specification. Elkem has both short-term and long-term contracts. Short-term contracts,
normally within one month, cover delivery of an agreed volume at market price at the date the order is placed. These
types of contracts are most common for commodity products, such as sales of ferrosilicon and sales to customers in
China. The long-term contracts cover a period of a few months and up to one year, where the prices normally are fixed
within a volume range. Elkem has for sale of metallurgical silicon some contracts that cover a period longer than one
year. In these contracts the prices are normally negotiated on an annual basis. Some of Elkem’s sales contracts include
an element of freight services, see separate section below for accounting policies.
Revenue is recognised when control of the goods is transferred to the customer, at an amount that reflects the
consideration to which Elkem expects to be entitled in exchange for those goods. Control is transferred to the
buyer, according to the agreed delivery term for each sale. Delivery terms are based on Incoterms® 2020 issued by
International Chamber of Commerce, and the main terms are:
“F” terms, where the buyer arranges and pays for the main carriage. The risk is transferred to the buyer when the goods
are handed to the carrier engaged by the buyer.
“C” terms, where the group arranges and pays for the main carriage but without assuming the risk of the main carriage.
The risk is transferred to the buyer when the goods are handed over to the carrier engaged by the seller.
“D” terms, where the group arranges and pays for the carriage and retains the risk of the goods until delivery at
the agreed destination. The ownership is transferred to the buyer upon arrival at the agreed destination, usually the
purchaser’s warehouse.
The goods are normally sold with standard warranties that the goods comply with the agreed-upon specifications. These
standard warranties are accounted for using IAS 37 Provisions, Contingent Liabilities and Contingent Assets. Elkem does
not have any other significant obligations for returns or refunds.
Freight services included in sale of goods
Freight components included in sale of goods on incoterms “C” terms are considered as a separate performance
obligation and recognised over the period the service is performed. Shipping and handling services that occur before the
customer takes control of the goods for sales on “D” terms are considered to be part of fulfilling the sale of the goods
and are presented as other operating expense.
Revenue from sale of services
Revenue from sale of services is recognised when the services have been provided. Sale of services are mainly related to
management agreements with related parties based on a cost plus a margin and sale of shipping and handling related
services.
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Silicon Carbon
Details of revenue from contracts with customers 2025 Products Solutions Other Total
Sale of goods, Silicon Products 12 588 - 0 12 589
Sale of goods, Carbon Solutions - 2 884 - 2 884
Sale of goods to related parties 1) 581 2 - 583
Revenue from energy recovery and other energy related income 26 0 221 248
Service agreements with related parties (note 36) 1)
17 0 146 163
Other revenue from contracts with customers 40 12 128 180
Total revenue from contracts with customers 13 253 2 898 495 16 645
Realised effects from hedging programmes (note 30) 31 - (142) (111)
Total revenue 13 284 2 898 353 16 535
1) Includes revenue with discontinued operations
Silicon Carbon
Details of revenue from contracts with customers 2024 Products Solutions Other Total
Sale of goods, Silicon Products 13 507 - (1) 13 506
Sale of goods, Carbon Solutions - 3 243 - 3 243
Sale of goods to related parties 1)
697 - - 697
Revenue from energy recovery and other energy related income 31 0 75 106
Service agreements with related parties (note 36) 1)
20 1 168 189
Other revenue from contracts with customers 45 15 133 193
Total revenue from contracts with customers 14 300 3 259 375 17 935
Realised effects from hedging programmes (note 30) 41 - (166) (125)
Total revenue 14 341 3 259 209 17 810
1) Includes revenue with discontinued operations
Elkem Annual report 2025 201
8 Other operating income
Principle application
Insurance settlements
Income from insurance settlements is recognised as other operating income when it is virtually certain that the group will
receive the compensation. Expected cash flows from credit insurance contracts where such contracts are deemed to be
an integral part of the sale transactions is presented net against impairment losses trade and other receivables, included
in other operating expenses. See note 23 Trade receivables.
Sale of CO2 emission allowances
Gain from sale of CO2 emission allowances are recognised as other operating income when the allowances are delivered
from Elkem’s account in the EU ETS Union registry.
Details of other operating income 2025 2024
Sale of CO2 emission allowances 118 169
Gain on disposal of fixed assets 18 3
Insurance settlements 12 849
Other 25 46
Total other operating income 172 1 066
9 Grants
Principle application and judgements
CO2 Compensation
Changes to the compensation scheme for 2024-2030 was presented in February 2024 and included in an updated
regulation in December 2024. Elkem is still entitled to receive compensation under the updated scheme. The main
changes from the previous compensation scheme is a cap on the total cost of the government grants and that 40 per
cent of the compensation must be used for projects aiming to reduce CO2 emissions and/or improving energy efficiency.
Compliance with the condition can be achieved over multiple years, but no later than 2034.
Elkem has recognised its estimated share of the total compensation for 2025 and 2024 based on the power
consumption at the Norwegian silicon product plants. Elkem has identified projects which are expected to be compliant
with the requirements to qualify for the 40 per cent conditional compensation and have therefore recognised full
compensation. As the grant partially compensates power costs, which are costs recognised as part of the cost price of
inventory during the production process, the compensation is recognised in the statement of profit or loss when the
produced goods are sold.
Grants related to expenses are presented in the statement of profit or loss as a reduction of raw materials and energy,
employee benefit expenses or other operating expense over the periods necessary to match them with the cost they are
intended to compensate.
Grants relating to property, plant and equipment (fixed assets) and intangible assets are deducted from the carrying
amount of the asset and recognised in profit or loss as a reduction of the depreciation charge over the lifetime of the
asset, or the impairment charge when applicable.
Non-monetary grants are measured at nominal value.
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Other Raw Employee Other Amortisation
operating materials benefit operating and
Details of grants 2025 income and energy expenses expenses depreciation
R&D grants from government 1 - 37 49 -
Other government grants 7 17 6 7 -
CO2 compensation from the Norwegian Environment Agency - 730 - - -
Grants related to investment projects - - - - 59
Total government grants 8 747 44 56 59
Other Raw Employee Other Amortisation
operating materials benefit operating and
Details of grants 2024 income and energy expenses expenses depreciation
R&D grants from government 1 - 21 23 -
Other government grants 7 - 5 2 -
CO2 compensation from the Norwegian Environment Agency - 593 - - -
Grants related to investment projects - - - - 58
Total government grants 8 593 26 25 58
Balances related to grants 2025 2024
Grants receivable related to income (note 24) 774 576
Grants payable (note 28) (20) (17)
Grants, deferred income (note 28) - (0)
Details of grants recognised as a reduction of property, plant and equipment
(fixed assets) and intangible assets 2025 2024
R&D grants from government 37 35
Other government grants 3 -
Total government grants 39 35
CO2 emission allowances
CO2 emission allowances allocated from the government are classified as grants, measured at nominal value (zero).
The CO2 allowance scheme pertains to the group’s plants in Europe. If actual emissions exceed the number of allocated
allowances, additional allowances must be purchased and the cost is included as a part of production cost of inventory.
The final allocation of free allowances for the period 2026-2030 has not yet been decided by the authorities. Gain on
sale of CO2 emission allowances are included in other operating income.
Other
The remaining grants are mainly related to R&D projects.
Elkem Annual report 2025 203
10 Raw materials and energy
Principle application
Cost of production is presented in different lines in the statement of profit or loss based on nature, raw materials and
energy, employee benefits, and other operating expenses. Energy for production comprise energy for smelting and
processing machinery. Energy for light, heating, ventilation etc. is auxiliary power and is included in other operating
expenses. Actual cost of conversion related to goods sold is reported net of change in cost of conversion in inventory and
is included in the line item Raw materials and energy.
Raw materials and energy 2025 2024
Raw materials and energy for production (8 112) (8 591)
Change in inventories own production 481 278
Total raw materials and energy (7 631) (8 313)
11 Employee benefits
Principle application
Employee benefits
Employee benefits include both current and non-current benefits, and are expensed as incurred, together with any social
security taxes applicable. Short-term benefits consist of wages and salaries, bonuses, holiday payments and other short-
term benefits that are expected to be settled within 12 months after the reporting period. Long-term benefits consist
mainly of jubilee and long-service benefits, post-employment benefits, and post-retirement benefits, not expected to be
wholly settled within the next twelve months.
Defined contribution plans
Defined contribution plans comprise of arrangements where Elkem makes monthly contributions to the employees’
pension plans, and where the future pensions are determined by the amount of the contributions and the return on the
individual pension plan asset. The contributions are expensed as incurred and there is no further obligation related to the
contribution plans. Prepaid contributions are recognised as an asset.
Defined benefit plans
Defined benefit plans are pension plans where Elkem is responsible for paying pensions at a certain level, based on
employees’ salaries when retiring. The cost from benefit plans is expensed over the period that the employees render
services and become eligible to receive benefits. The net liability from defined benefit plans is recognised at present
value of estimated future benefits earned by employees for their services, calculated separately for each plan.
Multi-employer defined benefit plans where available information is insufficient to be able to calculate each participant’s
obligation, are accounted for as contribution plans.
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Employee benefit expenses 2025 2024
Salaries, holiday pay and variable compensation (2 386) (2 277)
Employer's national insurance contributions / social security tax (325) (318)
Pension expenses (173) (163)
Share-based payments (note 12) 0 (2)
Other payments / benefits (53) (48)
Grants 44 26
Capitalised employee benefit expenses on PPE development 20 15
Total employee benefit expenses (2 874) (2 766)
Average number of full-time equivalents 3 032 3 010
Remuneration to corporate management 2025 2024
Fixed compensation (35) (41)
Variable compensation - STI (11) (19)
Variable compensation - LTI (2) (1)
Other benefits (4) (2)
Pension benefits (4) (4)
Total remuneration to corporate management (56) (67)
Remuneration provided to the board of directors (7) (6)
Remuneration provided to the committee remuneration (1) (1)
For more details on the remuneration to corporate management see “Report on salary and other remuneration to leading
personnel in Elkem ASA for the financial year 2025”. The report is published on Elkem’s website elkem.com.
Elkem Annual report 2025 205
Note 11 continued
Movements in equity accounted investments 2025 2024
Number Number Number Number
Name Position of shares of options of shares of options
Helge Aasen CEO 68 406 67 333 68 406 67 333
Morten Viga CFO 46 896 300 000 46 896 300 000
Katja Lehland SVP Human Resources - 300 000 - 300 000
Asbjørn Søvik (until October 2025) SVP Green Ventures & Digital 10 000 300 000 10 000 300 000
Håvard Moe SVP Technology 10 000 300 000 10 000 300 000
Louis Vovelle (until January 2025) SVP Innovation and R&D 6 896 300 000 6 896 300 000
Morten Magnus Voll SVP Strategy and Business Development 10 384 150 000 10 384 150 000
Inge Grubben-Strømnes SVP Silicon Products 35 189 300 000 35 189 300 000
Luiz Simao SVP Carbon Solutions 22 000 300 000 22 000 300 000
Sandy Chen Acting SVP Silicones - 150 000 - 150 000
Li Bo (from April 2024) 1)
Chair of the board - - - -
Dag Jakob Opedal Vice chair of the board 40 000 - 40 000 -
Zhigang Hao (until October 2024) 1)
Board member - - - -
Olivier Tillette de Clermont-Tonnerre 1)
Board member 15 517 - 15 517 -
Dong Dachuan (from October 2024) 1) Board member - - - -
Yougen Ge (until October 2024) 1) Board member - - - -
Marianne Johnsen Board member - - - -
Grace Tang Board member - - - -
Nathalie Brunelle Board member - - - -
Wei Yao (from October 2024) 1)
Board member - - - -
Terje Andre Hanssen 2)
Board member - - - -
Marianne Færøyvik 2) Board member 4 950 - 4 950 -
Thomas Eggan 2) Board member - - - -
1) Representatives for the majority shareholder
2) Employee representatives
Non-current Current
Employee benefit assets and obligations 31.12.25 31.12.24 31.12.25 31.12.24
Pension plan assets, net (note 24) 35 31 - -
Pension contribution fund (note 24) 1 1 2 4
Total employee benefit assets 37 32 2 4
Salaries, holiday pay and variable compensation - - 417 403
Employer's national insurance contributions / social security tax - - 62 66
Pension plan obligations, net 217 219 - -
Other benefit plans 21 20 2 2
Total employee benefit obligations 238 238 482 471
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(a) Salaries, holiday pay and variable compensation
The obligations are related to incurred employee benefits, not paid.
(b) Pension plans
Elkem has both defined contribution and defined benefit plans. For defined contribution plans the cost is equal
to Elkem’s contribution to the employee’s pension savings during the period. For defined benefit plans the cost is
calculated based on actuarial valuation methods, taking assumptions related to the employee’s salary, turnover,
mortality, discount rate, etc. into consideration.
Defined contribution plans
Defined contribution plans are the main pension plan for Elkem’s Norwegian entities, where the contribution to each
individual pension plan is 5 per cent of annual salary up to 7.1G and 15 per cent of annual salary between 7.1-12G. 1G refers
to the Norwegian national insurance scheme’s basic amount, which is NOK 130 160 as at 1 May 2025. Pension on salary
above 12G is not supported by external service providers and is therefore handled as a separate plan and included under
defined benefit plans.
In addition, a Norwegian multi-employer early retirement scheme called AFP, where sufficient information to calculate
each participant’s pension obligation is not available, is accounted for as it is a defined contribution plan in accordance
with the Ministry of Finance’s conclusion. The participants in the pension plan are jointly responsible for 2/3 of the plan’s
pension obligation, the government is responsible for the remaining part. The pension premium in 2025 is 2.7 per cent of
the employees’ salary between 1 and 7.1G, covering this year’s pension payments and contribution to a security fund for
future pension obligations. The yearly premium for 2026 is set to 2.7 per cent.
Defined benefit plans
Defined benefit plans are pension plans where the group is responsible for paying pensions at a certain level, based on
employees’ salaries when retiring. The group has funded and unfunded benefit plans in Norway, France, Germany, UK,
Canada, Japan, and South Africa. The pension scheme in UK and two of Canada’s schemes are overfunded and are net
in an asset position. The schemes that are underfunded and are net in a liability position as at 31 December 2025 are
distributed as follows; Norway 53 per cent, Germany 25 per cent, Canada 15 per cent, and other countries 7 per cent. In
Canada provisions are also made for medical insurance as well as pension benefit plans.
The Norwegian pension plans are unfunded and comprise pension on salaries above 12G, where the expense is 15 per
cent of annual base salary that exceeds 12G plus interest on the individual calculated pension obligation, and some
individual retirement schemes that are closed.
Breakdown of net pension expenses 2025 2024
Current service expenses (20) (20)
Administration expenses (1) (1)
Curtailments (0) 0
Net pension expenses, defined benefit plans (21) (21)
Defined contribution plans (127) (119)
Early retirement scheme AFP (Norway) (26) (23)
Total pension expenses (173) (163)
In addition, interest expenses on net pension liabilities are recognised as a part of finance expenses (6) (6)
Elkem Annual report 2025 207
Note 11 continued
Net defined benefit obligations 2025 2024
Present value of funded pension obligations (436) (463)
Fair value of plan assets 472 494
Net funded pension obligations 35 31
Present value of unfunded pension obligations (217) (219)
Net value of funded and unfunded obligations (181) (188)
2025 2024
Defined Defined Net pension Defined Defined Net pension
benefit benefit plan plan benefit benefit plan plan
Movements obligations assets obligations obligations assets obligations
Opening balance (682) 494 (188) (813) 466 (347)
Current service cost and social contribution tax from
continuing operations (20) - (20) (20) - (20)
Current service cost and social contribution tax from
discontinued operations - - - (10) - (10)
Interest (expenses) income from continuing operations (28) 22 (6) (29) 22 (6)
Interest (expenses) income from discontinued
operations - - - (5) 0 (5)
Administration cost from continuing operations - (1) (1) - (1) (1)
Administration cost from discontinued operations - - - - - -
Remeasurement gains / (losses) (1) 15 14 (12) 20 8
Contributions from employer - 6 6 - 3 3
Benefits paid 44 (33) 11 63 (36) 27
Curtailments from continuing operations (0) - (0) 0 - 0
Curtailments from discontinued operations - - - - - -
Other changes - - - (6) - (6)
Liabilities classified as held for sale - - - 181 - 181
Currency translation 33 (31) 2 (32) 20 (12)
Closing balance (653) 471 (181) (682) 494 (188)
Fair value of Fair value of
Distribution % plan assets Distribution % plan assets
Breakdown of pension plan assets 31.12.25 31.12.25 31.12.24 31.12.24
Cash, cash equivalents and money market investments 7% 34 9% 47
Bonds 16% 77 15% 73
Shares 30% 140 32% 159
Property 37% 172 36% 179
Other plan assets 10% 48 7% 37
Total pension plan assets 100% 472 100% 494
2025 2024
Actual return on plan assets 7% 37 9% 43
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In addition, some Norwegian entities have pension contribution funds, mainly based on excess pension assets from
settlement of the defined benefit plans in 2010. The pension contribution funds are classified as non-current pension
funds, except next year’s expected contributions which are classified as current (see note 24 Other assets).
Principal assumptions used for the actuarial
valuations in 2025 (2024) Norway France Canada Germany UK
Discount rate 4.4% (4.8%) 4.8% (4.8%) 3.6% (3.7%) 5.5% (4.8%) 5.5% (4.8%)
Expected rate of salary increase - - 3.5% (3.5%) - - - - na (na)
Annual regulation of pensions paid 2.3% (2.3%) - - 2.0% (2.0%) - - na (na)
Assumptions regarding future mortality are based on actuarial advice in accordance with published statistics and
experience in each country.
Sensitivity on pension obligations based on changes in main actuarial assumptions
The defined benefit pension schemes expose Elkem to actuarial risk such as investment risk, interest rate risk, salary
growth risk, mortality risk, and longevity risk. A decrease in corporate bond yields, a rise in inflation or an increase in life
expectancy would result in an increase to plan liabilities.
The sensitivity analysis below shows estimated effects in the defined pension obligation based on reasonable changes
in the main assumptions. The calculations are based on a change in one assumption while holding all other assumptions
constant. Negative amounts show an expected decrease in the net pension liability.
Discount rate Life expectancy Salary growth
0.5% 0.5% 1 year 1 year 0.5% 0.5%
Assumptions increase decrease increase decrease increase decrease
2025: Effect on the pension obligation in NOK million (32) 36 16 (17) 10 (9)
2024: Effect on the pension obligation in NOK million (36) 40 18 (19) 12 (10)
As the group’s main pension plans are defined contribution plans, there are no group policies for funding of the defined
benefit plans. This is managed locally, based on the terms and status for the individual plan.
Expected contribution for the pension plans next year and average
duration for the main defined benefit plans Norway Canada Germany UK
Contribution to be paid to defined pension plans next year, in NOK million 9 12 4 -
Weighted average duration of the defined benefit obligations 6 years 15 years 10 years 11 years
(c) Other benefit plans
Other employee benefits consist of provisions related to jubilee and long-service benefits, and other post-employment
benefits.
Elkem Annual report 2025 209
12 Share-based payments
Elkem’s share option scheme
The group has in 2018 - 2021 granted share options to corporate management and selected key employees. Each option
gives the right to acquire one share in Elkem ASA on exercise. In 2022 the Board decided to terminate the option scheme
and replace it with a Long-term Bonus Scheme (LTBS). See the “Report on salary and other remuneration to leading
personnel in Elkem ASA for the financial year 2024” for description of the LTBS. The previous granted options are still
exercisable over the exercise period.
The share options vest annually in equal tranches over a three-year period following the date of grant, with one-third
vesting each year. The options will expire two years after vesting, in total 5 years after the date of grant. No option holder
may in any calendar year realise a total gain on exercise of options in excess of twice the option holder’s base salary in
the same calendar year, however provided that the maximum gain for Elkem’s CEO shall be four times the CEO’s base
salary. See note 11 Employee benefits for an overview of options granted to Elkem’s corporate management.
When the options are exercised, the corresponding number of shares are transferred to the employee. The proceeds
received from the exercise of the options (net of any directly attributable transaction costs) are credited directly to equity.
Components of share-based payments employee benefit expenses 2025 2024
Share-based payment 1)
- (2)
Social security contribution - 0
Total expenses related to share-based payments - (1)
1) The statement of changes in equity includes a share‑based payment expense of NOK 6 million. In March 2025, the board of directors approved an
extension of the option awards’ expiry date in connection with the Strategic Review. This modification of the share‑based payment arrangement resulted
in an incremental expense, which has been recognised within discontinued operations.
Parameters connected to share options granted in years respectively 2021 2020 2019
Number of options granted 7 451 000 8 000 000 8 000 000
Date of Grant 29 July 2021 29 July 2020 29 July 2019
Exercise price (NOK) 31.20 19.10 23.53
Share price (NOK) 32.90 17.19 24.66
Expected lifetime* 3.34 3.12 3.12
Volatility* 34.4% 46.0% 35.8%
Interest rate* 0.9% 0.2% 1.3%
Dividend* 6.5% 6.5% 6.5%
FV per instrument* 5.19 2.95 4.08
Vesting conditions Service Service Service
*Weighted average parameters of instruments
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31.12.25 31.12.24
Number of Number of
instruments Remaining instruments Remaining
Grant Exercise price outstanding contractual life outstanding contractual life
2020 programme 19.10 1 850 000 0.50 2 150 000 0.58
2021 programme 31.20 3 867 333 0.54 4 667 333 1.08
Total outstanding 5 717 333 0.52 6 817 333 0.93
At March 20, 2025, the board of directors approved an extension of the option expiry date to a point in time following the
completion of the transaction classified as held for sale. For valuation purposes, 30 June 2026 has been applied as the
revised expiry date.
Quantity and weighted average prices
31.12.25 31.12.24
Number of Weighted average Number of Weighted average
Overview of outstanding options instruments exercise price instruments exercise price
Outstanding options 1 January 6 817 333 27.38 7 614 520 27.07
Granted during the year - - - -
Exercised during the year (50 000) 19.10 (279 190) 19.10
Forfeited during the year (1 050 000) 28.31 - 0.00
Expired during the year - - (517 997) 27.26
Outstanding options 31 December 5 717 333 27.28 6 817 333 27.38
Of which exercisable (vested) 5 717 333 27.28 6 817 333 27.38
Average share price at exercise date (NOK per share) 22.50 22.26
Elkem Annual report 2025 211
13 Other operating expenses
Details of operating expenses 2025 2024
Loss on disposal of fixed assets (0) (1)
Freight and commission expenses (1 143) (1 200)
Leasing short-term and low value contracts (note 18) (56) (55)
Machinery, equipment, spare parts and operating materials (766) (778)
External services 1) (1 351) (1 415)
Insurance expenses (133) (130)
Impairment losses trade and other receivables 1 2
Grants 56 25
Other operating expenses (767) (731)
Total other operating expenses (4 159) (4 283)
1) Including services from auditor, see specification below
Research and development
During 2025, Elkem expensed NOK 416 million (NOK 294 million) related to research and innovation activities, which
includes product and business development, technical customer support and improvement projects. In addition, Elkem
group capitalised development expenses of NOK 0 million (NOK 45 million).
Grants relating to research and development amount to NOK 87 million (NOK 46 million). In addition NOK 37 million
(NOK 35 million) is recognised as a reduction of intangible assets and NOK 3 million (NOK 0 million) is recognised as a
reduction of property, plant and equipment,
Audit fees
KPMG is the group auditor of Elkem. The table below is including audit services for discontinued operations.
Fees to KPMG and other audit firms 2025 2024
KPMG
Audit fee (26) (23)
Other assurance services (8) (1)
Tax services - (0)
Other services (0) -
Other audit firms
Audit fee (4) (4)
Other assurance services (0) (0)
Tax services (1) (2)
Other services (0) (1)
Total fees to KPMG and other audit firms (39) (30)
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14 Other items
Principle application and judgements
Other gains (losses)
Other gains (losses) consist of changes in fair value of financial instruments that are not designated as a part of a
hedging relationship, any ineffective part of hedging relationships, effects from discontinuation of hedging and foreign
exchange gains (losses) related to operating activities such as trade receivables, trade payables, bank accounts /
overdrafts. Foreign exchange gains (losses) related to financing activities, mainly interest-bearing liabilities and group
loans, are classified as a part of financial income and expenses.
Other income (expenses)
Other income (expenses) consist of transactions and events that are related to acquisition of business, gains / (losses) on
disposal of businesses and restructuring programmes. In addition, performance incentives for Elkem employees related
to such items. Cost related to liquidated / wound-up businesses, or updated regulations with retroactive effect related to
events / periods before purchase of the business, e.g., environmental measures, are also included in other income and
expenses.
Acquisition related costs may include both costs related to completed acquisitions, acquisitions in progress and
cancelled projects.
Investments in equity instruments with an ownership below 20 per cent are normally classified as other shares.
Dividends from such shares are recognised when shareholders’ right to receive dividends is determined by the
shareholder’s meeting. Fair value changes related to listed companies classified as other shares are presented as other
income (expenses). Fair value changes related to investments in unlisted companies classified as other shares are
recognised in other comprehensive income. See note 24 Other assets.
Details of other items 2025 2024
Changes in fair value commodity contracts (note 29) 3 (1)
Net gains (losses) on embedded EUR derivatives power contracts (note 29) 127 (106)
Ineffectiveness on cash flow hedges (note 30) 223 (196)
Net foreign exchange gains (losses) - forward currency contracts 19 (5)
Operating foreign exchange gains (losses) (80) 39
Total other gains (losses) 292 (269)
Dividends from other shares 6 3
Change in fair value from other shares measured at fair value through profit or loss 10 8
Restructuring expenses (note 28) (23) (9)
Dismantling and environmental expenses (note 28) (26) (1)
Other 1)
(0) (49)
Total other income (expenses) (34) (47)
Total other items 258 (316)
1) Mainly expenses related to business projects and acquisitions
Elkem Annual report 2025 213
15 Finance income and expenses
Principle application
Foreign exchange gains (losses) related to financing activities including group loans are classified as a part of financial
income and expenses, and foreign exchange gains (losses) related to operations are classified as a part of other items.
Interest is capitalised as a part of the carrying amount of a self-constructed item of property, plant and equipment when
the construction period takes a substantial period of time, meaning more than 9-12 months. Judgement is applied in
determining if a project is expected to last for a substantial period of time.
Financial expenses also include interest on net pension liabilities, unwinding of the discount effect from provisions and
contingent consideration from acquisition of subsidiaries, and interest on lease liabilities.
Interest expenses from factoring and supply finance agreements are presented as part of finance expenses.
Details of net finance income (expenses) 2025 2024
Interest income on loans and receivables 59 78
Fair value adjustments on financial instruments - 16
Other financial income 1 12
Total finance income 61 107
Change in fair value derivatives (30) -
Net foreign exchange gains (losses) 1)
(254) 247
Total foreign exchange gains (losses) (284) 247
Interest expenses on interest-bearing liabilities measured at amortised cost (481) (694)
Interest expenses on lease liabilities (note 18) (24) (15)
Interest expenses from other items measured at amortised cost (4) (9)
Interest expenses on factoring agreements (30) (50)
Unwinding of discounted liabilities (2) (2)
Interest expenses on net pension liabilities (note 11) (6) (6)
Other financial expenses (3) (3)
Total finance expenses (549) (778)
Net finance income (expenses) (772) (424)
1) Some / part of loans are designated as a hedging instrument, hence the unrealised part of net foreign exchange gains (losses) are recognised against
OCI, see note 30 Hedging.
214 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
16 Taxes
Principle application and judgements
Income taxes
Income tax (expense) benefit in the statement of profit or loss comprises current income tax, effects of changes in
deferred tax positions in addition to penalties and interest related to income taxes.
Deferred tax assets
Deferred tax assets are not recognised for start-up projects and entities with longer periods of losses unless there is
convincing evidence of recoverability. Elkem recognises a previously unrecognised deferred tax asset to the extent that it
has become probable that future taxable profit will allow the deferred asset to be recovered. For example, when start up
projects becomes profitable, or the market condition has changed so the entity has longer periods with historic taxable
profits and future forecasted taxable profits.
Judgement has been applied in the assessment of the probability of being able to apply the group’s carry forward loss
against future taxable profit. Based on the current facts and circumstances, Elkem has concluded that it is not probable
that the carry forward loss will be applied against future profit within a reasonable period and have therefore not
recognised a deferred tax asset. When assessing the recognition of deferred tax assets, a five-year historic performance
is applied in order to determine if future profit is probable. All entities with carry forward loss have had negative taxable
result this year. To reconsider and recognise deferred tax assets, an entity must experience stable taxable income for 3-5
years.
The exception from this is the tax loss carry forward acquired in the asset acquisition of Elkem Testvirksomhet
(previously REC Solar Norway AS). Elkem Testvirksomhet was merged into Elkem ASA in November 2024. It is assessed
that the tax loss carry forward can be applied towards taxable income in Elkem ASA and towards group contributions
from other Norwegian entities, primarily Elkem Carbon AS.
Estimates
Part of the basis for recognising deferred tax assets is based on applying the loss carried forward against future taxable
income, which requires use of estimates for calculating future taxable income.
When estimating uncertain tax positions, the most probable amount, including interest and penalties, is used because in
most cases the outcome of the tax review is binary. See details on current uncertain tax positions below.
Income tax recognised in profit or loss 2025 2024
Profit (loss) before income tax 534 1 526
Current taxes (475) (455)
Deferred taxes 326 1 043
Total income tax (expense) benefit (149) 588
Income taxes recognised in other comprehensive income (OCI) 2025 2024
Remeasurement of defined benefit pension plans (2) (1)
Hedging of net investment in foreign operations 2 28
Cash flow hedges (15) (9)
Total tax charged to OCI (15) 18
Elkem Annual report 2025 215
Note 16 continued
Reconciliation of income tax (expense) benefit 2025 2024
Profit (loss) before income tax 534 1 526
Expected income taxes, 22% of profit before tax (22%) (118) (336)
Tax effects of
Difference in tax rates for each individual jurisdiction (67) (22)
Preferential tax rates 6 5
Permanent differences
Tax effects of income from Norwegian controlled foreign companies (NOKUS) (21) (23)
Tax effects share of profit (loss) from equity accounted investments 6 (17)
Tax effects non-taxable expenses (7) (15)
Tax effects on elimination items between continued and discontinued operations (26) (73)
Tax relief based on value of equity 17 7
Tax effects non-taxable income 34 20
Other effects
Tax effects of changes in unrecognised deferred tax assets 81 1 060
Other current taxes (42) (4)
Previous year tax adjustment (12) (14)
Total income tax (expense) benefit (149) 588
Effective tax rate 28% (39%)
One company in China is taxed under the regulations for “High and new technology company” which mean that the tax
rate is 15 per cent compared to the regular 25 per cent. The company has to confirm to the authorities every year that
they fulfil the conditions for “High and new technology company” in order to apply the preferential tax rate.
Tax effect of non-taxable income is mainly related to R&D, additional R&D deduction and non-taxable R&D grants, and
additional deduction on investments in fixed assets equipment.
Other current taxes relates mainly to taxes that are indirectly calculated based on profit (loss) before income tax and
withholding taxes.
Tax effects of changes in unrecognised deferred tax assets are mainly the effect of recognising the tax assets coming
from the acquired company Elkem Testvirksomhet (previously REC Solar Norway AS).
216 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
31.12.25 31.12.24
Temporary Deferred Temporary Deferred
Deferred tax assets and deferred tax liabilities difference tax difference tax
Property, plant and equipment and intangible assets 153 36 154 37
Pension liabilities 200 48 182 45
Trade receivables 5 2 8 2
Inventories 233 52 325 72
Provisions 275 72 249 65
Other differences 153 39 467 110
Interest restrictions 947 208 - -
Tax losses carried forward 5 991 1 309 5 065 1 107
Gross deferred tax assets 7 957 1 766 6 449 1 437
Not capitalised deferred tax asset from tax loss carry forward (253) (49) (242) (45)
Unrecognised deferred tax assets other items (1 444) (318) (1 623) (357)
Recognised deferred tax assets 6 261 1 399 4 584 1 036
Netting (457) (297)
Net deferred tax assets 942 738
Derivatives including cash flow hedges 805 177 654 144
Property, plant and equipment and intangible assets 1 488 349 1 092 265
Inventories 194 42 72 16
Other differences 85 18 514 110
Gross deferred tax liabilities 2 572 586 2 332 535
Netting (457) (297)
Net deferred tax liabilities 129 238
Net deferred tax (liabilities) assets recognised 813 501
Unrecognised deferred tax assets other items are mainly related to property, plant and equipment and inventories. The
tax assets are not recognised due to uncertainty regarding future taxable income and the long period for which the tax
asset shall be amortised.
