Orkuveita Reykjavíkur - Half Year financial report

Orkuveita Reykjavikur (Reykjavik Energy) Interim Financial Statements for the period ended 30 June 2009

Orkuveita Reykjavikur's EBITDA for the period 1. January to 30.  June
2009 was ISK 5.7 billion. Orkuveita Reykjavikur's loss for the period
ended 30 June 2009 was ISK  10.6 billion mostly due to the  weakening
of the Icelandic Krona by 7% during the period. The same period  2008
resulted in a loss of ISK 16.4 billion.
Increased revenues in foreign currency enable the company to  service
its payments related  to foreign currency  denominated loans  despite
currency fluctuations.
Orkuveita Reykjavikur Interim Financial Statements are in  accordance
with International Financial  Reporting Standards as  adopted by  the
EU.

Highlights of the period ended 30 June 2009

Orkuveita Reykjavikur  operations  returned  a  loss  of  ISK  10.615
million for the first two quarters of 2009. The corresponding  period
in 2008 resulted in a loss of ISK 16.406 million.

Operating revenues for  the period  amounted to  ISK 11.925  million.
Operation revenues for the corresponding  period in 2008 amounted  to
ISK 11.369 million.

EBITDA of the company  for the period was  ISK 5.692 million and  ISK
5.816 million for the corresponding period in 2008.

Financial income  and  expenses  were negative  for  the  period  and
amounted to  ISK 14.132  million. The  amount for  the  corresponding
period in 2008 was negative by ISK 22.187 million.

Total assets  30 June  2009 were  ISK 264.438  million and  were  ISK
259.373 million at year-end 2008.

Equity of the company 30 June 2009 was ISK 37.344 million and was ISK
48.359 million at year-end 2008.

Total liabilities of the company 30 June 2009 was ISK 227.094 million
compared to ISK 211.015 million at year-end 2008.

The equity ratio was 14.1%  as at 30 June  2009 compared to 18.6%  at
year-end 2008

Other issues
The Icelandic Parliament passed changes to several Acts affecting the
energy sector in its spring session 2008, which will come into effect
1 January 2010. These  changes involve among  others things that  the
Company must  be  split  so that  exclusive  licence  operations  and
competitive  operations  will  be  operated  in  separate   entities.
Preparations for these changes are underway.

Prospects
In spite of turbulence on Icelandic and foreign financial markets the
operations of Orkuveita Reykjavikur  is solid. The company  continues
to work on  the enlargement  of the  power plant  at Hellisheiði  and
intends to take the last phase  of its energy production into use  in
the first quarter  of 2011.  The construction of  other power  plants
will be limited by access to funding at acceptable terms.

Due to uncertainty in the Icelandic economy Orkuveita Reykjavikur has
reduced its capital expenditures in the company's budget for the year
2009. The company has also taken actions to curtail operating  costs,
both regarding salary payments and other operational expenses.

Orkuveita Reykjavikur's  future equity  position will  be  determined
largely by the position of the Icelandic Krona in regards to  foreign
currency.

Further  information  gives  Hjörleifur  B.  Kvaran,  CEO   Orkuveitu
Reykjavikur, tel.: +354 516 6000


Orkuveita Reykjavikur - Interim Financial Statements

All amounts are in ISK millions                             1. og 2.    1. og 2.
                                        1 ársfj. 2 ársfj.     ársfj.      ársfj.
Interim statement                           2009     2009       2009        2008
of comprehensive income                 1.1-31.3 1.4-30.6   1.1-30.6    1.1-30.6

Operating revenue ....................     6.541    5.383     11.925      11.369
Operating expenses ...................   (3.206)  (3.027)    (6.233)     (5.553)
                                EBITDA     3.335    2.357      5.692       5.816
Depreciation, amortisation .........     (2.374)  (2.327)    (4.702)     (3.308)
Financial income and (expenses).             703 (14.835)   (14.132)    (22.187)
Results from associated companies             19       13         33          14
       (Loss) profit before income tax     1.684 (14.793)   (13.109)    (19.666)
Income tax
...............................              129    2.365      2.494       3.260
           (Loss) profit of the period     1.812 (12.427)   (10.615)    (16.406)

Attributable to:
Equity holders of the Company ...          1.806 (12.415)   (10.610)    (16.382)
Minority interest in subsidiaries ...          7     (12)        (5)        (24)
           (Loss) profit of the period     1.812 (12.427)   (10.615)    (16.406)

  Net cash from operating activities         425    2.451      2.876       3.127


Interim statement
of financial position                  31.3.2009           30.6.2009  31.12.2008

Non-current assets
....................                     242.946             250.993     252.618
Current assets
..........................                19.613              13.444       6.755
                          Total assets   262.559             264.438     259.373

Equity
......................................    49.971              37.344      48.359
Non-current liabilities
.................                        194.810             207.176     196.589
Current liabilities
.......................                   17.778              19.918      14.425
                Equity and liabilities   262.559             264.438     259.373

Ratios
   Working capital ratios                   1,10                0,67        0,47
   Equity ratios                           19,0%               14,1%       18,6%

Attachments:

OR Q2 2009.pdf