Movements in net deferred tax assets and deferred tax liabilities 2025 2024
Opening balance 501 (801)
Recognised in profit or loss for the year 326 1 043
Effect of assets acquisition (see note 4) - 128
Recognised in other comprehensive income (15) 18
Assets classified as held for sale - 112
Currency translation differences 1 1
Closing balance 813 501
Elkem Annual report 2025 217
Note 16 continued
Tax losses carried forward Gross tax losses Net tax losses Unrecognised tax Recognised deferred tax
31 December 2025 carried forward carried forward losses losses carried forward
Norway 5 722 1 259 - 1 259
Malaysia 27 7 (7) -
Paraguay 112 11 (11) -
Uruguay 107 27 (27) -
France 6 2 (2) -
Netherlands 4 1 (1) -
Belgium 3 1 (1) -
Turkey 3 1 (1) -
Slovakia 7 2 - 2
Total tax losses to carried forward 5 991 1 309 (49) 1 260
Tax losses carried forward Gross tax losses Net tax losses Unrecognised tax Recognised deferred tax
31 December 2024 carried forward carried forward losses losses carried forward
Norway 4 811 1 058 - 1 058
Malaysia 38 9 (9) -
Paraguay 96 9 (9) -
Uruguay 105 26 (26) -
France 12 3 - 3
Slovakia 3 1 (1) -
Total tax losses to carried forward 5 065 1 107 (45) 1 061
31.12.25 31.12.24
Total unrecognised Total recognised Total unrecognised Total recognised
Tax losses carried forward by expiry date losses losses losses losses
Loss car.forw.which exp. within 1 year (6) - - -
Loss car.forw.which exp. within 2 years (3) - (7) -
Loss car.forw.which exp. within 3 years - - (3) -
Loss car.forw.which exp. within 4 years - - -
Loss car.forw.which exp. within 5 years - - - -
Loss car.forw.which exp. within 5-10 years (5) - -
Without maturity (35) (1 260) (35) 1 061
Total tax losses carried forward (49) (1 260) (45) 1 061
Pending tax issues with tax authorities
The Norwegian Tax Office decided in February 2021 to increase Elkem ASA’s taxable income for the fiscal years 2016-
2019 by in total NOK 781 million, which would have led to an increase in the income tax expense of NOK 181 million. The
reassessments relate to loan arrangements / debt waiver agreements acquired by Elkem ASA in 2016 through the cross-
border parent-subsidiary merger with Bluestar Silicones International Sarl. In 2025 the Appeals board for tax matters
ruled in favour of Elkem and the income tax paid in 2021 included interest was refunded to Elkem. Interest income is
recognised as part of other current taxes.
218 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
17 Property, plant and equipment
Principle application and judgements
Property, plant and equipment (PPE) are stated in the statement of financial position at cost less accumulated
depreciation and accumulated impairment losses.
Initial cost includes expenditures that are directly attributable to the acquisition of the asset. In projects depending on
new technology, all cost up to final investment decision is expensed when incurred. In projects using known technology
the cost incurred in the preparation for the final investment decision is capitalised due to the close integration with the
investment. This is for example relevant for relining of furnaces.
When substantial parts of an installation are replaced with a new component, the cost is capitalised. The replacement
is substantial when the costs associated with the replacement account for more than approximately 70 per cent of the
value of an equivalent new installation. Upon capitalisation, the carrying amount of the replaced part is derecognised.
Major periodic maintenance that is carried out less frequently than every year is capitalised and depreciated over the
period until the next periodic maintenance. Major periodic maintenance typically requires curtailment of production
during the maintenance period. Silicon products typically perform relining of a furnace approximately every 10th to
15th year, Silicones performs mainly biennial maintenance of production equipment, while maintenance within Carbon
Solutions is mostly performed on a day-to-day basis. Costs related to restarting the production after major maintenance
are expensed when incurred. Costs that do not relate to replacement of substantial parts or major periodic maintenance
that is carried out less frequently than every year, are classified as “day-to-day servicing” and are expensed when
incurred.
Property, plant and equipment also consists of spare parts that are expected to last for more than one year and are
substantial in nature or may only be used in conjunction with one item of tangible fixed assets. Other spare parts are
presented as part of inventory.
Depreciation is calculated based on estimated useful life and expected residual value for each item of PPE and is
recognised in the statement of profit or loss using the straight-line method. Elkem has certain leases with local
governments. Unless there are indications to the contrary, it is assumed that these leases are extended at expiry when
determining the useful life of the assets situated on the land. Depreciation commences when the assets are ready for
their intended use. Judgement is applied to determine the time when the asset is ready for intended use.
The main rule is to classify spare parts as inventory. However, major spare parts and stand-by equipment qualify as
property, plant, and equipment when Elkem expects to use them during more than one period. Depreciation of major
spare parts starts when the asset is recognised in the asset register.
Accounting principle application and judgements for impairment of assets, see note 21 Impairment assessments.
Elkem Annual report 2025 219
Note 17 continued
Plant, machinery, Office
2025 Buildings and equipment and and other Construction
Details of property, plant and equipment Land other property motor vehicles equipment in progress Total
Cost
Opening balance 134 3 819 12 540 293 1 682 18 468
Additions 0 9 32 7 1 147 1 195
Transferred from CiP 2 314 1 407 8 (1 731) -
Reclassification (9) 9 - - - -
Disposals - (1) (89) (4) (18) (112)
Currency translation differences (6) (35) (158) (7) (3) (209)
Closing balance 121 4 115 13 732 296 1 077 19 342
Accumulated depreciation
Opening balance - (2 121) (7 507) (199) - (9 827)
Additions - (151) (721) (21) - (894)
Disposals - 1 78 4 - 83
Currency translation differences - 15 80 4 - 99
Closing balance - (2 256) (8 072) (212) - (10 539)
Impairment losses
Opening balance (13) (18) (202) (1) (1) (235)
Additions - (0) (2) (0) (2) (5)
Disposals - - 2 0 2 5
Currency translation differences (0) 0 1 0 - 1
Closing balance (13) (18) (201) (1) (1) (234)
Carrying amount
Closing balance 109 1 841 5 460 83 1 076 8 568
Original cost of assets fully depreciated
but still in use 0 1 194 5 241 93 - 6 528
Estimated useful life Indefinite 5–50 years 3–50 years 3–20 years
Depreciation plan Straight-line Straight-line Straight-line
There are no capitalised interest expenses in 2025.
220 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Plant, machinery, Office
2024 Buildings and equipment and and other Construction
Details of property, plant and equipment Land other property motor vehicles equipment in progress Total
Cost
Opening balance 276 9 575 26 965 2 328 6 842 45 987
Additions - 40 71 23 2 783 2 917
Transferred from CiP 4 450 4 308 1 381 (6 144) -
Disposals (0) (20) (144) (23) (6) (194)
Assets classified as held for sale (160) (6 757) (19 993) (3 604) (2 080) (32 595)
Currency translation differences 15 530 1 333 188 287 2 353
Closing balance 134 3 819 12 540 293 1 682 18 468
Accumulated depreciation
Opening balance (3 639) (15 650) (1 043) (20 332)
Additions from continuing operations (134) (677) (15) (827)
Additions from discontinued operations (194) (992) (288) (1 475)
Disposals 16 118 23 157
Assets classified as held for sale 1 964 10 400 1 202 13 566
Currency translation differences (133) (706) (77) (917)
Closing balance (2 121) (7 507) (199) (9 827)
Impairment losses
Opening balance (12) (446) (2 398) (15) (30) (2 900)
Additions from continuing operations - (3) (35) (0) (0) (38)
Additions from discontinued operations - (1) (9) (0) - (10)
Disposals - 3 17 0 0 20
Assets classified as held for sale - 469 2 419 15 31 2 935
Currency translation differences (1) (41) (197) (1) (3) (242)
Closing balance (13) (18) (202) (1) (1) (235)
Carrying amount
Closing balance 121 1 680 4 831 92 1 681 8 405
Original cost of assets fully depreciated
but still in use 0 1 919 4 903 97 - 6 919
Estimated useful life Indefinite 5–50 years 3–50 years 3–20 years
Depreciation plan Straight-line Straight-line Straight-line
Capitalised interest is NOK 44 million in 2024 mainly related to discontinued operations. The weighted average cost of
capital for capitalisation of loan interest in 2024 is in the range of 2.6 per cent and 2.8 per cent per annum. Impairment
losses from continuing operations in 2024 are primarily related to lining damage at Rana of NOK 35 million.
Elkem Annual report 2025 221
18 Leases
Principle application
Right-of-use assets are presented separately in the statement of financial position, whereas lease liabilities are presented
in interest-bearing liabilities.
Elkem’s policy in general is to own critical assets related to the production cycle, including production buildings and land
where this is not controlled by the local government. The group’s main lease contracts comprise office buildings and
machinery / storage assets to be used at production sites. The less significant lease contracts comprise employee cars,
machinery, and equipment.
Elkem applies a single recognition and measurement approach for all leases, except for:
→ Lease contracts for which the lease term ends within 12 months as of the commencement date are not capitalised
(short-term leases). Elkem’s short-term lease commitments are related to rental of equipment in connection with
maintenance or installation of new equipment.
→ Lease contracts for which the underlying asset is of low value, mainly office equipment, are not capitalised.
→ Lease of intangible assets are not capitalised.
→ Lease payments on contracts that are not capitalised are recognised as other operating expenses on a straight-line
basis over the lease term.
Right-of-use assets are subject to impairment assessments as described in note 21 Impairment assessments.
Plant, machinery, Office
2025 Buildings and equipment and and other
Details of right-of-use assets Land other property motor vehicles equipment Total
Cost
Opening balance 60 523 36 0 619
Additions / lease modifications / remeasurements - 91 6 - 97
Partial or full termination of agreements (5) (36) (7) - (48)
Currency translation differences (3) (5) (0) - (8)
Closing balance 51 573 35 0 660
Accumulated depreciation
Opening balance (20) (174) (22) (0) (216)
Additions (5) (69) (8) - (82)
Partial or full termination of agreements 5 26 6 - 36
Currency translation differences 1 3 0 - 4
Closing balance (20) (215) (24) (0) (258)
Impairment losses
Opening balance - - - - -
Closing balance - - - - -
Carrying amount
Closing balance 32 359 11 0 402
Estimated useful life 1–99 years 1–25 years 1–7 years
Depreciation plan Straight-line Straight-line Straight-line
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Table of contents Board of directors’ report Sustainability statement Financial statements
Plant, machinery, Office
2024 Buildings and equipment and and other
Details of right-of-use assets Land other property motor vehicles equipment Total
Cost
Opening balance 397 733 153 2 1 285
Additions / lease modifications / remeasurements 8 78 60 0 148
Partial or full termination of agreements - (53) (41) (2) (96)
Assets classified as held for sale (378) (260) (143) (0) (782)
Currency translation differences 33 25 7 0 65
Closing balance 60 523 36 0 619
Accumulated depreciation
Opening balance (80) (258) (92) (2) (431)
Additions from continuing operations (6) (52) (9) - (68)
Additions from discontinued operations (8) (42) (36) (0) (87)
Partial or full termination of agreements - 48 36 2 86
Assets classified as held for sale 81 143 84 0 308
Currency translation differences (7) (12) (4) (0) (23)
Closing balance (20) (174) (22) (0) (216)
Impairment losses
Opening balance - - - - -
Closing balance - - - - -
Carrying amount
Closing balance 40 349 15 0 403
Estimated useful life 1–99 years 1–25 years 1–5 years 3-4 years
Depreciation plan Straight-line Straight-line Straight-line Straight-line
Carrying amounts of lease liabilities and the movements during the period 2025 2024
Opening balance 405 589
Additions / lease modifications / remeasurements 97 148
Partial or full termination of agreements (12) (10)
Payments (99) (170)
Interest expenses on lease liabilities from continuing operations 24 15
Interest expenses on lease liabilities from discontinued operations - 13
Liabilities classified as held for sale - (195)
Currency translation differences (2) 17
Closing balance (note 26) 413 405
The maturity analysis of lease liabilities is disclosed in note 26 Interest-bearing liabilities.
Elkem Annual report 2025 223
Note 18 continued
Amounts recognised in consolidated statement of profit or loss 2025 2024
Depreciation of right-of-use assets (82) (68)
Interest expenses on lease liabilities (note 15) (24) (15)
Leasing expenses, short-term leases (note 13) (54) (53)
Leasing expenses, low value assets (note 13) (1) (2)
Leasing expenses, variable lease payments (note 13) (0) (1)
Total amount recognised in consolidated statement of profit or loss (162) (138)
19 Other intangible assets
Principle application and judgements
Judgement is used in determining when a project moves from the research phase to the development phase for
internally developed intangible assets. To ensure consistent judgement, different activities are grouped in four different
phases. Expenses incurred in phase 1 are classified as research and expensed directly to profit and loss. Expenses
incurred in phase 2-4 are normally capitalised as long as the criteria for capitalisation are met. Phase 4 may also contain
commercialisation/industrialisation of technology developed in phase 1-3 into full scale plants and judgement must
be applied both in terms of separation between fixed and intangible assets as well as the correct starting point for
depreciation. In general, depreciation of the intangible assets starts when the full-scale production facility is put into
operation.
Expenditures related to research and development activities, see note 13 Other operating expenses.
Accounting principle application and judgements for impairment of assets, see note 21 Impairment assessments.
224 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Intangible Total other
2025 Land use Technology Other assets under intangible
Details of intangible assets rights and licences Software Development intangible1) construction assets
Cost
Opening balance 121 23 309 - 86 193 732
Additions 0 - 21 - 0 4 25
Transferred from CiP - - 2 - - (2) -
Disposals - (20) (2) - (6) (2) (30)
Currency translation differences 0 (0) (4) - (1) (46) (51)
Closing balance 122 2 326 - 79 147 676
Accumulated amortisation
Opening balance (70) (23) (257) - (35) - (385)
Additions (4) (0) (20) - (8) - (32)
Disposals - 20 1 - 4 - 25
Currency translation differences (0) 0 3 - 0 - 4
Closing balance (74) (2) (273) - (39) - (388)
Impairment losses
Opening balance (1) - (1) - - (129) (131)
Additions - - - - (2) - (2)
Disposals - - - - 2 - 2
Currency translation differences (0) - - - - 6 6
Closing balance (1) - (1) - - (122) (124)
Carrying amount
Closing balance 47 0 53 - 40 25 164
Estimated useful life 3–10 years 3–15 years 3–10 years 3–16 years 3–10 years
Amortisation plan Straight-line Straight-line Straight-line Straight-line Straight-line
1) Other intangible assets consists mainly of customer relationships.
Additions in 2025 consist mainly of software projects of NOK 21 million.
Elkem Annual report 2025 225
Note 19 continued
Intangible Total other
2024 Land use Technology Other assets under intangible
Details of intangible assets rights and licences Software Development intangible1) construction assets
Cost
Opening balance 116 911 714 1 030 384 407 3 563
Additions - 0 12 - - 88 100
Transferred from CiP - 0 44 61 11 (116) -
Disposals - - (2) - - - (2)
Assets classified as held for sale - (945) (490) (1 152) (333) (201) (3 121)
Currency translation differences 6 56 31 61 24 14 192
Closing balance 121 23 309 - 86 193 732
Accumulated amortisation
Opening balance (65) (654) (514) (711) (159) (2 103)
Additions from continuing operations (2) (1) (25) - (8) (35)
Additions from discontinued operations - (42) (33) (77) (31) (182)
Disposals - - 2 - - 2
Assets classified as held for sale - 712 335 826 173 2 045
Currency translation differences (3) (38) (22) (39) (10) (112)
Closing balance (70) (23) (257) - (35) (385)
Impairment losses
Opening balance (1) - - - - - (1)
Additions from continuing operations - - (1) - - (129) (130)
Currency translation differences (0) - - - - 0 (0)
Closing balance (1) - (1) - - (129) (131)
Carrying amount
Closing balance 50 0 51 - 51 64 216
Estimated useful life 3–10 years 3–15 years 3–10 years 3–16 years 3–10 years
Amortisation plan Straight-line Straight-line Straight-line Straight-line Straight-line
1) Other intangible assets consists mainly of customer relationships.
Additions in 2024 consist mainly of capitalisation of development projects of NOK 45 million, mainly related to
discontinued operations. Impairment losses in 2024 are mainly related to impairment of biocarbon NOK 129 million.
226 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
20 Goodwill
Principle application and judgements
If the fair value at the time of acquisition of the group’s interest in the net assets of the acquired subsidiary exceeds
the cost of the acquisition (negative goodwill), the differences are presented directly in the statement of profit or loss
as other items. Judgement is applied in determining net identifiable assets and hence in determining the amount of
goodwill.
Accounting principle application and judgement for impairment of assets, see Note 21 Impairment assessments.
Details of goodwill 2025 2024
Opening balance 329 1 015
Assets classified as held for sale - (756)
Currency translation differences (24) 70
Closing balance 305 329
Origin of goodwill per CGU and operating segment Silicon Carbon
31 December 2025 Products Solutions Total
Elkem Rana AS 40 - 40
Elkem Nagpur 35 - 35
Elkem Oilfield Chemical FZCO Ltd. 24 - 24
Elkem Dronfield Ltd. 18 - 18
Elkem Materials Processing Services BV 0 - 0
Elkem Ferroveld JV - 45 45
Elkem Carbon Slovakia a.s. - 22 22
Elkem Participaçòes Indústria e Comércio Limitada - 8 8
Elkem Carbon (China) Co., Ltd. - 1 1
NEH LLC 95 18 112
Total goodwill 212 94 305
Origin of goodwill per CGU and operating segment Silicon Carbon
31 December 2024 Products Solutions Total
Elkem Nagpur 42 - 42
Elkem Rana AS 40 - 40
Elkem Oilfield Chemical FZCO Ltd. 26 - 26
Elkem Dronfield Ltd. 19 - 19
Elkem Materials Processing Services BV 0 - 0
Elkem Ferroveld JV - 45 45
Elkem Carbon Slovakia a.s. - 22 22
Elkem Participaçòes Indústria e Comércio Limitada - 8 8
Elkem Carbon (China) Co., Ltd. - 1 1
NEH LLC 107 20 126
Total goodwill 234 95 329
Elkem Annual report 2025 227
21 Impairment assessments
Principle application and judgements
This disclosure covers the impairment assessment for goodwill, intangible assets, property plant and equipment and
right-of-use assets (non-current non-financial assets).
Impairment is recognised when the carrying value of an asset or cash generating unit (CGU) exceeds its recoverable
amount. As a starting point Elkem uses the value in use method for estimating recoverable amount in an impairment
test. The value in use calculation is based on a discounted cash flow (DCF) model. The cash flows are derived from the
strategic plan for the next five years and do not include restructuring activities that Elkem is not yet committed to or
significant future investments that will enhance the performance of the assets of the CGU being tested. An exception
from this is ongoing projects with known technology where both future cash inflows and remaining investments are
included.
A long-term growth rate is calculated and applied to project future cash flows after the fifth year to calculate the terminal
value. If the value in use calculation indicates an impairment, the fair value less cost to sell will be estimated and the
higher of this amount and the value in use is applied as the recoverable amount.
Judgement is applied by management in determining if an impairment trigger exists. Management assesses a wide
range of quantitative and qualitative information before concluding on the trigger review. Triggers normally assessed in
Elkem include:
→ performance compared to budget since the last trigger review
→ the expected development in sales prices and the cost of materials, employees and other operating expenses in both
the short and medium term
→ supply / demand balance
→ regulatory changes and new technology
→ competitive situation
There is significant judgment required to determine the CGU for impairment testing. For impairment testing of property,
plant and equipment, intangible and right of use assets, the CGU is the lowest level that generates cash inflows
independent of other assets. This can be both a single plant or a combination of plants depending on the facts and
circumstances. For goodwill, the unit of testing is based on the lowest level where synergies are expected to be realised
following a business combination and the CGU is determined to be the operating segments as presented in note 6
Operating segments.
Estimates
The value-in-use calculations are based on estimated future cash flows. The uncertainty in the cash flows relates to
future prices for both key input factors in the production and market prices for the sale of Elkem’s products. There is
uncertainty regarding these factors both for the next 12 months and for the rest of the forecast period. There is also
uncertainty in estimating replacement investments and the growth rate in the terminal value. The estimated future
pre-tax cash flows are discounted using a discount rate before tax. The estimation uncertainty in the discount rate
relates to the determination of the risk-free rate, the market risk premium and the beta. Elkem uses a beta per business
segment and the beta is found using observable betas of comparable companies for each business segment. Elkem has
performed sensitivity analyses for key drivers in the impairment test to reflect the uncertainty in the estimates.
Impairment assessment for non-current non-financial assets including goodwill
The impairment assessment for non-current non-financial assets is performed on two levels.
→ For non-current non-financial assets other than goodwill a quarterly trigger assessment is performed for each of the
separate CGUs within the three operating segments Silicones, Silicon Products, and Carbon Solutions. If a trigger is
identified, an impairment assessment is performed for the CGU.
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→ Goodwill acquired through business combinations is allocated to the operating segments Silicones, Silicon Products,
and Carbon Solutions. Each of the operating segments consist of several CGUs, typically a plant or a group of plants.
Impairment testing of goodwill is done annually, or more frequently if indicators exist, for the group of CGUs that is
included in the respective operating segments.
At 23 January 2025 the group announced its intention to perform a strategic review of the Silicones division. At the end
of 2024, the Silicones division was reclassified as held for sale and discontinued operations. Immediately before the
reclassification of the Silicones division as discontinued operations, an impairment assessment was performed and no
impairment loss was identified. Subsequent to the reclassification, the disposal group classified as held for sale shall be
measured at the lower of its carrying amount and fair value less costs to sell. Please refer to note 38 Assets held for sale
and discontinued operations for assumptions used in estimating fair value of the assets held for sale at 31 December
2025. The remainder of this disclosure for 2025 will cover the continuing operations in Elkem Silicon Products and Elkem
Carbon Solutions divisions.
The following table gives an overview of carrying amount of total non-current non-financial assets and goodwill allocated
to each of the operating segments. The table also includes the pre-tax discount rate for each operating segment.
31.12.25 31.12.24
Carrying Of which Pre-tax Carrying Of which Pre-tax
Operating segment amount goodwill discount rate amount goodwill discount rate
Silicon Products 7 540 212 10.7% 7 447 234 11.1%
Carbon Solutions 1 327 94 10.1% 1 259 95 10.5%
Total 8 868 305 8 706 329
Elkem analyses both quantitative and qualitative triggers that may indicate that a CGU is impaired. Quantitative
indicators include Elkem’s market capitalisation, return on capital employed compared to WACC and EBITDA margin
compared to budget. Qualitative indicators include significant adverse changes in expected sales volumes or margins,
raw material prices, power prices and supply and changes in regulations.
The impairment assessment for goodwill allocated to the operating segments and for the respective CGUs within the
operating segments performed at year-end is covered for each operating segment below.
Discounted cash flow models are applied to determine the value in use for the operating segments. Key assumptions
used in the calculation of value in use are sales prices and volumes, raw material prices and discount rates.
A range of important assumptions used in the impairment assessment is common for all GGUs/operating segments
and are to large extent determined at the group level in relation with the budget and strategic forecast process. These
assumptions are described below. In addition, certain assumptions such as sales prices, cost of materials and supply /
demand balance are specific for the respective CGUs/operating segments. These assumptions are described within the
below impairment assessments done for each operating segment and underlying CGUs.
Common assumptions for all operating segments
Financial forecasts
The 2026 budget is used together with the 2026-2030 strategic plan to prepare the forecasts which are used for the
impairment assessment. When preparing the budget and strategic plan, a range of both external and internal sources are
considered. External sources include market reports and price indexes. Internal sources include agreed sales volumes for
the period, the effect of implemented cost saving initiatives and planned investments and maintenance.
Normalised EBITDA level represents the operating profit (loss) before depreciation and amortisation. The key
assumptions used in reaching the forecast figures are sales prices, total volume and product mix, operating costs, and
productivity targets. See note 6 Operating segments for Elkem’s definition of normalised EBITDA.
Elkem Annual report 2025 229
Note 21 continued
Other operating costs
These are estimated based on the current level and adjusted for expected inflation in the respective locations where the
business is situated. Operating costs are also impacted by ongoing operational efficiency programmes. Changes to the
outcome of these initiatives may affect future normalised EBITDA levels.
Capital expenditure (“Capex”)
A normalised capex is assumed in the long run and are based on today’s maintenance level and technology. Estimated
capital expenditures do not include capital expenditures that significantly enhance the current performance, as such
effects are not included in the cash flow projection. However, capex includes remaining investments on strategic projects
in an advanced stage where only a small part of the total investment remains before start up.
Discount rates
The required rate of return is calculated by the WACC method. The cost of a company’s equity and liabilities, weighted
to reflect its target capital structure of 50:50, respectively, derive from its weighted average cost of capital. The WACC
rates are based on 10-year risk-free interest rate for the relevant currency of the CGU. For the operating segments with
cash inflows and outflows in different currencies these are translated to NOK in the goodwill impairment test and a
NOK 10 year risk-free interest rate is used in the WACC. The rates are adjusted for inflation differential and country risk
premium. The discount rates also consider the debt premium, market risk premium, corporate tax rate and asset beta.
The WACC is adjusted for tax to determine a pre-tax rate that is used for discounting the estimated future cash flows.
Growth rates
The expected growth rates for a cash-generating unit (CGU) converge from its current level experienced over the last
few years, to the long-term growth level in the market in which the entity operates. The growth rates used to extrapolate
cash flow projections beyond the explicit forecast period are based on management’s experience, assumptions in terms
of market share and expectations for the market development in which the entity operates. Growth rate used in Elkem’s
DCF models is 1.5 per cent for Silicon Products and Carbon Solutions with a significant market exposure in Europe.
Currency rates and inflation
The value-in-use calculation is performed in the functional currency for the CGU. The currency rates used to translate
future incomes and expenses in other currencies than the functional currency is based the currency rates used in
the strategic planning process. These are also used when translating the cash inflows and outflows in the operating
segments to NOK in the goodwill impairment test. The long-term inflation (CPI) is based on external predictions and
reflect the CPI in which each CGU is located.
Climate related risk
The calculation of value in use reflects the expected development in both the cost of CO2 quotas and the income from
CO2 compensation going forward, in line with the current regulatory framework. Outside of this, no climate related
legislation has been passed at the current time that will impact the group. However, there is an expectation that any
increase in cost due to new legislation will be covered by increased sales prices, full or partial compensation by incentive
schemes or increased effectiveness resulting in limited impact on operating cash flows. See also the climate risk
assessment in note 31 Financial risk.
Mandatory tests
Silicon Products and Carbon Solutions
For Elkem Silicon Products and Carbon Solutions the goodwill impairment test has been done based on approved
business plans for the period 2026-2030 and a terminal value for the subsequent years. The estimated value in use
exceeds the carrying amount.
Impairment assessment
Neither in 2024 nor 2025 did Elkem identify any triggers for CGU’s within the Silicon Products or Carbon Solutions
segments.
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22 Inventories
Principle application and judgements
Inventory consists of raw materials, semi-finished goods and finished goods, in addition to operating materials and
spare parts that do not meet the definition of property, plant and equipment. Raw materials, operating materials and
spare parts are recognised at cost of purchase including transport and handling to their present location. Finished and
semi-finished goods are measured at cost of raw materials, energy for production and cost of conversion up to the actual
completion stage. Cost of conversion comprise operating expenses directly related to manufacturing of the products and
an allocation of direct fixed operating expenses. Judgement is applied in determining the share of cost to be allocated to
inventory from departments that perform both production and overhead related tasks.
The cost of CO2 allowances that Elkem needs to purchase in addition to allowances received from the government, see
note 9 Grants, are based on estimated production / emissions for the year. The cost is allocated to cost of conversion
proportionally with estimated produced volumes over the year as the number of allocated allowances will not be revised
unless there is a substantial change in the production level at the plants. The income from the Norwegian government
related to the CO2 compensation scheme is recognised in inventory based on estimated compensation per produced ton
and accrued proportionally with produced volumes.
Entities within the group sell goods to other group entities, consequently finished goods from one entity become raw
materials or semi-finished goods for another group entity. The classification of goods in the consolidated statement of
financial position is based on the separate entity’s classification.
The allocation of fixed production overheads to the costs of conversion is based on the normal capacity of the
production facilities. Judgement is applied in determining normal level of production per plant, but is also aligned with
comparable plants within the group.
31.12.25 31.12.24
Details of inventory Cost price Provision Net total Cost price Provision Net total
Raw materials 1 358 (1) 1 357 1 616 (1) 1 614
Semi-finished goods 890 (1) 889 570 - 570
Finished goods 3 092 (110) 2 982 3 227 (66) 3 162
Operating materials and spare parts 734 (3) 731 695 (4) 692
Total inventories 6 075 (116) 5 959 6 108 (71) 6 038
This year’s change in provision for impairment of inventory, a loss of NOK 46 million (gain of NOK 30 million), is
recognised as a part of raw materials and energy.
Elkem Annual report 2025 231
23 Trade receivables
Principle application and judgements
Trade and bills receivables are initially recognised at transaction price, which in most cases corresponds to their nominal
amount. Elkem mainly has receivables without stated interest rate and no significant financing component and the trade
and bills receivables are therefore subsequently measured at nominal amount, less any provision for expected credit loss.
Judgement has been applied in assessing derecognition of trade receivables included in factoring arrangements.
When Elkem’s Chinese entities sells goods to a customer a trade receivable is established. The customer can then issue
a bank guaranteed bill that is used to settle the trade receivable. A bill receivable is transferable and can be used to
pay trade payables (endorsed) or be settled in cash with a finance institution (discounted). Bills receivables are mainly
bank acceptance bills that are guaranteed by a financial institution. The duration of a bill receivable is normally below 6
months.
Trade receivables are derecognised when settled, replaced by bills receivables or when transferred to a third party and
Elkem has no further risk related to the receivable. Bills receivables are derecognised when they are settled on due date
or when the risk and reward are transferred to a third party. Transferral to a third party can be done by discounting a bill
receivable before due date or by endorsing the bill receivable, meaning that it is accepted by the supplier as payment for
goods or services received. See below for details on the different agreements.
Elkem calculates the expected credit losses (ECL) for trade receivables and bills receivables in accordance with the
simplified approach. All expected cash flows, including cash flows from credit insurance contracts where such contracts
are deemed to be an integral part of the transactions, is taken into consideration. The assessment is based on historically
experienced losses adjusted for forward-looking estimates on changes in risk / probability that credit losses will occur for
the different customer groups /segments where applicable.
Details of trade receivables 31.12.25 31.12.24
Trade receivables 1 503 1 615
Trade receivables, related parties 1)
91 105
Allowance for expected credit losses (25) (29)
Bills receivables 283 269
Total trade receivables 1 852 1 960
1) Includes trade receivables to discontinued operations
Elkem has entered into factoring agreements with a credit limit totalling EUR 100 million (EUR 100 million), NOK 1 184
million (NOK 1 179 million), to sell on continuing basis trade receivables that meet specific conditions. The agreements
include a recourse clause for maximum 5-10 per cent, depending on the agreement, of the face value of the individual
receivables sold. The non-recourse amount of the receivables sold is derecognised and the recourse amount is
recognised as a current liability when the title to the receivables is transferred. As at 31 December 2025, NOK 43 million
(NOK 53 million) is recognised as current liability (see note 28 Provisions and other liabilities). In addition, Elkem has
entered into factoring agreements without recourse. Receivables that are sold without recourse are derecognised in its
entirety when the title is transferred, as there is no remaining credit risk after transfer. As at 31 December 2025 NOK 791
million (NOK 1 182 million) of Elkem’s trade receivables are derecognised under these agreements.
Bills receivables consist of NOK 283 million (NOK 267 million) bank acceptance bills and NOK 0 million (NOK 2 million)
commercial acceptance bills.
A total of NOK 0 million (NOK 0 million) in unmatured bills receivables are endorsed to a third party where the final
payment of the bill is guaranteed by a highly rated financial institution. Elkem will only suffer losses on an endorsed bill if
the bank that have issued the bill or all companies that has endorsed the bill before Elkem goes bankrupt. These bills are
derecognised as there is very low remaining credit risk related to endorsed bills.
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Table of contents Board of directors’ report Sustainability statement Financial statements
Analysis of gross trade receivables by age, presented based on the due date 31.12.25 31.12.24
Not due 1 107 1 306
Overdue by:
1–30 days 304 251
31–60 days 125 75
61–90 days 18 31
More than 90 days 40 57
Total trade receivables 1) 1 594 1 720
1) Bills receivables are not included in the ageing table
Movements in allowance for expected credit losses 2025 2024
Opening balance (29) (59)
Realised losses during the year / Received on earlier losses from continuing operations 3 (1)
Realised losses during the year / Received on earlier losses from discontinued operations - (0)
Provision for expected credit losses from continuing operations (9) (6)
Provision for expected credit losses from discontinued operations - (5)
Reversal of earlier provisions from continuing operations 10 7
Reversal of earlier provisions from discontinued operations - 3
Assets classified as held for sale - 40
Currency translation differences 1 (8)
Closing balance (25) (29)
Analysis of allowance for expected credit losses, presented based on related trade receivables 31.12.25 31.12.24
Not due (5) (6)
Overdue by:
1–30 days (0) (0)
31–60 days (0) (0)
61–90 days (1) (1)
More than 90 days (19) (21)
Total allowance for expected credit losses (25) (29)
Elkem Annual report 2025 233
24 Other assets
Principle application and judgements
Other shares
Other shares consist of equity investments in both listed and unlisted companies. Shares in listed companies are
measured at fair value through profit or loss with gains and losses presented in other items. Investments in equity
instruments that do not have a quoted market price in an active market are classified as financial assets measured at fair
value through other comprehensive income (OCI). Dividends from such investments are presented as other items in the
statement of profit or loss.
Loans and receivables
Loans and receivables are non-derivative hold to collect financial assets with fixed or determinable payments that are
not quoted in a regulated market. After initial recognition, they are recognised at amortised cost using the effective
interest method. Gains and losses are recognised in the statement of profit or loss when the loans and receivables are
derecognised or impaired, as well as through the amortisation process.
Judgement is applied in assessing the need for impairment on loans and receivables outside of trade and bills receivables
and in determining the level of credit loss. Judgement is applied when determining the estimated expected credit loss
on other receivables and prepayments. The judgement is based on experienced losses in the past and expectations
about future economic conditions for the different counterparties. Elkem calculates the expected credit losses (ECL) for
other receivables in accordance with the simplified approach. The assessment is based on historical experienced losses
adjusted for forward-looking estimates on changes in risk / probability that credit losses will occur.
Non-current Current
Details of other assets 31.12.25 31.12.24 31.12.25 31.12.24
Other shares 52 36 - -
Restricted deposits 62 60 - -
Other deposits 8 9 - -
Pension assets, defined benefits and contribution plans (note 11) 37 32 2 4
Prepayments for construction of fixed assets 6 13 - -
Prepayments for goods and equipment - - 19 22
Prepayments for other expenses 17 - 89 82
Receivables from related parties, interest-bearing (note 37) 0 0 - -
Grants receivable (note 9) - - 774 576
Value added tax 61 68 202 297
Corporate income tax receivables - - 86 241
Interest receivables - - - 0
Other receivables - 0 34 13
Assets at fair value through profit (loss) 765 765 - -
Other assets 2 2 24 18
Total other assets 1 011 985 1 231 1 254
Provision for impairment included in total other assets, mainly prepayments.
Restricted deposits consist mainly of restricted deposits related to the ongoing tax litigation in Elkem’s business in Brazil
of NOK 3 million (NOK 11 million), see note 28 Provisions and other liabilities, and deposit for pension guarantee, related
to unfunded pension liabilities for salaries above 12G, of NOK 42 million (NOK 37 million). Assets at fair value through
profit (loss) relates to the sale of Vianode AS, see note 29 Financial assets and liabilities.
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Table of contents Board of directors’ report Sustainability statement Financial statements
25 Cash and cash equivalents and restricted deposits
Principle application
Cash and cash equivalents
Deposits with a term of 3 months or less on acquisition are included. Bank overdrafts are presented within interest-
bearing current liabilities in the statement of financial position. Deposits where the access is restricted for use by the
bank (more than 3 months) are presented separately in the statement of financial position and excluded from cash and
cash equivalents presented in the statement of cash flows.
Cash and cash equivalents
Cash pooling is used to secure availability and access to cash across the group. Due to local legislation, not all
subsidiaries are able to participate in international cash pooling arrangements. As at 31 December, NOK 1 061 million
(NOK 1 780 million) of Elkem’s cash and cash equivalents of NOK 2 694 million (NOK 4 397 million) was outside Elkem’s
cash pooling arrangements and / or not held at Elkem ASA. It is mainly Canada, Singapore, and China that hold cash
outside of Elkem’s cash pooling arrangements.
Elkem Annual report 2025 235
26 Interest-bearing liabilities
Principle application
Lease liabilities
See note 18 Leases for accounting policies for right-of-use assets and lease liabilities.
Non-current Current
Details of interest-bearing liabilities 31.12.25 31.12.24 31.12.25 31.12.24
Lease liabilities (note 18) 342 338 71 67
Loan agreements, bank 5 892 5 856 20 -
Loan agreements, bonds 3 000 3 500 500 706
Loan agreements, other than bank 415 2 123 1 718 295
Accrued interest - - 12 23
Total interest-bearing liabilities 9 648 11 817 2 322 1 090
31.12.25 31.12.24
Currency Currency
Interest-bearing liabilities by currency amount NOK amount NOK
EUR 687 8 129 711 8 386
USD 2 21 0 2
NOK 3 765 3 765 4 501 4 501
CNY 1 2 4 6
Other currencies - 53 - 12
Total interest-bearing liabilities 11 970 12 907
Maturity of interest-bearing liabilities 2031
31 December 2025 2026 2027 2028 2029 2030 and later Total
Lease liabilities 71 52 44 34 29 183 413
Loan agreements 2 239 6 820 1 414 800 - 300 11 573
Accrued interest 12 - - - - - 12
Total interest-bearing liabilities excluding
prepaid loan fees 2 322 6 872 1 459 834 29 483 11 998
Prepaid loan fees (28)
Total interest-bearing liabilities 11 970
Maturity of interest-bearing liabilities 2030
31 December 2024 2025 2026 2027 2028 2029 and later Total
Lease liabilities 67 41 38 34 32 193 405
Loan agreements 1 001 2 210 6 796 1 413 800 300 12 519
Accrued interest 23 23
Total interest-bearing liabilities excluding
prepaid loan fees 1 090 2 251 6 834 1 446 832 493 12 947
Prepaid loan fees (41)
Total interest-bearing liabilities 12 907
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Loan agreements
The main non-current loan agreements as at 31 December 2025 are granted to Elkem in Norway for financing of the
group; a term loan with bank institutions, bond loans and series of loans in Schuldschein market (other than bank).
Loan agreements, bank
The term loan of EUR 500 million (EUR 500 million) is unsecured, but there are related covenants. As at 31 December
2025 the interest rate is 3.32 per cent. The term loan is linked to two sustainability KPIs, KPI 1 Lost Time Injury Rate and
KPI 2 – Product Group Carbon Footprint. The margin of the RCF and term loan shall be reduced by 0.025 per cent if both
KPIs are met, and increased by 0.025 per cent if none of the KPIs are met. If one KPI is met there shall be no change to
the margin. Based on initial testing of the KPIs, the margin will increase with 0.025 per cent in 2026.
Elkem has entered into an interest swap agreement to swap the EUR 500 million loan from floating to fixed interest rate.
As at 31 December 2025 the fair value of this swap is NOK 5 million (entered into in 2025).
Loan agreements, bonds
The series of issued bond loans listed on Oslo Stock Exchange is in the size of NOK 3 000 million (NOK 3 500 million)
where of NOK 3 150 million (NOK 3 150 million) is registered as bonds with floating rate and NOK 350 million (NOK 350
million) is registered as a bond with fixed rate. The bond loans are unsecured and there are no related covenants. As of 31
December 2025 the interest rates are in the range of 5.36 per cent to 5.86 per cent.
Initially Elkem has entered into an interest swap agreement to swap the NOK 350 million bond from fixed to floating
interest rate. Later Elkem has entered into an cross-currency swap agreement to SWAP the NOK 350 million bond to an
EUR 30 million loan with fixed rate of 3.71 per cent. As at 31 December 2025 the net fair value of these swaps are NOK
0.3 million (NOK 1 million).
Initially Elkem has entered into an interest rate swap agreement to swap the NOK 800 million bond loan from floating
interest rates to fixed interest rates of 4.88 per cent. Later Elkem has entered into an cross-currency swap agreement to
SWAP the NOK 800 million bond to a EUR 69 million loan with fixed rate of 3.11 per cent. As at 31 December 2025 the
net fair value of these swaps are NOK 2 million (NOK 21 million).
A swap agreement has also been entered into to swap the NOK 400 million bond loan to a EUR 34 million loan with fixed
interest rates of 3.72 per cent. As at 31 December 2025 the fair value of this swap is negative NOK 3 million (negative
NOK 2 million).
The bond loans are listed on Oslo Stock Exchange from January 2024, as at 31 December 2025 the fair value of the bond
loans are positive NOK 40 million (positive NOK 2 million).
Loan agreements, other than bank
The series of loans issued in the Schuldschein market is of the size of EUR 35 million (EUR 180 million) with floating rate.
The loan series is unsecured, but there are related covenants. As of 31 December 2025 the interest rates are 3.7 per cent.
Elkem has entered into an interest swap agreement to swap the loans of EUR 35 million from floating to fixed interest
rates of 3.7 per cent. As at 31 December 2025 the fair value of these swaps are NOK 1 million (entered into in 2025).
Additionally Elkem has entered into an interest-swap agreement to swap the EUR 145 million loans that fall due in 2026
from floating to fixed interest rates of 3.5 per cent. As at 31 December 2025 the fair value of these swaps are NOK 3
million (entered into in 2025).
Elkem Annual report 2025 237
Note 26 continued
Credit facilities
As of 31 December 2025 the group is granted credit facilities of NOK 6 658 million. The facilities remain undrawn at 31
December 2025.
As of 31 December 2024 the group is granted credit facilities of NOK 6 519 million. The facilities remain undrawn at 31
December 2024.
The main revolving credit facilities are granted to Elkem ASA, but the facilities can be utilised by Elkem ASA and its
subsidiaries. The main facilities amount to EUR 500 million, CNY 199 million and NOK 250 million respectively. See note
31 Financial risk, section (c) liquidity risk for more information.
Hedging
Some / part of loans are designated as a hedging instrument, see note 30 Hedging.
Loan covenant
Elkem has financial covenants related to part of its loan agreements in Norway. The financial covenants are calculated
monthly, based on last 12 months figures of Elkem group total, and reported quarterly. Elkem is compliant with its
covenants at the end of 2025 and 2024. Elkem initiated a waiver process in 2024, and got consent from the lenders’ to
reduce the interest cover covenant from 4.0x to 3.0x for each and every quarter of the 2024 financial year. In 2025 the
interest cover covenant returned to 4.0x.
The covenants for the interest-bearing loan facilities in Norway relate to the financial performance of Elkem group total
and are as specified in the table below.
Covenant Elkem related to drawn loan agreements of NOK 8 051 million Loan Loan
(NOK 8 019 million) in Elkem ASA 31.12.25 covenant 31.12.24 covenant
Equity ratio 51% > 30% 49% > 30%
Interest cover ratio 6.1 > 4.00 5.2 > 3.00
Cash flows Non-cash changes
Additions, lease
modifications, Liabilities Currency
Movements in interest- Opening Receipts/ remeasurements, classified as translation Closing
bearing liabilities 2025 balance Payments and terminations held for sale Reclassification differences balance
Lease liabilities 338 - 85 - (81) (1) 342
Loan agreements 11 519 0 - - (2 217) 32 9 334
Total movements non-current 11 857 0 85 - (2 298) 32 9 676
Lease liabilities 67 (75) - - 81 (1) 71
Loan agreements 1 001 (982) - - 2 217 3 2 239
Total movements current 1 068 (1 057) - - 2 298 2 2 310
Total 12 925 (1 057) 85 - - 34 11 986
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Table of contents Board of directors’ report Sustainability statement Financial statements
Cash flows Non-cash changes
Additions, lease
modifications, Liabilities Currency
Movements in interest- Opening Receipts/ remeasurements, classified as translation Closing
bearing liabilities 2024 balance Payments and terminations held for sale Reclassification differences balance
Lease liabilities 464 - 137 (129) (147) 12 338
Loan agreements 13 091 2 118 - (3 162) (1 149) 620 11 519
Total movements non-current 13 555 2 118 137 (3 290) (1 295) 632 11 857
Lease liabilities 125 (143) - (66) 147 5 67
Loan agreements 1 078 (1 121) - (130) 1 149 26 1 001
Total movements current 1 203 (1 264) - (197) 1 295 31 1 068
Total 14 758 854 137 (3 487) - 663 12 925
27 Trade payables
Elkem has entered into supplier finance agreements with a carrying amount of NOK 123 million as at 31 December 2025
(113 million). Under the agreements, the suppliers have received payment. The duration is from six to twelve months.
Range of payment due dates for comparable trade payables that are not part of an arrangement are from 5 to 60 days.
The liabilities to the provider of the supplier financing is presented within trade payables in the statement of financial
position, while the settlement to the provider of supplier financing is presented within changes in working capital in the
statement of cash flows.
Elkem Annual report 2025 239
28 Provisions and other liabilities
Principle application
The cost of CO2 allowances that Elkem needs to purchase in addition to allowances received from the government
(see note 9 Grants), are based on estimated production / emissions for the year. The liability related to the purchase
of allowances is accrued for using an average cost method with the assumption that the allowances received from the
government is consumed evenly across the year. The provision for the purchase of necessary allowances is measured
at the agreed purchase price for allowances purchased on forward contracts, while the provision for the remaining
allowances is measured at market price at the reporting date.
Estimates
Elkem has several types of provisions due to its operations. Such liabilities are normally uncertain in timing and amount,
and recognised amounts are estimates based on available information at the end of the reporting period. The estimated
liability is based on expected cash flows necessary to settle the obligation, adjusted for any related risk and discounted
by using the pre-tax interest applicable for the specific entity. The estimates are updated when new or updated
information is available, or at a minimum at each reporting date. The actual outcome will differ from the estimate.
The estimate uncertainty primarily relates to environmental measures related to closed production sites and landfills.
The potential outcome can vary within a relatively wide range depending on the final scope of the measures required
and the cost of fulfilling the measures. In these cases, the estimated provision is made based on a combination of expert
opinions and management’s assessment of the known facts and circumstances.
Non-current Current
Details of provision and other liabilities 31.12.25 31.12.24 31.12.25 31.12.24
Employee withholding taxes and other public taxes - - 117 113
Value added tax - - 109 93
Prepayments - - 46 63
Liabilities to related parties (note 36) - - - 0
Provisions 259 250 35 19
Accrued expenses - - 181 361
Grants, deferred income (note 9) - - - 0
Grants payable (note 9) 16 17 3 -
Advances on export exchange contracts (ACC) - - - 72
Recourse liabilities factoring agreement (note 23) - - 43 53
Settlement liabilities factoring agreements - - 24 31
Other liabilities - - 29 9
Total provisions and other liabilities 275 267 588 815
Elkem has for its Carbon Solutions operations in Brazil entered into Advances on foreign exchange contracts (ACC) with
financial institutions. Under these contracts Elkem receives full or partial prepayments from the financial institution
before the goods are shipped. The prepayments are used to finance imports of raw materials.
240 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Movements in provision Site Environmental Other Total
2025 Restructuring restoration measures Litigations Customers provisions provisions
Opening balance 0 44 175 49 0 1 270
Additional provisions recognised 13 4 23 3 - 1 44
Used during the year (2) (4) - (1) (0) (0) (7)
Reversal of provisions recognised - - (4) - - - (4)
Foreign currency exchange
differences 0 (0) (8) (0) - 0 (8)
Closing balance 12 44 186 51 - 2 294
Hereof non-current - 41 166 51 - 2 259
Hereof current 12 3 21 - - 0 35
Closing balance 12 44 186 51 - 2 294
Movements in provision Site Environmental Other Total
2024 Restructuring restoration measures Litigations Customers provisions provisions
Opening balance 44 35 203 71 5 5 363
Additional provisions recognised from
continuing operations 9 9 11 3 0 0 32
Additional provisions recognised from
discontinued operations 130 - - - 8 10 148
Used during the year (101) (0) (13) (8) (2) (10) (134)
Reversal of provisions recognised
from continuing operations - - (3) - - - (3)
Reversal of provisions recognised
from discontinued operations - - - - (1) - (1)
Liabilities classified as held for sale (85) - (29) (10) (10) (5) (138)
Currency translation differences 4 0 5 (7) 0 0 3
Closing balance 0 44 175 49 0 1 270
Hereof non-current - 38 163 49 - 1 250
Hereof current 0 6 12 1 0 0 19
Closing balance 0 44 175 49 0 1 270
Restructuring
The provision is related to Elkem’s cost saving programme.
Site restoration
The site restoration provisions are related to the necessary site remediation work that Elkem will have to undertake in
respect of its quartz mines.
Elkem Annual report 2025 241
Note 28 continued
Environmental measures
Elkem has worldwide operations representing potential exposure towards environmental consequences. Elkem has
established clear procedures to minimise environmental emissions, well within public emission limits. The provisions
relate to clean up costs for a closed down production site and landfills, mainly in Canada and Norway, and also estimated
cost for clean-up cost of polluted soil and fjord in relation to production sites in Norway. Provisions are made for
each case based on estimates that are quality assured by external parties. The increase in provision are mainly due to
increased cost estimate for the work in Canada. The engineering work in Canada will start during 2026 and is expected
to be finalised during the next 3-4 years by phases. For the other projects the timing of when the work will start is
uncertain.
Litigations
The provisions due to litigation are mainly related to the Carbon Solutions operations in Brazil.
Federal tax cases in Brazil can take a substantial amount of time before resolution by the authorities, hence the time of
settlement is uncertain. The main part of the provision is related to cases back to 2006. Provisions are made for each
case based on the estimated amount expected to be paid, including interest and penalties. In accordance with Brazilian
regulations, agreed amounts have been transferred to restricted bank accounts and are adjusted for interest. The
restricted cash is recognised in other non-current assets, see note 24 Other assets.
Customers
The provisions are related to customer complaints, mainly in the Silicones division.
Contingent liabilities
Due to its operations Elkem could be included in criminal or civil proceedings related to, among others, product liability,
environment, health and safety, anti-competitive, anti-corruption, trade sanctions or other similar laws or regulations or
other forms of commercial disputes which could have a material adverse effect on Elkem. See section litigation above for
ongoing cases and see note 16 Taxes for ongoing tax audits by authorities.
242 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
29 Financial assets and liabilities
Principle application and judgements
Financial assets
Non-derivative financial assets include trade receivables, restricted deposits and cash and cash equivalents.
Financial liabilities
Non-derivative financial liabilities include interest-bearing liabilities, bills payables and trade payables.
Embedded derivatives
Elkem has long-term power purchase contracts settled in Euro which is different from both Elkem and the
counterparty’s functional currency. The currency portion of these contracts is an embedded derivative and is recognised
and presented as an independent derivative.
Commodity contracts within the scope of IFRS 9
Non-financial commodity contracts where the relevant commodity is readily convertible to cash and where the contracts
are not for own use, fall within the scope of IFRS 9 Financial instruments - recognition and measurement. Elkem’s
principle is that power delivered in a different grid area than the grid area where the power is consumed will meet the
own use criteria.
Elkem’s main energy contracts meet the own use criteria except for two power contracts in Norway, where both
derivatives are designated as hedging instrument in cash flow hedges.
Estimates
Estimates are used to estimate fair value for financial assets and liabilities where there are no listed prices or direct
observable prices. Calculation of fair value is in such cases based on observable prices for similar contracts, as far as
possible. For contracts with a duration beyond the period of observable prices, the assumptions are derived based on
the latest observable data. Due to the current market situation in the energy market with very high prices and high
volatility there is significant uncertainty in the estimation of forward power prices with direct impact on the value of the
power contracts classified as financial instruments. The estimated value of the power contracts can be impacted by
the changes in the power prices both within the next 12 months, but also in the period beyond 12 months. There is also
uncertainty related to the discount rate used for discounting future cash flows and the expectation to the development in
the consumer price index going forward.
See assumptions used at the balance sheet date in chapter (a) Fair value measurement below, and sensitivity of the main
power contracts in note 31 Financial risk.
Assets at fair value
Assets at fair Assets at fair through other Loans and Non-
Assets by category value through value - hedging comprehensive receivables at financial
31 December 2025 Note profit or loss instruments income amortised cost assets Total
Derivatives, non-current 586 395 - - - 981
Other assets, non-current 24 790 - 27 62 131 1 011
Trade receivables 23 - - - 1 852 - 1 852
Derivatives, current 141 144 - - 285
Other assets, current 24 - - - 34 1 197 1 231
Restricted deposits 25 - - - 1 - 1
Cash and cash equivalents 25 - - - 2 694 - 2 694
Total 1 517 538 27 4 642 1 328 8 054
Elkem Annual report 2025 243
Note 29 continued
Liabilities at fair Liabilities at fair Non-
Liabilities by category value through value - hedging Liabilities at financial
31 December 2025 Note profit or loss instruments amortised cost liabilities Total
Interest-bearing liabilities, non-current 26 - - 9 648 - 9 648
Derivatives, non-current 1) (34) 384 - - 350
Provisions and other liabilities, non-current 28 - - - 275 275
Trade payables 27 - - 1 818 - 1 818
Interest-bearing liabilities, current 26 - - 2 322 - 2 322
Derivatives, current 1)
(30) 145 - - 115
Provisions and other liabilities, current 28 - - 281 307 588
Total (64) 529 14 069 583 15 116
1) The group applies hedge accounting for certain currency contracts and certain parts of power contracts. The negative value reported as assets and
liabilities at fair value is representing the value of parts of power contracts where hedge accounting is not applied.
Assets at fair value
Assets at fair Assets at fair through other Loans and Non-
Assets by category value through value - hedging comprehensive receivables at financial
31 December 2024 Note profit or loss instruments income amortised cost assets Total
Derivatives, non-current 572 440 - - - 1 012
Other assets, non-current 24 781 - 20 70 115 985
Trade receivables 23 - - - 1 960 - 1 960
Derivatives, current 130 137 - - - 267
Other assets, current 24 - - - 13 1 241 1 254
Restricted deposits 25 - - - 7 - 7
Cash and cash equivalents 25 - - - 4 397 - 4 397
Total 1 483 577 20 6 447 1 355 9 883
Liabilities at fair Liabilities at fair Non-
Liabilities by category value through value - hedging Liabilities at financial
31 December 2024 Note profit or loss instruments amortised cost liabilities Total
Interest-bearing liabilities, non-current 26 - - 11 817 - 11 817
Derivatives, non-current 31 453 - - 485
Provisions and other liabilities, non-current 28 - - - 267 267
Trade payables 27 - - 2 076 - 2 076
Interest-bearing liabilities, current 26 - - 1 090 - 1 090
Derivatives, current (43) 183 - - 140
Provisions and other liabilities, current 28 - - 525 290 815
Total (11) 636 15 508 557 16 689
1) The group applies hedge accounting for certain currency contracts and certain parts of power contracts. The negative value reported as assets and
liabilities at fair value is representing the value of parts of power contracts where hedge accounting is not applied.
There are no material differences between fair value and the carrying amount for financial liabilities and financial assets
at amortised cost.
244 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
(a) Fair value measurement
Elkem’s financial instruments measured at fair value are categorised into three levels based on the inputs to the valuation
techniques used to measure fair value.
→ Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can
access at the measurement date.
→ Level 2 inputs are inputs, other than quoted prices included within level 1, that are observable for the asset or liability,
either directly or indirectly.
→ Level 3 inputs are unobservable inputs for the asset or liability.
Total Total
Assets and liabilities measured at fair value 31 December Level 1 Level 2 Level 3 2025 Level 1 Level 2 Level 3 2024
Financial assets at fair value through profit or loss 25 (8) 1 501 1 517 15 16 1 451 1 483
Derivatives designated in a hedging relationship - 62 476 538 - 81 496 577
Assets at fair value through other comprehensive income - - 27 27 - - 20 20
Total assets 25 54 2 004 2 083 15 97 1 968 2 080
Financial liabilities at fair value through profit or loss - (64) - (64) - (11) - (11)
Derivatives designated in a hedging relationship - 529 - 529 - 636 - 636
Total liabilities - 465 - 465 - 625 - 625
Level 1:
Financial assets measured at level 1 apply to external quoted shares, which are measured based on the quoted prices.
Level 2:
Financial assets and liabilities measured at level 2 applies to forward currency contracts, interest rate swaps and
embedded currency derivatives. The contracts are measured at fair value by estimating the future cash flows.
Level 3:
The financial assets and liabilities at fair value through profit or loss measured at level 3 consist of power derivative
contracts, shares in unlisted companies and other assets measured at fair value through profit and loss.
When valuing the power contracts, observable data is used such as power price, currency rates, CPI and EPAD, when
available. The power prices for long-term electricity contracts in Norway are not directly observable in the market for the
whole contract length. Power prices on system level are observable until 2036 and EPAD prices are only observable for a
relatively short time period. Valuation of the contracts for the remaining periods are based on the latest observable data
adjusted for CPI, if relevant.
Overview of contracts and the assumptions used for assessment of fair value for the level 3 contracts
Power contract “30-øringen”
“30-øringen” power contract lasts until 31 December 2030 and the power from the contract is restricted to be used
at Elkem ASA plants. For the years 2019 - 2020 the price under the contract was fixed except if the spot price at the
relevant grid points exceeded a certain threshold, in which case the price equalled the spot price. For the last 10 years
of the contract, starting 1 January 2021, the price is fixed based on the average spot price for the five years preceding
1 January 2021, adjusted for inflation. The fixed price and the threshold price are based on a start date and thereafter
adjusted with inflation annually. Changes in fair value for the “30-øringen” contract was classified as other items before
1 January 2021. Due to the change in the contract price structure of the instrument from 2021, the contract is designated
as a hedging instrument from 1 January 2021. This means that fair value changes from the effective part of the hedging
relationship from 1 January 2021 initially are booked against OCI and subsequently recycled and recognised as raw
materials and energy in the statement of profit or loss in the same period(s) as the hedged objects affect the profit or
loss. The ineffective part of the hedging relationship is recognised in other items.
Elkem Annual report 2025 245
Note 29 continued
Power contract with Axpo
In February 2024, Elkem entered into a financial power contract with Axpo covering the period 2027 to 2035. The
contract has been designated as hedging instrument in a cash flow hedge of highly probable future purchases, hence
changes in fair value for the power contract are from the inception of the contract booked against OCI. Please refer to
note 31 Hedging.
Assumptions for valuation of the contracts
→ Discount rate: 5.71 per cent (5.60 per cent) p.a. for “30-øringen”, 3.7 per cent (4.3 per cent) for Axpo. The
assumptions are based on the estimated risk of the contract, including credit risk.
→ Inflation: 2 per cent (2 per cent) p.a.
→ Power prices: Market prices per 31 December 2025 until 2035.
→ CfDs: 4-year average historic CfD prices based on Nord Pool prices for “30-øringen”. For Axpo the implicit CFD at the
contractual agreement date is used.
→ Exchange rate EUR: Observable rates for the next 5 years, thereafter calculated rates based on long-term interest
rates is used to translate estimated future power prices to NOK for “30-øringen” which is priced in NOK.
For external shares measured at level 3, book value of equity adjusted for excess values at purchase date is used as an
approximation of fair value.
The Vianode receivable at fair value through profit and loss
In February 2024, Elkem sold its shares in Vianode AS, a synthetic graphite manufacturer for a total nominal amount of
NOK 847 million to AV Anodos AS. NOK 10 million of the compensation was received at closing, while NOK 315 million
(second instalment) and NOK 522 million (third instalment) are tied to Vianode meeting two future milestones relating to
the building of a full-scale plant. Interest shall accrue on the second instalment if the due date is later than 30 June 2025
and for the third instalment 31 December 2027. At initial recognition, the present value of the receivable was estimated
to NOK 749 million after the payment of the NOK 10 million. Vianode AS and AV Anodos AS are dependent on additional
funding to be able to perform the investments necessary to meet the milestones required for the settlement of Elkem’s
receivable. If additional funding is not obtained, there is a risk of significant credit loss related to Elkem’s receivable. As
the value of the deferred payments is uncertain, Elkem monitors the situation closely. Considering the need for additional
funding, market development and recent project development in Vianode available at year-end, Elkem has assessed that
the fair value of the receivable is NOK 765 million. The receivable is measured at fair value through profit and loss and is
included in Level 3.
Movements in fair value measurement level 3 2025 2024
Opening balance 1 968 1 229
Acquisition / business combinations - 0
Transfer from investment in equity accounted investments - 759
Change in fair value recognised in OCI, cash flow hedges 207 412
Hedge ineffectiveness (94) (338)
Disposal (0) -
Settlement / realised effects (79) (109)
Other changes in fair value through profit or loss, unrealised 3 15
Currency translation differences (0) 0
Closing balance 2 004 1 968
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Table of contents Board of directors’ report Sustainability statement Financial statements
(b) Details of financial instruments
Details of currency exchange contracts 31 December 2025
Notional
Purchase Purchase Sale Sale ccy Type of Currency Fair value amount1)
currency ccy million currency million instrument deal rate Due NOK NOK
NOK 25 USD 2 Fwd 11.3269 2026 3 22
NOK 494 EUR 42 Fwd 11.8831 2026 1 493
NOK 73 EUR 6 Fwd 12.2123 2027 1 71
NOK 33 JPY 312 Fwd 0.1052 2027 13 20
NOK 1 378 EUR 115 Fwd 11.9863 2026 1 1 362
USD 1 JPY 100 Fwd 0.0065 2026 0 6
NOK 821 EUR 75 Embedded 10.9640 2026 (79) 886
NOK 6 588 EUR 556 Embedded 11.8526 2027-2035 (349) 6 580
Total fair value2) (409)
Details of currency exchange contracts 31 December 2024
Notional
Purchase Purchase Sale Sale ccy Type of Currency Fair value amount1)
currency ccy million currency million instrument deal rate Due NOK NOK
NOK 1 864 EUR 159 Fwd 11.7621 2025 (20) 1 869
NOK 201 JPY 1 954 Fwd 0.1028 2025 57 141
NOK 33 JPY 312 Fwd 0.1052 2026 9 23
NOK 375 USD 35 Fwd 10.7453 2025 (21) 396
USD 1 JPY 101 Fwd 0.0068 2025 0 7
NOK 818 EUR 76 Embedded 10.7941 2025 (89) 894
NOK 5 984 EUR 518 Embedded 11.5528 2026-2035 (483) 6 108
Total fair value2) (547)
1) Notional value of the contracts, based on currency rates 31 December.
2) The spot element of forward currency contracts with duration more than 3 months are designated as hedging instruments in a cash flow hedge of highly
probable future sales, hence this part is classified as “Derivatives used for hedging” in the table “Assets and liabilities classified by category” above. The
interest element of these contracts and contracts of duration < 3 months are classified as “Assets/liabilities at fair value through profit or loss”.
Details commodity contracts and interest rate swap Notional
within the scope of IFRS 9 31 December 2025 Volume Due Fair value amount3)
Commodity contracts Power 501 GWh 2026 244 184
Commodity contracts Power 3976 GWh 2027-2035 968 1 764
Interest rate swap NOK 12 731 million 2026-2029 (2) 355
Total fair value contracts within scope of IFRS 9 4) 1 209
Details commodity contracts and interest rate swap Notional
within the scope of IFRS 9 31 December 2024 Volume Due Fair value amount3)
Commodity contracts Power 501 GWh 2025 196 177
Commodity contracts Power 4478 GWh 2026-2035 986 1 950
Interest rate swap NOK 1 550 million 2025-2029 19 301
Total fair value contracts within scope of IFRS 9 4) 1 201
3) Notional value of underlying asset at the end of reporting period, calculated as volume * price * currency rate as at 31 December (if other currencies
than NOK).
4) Certain power contracts are designated as hedging instruments, the remaining contracts / parts of contracts are classified as “Assets/liabilities at fair
value through profit and loss”.
Elkem Annual report 2025 247
Note 29 continued
(c) Offsetting
Financial
Gross amount of Net amounts instruments
Gross financial liabilities of financial not set off in
amount of set off in the assets the statement Cash
financial statement of recognised/ of financial collateral Net
Financial assets 31 December 2025 assets financial position presented position pledged amount
Power contracts including embedded derivatives 1 211 - 1 211 - - 1 211
Forward currency contracts 54 - 54 - - 54
Total 1 265 - 1 265 - - 1 265
Gross amount Financial
Gross of recognised instruments
amount of financial assets Net amounts not set off in
recognised set off in the of financial the statement Cash
financial statement of liabilities of financial collateral Net
Financial liabilities 31 December 2025 liabilities financial position presented position pledged amount
Power contracts including embedded derivatives 427 - 427 - - 427
Forward currency contracts 38 - 38 - - 38
Total 465 - 465 - - 465
Financial
Gross amount of Net amounts instruments
Gross financial liabilities of financial not set off in
amount of set off in the assets the statement Cash
financial statement of recognised/ of financial collateral Net
Financial assets 31 December 2024 assets financial position presented position pledged amount
Power contracts including embedded derivatives 1 182 - 1 182 - - 1 182
Forward currency contracts 75 - 75 5 - 80
Total 1 257 - 1 257 5 - 1 262
Gross amount Financial
Gross of recognised instruments
amount of financial assets Net amounts not set off in
recognised set off in the of financial the statement Cash
financial statement of liabilities of financial collateral Net
Financial liabilities 31 December 2024 liabilities financial position presented position pledged amount
Power contracts including embedded derivatives 572 - 572 - - 572
Forward currency contracts 50 - 50 5 - 54
Total 622 - 622 5 - 626
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Table of contents Board of directors’ report Sustainability statement Financial statements
30 Hedging
Principle application and judgements
Elkem has applied IFRS 9 for hedge accounting. Elkem applies cash flow hedging and net investment hedging. Cash
flow hedging is applied to two power contracts, interest rate swaps and for hedging of sales in foreign currency.
The “30-øringen” power contract is delivered in the power price area NO2 in the south of Norway but is used to hedge
cash flows for all the Norwegian plants including plants in other power price areas. At initial hedge designation there was
a strong economic relationship between the prices in the different price areas. However, due to the at times significant
differences in prices between the price areas the last years, significant judgement is required to assess if there is still
an economic relationship between the hedged item and the hedging instrument. There is an expectation that the price
differences will be reduced over time due to for example grid improvements and changes in the supply/demand balance.
Given the strict requirements in IFRS 9 for being allowed to discontinue hedging and the fact that the “30-øringen” is
a long-term contract with expiry in 2030 it has been assessed that there is still an economic relationship between the
hedging item and the hedged object.
Estimates
See disclosures describing estimation uncertainty for financial assets in note 29 Financial assets and liabilities.
Elkem’s hedging instruments
Cash flow hedge
Elkem has forward currency contracts and embedded EUR derivatives in power contracts where the spot element
is designated as hedging instruments and Elkem’s highly probable future revenue in corresponding currencies is
designated as the hedging objects in this hedging relationship, defined as a cash flow hedge. In addition, certain power
derivative contracts, are designated as hedging instruments in a cash flow hedge of price fluctuations for highly probable
future purchases. Hence, the effective part of changes in fair value of the financial instruments is booked against OCI,
and recycled to profit or loss as an adjustment of revenue and power cost (included in raw materials and energy) when
realised. The ineffective part of changes in the fair value of the financial instrument is recognised in other items in
the statement of profit and loss. Elkem should primarily pursue a floating interest rate policy for long-term financing.
Interest rate hedging will be considered in specific cases, e.g. when there is a need to protect financial covenants in loan
agreements. In 2025 and 2024, Elkem entered into interest rate swaps to change from floating to fixed interest rates.
For interest rate swaps designated for hedging, the effective part of changes in fair value of the financial instruments is
booked against OCI, and recycled to profit or loss as an adjustment to interest expense when realised.
Net investment hedge
Elkem has a EUR 500 term loan. As of 1 January 2024, EUR 230 million of the loan was designated as a hedge of the net
investment in the group’s subsidiaries with EUR as functional currency. In June 2024 EUR 30 million was discontinued
as a consequence of reduced value of net investments in euro, reducing the amount of the loan designated as a hedge
of the net investment to EUR 200 million. The fair value and carrying amount of the borrowing designated as a hedge
at 31 December 2025 was NOK 2 368 million (NOK 2 358 million). The foreign exchange loss of NOK 9 million (NOK
128 million) on translation of the borrowing from EUR to NOK at the end of the reporting period is recognised in other
comprehensive income and accumulated in the foreign currency translation reserve in the statement of changes in
equity. There was no ineffectiveness recognised from the net investment hedge.
See note 32 Financial risk for Elkem’s hedging policy.
Elkem Annual report 2025 249
Note 30 continued
31.12.25 31.12.25 31.12.24 31.12.24
Assets Liabilities Assets Liabilities
Cash flow hedging instruments, by type fair value fair value fair value fair value
Forward currency contracts 33 10 60 43
Financial power contracts 476 - 496 -
Power contracts embedded derivatives - 516 - 591
Interest rate swap 29 3 21 3
Total hedging instruments 538 529 577 636
Less non-current portion:
Forward currency contracts 1 0 8 -
Financial power contracts 380 - 415 -
Power contracts embedded derivatives - 383 - 451
Interest rate swap 14 1 17 2
Current portion of hedging instruments 144 145 137 183
As at 31 December 2025 financial power contracts designated in a hedging relationship comprise 14 per cent of
expected consumption in Norway in 2026, 21 per cent in the period 2027-2030, and 6 per cent from 2031-2035. Elkem
has hedged approximately 11 per cent of the expected revenues in EUR for 2026 and for the years 2027-2037 EUR is
hedged at a range gradually declining from 7-1 per cent.
Effects to be recycled from OCI
Financial instruments Within Within Within Within 4
31 December 2025 Net fair value Hereof recognised in OCI 1 year 2 years 3 years years or more
Forward currency contracts 19 23 22 1 - -
Power contracts 1 211 476 96 98 92 190
Embedded EUR derivatives (427) (516) (133) (91) (54) (238)
Interest rate swaps (2) 26 13 5 5 3
Total 1)
800 9 (1) 13 43 (45)
Effects to be recycled from OCI
Financial instruments Within Within Within Within 4
31 December 2025 Net fair value Hereof recognised in OCI 1 year 2 years 3 years years or more
Forward currency contracts 25 17 9 8 - -
Power contracts 1 182 496 81 84 80 252
Embedded EUR derivatives (572) (591) (140) (124) (84) (243)
Interest rate swaps 19 18 3 3 4 7
Total 1)
654 (59) (46) (28) (1) 16
1) Hedge accounting is applied for certain contracts and for parts of contracts.
250 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Of total changes in fair value of power contracts designated as hedging instruments, a gain of NOK 223 million (loss
of NOK 196 million) is recognised in profit or loss, and classified as other items (see note 14 Other items), due to
ineffectiveness in the hedging relationship and discontinuation of hedging. The ineffectiveness on cash flow hedges
primarily relates to Elkem’s hedges of future power purchase. The ineffectiveness is caused by the extraordinary
developments in the Norwegian power market with significant differences in prices between the different price areas.
Consequently, the cumulative change in fair value of some of the hedging instruments are higher than the cumulative
changes in the present value of the hedge items from the inception of the hedge. The difference between the two is the
recognised as ineffectiveness. Of the gain of NOK 223 million (loss of NOK 196 million) recognised in 2025, a gain of
NOK 33 million (loss of NOK 319 million) relates to hedge ineffectiveness caused by these price differences. In addition,
Elkem has recognised a gain of NOK 61 million (NOK 102 million) related to discontinuation of power hedging caused by
furnace curtailments in Norway and a gain of NOK 2 million (NOK 1 million) related to cash flow hedges of future sale of
goods in currency.
Realised effects hedge accounting 31.12.25 31.12.24
Realised effects from forward currency contracts, recognised in revenue 26 10
Realised effects from embedded derivatives EUR, recognised in revenue (137) (135)
Realised effects from interest rate swap, recognised in finance expenses 59 (4)
Realised effects from power contracts, recognised in raw materials and energy 31 13
Realised effects hedge discontinuation, recognised in other items 61 102
Total realised effects hedge accounting 41 (14)
In addition, Elkem applies hedge accounting principles related to currency risk from a net investment in foreign
operation, see note 26 Interest-bearing liabilities.
Movements in OCI related to hedging instruments
Opening Net change Reclassified Closing
2025 balance in fair value to P&L balance
Hedging of future sales, forward currency contracts 17 32 (26) 23
Hedging of future sales, embedded EUR derivatives in own use power contracts (591) (62) 137 (516)
Hedging of future need for power 496 72 (92) 476
Hedging of future interest expense 18 67 (59) 26
Total (before tax) (59) 109 (41) 9
Opening Net change Reclassified Closing
2024 balance in fair value to P&L balance
Hedging of future sales, forward currency contracts 129 (102) (10) 17
Hedging of future sales, embedded EUR derivatives in own use power contracts (463) (263) 135 (591)
Hedging of future need for power 220 391 (115) 496
Hedging of future interest expense 12 2 4 18
Total (before tax) (102) 29 14 (59)
Elkem Annual report 2025 251
31 Financial risk
Elkem is exposed to (a) Market risk, defined as financial risk from fluctuations in market prices for finished goods, raw
materials, currency exchange rates, and interest rates. In addition, Elkem is exposed to financial risks related to (b)
Counterparty credit risk, (c) Liquidity risk and (d) Climate risk. This may have a considerable impact on Elkem’s financial
performance.
Elkem’s principle is to organise resources close to the value chain. Risk management is an integrated part of Elkem’s
business activities, included in the line management’s responsibility. Financial risk, including financing, liquidity,
currency, interest rates, and counterparty risks, is generally managed centrally by treasury. Elkem has financial risk
policies in place, approved by the board of directors.
Elkem’s financial risk exposure and business performance are evaluated regularly, and the main risks are analysed in
terms of impact, likelihood, and correlation. Based on the overall risk evaluation, Elkem may accept or seek to further
reduce the risks arising from operational activities.
(a) Market risk
(i) Price risk
Commodity prices
Elkem is exposed to fluctuations in market prices for finished goods and raw materials. The market risk assessment
is based on a holistic approach, as prices for Elkem’s products tend to fluctuate with underlying macroeconomic
conditions. The same dynamics tend to apply to prices for the main raw materials, giving Elkem a certain degree of
natural hedging.
For the main upstream products and raw materials Elkem seeks to reduce the risk exposure by entering sales and
purchase contracts for corresponding time periods and volumes. The goal is to partly offset changes in sales prices
through changes in raw material costs.
A significant part of Elkem’s sales consists of specialised products. These products have generally more stable pricing.
Elkem’s integrated value chain mitigates the supply chain and pricing risks and also gives flexibility to realise value at
various levels through the value chain. Elkem aims to ensure sales volumes and raw material supply by entering into
long-term customer relationships.
Power
Electric power is a key input factor and Elkem enters into long-term power contracts to reduce the future exposure to
changes in power prices, particularly in Norway where electricity prices based on hydro power tend to have different
pricing dynamics than for Elkem’s products and other raw materials.
Normally all plants have covered their main future need for power by entering into power contracts, primarily classified
as own use contracts according to IFRS 9, hence such contracts are off-balance. In addition to the own use contracts,
certain financial power contracts are classified as derivatives and designated in a cash flow hedging relationship in
accordance with IFRS (see notes 29 Financial assets and liabilities and 30 Hedging). For plants located in Norway,
Elkem’s policy is that a minimum 80 per cent of the expected power consumption shall be covered by fixed price
contracts for current and next year. This includes both own use and derivative contracts at fair value. For the following
periods, the ratio extends until 4 years ahead, declining with 10 percentage point per year ending at 50 per cent. Elkem
currently fulfils this minimum hedge policy, and also has a substantial amount of contracts at fixed price for the period
after 5 years. Optimisation of 24-hour-, seasonal-, and capacity utilisation variations is achieved by utilising financial
and physical contracts that are traded bilaterally. The purpose of entering into long term power contracts is to reduce
volatility in the power cost and to increase the predictability of the cost base. Fair value of commodity contracts is
especially sensitive for future changes in energy prices.
Changes in fair value of commodity contracts, classified as financial instruments, reflect unrealised gains or losses, and
are calculated as the difference between market price and contract price, discounted to present value. Valuations are
based on market information where this is available, if not, valuations are based on estimated market price for non-
observable parameters.
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Valuation of the power contracts
The assumptions for the fair value measurement of power contracts are described in note 29 Financial assets and
liabilities.
Sensitivity analysis - power contracts
Sensitivity on the “30-øringen” and Axpo contracts is as follows
31.12.25 31.12.24
Power contracts Fair value Adjusted NPV Fair value Adjusted NPV
Discount rate (used 5.71% (5.60%)) decrease with 3.5%-point 1 211 1 322 1 182 1 313
Discount rate (used 5.71% (5.60%)) increase with 3.5%-point 1 211 1 116 1 182 1 073
CPI (used 2.0%) change to 1% 1 211 1 227 1 182 1 204
CPI (used 2.0%) change to 3% 1 211 1 196 1 182 1 160
Power price decrease 10% 1 211 931 1 182 904
Power price increase 10% 1 211 1 492 1 182 1 461
(ii) Currency risk
Elkem has revenues and operating costs in various currencies. The prices of finished goods are to a large extent
determined in international markets, primarily denominated in US dollar, Chinese yuan and Euro. This is partly offset
by purchases of raw materials denominated in the same currencies. Elkem aims to establish natural hedging positions
if this is possible and economically viable. Financial derivatives are then used to hedge the remaining net currency risk
exposures. Elkem has net positive operating cash flows mainly in Euro, US dollar, Chinese yuan and Brazilian real. Due
to the location of its plants, Elkem has net cost positions in certain other currencies, mainly Norwegian krone, but also
Canadian dollar and Icelandic krona.
Elkem’s policy is to hedge the net positive cash flows in foreign currencies against NOK to even out fluctuations in
results and cash flow. The target is to hedge expected net cash flow for 0–3 months on a 90 per cent hedging ratio.
Expected net cash flow for 4–12 months should be hedged on a rolling basis targeting a 45 per cent hedging ratio. The
hedging ratio for 4–12 months may vary subject to internal approval. Chinese yuan (CNY) is not included in the hedging
programme. Elkem has hedged Japanese yen until 2026, related to a long-term customer contract. Elkem uses hedge
accounting for all cash flow hedges over 3 months. Embedded EUR derivatives in power contracts are included in the
foreign exchange hedging programme. To ensure an effective hedge, according to the hedge accounting principles, the
spot element of the forward currency contracts is designated as hedging instruments and highly probable future revenue
as hedging object in a hedging relationship, covering the exposure beyond 3 months.
In 2025, Elkem realised a loss of NOK 111 million from the hedging programme (loss of NOK 125 million).
Elkem aims to mitigate the currency risk in the statement of financial position by keeping interest-bearing debt in the
same currencies as the group’s assets. Elkem has mainly interest-bearing debt in Euro, Chinese yuan and Norwegian
krone.
Elkem Annual report 2025 253
Note 31 continued
Currency effects recognised in total comprehensive income for the year,
excluding effects from cash flow hedging 2025 2024
Net foreign exchange gains (losses) - forward currency contracts - recognised in other items 19 (5)
Operating foreign exchange gains (losses) - recognised in other items (80) 39
Net foreign currency exchange gains (losses) on financing activities - recognised in foreign exchange gains (losses) (254) 247
Currency translation differences - recognised in other comprehensive income (1 214) 1 154
Hedging of net investment in foreign operations - recognised in other comprehensive income (9) (128)
Total (1 539) 1 307
Currency exposure
The amounts in the tables below are translated to NOK using exchange-rates against NOK as at 31 December.
Exchange rates against NOK per 31 December 2025 2024
USD 10.0714 11.3484
EUR 11.8394 11.7921
CNY 1.4401 1.5547
CAD 7.3554 7.8822
Currency exposure affecting statement of profit or loss
The tables show carrying amount of assets and liabilities for Elkem group total denominated in foreign currencies
different from the entities functional currency, where changes in currency rates will affect profit and loss. The tables
include notional amount of currency exchange contracts (see note 29 Financial assets and liabilities). Amounts are
presented in NOK based on currency rates as at 31 December 2025.
31 December 2025 USD EUR CNY CAD NOK Other Total
Other non-current assets - - - - - - -
Trade receivables 576 (19) - - 0 60 617
Other assets - - - - - - -
Restricted deposits - - - - - - -
Cash and cash equivalents 1 514 (761) 617 (102) 1 307 1 576
Total monetary assets 2 090 (780) 617 (102) 1 367 2 193
Interest-bearing liabilities - 8 064 - - - - 8 064
Other liabilities - - - - - - -
Trade payables 305 222 2 (0) 0 53 581
Bills payables - - - - - - -
Total monetary liabilities 305 8 285 2 (0) 0 53 8 645
Derivatives, notional value 22 9 392 - - - 20 9 434
Net currency exposure financial position 1 763 (18 457) 615 (102) 0 294 (15 886)
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31 December 2024 USD EUR CNY CAD NOK Other Total
Other non-current assets - - - - - - -
Trade receivables 627 (7) - - - 96 715
Other assets - - - - - - -
Restricted deposits - - - - - - -
Cash and cash equivalents 709 1 293 (123) (282) 0 358 1 955
Total monetary assets 1 336 1 285 (123) (282) 0 454 2 670
Interest-bearing liabilities - 8 714 - - - - 8 714
Other liabilities - - - - - - -
Trade payables 341 218 - 0 1 53 613
Bills payables - - - - - - -
Total monetary liabilities 341 8 932 - 0 1 53 9 327
Derivatives, notional value 396 8 871 - - - 164 9 431
Net currency exposure financial position 599 (16 518) (123) (282) (1) 237 (16 088)
Sensitivity on profit and loss from financial assets and liabilities
The following tables demonstrate the sensitivity to a reasonable possible change in EUR and USD exchange rates by 5
per cent, with all other variables held constant. The impact on Elkem group total’s profit before tax is due to changes
in the fair value of monetary assets and liabilities including foreign currency derivatives and embedded derivatives not
designated for hedging. The impact on Elkem group total’s pre-tax equity is due to changes in the fair value of forward
exchange contracts designated as cash flow hedges and net investment hedges. The impact on pre-tax equity would be
booked against OCI and recycled through profit before tax, when the hedged items are realised. In addition the profit and
loss will be affected by translation differences on intra group balances, mainly in EUR, USD and CNY.
31.12.25 31.12.24
Effect on profit Effect on Effect on profit Effect on
Currency Change in FX rate before tax pre-tax equity before tax pre-tax equity
EUR 5% (923) (465) (288) (517)
EUR (5%) 923 465 288 517
USD 5% 88 120 50 (20)
USD (5%) (88) (120) (50) 20
Currency exposure affecting currency translation differences / equity
The table shows Elkem group’s total assets and liabilities denominated in the group’s main currencies translated to
NOK at the currency rates at 31 December and gives an overview of the group’s total currency exposure that will affect
currency translation differences both in the consolidated statement of comprehensive income and / or profit and loss.
Elkem Annual report 2025 255
Note 31 continued
31 December 2025 USD EUR CNY CAD NOK Other Total
Other non-current assets 63 163 25 35 898 28 1 212
Trade receivables 921 162 1 647 11 168 510 3 419
Other assets 49 167 219 20 969 210 1 633
Restricted deposits - - 95 - 0 - 95
Cash and cash equivalents 1 851 (535) 1 565 30 182 713 3 806
Total monetary assets 2 885 (44) 3 551 95 2 218 1 461 10 166
Asset non-monetary items 2 178 7 324 11 587 825 13 353 2 048 37 315
Total assets 5 063 7 281 15 138 921 15 571 3 509 47 481
Interest-bearing liabilities 21 8 129 3 721 - 3 765 53 15 689
Other liabilities 57 213 243 14 322 165 1 015
Trade payables 402 923 1 107 91 736 296 3 556
Bills payables - - 657 - (0) - 657
Total monetary liabilities 480 9 265 5 729 105 4 824 515 20 917
Liabilities non-monetary items 114 691 243 121 1 161 208 2 538
Total liabilities 595 9 956 5 972 226 5 985 722 23 455
31 December 2024 USD EUR CNY CAD NOK Other Total
Other non-current assets 68 166 23 31 849 50 1 186
Trade receivables 966 176 1 798 18 84 619 3 661
Other assets 57 196 592 13 1 023 263 2 144
Restricted deposits 1 - 356 - 0 - 356
Cash and cash equivalents 1 132 1 665 1 324 (72) 1 324 698 6 070
Total monetary assets 2 224 2 202 4 093 (11) 3 279 1 630 13 418
Asset non-monetary items 2 826 7 428 13 864 974 12 822 2 100 40 014
Total assets 5 050 9 631 17 957 963 16 102 3 730 53 432
Interest-bearing liabilities 2 8 386 3 448 - 4 501 60 16 397
Other liabilities 60 246 329 17 450 235 1 337
Trade payables 469 1 200 2 046 106 949 389 5 159
Bills payables - - 1 549 - (0) - 1 549
Total monetary liabilities 532 9 832 7 371 123 5 900 685 24 442
Liabilities non-monetary items 136 772 292 216 1 338 215 2 969
Total liabilities 668 10 605 7 663 338 7 238 900 27 411
(iii) Interest rate risk
Elkem’s interest rate risk arises from interest-bearing liabilities granted by external financial institutions, factoring
agreements (note 23 Trade receivables) and liabilities related to factoring agreements and advances on export exchange
contracts (note 28 Provisions and other liabilities). In addition, Elkem has supplier finance agreements of NOK 123 million
(NOK 113 million) classified as trade payables (note 27 Trade payables). Elkem’s liabilities are mainly drawn in Euro,
Chinese yuan and Norwegian krone.
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Elkem’s policy is to primarily have floating interest rates on its debt financing. Whilst this exposes the group to
fluctuations in interest rates, the group will benefit from lower rates during economic downturns. The prices and sales
volumes of Elkem’s core products tend to correlate with general economic conditions. Interest rates remained low for
several years due to a low-rate economic environment. However, from 2022 to 2025, interest rates have increased as
many central banks hiked rates to control inflation. Due to the relatively higher interest-level in Norway compared to
the Euro-area, Elkem has during 2025 entered into several short-term cross currency interest rate swaps, resulting in a
relatively high share of fixed-rate liabilities. Also see note 29 Financial assets and liabilities.
Elkem has financial covenants related to part of its loan agreements in Norway. The financial covenants are calculated
monthly, based on last 12 months figures of Elkem group total, and reported quarterly. Elkem is compliant with its
covenants at the end of 2025 and 2024. Elkem initiated a waiver process in 2024, and got consent from the lenders’ to
reduce the interest cover covenant from 4.0x to 3.0x for each and every quarter of the 2024 financial year. In 2025 the
interest cover covenant returned to be 4.0x. For more details on covenants, see note 26 Interest-bearing liabilities.
Elkem’s continuing operations have the following items exposed to
interest rate risk 31 December 2025 Floating Fixed Total
Interest-bearing liabilities (note 26) 2 751 9 219 11 970
Derecognised trade receivables under factoring agreements (note 23) 791 - 791
Recourse liability factoring agreement (note 28) 43 - 43
Settlement liability factoring agreements (note 28) 24 - 24
Supplier finance agreements (note 27) 123 - 123
Cash and cash equivalents (note 25) (2 694) - (2 694)
Restricted deposits (note 25) (1) - (1)
Receivables from related parties (note 24) (0) - (0)
Net exposure 1 038 9 219 10 257
Elkem’s continuing operations have the following items exposed to
interest rate risk 31 December 2024 Floating Fixed Total
Interest-bearing liabilities (note 26) 11 707 1 200 12 907
Derecognised trade receivables under factoring agreements (note 23) 1 182 - 1 182
Advances on export exchange contracts (note 28) 72 - 72
Recourse liability factoring agreement (note 28) 53 - 53
Settlement liability factoring agreements (note 28) 31 - 31
Supplier finance agreements (note 27) 113 - 113
Cash and cash equivalents (note 25) (4 397) - (4 397)
Restricted deposits (note 25) (7) - (7)
Receivables from related parties (note 24) (0) - (0)
Net exposure 8 753 1 200 9 953
Sensitivity
The interest rate sensitivity is based on a parallel shift in the interest rates that Elkem is exposed to. If interest rates
had been 100 basis points higher for a full year, based on net debt as at 31 December 2025, with all other variables held
constant, the profit (loss) for the year would have been NOK 8 million (NOK 68 million) lower.
Elkem Annual report 2025 257
Note 31 continued
(b) Counterparty credit risk
Credit risk is the risk of financial losses to the group if a customer or counterparty fails to meet contractual obligations.
For Elkem, this arises mainly to trade receivable and financial trading counterparties.
Trade receivables are generally secured by credit insurance from a reputable credit insurance company. For customers
where credit insurance cannot be obtained, other methods are generally used to secure the sales proceeds, such as
prepayment, letter of credit, documentary credit, or guarantees. In particular, when sales are made in countries with a
high political risk, or to remote customers, trade finance products are used to reduce the credit risk. Of Elkem’s revenue
outside China 85-95 per cent is covered by credit insurance or other trade finance tools.
Elkem realised credit losses of NOK 2.9 million (NOK 0.8 million) on trade receivables in 2025.
The maximum exposure to credit risk for trade receivables for the group is NOK 2 358 million as at 31 December 2025
(NOK 2 550 million).
Evaluation of financial counterparties is based on external credit ratings from Moody’s and / or Standard and Poor’s. The
general policy is that financial counterparties should have a rating equal to, or higher than, A- (or the equivalent) from
the rating agencies, but exceptions may be made on a case-by-case basis, mainly for local banks in emerging markets.
Elkem has not had any losses in 2025 or 2024 related to financial counterparties.
(c) Liquidity risk
Liquidity risk is the risk that the group will encounter difficulty in meeting the obligations associated with its financial
liabilities. Elkem is exposed to liquidity risk related to its operations and financing.
Elkem’s cash flow will fluctuate due to economic conditions and financial performance. In order to assess its future
operational liquidity risk, short-term and long-term cash flow forecasts are provided. The short-term forecast is updated
each week, and the long-term cash flow projection is updated each quarter.
In order to mitigate the operational liquidity risk, Elkem has cash and revolving credit facilities with banks. As at 31
December 2025, Elkem has unrestricted cash and cash equivalents of NOK 3 806 million (NOK 6 070 million). In
addition, revolving credit facilities amount to NOK 10 810 million (NOK 9 459 million), of which NOK 6 681 million is
undrawn (NOK 6 542 million).
The external loan agreements contain two financial covenants. The ratio of EBITDA to consolidated net interest payable,
as defined herein, for each measurement period, where the period is calculated as the 12 months ending on the last
day of a financial quarter, must exceed 4. Elkem initiated a waiver process in 2024, and got consent from the lenders to
reduce the interest cover covenant from 4.0x to 3.0x for each and every quarter of the 2024 financial year. Additionally,
the ratio of total equity to total assets must be more than 30 per cent at all times. Elkem complies with these covenants
as at 31 December 2025 and also complied with the covenants as at 31 December 2024, see note 26 Interest-bearing
liabilities.
The policy is to have cash equivalents and available credit facilities to cover known capital needs and generally not less
than 10 per cent of annual total operating income. In addition, the policy is to ensure that the main credit facilities have
a remaining maturity of at least 12 months. The maturity profile of the credit facilities as at 31 December 2025 for Elkem
continued is shown in the table below.
Year / maturity 2029 Rolling +1 year Total
Total amount of credit facilities 5 920 738 6 658
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The table below analyses the Elkem group continuing’s financial liabilities and assets into relevant maturity groupings
based on the remaining period at the date of the statement of financial position to the contractual maturity date. The
amounts disclosed in the table are the contractual undiscounted cash flows, and the amounts are including interest
payments.
31 December 2025 2026 2027 2028 2029 2030 2031 and later Total Carrying amount
Trade receivables 1 852 - - - - - 1 852 1 852
Derivative assets 289 279 280 284 285 29 1 446 1 265
Total assets 2 141 279 280 284 285 29 3 299 3 117
Trade payables 1 818 - - - - - 1 818 1 818
Derivative liabilities 114 74 47 51 47 225 557 465
Lease liabilities 71 67 57 45 38 206 484 413
Loan agreements 2 626 7 128 1 504 839 11 311 12 417 11 573
Total liabilities 4 628 7 269 1 608 935 95 742 15 276 14 269
31 December 2024 2025 2026 2027 2028 2029 2030 and later Total Carrying amount
Trade receivables 1 960 - - - - - 1 960 1 960
Derivative assets 272 243 247 261 279 199 1 501 1 279
Total assets 2 233 243 247 261 279 199 3 462 3 240
Trade payables 2 076 - - - - - 2 076 2 076
Derivative liabilities 141 94 85 56 62 312 750 625
Lease liabilities 67 54 49 43 40 216 468 405
Loan agreements 1 581 2 738 7 225 1 552 864 335 14 296 12 519
Total liabilities 3 865 2 886 7 358 1 651 966 863 17 590 15 625
(d) Climate risk
Governance
In Elkem, the responsibility for climate-related issues sits with the board, and the management of risks and opportunities
related to climate is integrated into Elkem’s overall business strategy. The audit committee has board-level responsibility
related to managing sustainability, non-financial reporting, internal control, and sustainability-related risk. The CEO,
supported by the CFO and SVP Technology, ensures daily operational responsibility for climate-related issues. Regular
reporting to the board and proactive engagement with stakeholders, including investors and banks, are integral to
Elkem’s governance structure.
Strategy
Elkem’s climate strategy spans short-, medium-, and long-term horizons, evaluating transition risks and opportunities.
Recognising its role in the full silicon value chain, Elkem addresses specific climate risks tied to its carbon-intensive
production process. Elkem has established its climate roadmap, which is the group’s transition plan that outlines the
initiatives and actions to be taken to meet the goal of the Paris Climate Agreement of well below 2°C temperature
increase. Elkem proactively identifies climate impacts and pursues a dual-play growth strategy focused on reducing
fossil CO2 emissions and promoting circular economies. The climate roadmap integrates with Elkem’s corporate strategy,
emphasising its commitment to a sustainable future.
Risk management
Climate-related considerations are a key part of Elkem’s risk management process, with a comprehensive assessment
Elkem Annual report 2025 259
Note 31 continued
presented annually to the board. The evaluation identifies potential financial impacts on Elkem’s EBIT and equity within
a 5 year timeframe. The risk mapping process categorises risks into strategic, financial, raw material, production and
process, and market and product risks. Climate related risks can be split into transitional and physical climate risks. The
key transitional risks include regulatory risks, such as changes in the framework for CO2 quotas and CO2 compensation.
Elkem monitors physical climate risks through site-specific analyses, recognising the potential impact of climate change
on its operations. Central physical climate risks for Elkem are drought and extreme weather events, but the effects differ
from site to site. Elkem has not identified any immediate need for action related to the buildings and assets identified.
In addressing emission abatement project profitability, Elkem employs an internal carbon price aligned with market
trends. Risks are categorised by financial impact (high, medium, low) and frequency (low, medium, high). As Elkem
navigates climate-related challenges and opportunities, the group remains committed to responsible governance,
sustainable strategies, and effective risk management practices.
Key risks and opportunities
Elkem’s key transitional climate risk is changes to existing regulations and carbon pricing mechanisms, and the
emergence of new regulations. Use of a carbon material is necessary when producing silicon and ferrosilicon, hence
emissions of CO2 is inevitable, resulting in significant scope 1 emissions. Elkem falls under the ambit of EU’s emission
trading system (ETS), and changes to the number of free allowances and pricing of quotas influence Elkem’s cost of raw
materials and energy for production. In addition, Elkem is eligible for CO2 compensation in Norway for the implicit CO2
quota costs in Norwegian electricity prices. In March 2024, the Norwegian government and the parties representing
the industry agreed on a revised CO2 compensation scheme. The new scheme has a cap of NOK 7 billion in annual
compensation to the industry. The cap will be KPI adjusted annually. In the new scheme, 40 per cent of compensation
will be dependent on investments in climate and energy efficiency measures by the recipients. It has been assessed
that there is reasonable assurance that Elkem will continue to receive CO2 compensation and fulfil the requirements to
receive full compensation including the 40 per cent conditioned by climate and energy efficiency measures.
Elkem is not covered by Carbon Border Adjustment Mechanism (CBAM) currently, but if Norway chooses to adopt
CBAM, this would also affect Elkem, and there is significant concern that the scheme has shortcomings that would
be unfavourable for Elkem when competing in global markets. To mitigate this risk, Elkem is working to reduce its CO2
emissions through the use of biocarbon as a reductant, and research and testing of carbon capture technology.
China does not currently have a CO2 emission trading system, but introduction of such a scheme could potentially
increase operational costs.
Elkem’s production sites face different levels of physical climate risk. Changes to severity and frequency of extreme
weather could pose a risk to many of the sites, but the location and infrastructure mitigate this risk. Elkem has not
identified any immediate need for action related to buildings and assets identified. Elkem is however, monitoring
temperature increases, increased dry spells, ocean rise, and extreme weather events to secure assets and avoid business
interruptions.
Elkem’s opportunities related to climate change are significant. Elkem’s products are a key component to the green
transition, examples of this being silicones used in electric vehicles (EVs), silicones, silicon and foundry products used in
renewable and nuclear energy production, and silicones and Elkem Microsilica® in construction. There is also a potential
in recycling and reuse related to silicone production.
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Table of contents Board of directors’ report Sustainability statement Financial statements
32 Capital management
Elkem focuses on having a balanced capital structure, which seeks to reflect the return requirements for the
shareholders and the need for a strong financial position to facilitate the group’s strategy for growth and specialisation.
The target is to have a leverage between 1.0x and 2.0x over a cycle. The leverage ratio is defined as current and non-
current interest-bearing liabilities, see note 26 Interest-bearing liabilities, reduced with cash and cash equivalents, see
note 25 Cash and cash equivalents and restricted deposits, divided by normalised EBITDA, as defined in the APM
section.
Elkem manages its financing and liquidity position to reduce liquidity risk and to ensure that the group can meet its
financial obligations at all times. Elkem has centralised the responsibility for group financing and liquidity handling. The
policy is to raise financing at parent company level, however, country specific exceptions may be made due to local
legislation or currency restrictions. Loan maturities are subject to liquidity and refinancing risk and the group aims to
have a long-term and smooth maturity profile on its loan portfolio.
Cash pooling is used to secure availability and access to cash across the group. Due to local legislation, not all
subsidiaries are able to participate in international cash pooling arrangements. In these cases, repatriation of excess cash
is mainly executed through dividend payments and intercompany deposits, while liquidity needs are covered through
capital injections and intercompany loans. Liquidity forecasts are prepared and updated on a regular basis. The short-
term forecasts are updated weekly. Elkem’s cash position is reported on a daily basis and tracked against respective
forecasts. The policy is that available liquidity reserves, defined as cash and cash equivalents and available long-term
credit facilities, should exceed 10 per cent of total operating income.
Financial covenants are applicable in some of Elkem’s loan agreements. Financial covenants, if required, are standardised
across all loan agreements. Financial covenants and other financial policy targets are monitored monthly and included in
Elkem’s management reports. See note 26 Interest-bearing liabilities for more details on the current covenants.
Elkem intends to pay dividends reflecting the underlying earnings and cash flow. Elkem envisages a dividend pay-
out ratio of 30-50 per cent based on profit for the year. When deciding the annual dividend level, Elkem’s leverage,
capital expenditure plans and financing requirements will be taken into consideration. Focus will also be on maintaining
appropriate strategic flexibility. Due to the ongoing strategic review and the process leading up to the sale of the
Silicones division, see note 38 Assets held for sale and discontinued operations, the Board has proposed zero payments
of dividends for the financial year 2025. For the year 2024, Elkem paid NOK 0.3 per share in dividend, NOK 190 million in
total.
At 31 December 2025, Elkem’s equity was NOK 24 026 million, including non-controlling interest of NOK 104 million. The
equity ratio was 51 per cent.
Elkem Annual report 2025 261
33 Number of shares
The development in share capital and other paid-in equity is set out in the consolidated statement of changes in equity.
The largest shareholders are listed in note 22 Shareholders to the financial statement of Elkem ASA.
2025 2024
Shares Treasury Total issued Shares Treasury Total issued
Number of shares outstanding shares shares outstanding shares shares
Beginning of the year 634 169 478 5 271 900 639 441 378 633 890 288 5 551 090 639 441 378
Increase in treasury shares - - - - - -
Sale of treasury shares 50 000 (50 000) - 279 190 (279 190) -
End of the year 634 219 478 5 221 900 639 441 378 634 169 478 5 271 900 639 441 378
The share capital of Elkem ASA is NOK 3 197 206 890 consisting of 639 441 378 shares of NOK 5 nominal value. Of this
amount, Elkem ASA held 5 221 900 treasury shares, 0.8 per cent of total issued shares. Elkem has in 2025 sold 50 000
shares in connection with Elkem’s share option scheme. The total consideration was NOK 1 million.
In the annual general meeting held at 30 April 2025, the board of directors was granted an authorisation to repurchase
the company’s own shares within a total nominal value of up to NOK 319 720 689. The maximum amount that can be
paid for each share is NOK 150 and the minimum is NOK 1. The authorisation is valid until the annual general meeting
in 2026, but not later than 30 June 2026. The authorisation can be used to acquire shares as the board of directors
deems appropriate, provided however, that acquisition of shares shall not be by subscription. Shares acquired under the
authorisation may either be used to fulfil Elkem’s obligations in connection with acquisitions, incentive arrangements for
employees, fulfilment of earn-out arrangements, sale of shares to strengthen Elkem’s equity or deletion of shares.
In the annual general meeting held at 30 April 2025, the board of directors was granted an authorisation to increase
the company’s share capital by an amount up to NOK 319 720 689 - corresponding to 10 per cent of the current
share capital. The authorisation is valid until the annual general meeting in 2026, but not later than 30 June 2026. The
authorisation can be used to cover share capital increases against contribution in kind and in connection with mergers.
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34 Earnings per share
Principle application
The calculation of basic earnings per share (EPS) has been based on profit attributable to ordinary shareholders and
weighted‑average number of ordinary shares outstanding. The calculation of diluted EPS has been based on profit
attributable to ordinary shareholders and weighted‑average number of ordinary shares outstanding after adjustment for
the effects of all dilutive potential ordinary shares.
2025 2024
Weighted average number of shares outstanding 634 197 568 634 005 481
Effects of dilution 387 716 128 351
Weighted average number of shares outstanding - diluted 634 585 284 634 133 832
Owners of the parent's share of profit (loss) (NOK million) from Elkem group total operations (668) 488
Earnings per share (NOK) (1.05) 0.77
Diluted earnings per share (NOK) (1.05) 0.77
Owners of the parent's share of profit (loss) (NOK million) from continuing operations 301 2 026
Earnings per share (NOK) 0.47 3.20
Diluted earnings per share (NOK) 0.47 3.20
Owners of the parent's share of profit (loss) (NOK million) from discontinued operations (969) (1 538)
Earnings per share (NOK) (1.53) (2.43)
Diluted earnings per share (NOK) (1.53) (2.43)
Elkem Annual report 2025 263
35 Supplemental information to the consolidated
statement of cash flows
The following table gives a detailed overview of changes in working capital in the statement of cash flows. Working
capital is defined as accounts receivables, inventories, other current assets, accounts payables, current employee benefit
obligations and other current liabilities. Accounts receivables are defined as trade receivables less bills receivables. Other
current assets are defined as other current assets less current receivables to related parties, current interest-bearing
receivables, tax receivables, grants receivable, assets at fair value through profit or loss, and accrued interest income.
Accounts payables are defined as trade payables less trade payables related to purchase of non-current assets. Other
current liabilities are defined as provisions and other current liabilities less current provisions, contingent considerations,
contract obligations, and liabilities to related parties.
Changes in working capital 2025 2024
Changes in accounts receivable 29 13
Changes in inventories 627 (447)
Changes in other current assets 490 (97)
Changes in accounts payable (954) (45)
Changes in other current liabilities including employee benefit obligations (330) (53)
Total (138) (629)
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Table of contents Board of directors’ report Sustainability statement Financial statements
36 Related parties
Related parties’ relationships are defined to be entities outside Elkem group that are under control (either directly
or indirectly), joint control or significant influence by the owners of Elkem. The related party disclosure includes
transactions and balances with parties considered related to Elkem group total. A significant level of related party
transactions and balances are with the Silicones segment, which is classified as discontinued operations.
Elkem ASA is owned 52.9 per cent by Bluestar Elkem International Co. Ltd S.A., Luxembourg, which is under control of
Sinochem Holdings Co., Ltd (Sinochem), a company registered and domiciled in China. All companies under control by
Sinochem are considered to be related parties, including among others China Blue Chemicals Ltd and Jiangxi Xinghuo
Spaceflight New Material Co., Ltd.
Elkem also considers equity accounted investments as related parties.
The structure of Elkem group is disclosed in note 4 Composition of the group and note 5 Equity accounted investments
and joint operations.
2025 Purchase of Sale of Purchase of Interest Financial
Transactions with related parties Sale of goods goods services1) services income expenses
Bluestar Elkem International Co. Ltd S.A. - - - - - -
Joint ventures and associates 31 (473) 31 (217) 0 -
Related parties within Sinochem 111 (681) 2 (173) - -
Other related parties 1 (4) - (17) - -
Total 143 (1 158) 33 (408) 0 -
1) Including sub-lease
2024 Purchase of Sale of Purchase of Interest Financial
Transactions with related parties Sale of goods goods services1) services income expenses
Bluestar Elkem International Co. Ltd S.A. - - - - - -
Joint ventures and associates - (202) 20 (192) 0 -
Related parties within Sinochem 130 (619) 1 (112) - -
Other related parties 4 (8) - (23) - -
Total 133 (830) 21 (327) 0 -
1) Including sub-lease
Elkem Annual report 2025 265
Note 36 continued
Non-current Current
Balances with related parties 31.12.25 31.12.24 31.12.25 31.12.24
Receivables from joint ventures and associates, interest-bearing 0 0 - -
Receivables from joint ventures and associates, interest free - - - 4
Receivables from related parties within Sinochem, interest free - - 3 10
Trade receivables, joint ventures and associates - - 16 18
Trade receivables, related parties within Sinochem - - 6 1
Liabilities to related parties within Sinochem, interest free - - (2) (14)
Trade payables, Bluestar Elkem Investment Co. Ltd. S.A - - (48) (48)
Trade payables, joint ventures and associates - - (64) (47)
Trade payables, related parties within Sinochem - - (4) (4)
Prepayments from joint ventures and associates - - - (3)
Prepayments from related parties within Sinochem - - (0) (1)
Net balances with related parties 0 0 (92) (83)
Outstanding balances at year-end are unsecured, and the current receivables and payables are interest-free, with an
exception of the non-current receivables. The interest rate for the non-current receivables to the joint ventures and
associates are currently 3.0 per cent (3.0 per cent).
Information about main transactions with related parties
Related parties within Sinochem
→ Sale of Silicones to China Bluestar International Chemical Ltd, Jiangxi Xinghuo Spaceflight New Material Co., Ltd, and
other companies within Sinochem
→ Purchase of raw materials from companies within Sinochem
Equity accounted investments
→ Purchase of short and deep sea transport from North Sea Containerline AS and EPB Chartering AS
→ Purchase of warehousing for Combined Cargo Warehousing BV
→ Purchase of services related to steam from Jiangxi Guoxing Intelligence Energy Co. Ltd
→ Purchase of services related to shared infrastructure such as laboratory analysis, IT and telephone, warehousing and
purchase of basic chemistry products such as gas, nitrogen, compressed air from GIE Osiris
There are no other contingent liabilities or commitments related to the joint ventures and associates.
Key management personnel and board of directors
Information on transactions with key management personnel and /or their related parties, see note 11 Employee benefits
and “Report on salary and other remuneration to leading personnel in Elkem ASA for the financial year 2025”.
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Table of contents Board of directors’ report Sustainability statement Financial statements
37 Pledge of assets and guarantees
Pledges
The main part of Elkem’s interest-bearing liabilities are not pledged. Details of liabilities that have pledged assets or
guarantees related to them are stated below.
Pledged liabilities 31.12.25 31.12.24
Pledged liabilities 44 53
Book value pledged assets 31.12.25 31.12.24
Machinery, equipment and motor vehicles 0 -
Accounts receivables 43 53
Elkem makes limited use of guarantees, see specification below.
Guarantee commitments 31.12.25 31.12.24
Guarantee commitment KLIF (Climate and Pollution Agency) 40 40
Guarantee commitment Prefet de l'Isere (The Prefect of the Isère Department) 190 -
Guarantee commitment tax cases Brazil 43 42
Elkem Annual report 2025 267
38 Assets held for sale and discontinued operations
Principle application and judgements
At 23 January 2025, the group announced its intention to perform a strategic review of the Silicones business area,
and it initiated an active programme to locate a buyer for the Elkem Silicones operating segment. At the end of 2024,
it was assessed that Silicones met the criteria held for sale. In February 2026, the group announced that an agreement
to sell the majority of Elkem Siliconces to Bluestar had been made (see note 39 Events after the reporting period).
Elkem Silicones operating segment represents a major line of business and per 31 December 2024 a sale was regarded
to be highly probable to occur within one year. As such, the Silicones operating segment is presented as discontinued
operations in the statement of profit and loss, and as held for sale in the statement of financial position in both the 2024
and 2025 financial statements.
Continuing operations include internal transactions with the Silicones division that are expected to continue after
the sale. This includes sale of goods from the Silicon Products divison to the Silicones division. Financial income and
expenses are eliminated.
Discontinued operations are still included in the segment reporting as it will continue to be the followed up by the chief
operating decision maker in the same manner as before the reclassification. This will be continuously reviewed as the
strategic review process progresses. Please refer to note 6 Operating segments for segment disclosures.
Estimates
The calculations of fair value less cost to sell are based on estimated future cash flows. These cash flows are uncertain
due to potential changes in the prices of key production input factors and the market prices of Elkem’s products. This
uncertainty affects both the next 12 months and the rest of the forecast period. Additionally, there is uncertainty in
estimating replacement investments and the growth rate for the terminal value. The estimated future pre-tax cash flows
are discounted using a pre-tax discount rate. The uncertainty in this discount rate relates to the determination of the
risk-free rate, the market risk premium and the beta. Elkem uses a beta specific to each business segment, found using
observable betas of comparable companies for each business segment. To address the uncertainty in these estimates,
Elkem has conducted sensitivity analyses on key drivers in the fair value less cost to sell calculations.
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Table of contents Board of directors’ report Sustainability statement Financial statements
Internal transactions are eliminated in the presentation of profit and loss from discontinued operations in the table below.
Profit and loss from discontinued operations 31.12.25 31.12.24
Revenue 14 062 14 113
Other operating income 10 20
Share of profit (loss) from equity accounted investments 7 2
Total operating income 14 079 14 134
Raw materials and energy (8 636) (8 718)
Employee benefit expenses (2 327) (2 469)
Other operating expenses (2 003) (2 431)
Amortisation and depreciation (1 652) (1 744)
Impairment loss (75) (10)
Other items (167) (145)
Operating profit (loss) (782) (1 382)
Finance Income 24 41
Foreign exchange gains (losses) 0 -
Finance expenses (157) (138)
Profit (loss) before income tax (914) (1 480)
Income tax (expenses) benefits (54) (58)
Profit (loss) for the year from discontinued operations (969) (1 538)
Cumulative income or expense recognised in other comprehensive income from discontinued operations 2025 2024
Exchange differences on translation of discontinued operations 1 388 2 048
Earnings per share - discontinued operations 2025 2024
Basic earnings per share in NOK (1.53) (2.43)
Diluted earnings per share in NOK (1.53) (2.42)
Elkem Annual report 2025 269
Note 38 continued
The below tables shows profit and loss from continuing operations, from the Silicones operating segment and
eliminations booked in discontinued operations in order to show the profit and loss from Elkem group total,
Silicones Eliminations in
Reconciliation between continuing and discontinued operations Continuing operating discontinued Elkem group
with Elkem group total 2025 operations segment operations total
Revenue 16 535 14 924 (862) 30 596
Other operating income 172 10 (0) 182
Share of profit (loss) from equity accounted investments 20 7 - 27
Total operating income 16 727 14 941 (862) 30 806
Raw materials and energy (7 631) (9 254) 618 (16 267)
Employee benefit expenses (2 874) (2 327) - (5 201)
Other operating expenses (4 159) (2 265) 262 (6 163)
Amortisation and depreciation (1 008) (1 652) - (2 659)
Impairment loss (7) (75) - (82)
Other items 258 (167) - 91
Operating profit (loss) 1 307 (799) 17 525
Finance Income 61 25 (1) 85
Foreign exchange gains (losses) (284) 0 - (284)
Finance expenses (549) (276) 120 (706)
Profit (loss) before income tax 534 (1 050) 136 (380)
Income tax (expenses) benefits (149) (54) (1) (203)
Profit (loss) for the year 385 (1 104) 135 (584)
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Table of contents Board of directors’ report Sustainability statement Financial statements
Silicones Eliminations in
Reconciliation between continuing and discontinued operations Continuing operating discontinued Elkem group
with Elkem group total 2024 operations segment operations total
Revenue 17 810 15 069 (956) 31 922
Other operating income 1 066 20 (1) 1 086
Share of profit (loss) from equity accounted investments (6) 2 - (4)
Total operating income 18 870 15 091 (957) 33 004
Raw materials and energy (8 313) (9 439) 720 (17 032)
Employee benefit expenses (2 766) (2 469) - (5 234)
Other operating expenses (4 283) (2 663) 232 (6 714)
Amortisation and depreciation (931) (1 744) - (2 674)
Impairment loss (168) (10) - (178)
Other items (316) (145) - (460)
Operating profit (loss) 2 094 (1 377) (5) 712
Share of profit (loss) from equity accounted financial investment (143) - - (143)
Finance Income 107 41 (0) 147
Foreign exchange gains (losses) 247 - - 247
Finance expenses (778) (471) 332 (916)
Profit (loss) before income tax 1 526 (1 807) 328 47
Income tax (expenses) benefits 588 (58) (0) 530
Profit (loss) for the year 2 115 (1 865) 328 577
Cash flows from internal transactions are eliminated in cash flows from discontinued operations in the below table.
Cash flows from discontinued operations 2025 2024
Net cash inflow from operating activities 483 262
Net cash inflow from investing activities (1 082) (1 734)
Net cash outflow from financing activities 410 769
Net increase (decrease) in cash generated from discontinued operations (188) (703)
Elkem Annual report 2025 271
Note 38 continued
Assets reclassified as held for sale in relation to the discontinued operation as at 31 December 2025 2024
Property, plant and equipment 14 320 16 095
Right of use assets 428 474
Other intangible assets 970 1 075
Goodwill 705 756
Deferred tax assets 25 36
Investments in equity accounted investments 155 157
Other assets 201 201
Total non-current assets 16 805 18 793
Inventories 2 896 3 783
Trade receivables 1 567 1 700
Other assets 403 891
Restricted deposits 95 350
Cash and cash equivalents 1 112 1 673
Total current assets 6 073 8 396
Total assets 22 878 27 189
Liabilities directly associated with assets classified as held for sale as at 31 December 2025 2024
Interest-bearing liabilities 3 071 3 290
Deferred tax liabilities 117 137
Employee benefit obligations 253 292
Provisions and other liabilities 14 12
Total non-current liabilities 3 454 3 731
Trade payable 1 738 3 084
Income tax payables 50 52
Interest-bearing liabilities 648 200
Bills payable 657 1 549
Employee benefit obligations 472 530
Provisions and other liabilities 427 522
Total current liabilities 3 992 5 937
Total liabilities 7 447 9 668
Impairment testing for the year ended 31 December 2025
For the year ended 31 December 2025, an estimate of fair value less cost to sell of the disposal group was prepared, and
no loss was recognised. A signed agreement to transfer the majority of the Silicones division was signed 13 February
with Bluestar, see note 39 Events after the reporting period. The final negotiations with Bluestar have been ongoing
since September 2025. As at 31 December 2025 the most likely transaction structure was to settle the transaction
with redemption of all Bluestar’s shares in Elkem. When estimating the fair value less cost to sell, the income approach
(discontinued cash flow method) was used, taking into account the actual bid.
When estimating the fair value, a valuation of both the assets that are transferred and the assets that are not transferred
to Bluestar has been performed. The valuation of both groups of assets has been performed to be able to conclude that
there is reasonable correspondence between the assets Elkem shall transfer and the agreed consideration. Future cash
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Table of contents Board of directors’ report Sustainability statement Financial statements
flows were estimated using a combination of external and internal sources. In estimating future cash flows for 31.12.2025
for the Silicones division, the same assumptions was used for 2025 as are described below for 2024, updated as at
31.12.2025. For continuing operations, see Note 21 Impairment assessments.
For the Silicones division, Elkem has used a pre-tax WACC of 10.5 per cent and a growth rate of 2 per cent. For
illustrational purposes, the table below show the effect on the calculated value in use if different assumptions were used
(sensitivity analysis):
Sensitivity on value EBITDA-margin EBITDA-margin Pre-tax WACC Pre-tax WACC Growth rate Growth rate
in use for Silicones increased with decreased with increased with reduced with increased with reduced with
division at 31.12.2025 1% 1% 2% 2% 1% 1%
Change in value in use 2 545 (2 545) (4 487) 7 252 2 296 (1 815)
Impairment testing for the year ended 31 December 2024
Immediately before the Silicones division was initially presented as discontinued operations, an impairment assessment
was performed and no impairment loss was identified. Subsequently, the disposal group classified as held for sale
shall be measured at the lower of its carrying amount and fair value less costs to sell. When estimating fair value less
cost to sell the income approach (discounted cash flow method) was used. Future cash flows were estimated using a
combination of external and internal sources. In estimating future cash flows the following assumptions were used:
Financial performance 2024
Silicones markets remained challenging in 2024 due to weak market sentiment and Chinese overcapacity. The Chinese
property market has been in a severe downturn since 2021. During the second half of 2024 there were some positive
developments. The Chinese central bank announced its biggest stimulus package since the pandemic. Further, several
producers, including Elkem announced global price increases for specialties which gave a positive impact on profitability.
DMC prices in China showed a modest increase in the last two quarters of 2024. The normalised EBITDA-margin for the
Silicones segment in 2024 was 3.5 per cent, and with an improving trend through the year. The 2024 normalised EBITDA
of NOK 521 million is an improvement from a negative normalised EBITDA of NOK 605 million in 2023.
Financial forecasts 2025-2029
The 2025 budget and 2026-2029 strategic plan approved by the board is used a basis for the forecasts which is used for
the fair value estimate. When preparing the budget and strategic plan a range of both external and internal sources are
considered. External sources include market reports and price indexes. Internal sources include agreed sales volumes for
the period, the effect of implemented cost saving initiatives and planned investments and maintenance.
Normalised EBITDA level represents the operating profit (loss) before depreciation and amortisation. The key
assumptions used in reaching the forecast figures are sales prices, total volume and product mix, operating costs, and
productivity targets. See Note 6 Operating segments for Elkem’s definition of normalised EBITDA.
→ External markets analysts expect continued challenging supply/demand balance both in China and globally for the
next two years, before a gradual recovery towards the end of the forecast period resulting in a more balanced market
→ The Silicon division capacity increase following strategic investments in China in the previous years was ramped up
during 2024 and is performing better than target. The Silicon division production in France is expected to ramp up
production during 2025 and reach full capacity during the first half of 2025. These new assets are expected to yield
cost savings, more efficient production and an improved specialty ratio that will improve both absolute and stability
in margins
→ Cost saving programmes initiated in 2023 and continued in 2024 are expected to give permanent cost reductions
through improved productivity and better process quality.
→ A more balanced market, combined with an increased specialty ratio, results in improved average sales prices and
combined with reduced cost leads to a gradually improving normalised EBITDA-margin throughout the forecast
period. Forecasted sales prices are based on a weighted average of sales prices for commodity and specialty
volumes.
Elkem Annual report 2025 273
Note 38 continued
Other operating costs
These are estimated based on the current level and adjusted for expected inflation in the respective locations where the
business is situated. Operating costs are also impacted by ongoing operational efficiency programmes. Changes to the
outcome of these initiatives may affect future normalised EBITDA levels.
Capital expenditure (“Capex”)
A normalised capex is assumed in the long run and are based on today’s maintenance level and technology. Capex
includes remaining investments on strategic projects in an advanced stage where the projects are substantially
commenced per 31 December 2024.
Discount rate
A weighted average cost of capital is used to discount the cash flows. The WACC is calculated by using a target capital
structure of 50:50. Cash inflows and outflows in different currencies are translated to NOK and a NOK 10 year risk-free
interest rate is used in the WACC. The discount rates also consider the debt premium, market risk premium, corporate
tax rate, and asset beta. For the Elkem Silicones division the cash flows have been discounted with a pre-tax rate of 10.5
per cent, derived from a WACC of 8.44 per cent.
Growth rates and inflation
The expected growth rates converge from its current level, to the long-term growth level in the markets in which the
entity operates. The growth rates used to extrapolate cash flow projections in the terminal value are based on expected
inflation in relevant markets, assumptions in terms of market share and expectations for the market development in
which the entity operates.
Currency rates
The fair value calculation is performed in the presentation currency for the Silicones segment which is NOK. The
currency rates used to translate future incomes and expenses in other currencies than the functional currency is based
the currency rates used in the strategic planning process.
Steady state 2030 and onwards
After the forecast period 2025-2029 the cash flows from operations are expected to a reach a steady state. The steady
state cash flows in 2030 is used to calculate the terminal value. An normalised EBITDA-margin of 17.5 per cent and a
growth rate of 2 per cent is estimated in the steady state.
The estimated fair value less cost of sale of Elkem Silicones is higher than the net value of Silicones’ assets and liabilities
amounting to NOK 17.5 billion as at 31 December 2024, and no reduction of the carrying amount to fair value less cost
to sell has been recognised. There is significant uncertainty regarding the sales value of Elkem Silicones and therefore a
range of fair values are presented to illustrate the sensitivity in the fair value. In estimating the range of values the same
cash flows has been used for the forecast period 2025-2029. However, different WACCs is used to discount estimated
future cash flows and different normalised EBITDA-margins are used in the steady state and applied in calculating the
terminal value. The range can be summarised in the following matrix:
Amounts in NOK million EBITDA-margin in steady state (in per cent)
Sensitivity of fair value less cost to sell of discontinued operations 17.5% 15.0% 12.7%
8.44% 21.1 17.1 13.3
WACC (in per cent) 9.44% 17.9 14.5 11.4
10.0% 16.4 13.4 10.5
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Table of contents Board of directors’ report Sustainability statement Financial statements
39 Events after the reporting period
Principle application
Events after the reporting period
Events after the reporting period related to the group’s financial position at the end of the reporting period, are
considered in the financial statements. Events after the reporting period that have no effect on the group’s financial
position at the end of the reporting period, but will have effect on future financial position, are disclosed if the future
effect is material.
At 13 February 2026, Elkem signed an agreement to transfer the majority of its Silicones division to Bluestar (the
“Transaction”). The Transaction will be settled with all Elkem shares held by Bluestar through Bluestar Elkem Int.Co.LTD S.A,
338 338 536 shares. In the Transaction, Elkem will transfer all its shares in Elkem Siliconas España S.A.U, Elkem Silicones
(UK) Ltd., Elkem Silicones Brasil Ltda., Elkem Silicones Canada Corp., Elkem Silicones Czech Republic, s.r.o., Elkem
Silicones Finland OY, Elkem Silicones Germany GmbH, Elkem Silicones Hong Kong Co., Ltd., Elkem Silicones Korea Co.,
Ltd., Elkem Korea Co., LTD. , Elkem Silicones México S. De R.L. De C.V., Elkem Silicones Poland sp. z o.o., Elkem Silicones
Scandinavia AS, Elkem Silicones Services S.à r.l., Elkem Silicones USA Corp., Elkem Siliconi Italia S.r.l., Elkem Silicones
Shanghai Co., Ltd., Jiangxi Bluestar Xinghuo Silicone Co., Ltd., Elkem Silicones Guangdong Co., Ltd, Elkem Silicones
Material Zhongshan Co., Ltd. and Elkem Silicones France SAS (collectively, the “Transferred silicones assets”) to Bluestar.
At 6 February Elkem Silicones France SAS carved out its operations at the Roussillon plant (upstream Silicones) into a
new legal entity, Elkem Testvirksomhet III SAS (Roussillon). Roussillon is owned by Elkem ASA and will together with the
shares in Elkem Silicon Materials (Lanzhou) Co., Ltd. (Yongdeng) and the Silicones operation in India, a division of Elkem
South Asia Private Limited, not be included in the Transaction (collectively, the “Retained silicones assets”). In addition,
Elkem Silicones France SAS has distributed its shares in Osiris GIE and 3Deus Dynamics SAS as a dividend-in-kind to
Elkem in February 2026. For Roussillon, Elkem has entered into a five-year supply agreement of upstream silicones to
the downstream business to be acquired by Bluestar, ensuring economically viable operations.
The Transaction is conditional upon the approval by Elkem’s general meeting in addition to waivers and approvals from
Elkem’s lenders and other customary approvals. Bluestar will not vote their Elkem shares on agenda items relating to the
Transaction. The Transaction was approved by the extraordinary general meeting at 9 March 2026. Subject to the other
closing conditions being satisfied or waived, the Transaction is expected to close during the second quarter 2026.
Accounting effects of the transaction
The Transaction did not occur prior to 31 December 2025, and the Transaction is therefore not recognised in the financial
statements. The transaction is structured as a distribution of non-cash assets to owners, where the non-cash assets
will be ultimately controlled by the same party before and after the distribution. At the effective date of the transaction,
the book value of the Transferred silicones assets will be derecognised and adjusted against equity, representing the
cancellation of 338 338 536 shares. No gains or losses will be recognised in the statement of profit or loss related to the
derecognition of the Transferred assets.
Regarding the effect from the Transaction on the consolidated statement of profit or loss, it is considered that the
information given in note 38 Assets held for sale and discontinued operations provides the best overview of the historical
performance of the Transferred silicones assets. For Roussillon, Elkem has entered into a five-year supply agreement of
upstream silicones to the downstream business to be acquired by Bluestar, as well as to a renowned third party, which will
take effect upon the closing of the Transaction. For the Retained silicones assets, strategic alternatives are being explored.
The tables below are unaudited pro forma illustrations. The first table disaggregates the assets and liabilities currently
presented as held for sale (see note 38 Assets held for sale and discontinued operations) into “Transferred net assets”
and “Retained net assets” and the second table presents the consolidated statement of financial position as of 31
December 2025, as if the Transaction had occurred prior to 31 December 2025. The IFRS accounting policies adopted
in the preparation of the unaudited pro forma consolidated statement of financial position are consistent with those
disclosed in note 2 Basis for preparing the consolidated financial statements. Although the unaudited pro forma
consolidated statement of financial position is based on estimates and assumptions based on current circumstances
believed to be reasonable, actual outcome of the Transaction could materially differ from those presented herein.
Elkem Annual report 2025 275
Note 39 continued
Disaggregation of assets held for sale as at 31 December 2025 in Transferred Retained Assets held for sale as
conjunction with the Transaction (Unaudited) silicones assets silicones assets presented in note 38
Property, plant and equipment 12 082 2 238 14 320
Right of use assets 336 92 428
Other intangible assets 865 106 970
Goodwill 705 - 705
Deferred tax assets 24 1 25
Investments in equity accounted investments 66 88 155
Other assets 140 61 201
Total non-current assets 14 218 2 587 16 805
Inventories 2 373 523 2 896
Trade receivables 1 557 10 1 567
Other assets 384 19 403
Restricted deposits 95 - 95
Cash and cash equivalents 1 194 (82) 1 112
Total current assets 5 602 471 6 073
Total assets 19 820 3 057 22 878
Disaggregation of liabilities directly associated with
assets held for sale as at 31 December 2025 in conjunction Transferred Retained silicones Liabilities held for sale as
with the Transaction (Unaudited) silicones liabilities liabilities presented in note 38
Interest-bearing liabilities 3 051 21 3 071
Deferred tax liabilities 117 0 117
Employee benefit obligations 253 - 253
Provisions and other liabilities 14 - 14
Total non-current liabilities 3 434 21 3 454
Trade payable 1 712 27 1 738
Income tax payables 50 0 50
Interest-bearing liabilities 646 2 648
Bills payable 657 - 657
Employee benefit obligations 396 76 472
Provisions and other liabilities 421 6 427
Total current liabilities 3 882 111 3 992
Total liabilities 7 315 131 7 447
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Table of contents Board of directors’ report Sustainability statement Financial statements
Pro forma consolidated statement of financial position as at 31 December 2025, as if the
Transaction had occured prior to the balance sheet date (unaudited) 2025
Assets
Property, plant and equipment 8 568
Other non-current assets 4 015
Total non-current assets 12 583
Other current assets 9 327
Cash and cash equivalents 2 694
Total current assets 12 021
Assets classified as held for sale 3 057
Total assets 27 661
Equity and liabilities
Total owners' share 11 417
Non-controlling interest 104
Total equity 11 521
Non-current interest-bearing liabilities 9 648
Other non-current liabilities 992
Total non-current liabilities 10 640
Current interest-bearing liabilities 2 322
Other current liabilities 3 046
Total current liabilities 5 368
Liabilities classified as held for sale 131
Total equity and liabilities 27 661
Elkem Annual report 2025 277
Elkem ASA
Financial statements
Income statement 280
Balance sheet 281
Cash flow statement 283
General information
Note 1 General information 284
Note 2 Significant accounting policies 285
Note 3 Accounting estimates 292
Income statement
Note 4 Operating income 293
Note 5 Grants 294
Note 6 Raw materials and energy 295
Note 7 Employee benefit expenses 295
Note 8 Employee retirement benefits 296
Note 9 Other operating expenses 297
Note 10 Operating lease 298
Note 11 Other gains (losses) related to operating activities 298
Note 12 Finance income and expenses 299
Note 13 Taxes 300
278 Financial statements | Elkem ASA
Balance sheet
Note 14 Property, plant and equipment 302
Note 15 Intangible assets and goodwill 303
Note 16 Investment in subsidiaries 304
Note 17 Investment in joint ventures 306
Note 18 Inventories 307
Note 19 Trade receivables 308
Note 20 Other assets 309
Note 21 Equity 310
Note 22 Shareholders 311
Note 23 Interest-bearing assets and liabilities 312
Note 24 Provisions and other liabilities 315
Note 25 Financial instruments 316
Other information
Note 26 Financial risk 318
Note 27 Related parties 318
Note 28 Pledge of assets and guarantees 320
Note 29 Supplemental information to the cash flow statement 320
Note 30 Merger 321
Note 31 Events after the reporting period 322
Elkem Annual report 2025 279
Income statement – Elkem ASA
Amounts in NOK million
1 January - 31 December Note 2025 2024
Revenue 4 8 358 8 881
Other operating income 4 103 829
Total operating income 8 461 9 710
Raw materials and energy 6 (3 745) (4 138)
Employee benefit expenses 7, 8 (1 580) (1 480)
Other operating expenses 9 (2 863) (2 918)
Other gains (losses) related to operating activities 11 382 (450)
Amortisation and depreciation 14, 15 (520) (507)
Impairment losses 14, 15 (5) (36)
Total operating expenses (8 330) (9 529)
Operating profit (loss) 131 181
Income from subsidiaries and associates 16 3 206 1 758
Income (loss) from joint ventures 17 - (84)
Finance income 12 235 465
Foreign exchange gains (losses) 12 (305) 78
Finance expenses 12 (665) (1 003)
Profit (loss) before income tax 2 602 1 395
Income tax (expenses) benefit 13 298 928
Profit (loss) for the year 2 900 2 323
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Balance sheet – Elkem ASA
Amounts in NOK million
Note 2025 2024
ASSETS
Property, plant and equipment 14 5 319 5 144
Goodwill 15 4 8
Other intangible assets 15 73 73
Deferred tax assets 13 878 633
Investment in subsidiaries 16 16 730 16 729
Investment in joint ventures 17 - -
Derivatives 25 981 1 012
Other assets 20 3 438 3 986
Total non-current assets 27 422 27 586
Inventories 18 2 979 2 685
Trade receivables 19 1 207 1 146
Derivatives 25 285 267
Other assets 20 2 016 1 723
Cash and cash equivalents 23 1 468 2 730
Total current assets 7 954 8 551
TOTAL ASSETS 35 376 36 136
Elkem Annual report 2025 281
Balance sheet – Elkem ASA
Amounts in NOK million
Note 2025 2024
EQUITY AND LIABILITIES
Paid-in capital 21.22 3 508 3 502
Retained earnings 21 15 109 12 163
Total equity 18 617 15 665
Interest-bearing liabilities 23 9 486 11 738
Deferred tax liabilities 13 - -
Employee retirement benefits 8 107 100
Derivatives 25 350 485
Provisions and other liabilities 24 91 85
Total non-current liabilities 10 033 12 407
Trade payables 1 202 1 258
Income tax payables 13 56 -
Interest-bearing liabilities 23 4 708 5 684
Derivatives 25 115 140
Dividend 21 - 190
Provision and other liabilities 24 644 792
Total current liabilities 6 725 8 064
TOTAL EQUITY AND LIABILITIES 35 376 36 136
Oslo, 10 March 2026
Bo Li Dag Jakob Opedal Olivier Tillette de Clermont- Wei Yao
Chair Vice chair Tonnerre Board member
Board member
Dachuan Dong Grace Tang Nathalie Brunelle Marianne Elisabeth Johnsen
Board member Board member Board member Board member
Terje Andre Hanssen Marianne Færøyvik Thomas Eggan Helge Aasen
Board member Board member Board member CEO, Elkem ASA
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Cash flow statement – Elkem ASA
Amounts in NOK million
1 January - 31 December Note 2025 2024
Operating profit (loss) 131 181
Changes in fair value of derivatives (84) 587
Amortisation, depreciation and impairment losses 14, 15 524 543
Changes in working capital 29 (458) (369)
Changes in provisions, pension obligations and other (246) 158
Interest payments received 109 112
Interest payments made (621) (954)
Income taxes paid 95 (178)
Cash flow from operating activities (550) 81
Investments in property, plant and equipment and intangible assets 14, 15 (742) (879)
Received investment grants 5 3 -
Proceeds from sale of property, plant and equipment 14 34 1
Cash effect from merged companies 30 - 0
Acquisition and capital increase in subsidiaries 16 (0) (238)
Proceeds from sale of joint ventures - 10
Increase in loans to subsidiaries 23, 27 (16) (10)
Repayment on loans to subsidiaries 23, 27 388 29
Dividend and group contribution 16 856 1 458
Other investments / sales 1 9
Cash flow from investing activities 523 381
Dividend paid to owners 21 (190) 0
Net sale (purchase) of treasury shares 21 1 5
New interest-bearing loans and borrowings 23 2 1 599
Repayment of interest-bearing loans and borrowings 23 (1 005) (1 443)
New cash deposits to / from subsidiaries 23, 27 1 046 665
Repayment of cash deposits to / from subsidiaries 23, 27 (1 089) (1 888)
Cash flow from financing activities (1 236) (1 062)
Change in cash and cash equivalents (1 262) (600)
Currency translation differences 0 0
Net change in cash and cash equivalents (1 262) (600)
Cash and cash equivalents opening balance 23 2 730 3 331
Cash and cash equivalents closing balance 23 1 468 2 730
Elkem Annual report 2025 283
Elkem ASA
Notes to the financial
statements
Amounts in NOK million
1 General information
Elkem ASA is a limited liability company located in Norway, whose shares are publicly traded on Oslo Stock Exchange.
The main activities are related to production and sale of silicon materials, ferrosilicon, specialty alloys for the foundry
industry and Elkem Microsilica®. Elkem ASA is owned 52.9 per cent by Bluestar Elkem International Co. Ltd S.A.,
Luxembourg, which is under the control of Sinochem Holdings Co., Ltd (Sinochem), a company registered and domiciled
in China.
The presentation currency of Elkem ASA is Norwegian krone (NOK). All financial information is presented in NOK million,
unless otherwise stated. As a result of rounding adjustments, the amounts shown in one or more columns included in
the financial statements may not add up to the total. In text the current year’s figures are presented outside parentheses,
followed by the comparative figures presented in parentheses.
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2 Significant accounting policies
The financial statements have been prepared in accordance with the Norwegian Accounting Act and generally accepted
accounting principles in Norway. The accounts have been prepared under the going concern assumption.
Accounting estimates
In the event of uncertainty, the best estimate is applied, based on the information available when the financial
statements are prepared. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period for which the estimates are revised and in any future periods affected.
See note 3 Accounting estimates.
Foreign currency translation
Elkem ASA’s functional currency is Norwegian krone (NOK). Transactions in currencies other than the Elkem ASA’s
functional currency are translated using the transaction date’s currency rate. Monetary items in foreign currencies are
presented at the exchange rate applicable on the balance sheet date. Non-monetary items measured at fair value in a
foreign currency are translated using the exchange rate at the date fair value is measured. If the currency exposure of a
transaction is designated as a part of a hedging relationship, realised effects from the associated hedging instrument
are classified on the same line in the financial statements as the hedged transaction. Currency gains (losses) related
to operating activities, i.e. receivables, payables, bank accounts for operating purposes, are classified as a part of other
gains (losses) related to operating activities. Currency effects included in finance income and expenses are related to
loans and dividends.
Revenue recognition
Sale of goods
Revenue is recognised when it is earned and the revenue can be measured reliably. Revenue is measured at the fair
value of the consideration received or receivable, net of any taxes, rebates, and discounts. Expenses are recognised in
the same period as the related revenue. When products are sold with warranties, the expected warranty amounts are
recognised as expenses at the time of the sale, and are subsequently adjusted for any changes in estimates or actual
outcome.
Revenue from sale of goods is recognised when the significant risk and reward of the ownership of the goods have
passed to the buyer, according to the agreed delivery term for each sale. Delivery terms are based on Incoterms® 2020
issued by International Chamber of Commerce, and the main terms are:
→ “F” terms, where the buyer arranges and pays for the main carriage. The risk and reward are passed to the buyer
when the goods are handed over to the carrier engaged by the buyer.
→ “C” terms, where Elkem ASA arranges and pays for the main carriage but without assuming the risk of the main carriage.
The risk and reward are passed to the buyer when the goods are handed over to the carrier engaged by the seller.
→ “D” terms, where Elkem ASA arranges and pays for the carriage and retains the risk and reward of the goods until
delivery at agreed destination. The risk is transferred to the buyer upon arrival at agreed destination, usually the
purchaser’s warehouse.
Sale of power and revenue connected to energy recovery
Sale of electric power and revenue connected to energy recovery, mainly heat supply in form of steam and hot water,
el-certificates, and el-tax, are recognised as revenue based on volume and price agreed with the customer. Revenue
connected to energy recovery is mainly based on long-term contracts where the prices are regulated yearly based on
changes in CPI or government-regulated prices, except for the el-certificates where the price is based on the observable
market price at date of delivery.
Revenue from sale of services
Revenue from sale of services is recognised when the services have been provided. Sale of services are mainly related to
management agreements with related parties, based on cost plus a margin.
Elkem Annual report 2025 285
Note 2 continued
Other
Income from insurance settlements are recognised when it is virtually certain that Elkem ASA will receive the
compensation, and is recognised as other operating income. Cash flows from credit insurance contracts where such
contracts are deemed to be an integral part of the sale transactions are presented net as reduction of impairment losses
to assets / receivables, included in other operating expenses. Interest income is recognised on accrual basis. Dividends
are recognised when Elkem ASA’s right to receive dividends is determined by the shareholders’ meeting. Group
contributions are recognised in the year the subsidiary accrues the amount payable.
Grants
Grants are recognised when it is reasonably assured that the company will comply with the conditions attached to them
and the grants will be received. Grants relating to cost of production of goods are recognised in profit or loss when the
produced goods are sold. Grants relating to property, plant and equipment and intangible assets are deducted from
the carrying amount of the asset, and recognised in the income statement over the lifetime of a depreciable asset by
reducing the depreciation charge. Grants related to expenses are presented in the income statement as as a reduction of
raw materials and energy, employee benefit expenses or other operating expense over the periods necessary to match
them with the cost they are intended to compensate.
Investment in subsidiaries, associates, and jointly controlled entities
Subsidiaries are companies in which Elkem ASA has controlling interests, normally obtained when Elkem ASA owns
more than 50% of the shares.
Associates are those entities in which Elkem ASA has significant influence, but no control, over the financial and
operating policy decisions. Significant influence is presumed to exist when Elkem ASA holds between 20 per cent and
50 per cent of the voting power of another entity. Jointly controlled entities are those entities over whose activities Elkem
ASA has joint control, established by contractual agreement and requiring unanimous consent for decisions about the
relevant activities.
Interests in subsidiaries and associates are recognised at cost less any write-down for impairment. Dividends and group
contributions are recognised as income from subsidiaries and associates when Elkem ASA’s right to receive dividends
is determined by the shareholders’ meeting. If dividends or group contributions exceed withheld profits after the
acquisition date, the excess amount represents repayment of invested capital, and the distribution will be deducted from
the recorded value of the acquisition in the balance sheet.
Joint ventures
Elkem ASA’s interests in jointly controlled entities, which operates within Elkem ASA’s main business areas (Silicon
products), are accounted for using the gross method, meaning that the company’s share of the income, expense, assets
and liabilities are recognised. Elkem ASA combines its share of the joint ventures’ individual income and expenses, assets
and liabilities and cash flows on a line-by-line basis with similar items in the financial statements.
Elkem ASA’s interests in joint controlled entities, which do not operate within Elkem ASA’s main business areas, are
accounted for using the equity method. Under the equity method, the investment is initially recognised at cost, and the
carrying amount is increased or decreased to recognise Elkem’s share of the profit or loss and other comprehensive
income of the investee after the date of acquisition. In cases where a joint venture’s loss decreases the initially
recognised cost to zero and additional funding is required, the carrying amount presented reflects Elkem’s liability
to finance the joint venture. Any liability to finance a joint venture is presented either as part of provisions and other
liabilities, current, or netted against Elkem’s receivables towards the joint venture.
Impairment of investment in subsidiaries, associates, and jointly controlled entities
Impairment loss is recognised if the carrying amount exceeds the recoverable amount and the impairment is not
considered to be temporary. The recoverable amount is the higher of fair value less costs to sell, or its value in use. Value
in use is the present value of the future cash flow expected to be derived from the asset or the cash generating unit to
which it belongs, after taking into account all other relevant information. The impairment is reversed if the basis for the
write-down is no longer present.
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Intangible assets
Intangible assets are presented at cost less subsequent accumulated amortisation and accumulated impairment losses.
Intangible assets with a finite useful life are amortised, using the straight-line method. The estimated useful life and
amortisation method are reviewed at the end of each reporting period.
An intangible asset is derecognised on disposal, or when no future economic benefits from its use are expected to be
derived. Gain or loss arising from derecognition of an intangible asset, measured as the difference between the net
disposal proceeds and the carrying amount of the asset, is recognised in the income statement.
Expenditure on research activities is recognised as an expense in the period in which it is incurred. An intangible asset
arising from an internal development project is recognised if the company can demonstrate technical feasibility of
completing the intangible asset, has intention to complete it, ability to use it, can demonstrate that it will generate
probable future economic benefits and the cost can be reliably measured.
Property, plant and equipment
Property, plant and equipment are presented at cost, less accumulated depreciation and any accumulated impairment
losses. Construction in progress is carried at cost, less any recognised impairment loss. Such assets are classified to
the appropriate class of property, plant and equipment when completed and ready for its intended use. Significant
parts of an item of property, plant and equipment, which have different useful life, are accounted for as separate items.
Depreciation commences when the assets are ready for their intended use.
Initial cost includes expenditures that are directly attributable to the acquisition of the asset, cost of materials, direct
labour, any other costs directly attributable to bringing the assets to working condition for their intended use, estimated
dismantling or removal charges, and capitalised borrowing costs.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate,
when future benefits are probable and the cost can be measured reliably. The carrying amount of the replaced part
is derecognised. Major periodic maintenance that is carried out less frequently than every year, is capitalised and
depreciated over the period until the next periodic maintenance is performed. All other repairs and maintenance are
charged to the income statement when incurred.
Property, plant and equipment also consists of spare parts that are expected to last for more than one year and are
substantial in nature or may only be used in conjunction with one item of tangible fixed assets. Other spare parts are
presented as part of inventory.
Depreciation is recognised using the straight-line method. The estimated useful life, residual values and depreciation
method are reviewed at the end of each reporting period.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected to arise from the continued use of the asset. Any gain or loss from disposal or retirement is determined as the
difference between the sales proceeds and the carrying amount of the asset, and is recognised in the income statement.
Impairment of tangible and intangible assets
At the end of each reporting period, the carrying amounts of tangible and intangible assets are reviewed to determine whether
there is any indication of impairment. If any such indication exists, the recoverable amount of the individual asset is estimated
in order to determine the extent of the impairment loss. If it is not possible to estimate the recoverable amount of the individual
asset, the recoverable amount of the lowest possible cash generating unit to which the asset belongs is estimated. The
recoverable amount is the higher of fair value less costs to sell, or its value in use. Value in use is the present value of the future
cash flows expected to be derived from use of the cash generating unit, after taking into account all other relevant information.
If an impairment loss for assets other than goodwill is recognised in a previous period, Elkem ASA assesses whether there are
indications that the impairment may have decreased or no longer exists. If so, the impairment loss is reversed, based on an
updated estimate of the recoverable amount, but not exceeding the carrying amount that would have been determined had no
impairment loss been recognised for the asset. Any impairment of goodwill is not reversed.
Elkem Annual report 2025 287
Note 2 continued
Leasing
Leases are classified as financial leases whenever the terms of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases are classified as operating leases and expenses are recognised as incurred.
Assets held under finance leases are initially recognised as assets at the present value of the minimum lease payments.
The corresponding liability to the lessor is included in the financial statements as a finance lease obligation. Each lease
payment is allocated between the liability and finance charges so as to achieve a constant rate on the obligation.
Non-derivative financial assets and liabilities
A financial asset or a financial liability is recognised in the balance sheet when the entity becomes party to a contract.
Assets to be acquired and liabilities to be incurred as a result of a firm commitment to purchase or sell goods or services
are recognised at the time one of the parties has performed under the agreement.
Financial assets are initially recognised in the balance sheet at fair value plus any transaction costs directly attributable to
the acquisition or issue of the asset. Financial assets are derecognised once the right to future cash flows has expired or
when all substantial risks and rewards related to control of the assets are transferred to a third party.
Financial assets with a maturity exceeding one year are classified as non-current financial assets. Short-term
investments that do not meet the definitions of a cash equivalent, and financial assets with a maturity of less than one
year, are classified as current financial assets. Non-current financial assets are recognised and subsequently measured
at cost less any impairment loss, if the impairment is assessed not to be temporary.
Loans and receivables
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in
a regulated market. They are recognised at amortised cost using the effective interest method. Gains and losses are
recognised in the income statement when the loans and receivables are derecognised or impaired, as well as through the
amortisation process. An impairment loss is recognised when the carrying amount exceeds the estimated recoverable
amount.
The category includes trade receivables, deposits, guarantees and loans. These assets are classified in the balance sheet
as either other non-current assets or other current assets. Other current assets are receivables with maturity less than
one year.
Trade and other receivables are recognised at nominal value less provisions for doubtful accounts.
Cash and cash equivalents
Cash and cash equivalents are held for the purpose of meeting short-term fluctuations in liquidity, rather than for
investment purposes. Cash and cash equivalents comprise cash funds and short-term deposits with a term of 3 months
or less on acquisition. Bank overdrafts are shown within current interest-bearing liabilities in the balance sheet. Elkem
ASA’s deposits and drawings within the group cash pool are netted by offsetting deposits against withdrawals.
The subsidiaries’ deposits and drawings are classified as current assets / liabilities.
Derivative financial instruments
Currency derivatives are initially recognised at fair value on the date the derivative contracts are entered into, and are
subsequently remeasured to their fair value at the end of the reporting period. The resulting gain or loss is recognised in
the income statement immediately, unless when the derivative is designated and is effective as a hedging instrument.
If the derivative is designated as a hedging instrument, timing of recognition in the income statement depends on the
nature of the hedging relationship.
The part of commodity derivative contracts that do not qualify as hedging instruments and are not held for trading are
booked at the lower of cost and fair value.
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Embedded currency derivatives are separated from the host contract and booked at fair value, as an independent
derivative.
Non-financial commodity contracts, where the relevant commodity is readily convertible to cash and where the
contracts are for own use, are recognised in the balance sheet at cost and in the income statement on realisation. This
applies to power purchase contracts intended for use in the plants’ production processes.
Hedge accounting
Elkem ASA may designate certain derivatives as hedging instruments for fair value hedges and cash flow hedges. At the
inception of the hedging relationship, the entity documents the relationship between the hedging instrument and the
hedged item, along with its risk management objectives and its strategy for undertaking various hedge transactions.
Elkem ASA applies IFRS 9 Financial Instruments for all hedge accounting.
Cash flow hedges
The effective portion of changes in the fair value of derivatives that are designated and qualified as cash flow hedges,
are recognised in equity and accumulated under the heading of retained earnings. Gains / losses recognised in equity are
reclassified into the income statement in the same period(s) as the forecasted transaction occurs. The unrealised gains /
losses relating to the ineffective portion is recognised immediately in the income statement.
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting,
any cumulative gain or loss existing in equity at that time remains in equity until the forecast transaction is ultimately
recognised in the income statement. When a forecast transaction is no longer expected to occur, the cumulative gain or
loss that was reported in equity is immediately transferred to the income statement.
Inventories
Inventory consists of raw materials, semi-finished goods, and finished goods, in addition to operating materials and
spare parts that do not meet the definition of property, plant and equipment. Inventories are recognised at the lowest of
cost and net realisable value. The cost of inventory comprises the costs incurred in bringing the goods to their current
condition and location, such as raw materials, energy for production, direct labour, other direct costs and production
overhead costs based on normal capacity. Net realisable value represents the estimated selling price for inventories less
estimated costs of completion and variable selling expenses.
Cost of goods sold is included in different lines in the income statement based on nature; raw materials and energy for
production, employee benefits and other operating expenses, for the remaining part.
The cost of CO2 allowances that Elkem needs to purchase in addition to allowances received from the government (note
5 Grants), are based on estimated production / emissions for the year. The cost is allocated to cost of producing semi-
finished and finished goods proportionally over the year, as the number of allocated allowances will not be revised unless
there is a substantial change in the production level at the plants.
Taxation
Income taxes
Income tax (expenses) benefit in the income statement comprises current income tax and effects of changes in deferred
tax positions. Current tax assets and liabilities are measured at the amount expected to be recovered or paid to the
tax authorities. Current tax payable includes any adjustment to tax payable in respect of previous years. Income tax is
recognised in the income statement except to the extent that it relates to items recognised directly in equity. Income tax
relating to items recognised directly in equity is also recognised in equity.
Uncertain tax positions are included when it is virtually certain that the tax position will be sustained in a tax review by
the Norwegian Tax Office (NTO). Provisions are made at the amount expected to be paid or according to the decision
by the NTO for cases where the NTO has reached a conclusion. The provision for cases where the NTO has reached
a conclusion is reversed when it is virtually certain that the decision will be overruled, which is normally when the tax
position is settled in favour of Elkem ASA and can no longer be appealed.
Elkem Annual report 2025 289
Note 2 continued
Deferred tax
Deferred tax assets and liabilities are calculated using the liability method with full allocation for all temporary differences
between the tax base and the carrying amount of assets and liabilities in the financial statements, including tax losses
carried forward. Deferred tax items are recognised in correlation to the underlying transaction either in the income
statement or directly in equity.
Deferred tax assets are recognised in the balance sheet to the extent it is more likely than not that the tax assets will
be utilised. The enacted tax rate at the end of the reporting period and undiscounted amounts are used. Deferred tax
assets arising from tax losses are recognised when there is convincing evidence of recoverability. Deferred tax assets and
liabilities items are offset if there is a legally enforceable right to offset current tax liabilities and assets.
Employee benefits
Employee benefits consist of wages and salaries, bonuses, holiday payments, share-based payments and other
considerations paid in exchange for services rendered from employees, and are expensed as incurred together with any
social security tax applicable.
Employee retirement benefits
Defined contribution plans
Defined contribution plans comprise arrangements whereby Elkem ASA makes monthly contributions to the employees’
pension plans, and where the future pensions are determined by the amount of the contributions and the return on the
individual pension plan asset. Payments related to the contribution plans are expensed as incurred, as a part of employee
benefit expenses.
Defined benefit plans
Defined benefit plans are recognised at present value of future liabilities considered retained at the end of the reporting
period, calculated separately for each plan. Social security tax related to pension payments is included in estimated
pension liability. Plan assets are measured at fair value and deducted in calculating the net pension obligation. Actuarial
assumptions are used to measure both the obligation and the expense and effects of changes in estimates due to
financial and actuarial assumptions that are recognised in equity. Service costs are classified as part of employee benefit
expenses, and net interest on pension liabilities / assets are presented as a part of finance expenses. Past service cost
arising due to amendments in benefit plans are expensed as incurred.
Multi-employer defined benefit plans where available information is insufficient to be able to calculate each participant’s
obligation, are accounted for as contribution plans.
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Share-based payment
The fair value of options granted under the share-based payment programme is recognised as an employee benefit
expense with a corresponding increase in equity. The total amount to be expensed is determined by reference to the
fair value of the options granted. The total expense is recognised over the vesting period, which is the period over which
all of the specified vesting conditions are to be satisfied. At the end of each period, Elkem ASA revises its estimates
of the number of options that are expected to vest based on the non-market vesting and service conditions. Elkem
ASA recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding
adjustment to equity.
Social security contributions payable in connection with an option grant are considered an integral part of the grant itself
and the charges are treated as cash-settled transactions.
Contingent assets and liabilities
Contingent liabilities are liabilities that are not recognised because they are possible obligations that have not yet been
confirmed, or they are present obligations where an outflow of resources is not probable. Contingent assets are not
recognised. Any significant contingent assets and liabilities are disclosed in the notes.
Events after the reporting period
Events after the reporting period related to Elkem ASA’s financial position at the end of the reporting period, are
considered in the financial statements. Events after the reporting period that have no effect on the company’s financial
position at the end of the reporting period, but will have effect on future financial position, are disclosed if the future
effect is material.
Elkem Annual report 2025 291
3 Accounting estimates
In the event of uncertainty the best estimate is applied, based on the information available when the annual accounts are
prepared.
Taxes
When estimating uncertain tax positions, the most probable amount, including interests and penalties, is used because
in most cases the outcome of the tax review is binary. Part of the basis for recognising deferred tax assets is based
on applying the loss carried forward against future taxable income for Elkem ASA, which requires use of estimates for
calculating future taxable income. See details on current uncertain tax positions in note 13 Taxes.
Provisions and other liabilities
Elkem has several types of provisions due to its operations, see note 24 Provisions and other liabilities. Such liabilities are
normally uncertain in timing and amount, and recognised amounts are estimates based on available information at the
end of the reporting period. The estimated liability is based on expected cash flows necessary to settle the obligation,
adjusted for any related risk and discounted by using the pre-tax interest applicable for Elkem ASA. The estimates are
updated when new or updated information is available, or at a minimum at each reporting date. The actual outcome will
differ from the estimate.
The estimate uncertainty primarily relates to environmental measures and site restoration expenses for closed
production sites and landfills. The potential outcome can vary within a relatively wide range depending on the final scope
of the measures required and the cost of fulfilling the measures. In these cases, the estimated provision is made based
on a combination of expert opinions and management’s assessment of the known facts and circumstances.
Financial instruments
Elkem ASA holds financial instruments such as forward currency contracts, interest rate swap and commodity derivative
contracts, which are booked at fair value. For commodity contracts denominated in EUR, the embedded EUR derivative
is separated from the host contract and booked at fair value. Hedge accounting is applied for these contracts. Fair value
for the contracts is based on observable prices and assumptions derived from comparable instruments. For assumptions
applied in fair value measurement of the contracts, see note 29 Financial assets and liabilities in the consolidated
financial statement. Non-financial commodity contracts, where the relevant commodity is readily convertible to cash
and where the contracts are for own use, are booked at the lower of cost and the estimated obligation if it is an onerous
contract.
Net book value of contracts booked at fair value as at 31 December 2025 is in total positive NOK 800 million (positive
NOK 654 million), see note 25 Financial instruments.
Impairment of investments in subsidiaries, associates, jointly controlled entities, and tangible and intangible assets
The value-in-use calculations are based on estimated future cash flows. The uncertainty in the cash flows relates to
future prices for both key input factors in the production and market prices for the sale of Elkem’s products. There is
uncertainty regarding these factors both for the next 12 months and for the rest of the forecast period. There is also
uncertainty in estimating replacement investments and the growth rate in the terminal value. The estimated future pre-
tax cash flows are discounted using a discount rate before tax. The estimation uncertainty in the discount rate relates to
the determination of the risk-free rate, the market risk premium and the beta. Elkem uses a beta per business segment
and the beta is found using observable betas of comparable companies for each business segment.
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4 Operating income
Operating income by type 2025 2024
Revenue from sale of goods, Silicon Products 5 844 6 402
Revenue from sale of goods to related parties 1 758 1 846
Other operating revenue 284 149
Other operating revenue to related parties 472 484
Total revenue 8 358 8 881
Grants (note 5) 1 1
Insurance settlement 2 815
Sale of CO2 quotas 45 -
Rental income 4 3
Rental income from related parties 25 8
Other 27 1
Total other operating income 103 829
Total operating income 8 461 9 710
Operating income by geographic market 2025 2024
Nordic countries 1 764 2 205
United Kingdom 332 375
Germany 1 231 1 320
France 814 1 041
Italy 486 482
Poland 134 133
Spain 276 312
Netherlands 83 63
Other European countries 909 994
Europe 6 029 6 926
Africa 23 20
North America 527 808
South America 120 124
America 646 932
China 246 213
Japan 489 403
South Korea 212 276
Other Asian countries 803 917
Asia 1 750 1 809
The rest of the world 11 23
Total operating income 8 461 9 710
Elkem Annual report 2025 293
5 Grants
Other Raw Employee Other Amortisation
operating materials benefit operating and
Details of grants related to income 2025 income and energy expenses expenses depreciation
R&D grants from government 0 - 29 15 -
Other government grants 0 - 6 7 -
CO2 compensation from the Norwegian Environment Agency - 730 - - -
Grants related to investment projects - - - - 48
Total government grants 1 730 34 22 48
Other Raw Employee Other Amortisation
operating materials benefit operating and
Details of grants related to income 2024 income and energy expenses expenses depreciation
R&D grants from government 1 - 17 8 -
Other government grants - - 4 1 -
CO2 compensation from the Norwegian Environment Agency - 593 - - -
Grants related to investment projects - - - - 48
Total government grants 1 593 20 9 48
Details of grants recognised as a reduction of property, plant and equipment
(fixed assets) and intangible assets 2025 2024
Government grants, other 3 -
Total 3 -
Balances related to grants 2025 2024
Grants receivable related to fixed and intangible assets (note 20) - -
Grants receivable related to income (note 20) 746 571
Grants payable (note 24) - -
Grants, deferred income (note 24) - (0)
CO2 allowances
CO2 emission allowances allocated from the government are classified as grants, measured at nominal value (zero).
If actual emissions exceed the number of allocated allowances, additional allowances must be purchased. The final
allocation of free allowances for the period 2026-2030 has not yet been decided by the authorities.
CO2 compensation
Changes to the compensation scheme for 2024-2030 was presented in February 2024 and included in an updated
regulation in December 2024. Elkem is still entitled to receive compensation under the updated scheme. The main
changes from the previous compensation scheme is a cap on the total cost of the government grant and that 40 per
cent of the compensation must be used for projects aiming to reduce CO2 emissions and/or improving energy efficiency.
Compliance with the condition can be achieved over multiple years, but no later than 2034.
Elkem has recognised its estimated share of the total compensation for 2025 and 2024 based on the power consumption
at the Norwegian silicon product plants. Elkem has identified projects that are expected to be compliant with the
requirements to qualify for the 40 per cent conditional compensation, and has for this reason recognised full compensation.
As the grant partially compensates power costs, which are costs recognised as part of the cost price of inventory during the
production process, the compensation is recognised in the income statement when the produced goods are sold.
Other
The remaining grants are mainly related to R&D projects.
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6 Raw materials and energy
Raw materials and energy 2025 2024
Raw materials expenses and energy for production (4 251) (4 259)
Change in inventories own production 506 121
Total raw materials and energy (3 745) (4 138)
7 Employee benefit expenses
Employee benefit expenses 2025 2024
Salaries, holiday pay and variable compensation (1 339) (1 234)
Employer's national insurance contributions / social security tax (163) (154)
Pension expenses (note 8) (100) (94)
Share-based payments - (1)
Other payments / benefits (26) (27)
Grants 34 20
Capitalised employee benefit expenses on PPE development 13 10
Total employee benefit expenses (1 580) (1 480)
Average number of full-time equivalents 1 423 1 386
For information concerning remuneration to management and share-based payments, see “Report on salary and other
remuneration to leading personnel in Elkem ASA for the financial year 2025”, note 11 Employee benefits and note 12
Share-based payments in the consolidated financial statements.
Elkem Annual report 2025 295
8 Employee retirement benefits
Defined contribution plans
Pension for employees in Elkem ASA are mainly covered by pension plans that are classified as contribution plans.
Elkem ASA’s contributions to the employees’ individual pension plan assets constitute 5 per cent of base salary up
to 7.1 G and 15 per cent between 7.1 G and 12 G. G refers to the national insurance scheme’s basic amount in Norway,
amounting to NOK 130 160 as at 1 May 2025. Pension on salary above 12 G is not supported by external service providers
and is therefore handled as a separate plan and included under defined benefit plans.
Elkem ASA participates in the early retirement scheme AFP. This is a multi-employer plan accounted for as a defined
contribution plan, in accordance with the Ministry of Finance’s conclusion. The participants in the pension plan are
jointly responsible for 2/3 of the plan’s pension obligation, the government is responsible for the remaining part. The
yearly pension premium in 2025 is 2.7 per cent of the employee’s salary between 1 and 7.1 G, covering this year’s pension
payments and contribution to a security fund for future pension obligations. The premium in per cent of salary for 2026
will also be 2.7 per cent. At 31 December 2025 there is 1 626 (1 672) participants below the age of 61 years in the scheme.
Defined benefit plans
The defined benefit pension plans are unfunded and comprise pension on salaries above 12 G, for which the expense
is 15 per cent of annual base salary that exceeds 12 G plus interest on the individual calculated pension obligation, and
some individual retirement schemes. The individual retirement schemes are closed.
Net interest is calculated based on pension liability at the start of the period multiplied by the discount rate and is
presented as a part of finance expenses. Remeasurements of the defined benefit plans are recognised directly in equity.
The company’s retirement schemes meet the minimum requirement of the Norwegian Act of Mandatory Occupational
Pension.
Breakdown of pension expenses 2025 2024
Defined benefit plans (4) (4)
Defined contribution plans (73) (70)
Early retirement scheme (AFP) (23) (20)
Total pension expenses (100) (94)
Pension liabilities 31.12.2025 31.12.2024
Present value of pension obligations (107) (100)
Net value pension liabilities (107) (100)
Active participants in pension scheme for salary above 12 G 53 49
Retired participants 37 40
Changes in actuarial gains / (losses) recognised in equity / deferred tax (5) (8)
Principal assumptions used for the actuarial valuation 2025 2024
Discount rate 1) 4.4% 4.4%
Annual regulation of pensions paid 2.0% 2.3%
1) The discount rate is based on high quality corporate bonds reflecting the timing of the benefit payments.
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9 Other operating expenses
Operating income by type 2025 2024
Distribution expenses (578) (613)
Commission expense sales (86) (90)
Machinery, tools, fixtures, and fittings (458) (491)
Repair, maintenance and other operating expenses (280) (337)
Other expenses (fees, transport, IT services, etc.) (672) (667)
Energy and fuel expenses (108) (107)
Leasing expenses (note 10) (64) (56)
Travel expenses (24) (37)
Loss on trade receivables (1) (2)
Grants 22 8
Miscellaneous manufacturing, administration and selling expenses (613) (527)
Total other operating expenses (2 863) (2 918)
During 2025, Elkem ASA expensed NOK 154 million (NOK 165 million) related to research and innovation activities, which
includes product and business development, technical customer support, and improvement projects.
Grants received related to research and development amount to NOK 44 million (NOK 26 million). In addition NOK 3
million (NOK 0 million) is recognised as a reduction of property, plant and equipment.
Audit and other services 2025 2024
Audit fee (12) (8)
Other assurance services (8) (1)
Other services (0) -
Total fees to auditor (20) (9)
Elkem Annual report 2025 297
10 Operating lease
Operating lease 2025 2024
Leasing expenses, current year (note 9) (64) (56)
Minimum future lease payments due in accordance with non-cancellable operating lease contracts:
Within one year (28) (42)
Within two years (27) (30)
Within three years (26) (27)
Over three years (236) (234)
Future leasing obligations are mainly related to rental of office buildings.
11 Other gains (losses) related to operating activities
Other gains (losses) related to operating activities 2025 2024
Changes in fair value commodity contracts (note 25) 3 (1)
Embedded EUR derivatives power contracts, interest element (note 25) 127 (106)
Ineffectiveness on cash flow hedges (note 25) 223 (199)
Net foreign exchange gains (losses) - forward currency contracts (note 25) 25 (106)
Operating foreign exchange gains (losses) 5 (39)
Total other gains (losses) related to operating activities 382 (450)
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12 Finance income and expenses
Finance income and expenses 2025 2024
Interest income 64 59
Interest income from related parties (note 27) 161 370
Other financial income 10 36
Total finance income 235 465
Change in fair value derivatives (30) -
Net foreign exchange gains (losses) (275) 78
Total foreign exchange gains (losses) (305) 78
Interest expenses (525) (744)
Interest expenses to related parties (note 27) (133) (253)
Interest on net pension liabilities (4) (3)
Other financial expenses (3) (2)
Total finance expenses (665) (1 003)
Net finance income (expenses) (735) (460)
Foreign exchange gains (losses) in 2025 and 2024 are mainly related to the bank loans in EUR and loans to related
parties in EUR, USD, and CNY.
Elkem Annual report 2025 299
13 Taxes
Income tax recognised in income statement 2025 2024
Current tax expenses 72 (115)
Deferred tax 258 1 051
Other taxes (31) (8)
Total income tax (expenses) benefit 298 928
Reconciliation of income tax (expenses) benefit 2025 2024
Profit before tax 2 602 1 395
Applicable tax rate Norway 22% 22%
Tax expense at applicable tax rate (572) (307)
Permanent differences
Tax effects of income from Norwegian controlled foreign companies (NOKUS) (21) (23)
Tax effects share of profit (loss) from joint ventures - (18)
Dividend within the Tax exemption method 661 216
Change in non-capitalised deferred tax assets 1) 47 1 087
Tax effects other permanent differences 10 (4)
Other effects
Previous year tax adjustment 204 (15)
Other current taxes (31) (8)
Total income tax (expenses) benefit 298 928
Effective tax rate (11%) (67%)
1) The change in non-capitalised deferred tax assets in 2025 primarily relates to the remeasurement of deferred tax asset originating from the acquistion
and subsequent merger of Elkem Testvirksomhet AS. Deferred tax assets are recognised when they are dissolved.
Pending tax issues with tax authorities
Elkem ASA has three debt waiver agreements with Elkem Silicones France SAS. The gross taxable value of these
agreements as at 31 December 2025 is NOK 541 million (NOK 595 million), book value NOK 0. Elkem Silicones France
SAS has not repaid anything under these agreement in 2025 or 2024. One of the origial four agreements has expired in
2025. Elkem has previously assessed that the effect of repayment is tax exempted.
The Norwegian Tax Office (NTO) decided in February 2021 to increase Elkem ASA’s taxable income for the fiscal years
2016-2019 by NOK 781 million, which increased the income tax expenses by NOK 181 million in 2020. The amount was
paid in the first quarter of 2021. Elkem appealed the reassessment and in 2025 Elkem received a successful outcome,
which is recorded as a negative tax expense in 2025. Elkem received a total refund amounting to NOK 207 million
including interest.
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Deferred tax assets and deferred tax liabilities 31.12.2025 31.12.2024
Derivatives (177) (143)
Property, plant, equipment and intangible assets (131) (33)
Pension liabilities 29 21
Trade receivable 2 3
Inventory (26) 2
Provisions and other liabilities 9 79
Other differences (5) (3)
Interest deduction limitation 204 -
Tax loss carry forward 1 259 1 040
Not capitalised defferred tax on other items (287) (333)
Net deferred tax assets (liabilities) 878 633
Movement in net deferred tax assets (liabilities) 31.12.2025 31.12.2024
Opening balance 633 (514)
Charged to profit (loss) 258 1 051
Changes in deferred tax hedges charged to equity (14) (34)
Change in actuarial gains (losses) charged to equity 1 2
Effect of merger (note 30) - 128
Closing balance 878 633
Elkem Annual report 2025 301
14 Property, plant and equipment
Plant, machinery, Office
Buildings and equipment and and other Construction
2025 Land other property motor vehicles equipment in progress Total
Opening balance 9 1 080 3 010 30 1 015 5 144
Additions - 8 3 - 683 693
Disposals - - (0) - (15) (15)
Transferred from CiP - 238 723 3 (965) -
Impairment losses - (0) (2) - (2) (5)
Depreciation - (101) (391) (6) - (498)
Closing balance 9 1 225 3 342 27 716 5 319
Historical cost 9 2 556 7 812 116 716 11 209
Accumulated depreciation - (1 326) (4 368) (89) - (5 783)
Accumulated impairment losses (0) (5) (101) (0) - (107)
Closing balance 9 1 225 3 342 27 716 5 319
Estimated useful life Indefinite 5-40 years 3-30 years 3-20 years
Depreciation plan Straight-line Straight-line Straight-line
Plant, machinery, Office
Buildings and equipment and and other Construction
2024 Land other property motor vehicles equipment in progress Total
Opening balance 9 857 2 814 36 861 4 578
Additions - - 2 - 973 975
Disposals (0) - - - - (0)
Transferred from CiP - 275 542 1 (819) -
Merger (note 30) - 37 72 0 - 108
Impairment losses - (3) (32) - (0) (35)
Depreciation - (87) (388) (8) - (482)
Closing balance 9 1 080 3 010 30 1 015 5 144
Historical cost 9 2 310 7 114 113 1 015 10 561
Accumulated depreciation - (1 225) (4 003) (83) - (5 311)
Accumulated impairment losses (0) (5) (101) (0) - (106)
Closing balance 9 1 080 3 010 30 1 015 5 144
Estimated useful life Indefinite 5-40 years 3-30 years 3-20 years
Depreciation plan Straight-line Straight-line Straight-line
Impairment losses in 2024 are primarily related to impairment as a result of lining damage at Rana of NOK 35 million.
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15 Intangible assets and goodwill
Other Intangible Total
intangible assets under intangible
2025 Goodwill Software assets construction assets
Opening balance 8 31 20 22 73
Additions - 17 - 2 19
Disposals - - - (2) (2)
Transferred from CiP - - - - -
Amortisation (4) (13) (4) - (17)
Closing balance 4 35 16 22 73
Historical cost 40 255 42 22 319
Accumulated amortisation (36) (218) (27) - (245)
Accumulated impairment losses - (1) - - (1)
Closing balance 4 35 16 22 73
Estimated useful life 10 years 3-10 years 3-10 years
Amortisation plan Straight-line Straight-line Straight-line
Other Intangible Total
intangible assets under intangible
2024 Goodwill Software assets construction assets
Opening balance 12 43 12 33 88
Additions - 3 - 2 5
Transferred from CiP - 3 11 (14) -
Merger (note 30) - 1 - - 1
Impairment losses - (1) - - (1)
Amortisation (4) (18) (3) - (21)
Closing balance 8 31 20 22 73
Historical cost 40 238 42 22 303
Accumulated amortisation (32) (206) (23) - (229)
Accumulated impairment losses - (1) - - (1)
Closing balance 8 31 20 22 73
Estimated useful life 10 years 3-10 years 3-10 years
Amortisation plan Straight-line Straight-line Straight-line
Elkem Annual report 2025 303
16 Investments in subsidiaries
Carrying Carrying
Owner share amount amount
Investment in subsidiaries of Elkem ASA Country Voting rights (%) 31.12.2025 31.12.2024
Elkem Carbon AS Norway 100% 123 123
Elkem Chartering Holding AS Norway 80% 1 1
Elkem Digital Office AS Norway 100% 8 8
Elkem Distribution Center B.V. Netherlands 100% 0 0
Elkem Foundry (China) Co., Ltd. China 100% 66 66
Elkem GmbH Germany 100% 1 1
Elkem Iberia S.L.U Spain 100% 0 0
Elkem International AS Norway 100% 5 5
Elkem International Trade (Shanghai) Co. Ltd. 1)
China 11% 1 1
Elkem Ísland ehf. Iceland 100% 785 785
Elkem Japan K.K Japan 100% 0 0
Elkem Korea Co., Ltd. Republic of Korea 100% 19 19
Elkem Madencilik Metalurji Sanayi Ve Ticaret Ltd. STI 1)
Turkey 1% 0 0
Elkem Materials Processing (Tianjin) Co., Ltd. China 100% 1 1
Elkem Materials Processing Services BV Netherlands 100% 1 1
Elkem Metal Canada Inc. Canada 100% 7 7
Elkem Milling Services GmbH Germany 100% 12 12
Elkem Nordic A.S. Denmark 100% 5 5
Elkem Oilfield Chemicals FZCO Ltd. UAE 51% 13 13
Elkem Paraguay S.A. 1) Paraguay 79% 498 498
Elkem Processing Services S.A. Belgium 100% 34 34
Elkem S.à.r.l. France 100% - -
Elkem S.r.l. Italy 100% 6 6
Elkem Silicon Materials (Lanzhou) Co., Ltd. China 100% 1 033 1 033
Elkem Silicon Product Development AS Norway 100% 8 8
Elkem Siliconas España S.A.U 2)
Spain 100% 125 125
Elkem Silicones Brasil Ltda. 2) Brazil 100% 214 214
Elkem Silicones Canada Corp. 2) Canada 100% 6 6
Elkem Silicones Czech Republic, s.r.o. 2)
Czech Republic 100% 2 2
Elkem Silicones Finland OY 2) Finland 100% 5 5
Elkem Silicones France SAS 2) France 100% 5 992 5 992
Elkem Silicones Germany GmbH 2)
Germany 100% 130 130
Elkem Silicones Guangdong Co., Ltd. 2) China 100% 1 543 1 543
Elkem Silicones Hong Kong Co., Ltd. 2) Hong Kong 100% 102 102
Elkem Silicones Korea Co., Ltd. 2)
Republic of Korea 100% 219 219
Elkem Silicones México S. De R.L. De C.V. 2) Mexico 100% 5 5
Elkem Silicones Poland sp. z o.o. 2)
Poland 100% 4 4
Elkem Silicones Scandinavia AS 2)
Norway 100% 15 15
Elkem Silicones Services S.à.r.l 2) France 100% 4 4
304 Financial statements | Elkem ASA
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Carrying Carrying
Owner share amount amount
Investment in subsidiaries of Elkem ASA Country Voting rights (%) 31.12.2025 31.12.2024
Elkem Silicones Shanghai Co., Ltd. 2) China 100% 109 109
Elkem Silicones USA Corp. 2)
USA 100% 261 261
Elkem Siliconi Italia S.r.l. 2)
Italy 100% 24 24
Elkem Singapore Materials Pte. Ltd. Singapore 100% 0 0
Elkem South Asia Private Limited India 100% 34 34
Elkem Testvirksomhet II S.a.r.l. 2)
Luxembourg 100% 0 -
Elkem Testvirksomhet III SAS France 100% 0 -
Elkem (Thailand) Co., Ltd. Thailand 100% 3 3
Elkem UK Holdings Ltd. United Kingdom 100% 78 78
Elkem Uruguay S.A. Uruguay 100% 33 33
Explotación de Rocas Industriales y Minerales S.A. (ERIMSA) Spain 100% 80 80
Jiangxi Bluestar Xinghuo Silicones Co., Ltd. 2) China 100% 5 015 5 015
NEH LLC USA 100% 98 98
Total 16 730 16 729
1) Elkem ASA and a subsidiary own 100% of Elkem International Trade (Shanghai) Co. Ltd., Elkem Madencilik Metalurji Sanayi Ve Ticaret Ltd and Elkem
Paraguay S.A.
2) Subsidiaries held for sale. See note 31 Events after the reporting period.
On 14 May 2024 Elkem ASA acquired Elkem Testvirksomhet AS (previously REC Solar Norway AS) for USD 22 million
(NOK 238 million). Elkem Testvirksomhet AS was subsequently merged with Elkem ASA. See note 30 Merger.
Impairment
For details see note 21 Impairment assessments and note 38 Assets held for sale and discontinued operations in the
consolidated financial statement.
Income from investments in subsidiaries and associates 2025 2024
Dividends and group contributions from subsidiaries 3 191 1 748
Dividends from associates (note 20) 15 10
Total income from subsidiaries and associated companies 3 206 1 758
Elkem Annual report 2025 305
17 Investments in joint ventures
Owner share Owner share
Joint venture Company address Country Voting rights 2025 Voting rights 2024 Accounting method
Elkania DA Hauge i Dalane Norway 50% 50% Gross method
Vianode AS Oslo Norway - - Equity
In February 2024 Elkem ASA sold its shares in Vianode AS, a synthetic graphite manufacturer for a total nominal amount
of NOK 847 million to AV Anodos AS. NOK 10 million of the compensation was received at closing, while the rest are tied
to Vianode meeting two future milestones, see note 20 Other assets for more details regarding the receivable. The sale
resulted in a loss on disposal of NOK 68 million.
Main figures for the investments accounted for by equity method. The figures show Elkem ASA’s portion.
Total interests in joint ventures 2025 2024
Opening balance - 843
Acquisition of shares and capital contribution - -
Sale of shares - (759)
Share of profit / (loss) - (15)
Share of other comprehensive income - 0
Loss on sale of shares - (68)
Closing balance - 0
Main figures for Elkania DA accounted for using the gross method, showing Elkem ASA’s portion.
31.12.2025 31.12.2024
Current assets 97 65
Non-current assets 22 25
Current liabilities 7 6
Non-current liabilities - 0
Net assets 112 83
Total revenue 59 51
Total expenses (32) (33)
Financial items 2 1
Tax - -
Total profit (loss) for the year 29 19
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18 Inventories
Inventories 31.12.2025 31.12.2024
Finished goods 1 237 1 107
Semi-finished goods 669 358
Raw materials 638 812
Operating materials and spare parts 434 408
Total inventories 2 979 2 685
Provision for write-down of inventories 102 38
Elkem Annual report 2025 307
19 Trade receivables
Trade receivables 31.12.2025 31.12.2024
Trade receivables 253 215
Trade receivables, related parties 963 945
Provision for doubtful accounts (10) (13)
Total trade receivables 1 207 1 146
Elkem ASA and its subsidiary Elkem Carbon AS have entered into a factoring agreement with a credit limit of
EUR 100 million, NOK 1 184 million, to sell on continuing basis trade receivables that meet specific conditions. The
agreement includes a recourse clause for maximum 5 per cent of the face value of the individual receivables sold. The
non-recourse amount of the receivable sold is derecognised and the recourse amount is recognised as a current liability
when the title to the receivables is transferred. As of 31 December 2025, NOK 41 million (NOK 51 million) is recognised
as current liability, see note 24 Provisions and other liabilities. In addition, Elkem has entered into factoring agreements
without recourse for some specific customers. Receivables that are sold without recourse are derecognised in its entirety
when the title is transferred, as there is no remaining credit risk after transfer. As at 31 December 2025 NOK 664 million
(NOK 778 million) of Elkem ASA’s trade receivables is derecognised under these agreements.
Analysis of gross trade receivables by age, presented based on the due date 31.12.2025 31.12.2024
Not due 135 129
1 - 30 days 87 55
31 - 60 days 21 5
61 - 90 days 1 7
More than 90 days 9 19
Total trade receivables 253 215
Trade receivables are generally secured by credit insurance from a reputable credit insurance company. For customers
where credit insurance cannot be obtained, other methods are generally used to secure the sales proceeds, such as
prepayment, letter of credit, documentary credit or guarantees. In particular, when sales are made in countries with a
high political risk, or to remote customers, trade finance products are used to reduce the credit risk.
Movements in allowance for expected credit losses 2025 2024
Opening balance (13) (13)
Losses during the year 5 2
New provisions (8) (4)
Reversed provisions 7 2
Closing balance (10) (13)
Analysis of allowance for expected credit losses, presented based on related trade receivables 2025 2024
Not due (1) (1)
Overdue by:
1 - 30 days - (0)
31 - 60 days (0) (0)
61 - 90 days (0) (0)
More than 90 days (8) (12)
Total provisions for doubtful accounts (10) (13)
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20 Other assets
Non-current Current
Details of other assets 31.12.25 31.12.24 31.12.25 31.12.24
Shares in associates 1)
9 9 - -
Other shares 26 17 - -
Restricted deposits 57 47 - -
Other deposits 0 0 - -
Pension assets, defined benefits and contribution plans - - 2 3
Prepayments 6 - 69 67
Prepayments from related parties (note 27) - - 1 -
Loans and deposits to related parties, interest-bearing (note 27) 2 574 3 148 783 533
Receivables from related parties, interest free (note 27) - - 218 300
Grants receivable (note 5) - - 746 571
Value added tax - - 71 151
Interest receivable from related parties (note 27) - - 91 83
Other receivables 765 765 13 2
Other assets - 0 22 13
Total other assets 3 438 3 986 2 016 1 723
1) Elkem ASA owns 25% of the shares in EPB Chartering AS and 20% of the shares in Future Materials AS. Elkem has received NOK 15 million (NOK 10
million) in dividends during 2025, see note 16 Investment in subsidiaries.
In February 2024 Elkem ASA sold its shares in Vianode AS, a synthetic graphite manufacturer for a total nominal amount
of NOK 847 million to AV Anodos AS. NOK 10 million of the compensation was received at closing, while NOK 315 million
(second instalment) and NOK 522 million (third instalment) are tied to Vianode meeting two future milestones relating to
the building of a full-scale plant. Interest shall accrue on the second instalment if the due date is later than
30 June 2025 and for the third instalment 31 December 2027. At initial recognition, the present value of the receivable
was estimated to NOK 749 million after the payment of the NOK 10 million.
Vianode AS and AV Anodos AS are dependent on additional funding to be able to perform the investments necessary to
meet the milestones required for the settlement of Elkem’s receivable. If additional funding is not obtained, there is a risk
of significant credit loss related to Elkem’s receivable. As the value of the deferred payments is uncertain, Elkem monitors
the situation closely. Considering the need for additional funding, market development and recent project development in
Vianode available at year-end, Elkem has assessed that the fair value of the receivable is NOK 765 million.
Elkem Annual report 2025 309
21 Equity
Other paid- Total paid- Retained
2025 Share capital in capital in capital earnings Total equity
Opening balance 3 197 304 3 502 12 163 15 665
Profit for the year - - - 2 900 2 900
Cash flow hedge - - - 49 49
Share of items booked against equity from joint ventures - - - - -
Remeasurement pension obligations gains (losses) - - - (4) (4)
Currency translation differences - - - 0 0
Share-based payments - 6 6 - 6
Net movement treasury shares - 0 0 1 1
Dividends - - - - -
Closing balance 3 197 311 3 508 15 109 18 617
Share capital
The share capital of Elkem ASA is NOK 3 197 206 890 divided on 639 441 378 shares of NOK 5 nominal value. Elkem
ASA held 5 221 900 treasury shares as at 31 December 2025. Each share has one vote.
Other paid-in capital
Other paid-in capital consists of par value of Elkem ASA’s treasury shares negative NOK 26 million (negative NOK 26
million) and other capital contributions from owners (e.g. share-based payments).
Other retained earnings and dividends
Other retained earnings consist of all other net gains and losses not recognised elsewhere. In line with the dividend policy
of Elkem the board of directors has proposed zero in dividends for the year 2025.
Other paid- Total paid- Retained
2024 Share capital in capital in capital earnings Total equity
Opening balance 3 197 301 3 498 9 912 13 410
Profit for the year - - - 2 323 2 323
Cash flow hedge - - - 120 120
Share of items booked against equity from joint ventures - - - 0 0
Remeasurement pension obligations gains (losses) - - - (7) (7)
Currency translation differences - - - 0 0
Share-based payments - 2 2 - 2
Net movement treasury shares - 1 1 4 5
Dividends - - - (190) (190)
Closing balance 3 197 304 3 502 12 163 15 665
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22 Shareholders
The table shows shareholders holding 1 per cent or more of the total 639 441 378 shares outstanding as at 31 December
2025, according to information in the Norwegian “securities registry system” (Verdipapirsentralen).
Name Number of shares Ownership
Bluestar Elkem International Co., Ltd. S.A. 338 338 536 52.9%
Folketrygdfondet 22 053 204 3.4%
Must Invest AS 19 630 095 3.1%
Pareto Aksje Norge Verdipapirfond 16 766 326 2.6%
J.P. Morgan SE 1)
12 692 783 2.0%
DNB Asset Management 9 701 695 1.5%
Verdipapirfondet DNB Norge 6 170 254 1.0%
Total shareholders with ownership greater than 1% 425 352 893 66.5%
1) Nominee accounts
Information on shares held by key management personnel is included in “Report on salary and other remuneration to
leading personnel in Elkem ASA for the financial year 2025” and note 11 Employee benefits in the consolidated financial
statement.
Elkem Annual report 2025 311
23 Interest-bearing assets and liabilities
Non-current Current
Interest-bearing liabilities 31.12.25 31.12.24 31.12.25 31.12.24
Deposits from related parties (note 27) 179 260 2 478 4 660
Loan agreements, bank 5 892 5 856 - -
Loan agreements, bonds 3 000 3 500 500 706
Loan agreements, other than bank 414 2 123 1 718 295
Accrued interest - - 12 23
Total interest-bearing liabilities 9 486 11 738 4 708 5 684
Interest-bearing assets
Cash and cash equivalents - - 1 468 2 730
Restricted deposits 57 47 0 0
Loans to related parties (note 27) 2 574 3 148 - -
Deposits to related parties (note 27) - - 783 533
Interest receivable from related parties (note 27) - - 91 83
Interest receivable from external parties - - - -
Total interest-bearing assets 2 631 3 195 2 342 3 347
Currency NOK Currency NOK
Interest-bearing liabilities by currency amount 31.12.2025 amount 31.12.2024
EUR 744 8 814 780 9 199
USD 161 1 617 149 1 688
NOK 3 295 3 295 6 183 6 183
Other currencies - 468 - 352
Total interest-bearing liabilities 14 194 17 422
The table below analyses the financial liabilities into relevant maturity groupings based on the remaining period at the
date of the balance sheet to the contractual maturity date. The amounts disclosed in the table are discounted.
Maturity of interest-bearing liabilities 2031
31 December 2025 2026 2027 2028 2029 2030 and later Total
Loans from related parties 2 478 179 - - - - 2 657
Loan agreements, bank - 5 920 - - - - 5 920
Loan agreements, bonds 500 900 1 000 800 - 300 3 500
Loan agreements, other than bank 1 718 - 414 - - - 2 133
Accrued interest 12 - - - - - 12
Total 4 708 6 999 1 414 800 - 300 14 222
Prepaid loan fees (28)
Total interest-bearing liabilities 14 194
312 Financial statements | Elkem ASA
Table of contents Board of directors’ report Sustainability statement Financial statements
Maturity of interest-bearing liabilities 2030
31 December 2024 2025 2026 2027 2028 2029 and later Total
Deposits from related parties 4 660 260 - - - - 4 920
Loan agreements, bank - - 5 896 - - - 5 896
Loan agreements, bonds 706 500 900 1 000 800 300 4 206
Loan agreements, other than bank 295 1 710 - 413 - - 2 417
Accrued interest 23 - - - - - 23
Total 5 684 2 470 6 796 1 413 800 300 17 462
Prepaid loan fees (41)
Total interest-bearing liabilities 17 422
Loan agreements
The main non-current loan agreements as at 31 December 2025 are granted to Elkem ASA for financing of the group; a
term loan with bank institutions, bond loans and series of loans in Schuldshein market (other than bank).
Loan agreements, bank
The term loan of EUR 500 million (EUR 500 million) is unsecured, but there are related covenants. As at 31 December
2025 the interest rate is 3.32 per cent. The term loan is linked to two sustainability KPIs, KPI 1 Lost Time Injury Rate and
KPI 2 Product Group Carbon Footprint. The margin of the RCF and term loan shall be reduced by 0.025 per cent if both
KPIs are met, and increased by 0.025 per cent if none of the KPIs are met. If one KPI is met there shall be no change to
the margin. Based on initial testing of the KPI’s the margin will increase with 0.025 per cent in 2026.
Elkem has entered into an interest swap agreement to swap the EUR 500 million loan from floating to fixed interest rate.
As at 31 December 2025 the fair value of this swap is NOK 5 million (entered into in 2025).
Loan agreements, bonds
The series of issued bond loans listed on Oslo Stock Exchange is in the size of NOK 3 000 million (NOK 3 500 million)
whereof NOK 3 150 million (NOK 3 150 million) is registered as bonds with floating rate and NOK 350 million (NOK 350
million) is registered as a bond with fixed rate. The bond loans are unsecured and there are no related covenants. As at 31
December 2025 the interest rates are in the range of 5.36 per cent to 5.86 per cent.
Initially, Elkem has entered into an interest swap agreement to swap the NOK 350 million bond from fixed to floating
interest rate. Later Elkem has entered into a cross-currency swap agreement to swap the NOK 350 million bond to a
EUR 30 million loan with a fixed rate of 3.71 per cent. As at 31 December 2025 the net fair value of these swaps are
NOK 0.3 million (NOK 1 million).
Initially, Elkem has entered into an interest rate swap agreement to swap the NOK 800 million bond loan from floating
interest rates to fixed interest rates of 4.88 per cent. Later Elkem has entered into a cross-currency swap agreement to
swap the NOK 800 million bond to a EUR 69 million loan with a fixed rate of 3.11 per cent. As at 31 December 2025 the
net fair value of these swaps are NOK 2 million (NOK 21 million).
A swap agreement has also been entered into to swap the NOK 400 million bond loan to a EUR 34 million loan with fixed
interest rates of 3.72 per cent. As at 31 December 2025 the fair value of this swap is negative NOK 3 million (negative
NOK 2 million).
The bond loans are listed on Oslo Stock Exchange from January 2024, as at 31 December 2025 the fair value of the bond
loans are positive NOK 40 million (positive NOK 2 million).
Elkem Annual report 2025 313
Note 23 continued
Loan agreements, other than bank
The series of loans issued in the Schuldschein market is of the size of EUR 35 million (EUR 180 million) with floating rate.
The loan series is unsecured, but there are related covenants. As at 31 December 2025 the interest rates are 3.7 per cent.
Elkem has entered into an interest swap agreement to swap the loans of EUR 35 million from floating to fixed interest
rates of 3.7 per cent. As at 31 December 2025 the fair value of these swaps is NOK 1 million (entered into in 2025).
Additionally Elkem has entered into an interest-swap agreement to swap the EUR 145 million loans that fall due in 2026
from floating to fixed interest rates of 3.5 per cent. As at 31 December 2025 the fair value of these swaps is NOK 3 million
(entered into in 2025).
Credit facilities
Elkem ASA is granted credit facilities of EUR 500 million (NOK 5 920 million) and NOK 250 million, a total of NOK 6 170
million in granted credit facilities. Both facilities remained undrawn at 31 December 2025 and 31 December 2024.
Covenants
The credit facilities and the bank financing in Elkem ASA contain financial covenants based on the consolidated financial
statements of Elkem group total. In addition, parts of the loans from external parties, other than bank, contain financial
covenants. The financial covenants are calculated monthly, based on last 12 months figures, and reported quarterly. In
2024 Elkem initated a waiver process, and got consent from the lenders’ to reduce the interest cover covenant from 4.0x
to 3.0x for each and every quarter of the 2024 financial year. In 2025 the interest cover covenant returned to be 4.0x.
Loan Loan
Covenants Elkem group 31.12.2025 covenant 31.12.2024 covenant
Equity ratio 51% > 30% 49% > 30%
Interest cover ratio 6.1 > 4.00 5.2 > 3.00
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Table of contents Board of directors’ report Sustainability statement Financial statements
24 Provisions and other liabilities
Non-current Current
Details of other assets 31.12.25 31.12.24 31.12.25 31.12.24
Employee benefits - - 249 231
Employee withholding taxes, social security tax, and other public taxes - - 99 97
Value added tax - - 18 13
Prepayments from customers - - 13 11
Payables to related parties (note 27) - - 64 90
Provisions 54 48 23 18
Obligation to finance subsidiary 37 37 - -
Accrued expenses - 87 250
Deferred income, government grants - - - 0
Recourse liability factoring agreement (note 19) - - 41 51
Settlement liability factoring agreements - - 24 31
Other liabilities - - 25 -
Total provisions and other liabilities 91 85 644 792
Environmental
2025 Site restoration measures Restructuring Total provisions
Opening balance 41 25 - 67
Additional provisions recognised 2 5 7 14
Used during the year (3) - (0) (3)
Closing balance 40 31 7 77
Hereof non-current 37 17 - 54
Hereof current 3 13 7 23
Closing balance 40 31 7 77
Movements in provision Environmental
2024 Site restoration measures Total provisions
Opening balance 34 20 53
Additional provisions recognised 8 11 18
Used during the year - (5) (5)
Closing balance 41 25 67
Hereof non-current 35 13 48
Hereof current 6 12 18
Closing balance 41 25 67
Site restoration
The site restoration provisions are related to the necessary site remediation work that Elkem ASA will have to undertake
in respect of its quartz mines.
Environmental measures
Elkem ASA has nationwide operations representing potential exposure towards environmental consequences. Elkem
ASA has established clear procedures to minimise environmental emissions, well within public emission limits. The
estimated provisions relate to estimated clean-up costs in connection with closed landfills.
Restructuring
The provision is related to Elkem’s cost saving programme.
Elkem Annual report 2025 315
25 Financial instruments
Currency exchange contracts
Elkem ASA enters into forward currency contracts to mitigate Elkem group’s foreign currency exposure. Hedge
accounting is not applied, the contracts are classified as held for trading and booked at fair value in the income
statement. Elkem ASA’s Treasury department also offers internal currency hedging for major purchase / sale-contracts
entered into by the subsidiaries. Such contracts cannot be designated in a hedging relationship, hence the changes in
fair value are recognised in the income statement.
Elkem has embedded EUR derivatives in own use power contracts where the spot element is designated as hedging
instruments in a cash flow hedge to hedge currency fluctuations in highly probable future sales, from 1 January 2016.
Unrealised effects are from that date booked against equity and later reclassified to revenue when realised. Realised
hedging effects from such derivatives in 2025 constitute a loss of NOK 137 million (loss of NOK 135 million).
Details of currency exchange contracts 31 December 2025
Purchase Purchase Sale Sale Type of Currency Notional
currency ccy million currency ccy million instrument rate Due Fair value 1) value 2)
NOK 25 USD 2 Fwd 11.327 2026 3 22
NOK 494 EUR 42 Fwd 11.883 2026 1 493
NOK 73 EUR 6 Fwd 12.212 2027 1 71
NOK 33 JPY 312 Fwd 0.105 2027 13 20
NOK 1 378 EUR 115 Fwd 11.986 2026 1 1 362
NOK 821 EUR 75 Embedded 3) 10.964 2026 (79) 886
NOK 6 588 EUR 556 Embedded 3)
11.853 2027-2035 (349) 6 580
Total fair value (409)
Details of currency exchange contracts 31 December 2024
Purchase Purchase Sale Sale Type of Currency Notional
currency ccy million currency ccy million instrument rate Due Fair value 1) value 2)
NOK 1 864 EUR 159 Fwd 11.762 2025 (20) 1 869
NOK 201 JPY 1 954 Fwd 0.103 2025 57 141
NOK 33 JPY 312 Fwd 0.105 2026 9 23
NOK 375 USD 35 Fwd 10.745 2025 (21) 396
NOK 818 EUR 76 Embedded 3)
10.794 2025 (89) 894
NOK 5 984 EUR 518 Embedded 3) 11.553 2025-2035 (483) 6 108
Total fair value (547)
1) The currency exchange contracts are measured at fair value based on the observed forward exchange rate for contracts with a corresponding maturity
term, on the balance sheet date
2) Notional value of underlying asset, based on currency rates at 31 December
3) Embedded EUR derivatives in own use power contracts
316 Financial statements | Elkem ASA
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Power contracts recognised at fair value
Elkem ASA enters into power derivative contracts to meet its need for power at the plants. These contracts are
designated as hedging instruments in a cash flow hedge to mitigate price fluctuations in highly probable future need for
power. The fair value of these contracts is based on observable nominal values for similar contracts, adjusted for interest
effects.
The effective part of change in fair value of contracts designated in hedging relationships is booked temporarily in
equity, and recycled to the income statement when the hedged items are realised. Realised effects from the hedging of
future need for power are in 2025 a gain of NOK 31 million (gain of NOK 13 million), which is included in raw materials
and energy for smelting. The ineffective part of change in fair value of contracts designated in hedging relationships
is recognised as a part of other gains (losses) related to operating activities, see note 11 Other gains (losses) related to
operating activities.
In addition, Elkem ASA holds power contracts, which are entered into and continue to be held for the purpose of the
receipt of power. These contracts are booked at the lower of cost and fair value. As at 31 December 2025 the fair value of
these contracts is higher than cost (zero).
Interest rate swap
Elkem should primarily pursue a floating interest rate policy for long-term financing. Interest rate hedging will be
considered in specific cases, e.g. when there is a need to protect financial covenants in loan agreements. In 2025
and 2024, Elkem entered into interest rate swaps to change from floating to fixed interest rates. The effective part of
changes in fair value of the financial instruments is booked against OCI, and recycled to the income statement as a
regulatory interest expense when realised.
Details of fair value of power derivative contracts and
interest rate swap 31 December 2025 Volume Due Fair value Notional amount 1)
Commodity contracts Power 501 GWh 2026 244 184
Commodity contracts Power 3 976 GWh 2027-2035 968 1 764
NOK 12 685
Interest rate swap million 2026-2029 (2) 341
Total fair value 1 209
Details of fair value of power derivative contracts and
interest rate swap 31 December 2024 Volume Due Fair value Notional amount 1)
Commodity contracts Power 501 GWh 2025 196 177
Commodity contracts Power 4 478 GWh 2026-2035 986 1 950
NOK 1 550
Interest rate swaps million 2025-2029 19 301
Total fair value 1 201
1) Notional amount based on currency rates at 31 December.
Elkem Annual report 2025 317
26 Financial risk
Financial risk management in Elkem ASA is described in note 31 Financial risk, and capital management policies are
described in note 32 Capital management, in the consolidated financial statement. Elkem ASA’s use of derivative
instruments are described in note 29 Financial assets and libilities and note 30 Hedging. See note 26 Interest-bearing
liabilities for details of credit facilities and maturity profile of interest-bearing liabilities. The exposure to credit risk is
represented by the carrying amount of each class of financial assets, including derivative financial instruments, recorded
in the balance sheet.
27 Related parties
Elkem ASA is owned 52.9 per cent by Bluestar Elkem International Co. Ltd S.A., Luxembourg, which is under control
of Sinochem Holdings Co., Ltd (Sinochem), a company registered and domiciled in China. The structure of the Elkem
group is disclosed in notes to the consolidated financial statement; in note 4 Composition of the group and note 5 Equity
accounted investments and joint operations. Details of transactions between Elkem ASA and the parent company,
subsidiaries, joint ventures and associates, and related parties within Sinochem are disclosed below.
Sale of Purchase Sale of Purchase of Interest Interest
2025 goods of goods services services income expenses
Bluestar Elkem International Co., Ltd. S.A. - - - - - -
Related parties within Sinochem - - - - - -
Subsidiaries 1 758 (1 086) 495 (554) 161 (133)
Joint ventures and associates - - 1 (109) - -
Total related parties transactions 1 758 (1 086) 496 (663) 161 (133)
Sale of Purchase Sale of Purchase of Interest Interest
2024 goods of goods services services income expenses
Bluestar Elkem International Co., Ltd. S.A. - - - - - -
Related parties within Sinochem - - - - - -
Subsidiaries 1 846 (1 005) 477 (518) 370 (253)
Joint ventures and associates - - 7 (119) - -
Total related parties transactions 1 846 (1 005) 484 (637) 370 (253)
318 Financial statements | Elkem ASA
Table of contents Board of directors’ report Sustainability statement Financial statements
Non-current Current
Balances with related parties 31.12.25 31.12.24 31.12.25 31.12.24
Trade receivables, subsidiaries - - 963 945
Prepayments from subsidiaries - - 1 -
Loans to subsidiaries, interest-bearing 2 574 3 148 - -
Deposits from subsidiaries, interest-bearing - - 783 533
Interest receivable from subsidiaries - - 91 83
Receivables from subsidiaries, interest-free - - 218 300
Deposits from subsidiaries, interest-bearing (179) (260) (2 478) (4 660)
Other payables to subsidiaries, interest free - - (64) (90)
Trade payables, subsidiaries - - (303) (297)
Trade payables, joint ventures and associates - - (10) (8)
Transactions with key management personnel
Information on transactions with key management personnel and /or their related parties, is included in “Report on
salary and other remuneration to leading personnel in Elkem ASA for the financial year 2025” and note 11 Employee
benefits in the consolidated financial statement.
Commitment with related parties
Elkem has no commitments to related parties.
Information about transactions between related parties
Elkem follows internationally accepted principles for transactions between related parties. In general, Elkem seeks to use
transaction based methods (comparable uncontrolled price, cost plus and resale price method) in order to set the price
for the transaction.
The majority of the transactions between related parties relate to products involving:
→ Raw materials (quartz) from quarries to plants
→ Metallurgical silicon to Silicones
→ Electrode paste from Carbon plants to FeSi and Silicon plants
→ Surplus raw materials between plants
→ Ad-hoc supplies of finished goods to Elkem’s internal distributors
→ Purchase of short and deep-sea transport
→ Sale of management and technology services
→ Rent of plant facilities and related services
→ Purchase of management services for the Silicones segment
Elkem’s set-up for sales is based on an agent structure, rather than a distribution network. Elkem also owns companies
sourcing key raw materials and other supplies from selected suppliers world-wide. In both activities above, the
transaction between the related parties is a delivered service, either sales-service or sourcing-service. Additionally, Elkem
has internal help chains that are established to serve several operating units more efficiently.
Elkem ASA has both non-current receivables and non-current payables to related parties. The intra-group loans are
normally interest-bearing and interest is calculated based on interbank rates (for example NIBOR) and a margin.
Elkem Annual report 2025 319
28 Pledge of assets and guarantees
Guarantee commitments 31.12.2025 31.12.2024
Guarantees given on behalf of the operating plants regarding environmental obligations 40 40
Guarantees given on behalf of subsidiaries regarding financing 967 888
Guarantees given on behalf of subsidiaries regarding environmental obligations 190 -
As part of the factoring agreement parts of Elkem’s trade receivables are pledged, see note 19 Trade receivables. The
book value of the pledged assets and liabilities is NOK 41 million (NOK 51 million).
29 Supplemental information to the cash flow
statement
The following table gives a detailed overview of changes in working capital in the cash flow statement. Working capital is
defined as trade receivables, inventories, other current assets, accounts payable, current employee benefit obligations,
and other current liabilities. Other current assets are defined as other current assets less current receivables to related
parties, current interest-bearing receivables, tax receivables, grants receivable and accrued interest income. Accounts
payable are defined as trade payables less trade payables related to purchase of non-current assets. Other current
liabilities are defined as provisions and other current liabilities less current provisions, contingent considerations,
contract obligations and liabilities to related parties.
Changes in working capital 2025 2024
Changes in trade receivables (60) 166
Changes in inventory (294) (263)
Changes in other current assets 59 (99)
Changes in accounts payable (35) (104)
Changes in other current liabilities including employee benefit obligations (127) (69)
Total (458) (369)
320 Financial statements | Elkem ASA
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30 Merger
In 2024, Elkem ASA merged with its wholly-owned subsidiary Elkem Testvirksomhet AS, which was acquired at 14 May
2024. Elkem Testvirksomhet AS (former REC Solar Norway AS) controls industrial areas and production facilities as
Fiskaa in Kristiansand and at Herøya.
As the merger was between parent and wholly-owned subsidiary, the merger was accounted for in accordance with the
rules of group continuity, and no equity contribution was issued in the merger.
Net assets Note Total
Property, plant and equipment 14 108
Intangible assets 15 1
Deferred tax assets 13 128
Investments in subsidiaries (238)
Other non-current assets 1
Total non-current assets 1
Inventories 3
Trade receivables 0
Other current assets 0
Cash and cash equivalents 0
Total current assets 4
Pension liabilities (0)
Total non-current liabilities (0)
Trade payables (1)
Other current liabilities (3)
Total current liabilities (4)
Net assets / equity contributed in the merger 21 0
Elkem Annual report 2025 321
31 Events after the reporting period
At 13 February 2026, Elkem signed an agreement to transfer the majority of its Silicones division to Bluestar (the
“Transaction”). The Transaction will be settled with all Elkem shares held by Bluestar through Bluestar Elkem Int.Co.LTD
S.A, 338 338 536 shares. In the Transaction, Elkem will transfer all its shares in Elkem Siliconas España S.A.U, Elkem
Silicones (UK) Ltd., Elkem Silicones Brasil Ltda., Elkem Silicones Canada Corp., Elkem Silicones Czech Republic, s.r.o.,
Elkem Silicones Finland OY, Elkem Silicones Germany GmbH, Elkem Silicones Hong Kong Co., Ltd., Elkem Silicones
Korea Co., Ltd., Elkem Korea Co., LTD. , Elkem Silicones México S. De R.L. De C.V., Elkem Silicones Poland sp. z o.o.,
Elkem Silicones Scandinavia AS, Elkem Silicones Services S.à r.l., Elkem Silicones USA Corp., Elkem Siliconi Italia S.r.l.,
Elkem Silicones Shanghai Co., Ltd., Jiangxi Bluestar Xinghuo Silicone Co., Ltd., Elkem Silicones Guangdong Co., Ltd,
Elkem Silicones Material Zhongshan Co., Ltd. and Elkem Silicones France SAS (collectively, the “Transferred silicones
assets”) to Bluestar. Elkem Silicones (UK) Ltd. was owned by Elkem UK Holdings Ltd. as of 31 December 2025 and was
distributed as dividend to Elkem ASA in 2026 due to the Transaction.
At 6 February Elkem Silicones France SAS carved out its operations at the Roussillon plant (upstream Silicones) into
a new legal entity, Elkem Testvirksomhet III SAS (Roussillon). Roussillon is owned by Elkem ASA. In addition, Elkem
Silicones France SAS has distributed its shares in Osiris GIE and 3Deus Dynamics SAS as a dividend-in-kind to Elkem
ASA in February 2026.
The Transaction is conditional upon the approval by Elkem’s general meeting in addition to waivers and approvals from
Elkem’s lenders and other customary approvals. Bluestar will not vote their Elkem shares on agenda items relating to the
Transaction. The Transaction was approved by the extraordinary general meeting at 9 March 2026. Subject to the other
closing conditions being satisfied or waived, the Transaction is expected to close during the second quarter 2026.
The transaction is structured as a distribution of non-cash assets to owners, where the assets will be ultimately
controlled by the same party before and after the distribution. At the effective date of the transaction, the book value of
the shares will be derecognised and adjusted against equity, representing the cancellation of 338 338 536 shares. No
gains or losses will be recognised in the statement of profit or loss related to the sales transaction.
322 Financial statements | Elkem ASA
Table of contents Board of directors’ report Sustainability statement Financial statements
Declaration by the
board of directors
We confirm that, to the best of our knowledge, the financial statements for the period from 1
January to 31 December 2025 have been prepared in accordance with applicable standards and give
a true and fair view of the group and the company’s assets, liabilities, financial position, and results
of operations.
We confirm that the board of directors’ report provides a true and fair view of the development
and performance of the business and the position of the group and the company, together with a
description of the key risks and uncertainty factors that they are facing.
Oslo, 10 March 2026
Bo Li Dag Jakob Opedal Olivier Tillette de Clermont- Wei Yao
Chair Vice chair Tonnerre Board member
Board member
Dachuan Dong Grace Tang Nathalie Brunelle Marianne Elisabeth Johnsen
Board member Board member Board member Board member
Terje Andre Hanssen Marianne Færøyvik Thomas Eggan Helge Aasen
Board member Board member Board member CEO, Elkem ASA
Elkem Annual report 2025 323
KPMG AS Telephone +47 45 40 40 63
Dronning Eufemias gate 6A Internet www.kpmg.no
P.O. Box 7000 Majorstuen
Enterprise 935 174 627 MVA
N-0306 Oslo
To the General Meeting of Elkem ASA
Independent Auditor’s Report
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Elkem ASA, which comprise:
• the financial statements of the parent company Elkem ASA (the Company), which comprise
the balance sheet as at 31 December 2025, the income statement and cash flow statement for
the year then ended, and notes to the financial statements, including a summary of significant
accounting policies, and
• the consolidated financial statements of Elkem ASA and its subsidiaries (the Group), which
comprise the consolidated statement of financial position as at 31 December 2025, the
consolidated statement of profit or loss, consolidated statement of comprehensive income,
consolidated statement of changes in equity and consolidated statement of cash flows for the
year then ended, and notes to the financial statements, including material accounting policy
information.
In our opinion
• the financial statements comply with applicable statutory requirements,
• the financial statements give a true and fair view of the financial position of the Company as at
31 December 2025, and its financial performance and its cash flows for the year then ended in
accordance with the Norwegian Accounting Act and accounting standards and practices
generally accepted in Norway, and
• the consolidated financial statements give a true and fair view of the financial position of the
Group as at 31 December 2025, and its financial performance and its cash flows for the year
then ended in accordance with IFRS Accounting Standards as adopted by the EU.
Our opinion is consistent with our additional report to the Audit Committee.
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our
responsibilities under those standards are further described in the Auditor’s Responsibilities for the
Audit of the Financial Statements section of our report. We are independent of the Company and the
Group as required by relevant laws and regulations in Norway and the International Ethics Standards
Board for Accountants’ International Code of Ethics for Professional Accountants (including
International Independence Standards) (IESBA Code) as applicable to audits of financial statements
of public interest entities, and we have fulfilled our other ethical responsibilities in accordance with
324 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
To the best of our knowledge and belief, no prohibited non-audit services referred to in the Audit
Regulation (537/2014) Article 5.1 have been provided.
We have been the auditor of Elkem ASA for 10 years from the election by the general meeting of the
shareholders on 20 April 2016 for the accounting year 2016.
Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in
our audit of the financial statements of the current period. These matters were addressed in the
context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Fair value less cost to sell for assets held for sale and discontinued operations (Silicones division)
Refer to Note 3 Accounting estimates and Note 38 Assets held for sale and discontinued operations
The key audit matter How the matter was addressed in our audit
Market conditions for the Silicones division Our audit procedures in this area included:
continued to be challenging in 2025, with low
sales prices and decreased global demand, • Evaluating the design and
resulting in weak financial performance for the implementation of management's
division. controls over the process;
Following a strategic review of the Silicones • Assessing management’s evaluation for
division in January 2025, management whether the criteria are met for
reclassified the Silicones division as held for reclassifying the Silicones segment as
sale and discontinued operations in accordance held for sale and discontinued
with IFRS 5. As of 31 December 2025, the operations according to IFRS 5;
Silicones division is continued to be classified
as held for sale and discontinued operations. In • Performing retrospective reviews of the
line with IFRS 5 management prepared an accuracy of management’s estimate in
updated estimate of fair value less cost to sell of terms of timing of cash flows and other
the disposal group. assumptions where historical data is
available;
The net value of Silicones division’s assets and
liabilities as of 31 December 2025 is NOK • Evaluating and challenging the
15 431 million. forecasted cash flows including the
timing of future cash flows applied in the
Fair value less cost to sell of the Silicones model with reference to historical
division was significant to our audit because of accuracy and approved business plans;
the size of the balances, the challenging market
conditions experienced during 2025, as well as • Evaluating key assumptions such as
the significant estimation uncertainty in forecasted sales prices, sales volumes,
developing the estimates to determine the fair discount rate and the EBITDA margin
value. In addition, management’s assessment used in the terminal period with
process is complex and highly judgmental and reference to external sources and other
is based on significant assumptions, mainly relevant benchmarks;
EBITDA margin, discount rate and terminal
growth rate used. • Evaluating the sensitivity of the estimate
based on reasonable changes to key
Based on management’s assessment of the fair assumptions;
value less cost to sell, no impairment has been
recognised for the year ended 31 December • Assessing, with the assistance of our
2025. valuations specialists, the mathematical
accuracy and methodological integrity of
management’s impairment model and
the reasonableness of discount rate
2
Elkem Annual report 2025 325
applied with reference to relevant
external sources; and
• Evaluating the adequacy and
appropriateness of the disclosures in the
financial statements related to Assets
held for sale and discontinued
operations.
Other Information
The Board of Directors and the Managing Director (management) are responsible for the information
in the Board of Directors’ report and the other information accompanying the financial statements. The
other information comprises information in the annual report, but does not include the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not cover
the information in the Board of Directors’ report nor the other information accompanying the financial
statements.
In connection with our audit of the financial statements, our responsibility is to read the Board of
Directors’ report and the other information accompanying the financial statements. The purpose is to
consider if there is material inconsistency between the Board of Directors’ report and the other
information accompanying the financial statements and the financial statements or our knowledge
obtained in the audit, or whether the Board of Directors’ report and the other information
accompanying the financial statements otherwise appears to be materially misstated. We are required
to report if there is a material misstatement in the Board of Directors’ report or the other information
accompanying the financial statements. We have nothing to report in this regard.
Based on our knowledge obtained in the audit, it is our opinion that the Board of Directors’ report
• is consistent with the financial statements and
• contains the information required by applicable statutory requirements.
Our opinion on the Board of Directors' report applies correspondingly to the statement on Corporate
Governance.
Our opinion on whether the Board of Directors’ report contains the information required by applicable
statutory requirements, does not cover the Sustainability Statement, on which a separate assurance
report is issued.
Responsibilities of Management for the Financial Statements
Management is responsible for the preparation of financial statements of the Company that give a true
and fair view in accordance with the Norwegian Accounting Act and accounting standards and
practices generally accepted in Norway, and for the preparation of the consolidated financial
statements of the Group that give a true and fair view in accordance with IFRS Accounting Standards
as adopted by the EU. Management is responsible for such internal control as management
determines is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company’s and
the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going
concern. The financial statements of the Company use the going concern basis of accounting insofar
as it is not likely that the enterprise will cease operations. The consolidated financial statements of the
Group use the going concern basis of accounting unless management either intends to liquidate the
Group or to cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs will always detect a material misstatement when it exists.
3
326 Financial statements | Elkem ASA Group
Table of contents Board of directors’ report Sustainability statement Financial statements
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic decisions of users taken on the basis of
these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain
professional skepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the financial statements, whether due
to fraud or error. We design and perform audit procedures responsive to those risks, and
obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The
risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control.
• obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Company's and the Group's internal control.
• evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by management.
• conclude on the appropriateness of management’s use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt on the Company's and the
Group's ability to continue as a going concern. If we conclude that a material uncertainty
exists, we are required to draw attention in our auditor’s report to the related disclosures in the
financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company and the Group to cease to
continue as a going concern.
• evaluate the overall presentation, structure and content of the financial statements, including
the disclosures, and whether the financial statements represent the underlying transactions
and events in a manner that achieves a true and fair view.
• obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial
statements. We are responsible for the direction, supervision and performance of the group
audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other
matters that may reasonably be thought to bear on our independence, and where applicable, related
safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of
most significance in the audit of the financial statements of the current period and are therefore the
key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes
public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so
would reasonably be expected to outweigh the public interest benefits of such communication.
4
Elkem Annual report 2025 327
Report on Other Legal and Regulatory Requirements
Report on Compliance with Requirement on European Single Electronic Format (ESEF)
Opinion
As part of the audit of the financial statements of Elkem ASA, we have performed an assurance
engagement to obtain reasonable assurance about whether the financial statements included in the
annual report, with the file name 549300CVBE06T0SH6T76-2025-12-31-1-en, have been prepared, in
all material respects, in compliance with the requirements of the Commission Delegated Regulation
(EU) 2019/815 on the European Single Electronic Format (ESEF Regulation) and regulation pursuant
to Section 5-5 of the Norwegian Securities Trading Act, which includes requirements related to the
preparation of the annual report in XHTML format, and iXBRL tagging of the consolidated financial
statements.
In our opinion, the financial statements, included in the annual report, have been prepared, in all
material respects, in compliance with the ESEF regulation.
Management’s Responsibilities
Management is responsible for the preparation of the annual report in compliance with the ESEF
regulation. This responsibility comprises an adequate process and such internal control as
management determines is necessary.
Auditor’s Responsibilities
Our responsibility, based on audit evidence obtained, is to express an opinion on whether, in all
material respects, the financial statements included in the annual report have been prepared in
compliance with ESEF. We conduct our work in compliance with the International Standard for
Assurance Engagements (ISAE) 3000 – “Assurance engagements other than audits or reviews of
historical financial information”. The standard requires us to plan and perform procedures to obtain
reasonable assurance about whether the financial statements included in the annual report have been
prepared in compliance with the ESEF Regulation.
As part of our work, we have performed procedures to obtain an understanding of the Company’s
processes for preparing the financial statements in compliance with the ESEF Regulation. We
examine whether the financial statements are presented in XHTML-format. We evaluate the
completeness and accuracy of the iXBRL tagging of the consolidated financial statements and assess
management’s use of judgement. Our procedures include reconciliation of the iXBRL tagged data with
the audited financial statements in human-readable format. We believe that the evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Oslo, 13 March 2026
KPMG AS
Stian Tørrestad
State Authorised Public Accountant
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Table of contents Board of directors’ report Sustainability statement Financial statements
Alternative
Performance
Measures
An APM is defined as a financial measure of historical The APMs presented herein are not measurements of
or future financial performance, financial position, or performance under IFRS or other generally accepted
cash flows, other than a financial measure defined or accounting principles and should not be considered as
specified in the applicable financial reporting framework a substitute for measures of performance in accordance
(IFRS). Elkem uses normalised EBITDA and normalised with IFRS. Because companies calculate the APMs
EBITDA-margin to measure operating performance at presented herein differently, Elkem’s presentation of these
the group and segment level. In particular, management APMs may not be comparable to similarly titled measures
regards normalised EBIT and normalised EBITDA as used by other companies.
useful performance measures at segment level because
income tax, finance expenses, foreign exchange gains
(losses), finance income and other items are managed
on a group basis and are not allocated to each segment.
Elkem uses cash flow from operations to measure
the segments cash flow performance, this measure is
excluding items that are managed on a group level. Elkem
uses ROCE, or return on capital employed as measures of
the development of the group’s return on capital. Elkem
relies on these measures as part of its capital allocation
strategy. Elkem uses net interest-bearing debt less non-
current interest-bearing assets / normalised EBITDA as
leverage ratio for measuring the group’s financial flexibility
and ability for step-change growth and acquisitions.
Elkem Annual report 2025 329
Elkem’s financial APMs, normalised EBITDA, and normalised EBIT
→ Normalised EBITDA is defined as Elkem’s profit (loss) for the period, less income tax (expenses) benefits, finance expenses,
foreign exchange gains (losses), finance income, share of profit (loss) from equity accounted financial investments, other
items excluding derivative adjustments, impairment loss, and amortisation and depreciation. Derivative adjustments are
realised effects from the part of commodity derivative instruments that initially are designated as hedging instruments,
but where the realised effects are recognised in other items due to e.g., hedge ineffectiveness and realised effects from
derivatives included in operating profit, but not designated in a hedging relationship. Derivatives not designated in a hedging
relationship includes among others the interest element from currency forward contracts and embedded derivatives.
→ Normalised EBITDA margin is defined as normalised EBITDA divided by total operating income.
→ Normalised EBIT is defined as Elkem’s profit (loss) for the period, less income tax (expense) benefit, finance
expenses, foreign exchange gains (losses), finance income, share of profit from equity accounted financial
investments, and other items excluding derivative adjustments.
Below is a reconciliation of normalised EBIT and normalised EBITDA.
Silicon Carbon
2025 Silicones Products Solutions Other Eliminations Total
Profit (loss) for the year 385
Income tax (expense) benefit 149
Finance expenses 549
Foreign exchange gains (losses) 284
Finance income (61)
Share of profit from equity accounted financial investments -
Other items (258)
Realised effects from hedge ineffectiveness and discontinuation of hedging 266
Normalised EBIT from discontinued operations (615)
Normalised EBIT (632) 717 765 (231) 80 699
Impairment losses 7
Amortisation and depreciation 1 008
Amortisations, depreciations, and impairment losses from discontinued operations 1 726
Normalised EBITDA 1 095 1 517 908 (159) 80 3 440
Silicon Carbon
2024 Silicones Products Solutions Other Eliminations Total
Profit (loss) for the year 2 115
Income tax (expense) benefit (588)
Finance expenses 778
Foreign exchange gains (losses) (247)
Finance income (107)
Share of profit from equity accounted financial investments 143
Other items 316
Realised effects from hedge ineffectiveness and discontinuation of hedging 1) 167
Normalised EBIT from discontinued operations (1 237)
Normalised EBIT (1 233) 2 091 1 003 (476) (46) 1 339
Impairment losses 168
Amortisation and depreciation 931
Amortisations, depreciations, and impairment losses from discontinued operations 1 754
Normalised EBITDA 521 2 864 1 131 (324) (46) 4 191
1) Figures have been restated, see note 1 Basis for preparing the consolidated financial statements
330 Financial statements | Alternative Performance Measures
Table of contents Board of directors’ report Sustainability statement Financial statements
Elkem’s financial APMs, Cash flow from operations
→ Cash flow from operations is defined as cash flow from operating activities, less income taxes paid, interest
payments made, interest payments received, changes in provision, (gains) losses on disposal of subsidiaries, changes
in provisions, bills, and other, changes in fair value of derivatives, other items (from the statement of profit or loss),
realised effects from hedge ineffectiveness and discontinuation of hedging and including reinvestments.
→ Reinvestments generally consist of maintenance capital expenditure to maintain existing activities or that involve
investments designed to improve health, safety, or the environment.
→ Strategic investments generally consist of investments which result in capacity increases at Elkem’s existing plants or
that involve an investment made to meet demand in a new geographic or product area.
Below is a split of the items included in investment in property, plant and equipment and intangible assets.
2025 2024
Reinvestments (1 536) (2 061)
Strategic investments (328) (957)
Periodisations 1)
(455) (317)
Investments in property, plant and equipment and intangible assets (2 319) (3 334)
1) Periodisations reflects the difference between payment date and accounting date of the investment.
2025 2024
Cash flow from operating activities 1 176 2 030
Income taxes paid 436 614
Interest payments made 684 885
Interest payments received (84) (119)
Changes in provisions, bills and other 821 27
Changes fair value of derivatives 107 (475)
Other items (258) 316
Other items from discontinued operations 167 145
Realised effects from hedge ineffectiveness and discontinuation of hedging 266 167
Reinvestments (1 536) (2 061)
Cash flow from operations 1 779 1 529
Elkem Annual report 2025 331
Elkem’s financial APMs, ROCE
→ ROCE, Return on capital employed, is defined as normalised EBIT divided by the average capital employed.
→ Working capital is defined as accounts receivable, inventories, other current assets, accounts payable, current
employee benefit obligations, and other current liabilities. Accounts receivables defined are as trade receivables less
bills receivable. Other current assets are defined as other current assets less current receivables to related parties,
current interest-bearing receivables, tax receivables, grants receivables, assets at fair value through profit or loss, and
accrued interest income. Accounts payable are defined as trade payables less trade payables related to purchase
of non-current assets. Other current liabilities are defined as provisions and other current liabilities less current
provisions, contingent considerations, contract obligations, and liabilities to related parties.
→ Capital employed consists of working capital as defined above, property, plant and equipment, right-of-use assets,
other intangible assets, goodwill, equity accounted investments, grants payable, trade payables, and prepayments
related to purchase of non-current assets.
→ Average capital employed is defined as the average of the opening and ending balance of capital employed for the
relevant reporting period.
Below is a reconciliation of working capital and capital employed, which are used to calculate ROCE.
31.12.25 31.12.24
Inventories 5 959 6 038
Trade receivables 1 852 1 960
Bills receivable (283) (269)
Accounts receivable 1 569 1 691
Other assets, current 1 231 1 254
Grants receivables (774) (576)
Tax receivables (86) (241)
Accrued interest - (0)
Other current assets included in working capital 370 436
Trade payables 1 818 2 076
Trade payables related to purchase of non-current assets (149) (184)
Accounts payables included in working capital 1 668 1 892
Employee benefit obligations 482 471
Provisions and other liabilities, current 588 815
Provisions, contingent considerations, and contract obligations (35) (19)
Liabilities to related parties - (0)
Other current liabilities included in working capital 553 795
Working capital assets and liabilities as held for sale 1 864 2 302
Working capital Elkem group total 7 059 7 309
332 Financial statements | Alternative Performance Measures
Table of contents Board of directors’ report Sustainability statement Financial statements
Table from page 328 continued
31.12.25 31.12.24
Property, plant, and equipment 8 568 8 405
Right-of-use assets 402 403
Other intangible assets 164 216
Goodwill 305 329
Equity accounted investments 210 230
Grants payable (16) (17)
Trade payables- and prepayments related to purchase of non-current assets (143) (171)
Other capital employed effects assets and liabilities as held for sale 16 173 17 674
Capital employed 32 722 34 378
Elkem’s financial APMs, Leverage ratio
→ Net interest-bearing debt that is used to measure leverage ratio consists of current and non-current interest-bearing
liabilities, reduced with cash and cash equivalents. Below a calculation of Elkem’s leverage ratio.
Leverage ratio 31.12.25 31.12.24
Interest-bearing liabilities 11 970 12 907
Cash and cash equivalents (2 694) (4 397)
Interest-bearing liabilities as held for sale liabilities 3 719 3 490
Cash and cash equivalents as held for sale assets (1 112) (1 673)
Net interest-bearing debt 11 883 10 327
Normalised EBITDA 3 440 4 191
Leverage ratio (3.5) (2.5)
Elkem Annual report 2025 333
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