Orkuveita Reykjavíkur - Financial Statement Release

Orkuveita Reykjavíkur - Q1 Consolidated Condensed Financial Statements

Operations of Orkuveita Reykjavíkur (OR) returned better results for Q1 2011
than for the comparative period last year. The reasons are increased revenues
and curtailing in operations. Net cash from operating activities amounted to
ISK 3.9 billion, an increase of ISK 983 million from Q1 2010. 

Despite unfavorable currency exchange developments in Q1 2011, financial income
was positive, mostly due to an increase in the price of aluminum that increases
the book value of OR's wholesale electricity contracts. 

Profit during the period amounted to ISK 2.318 million but was ISK 7.187 in the
first quarter of 2010, when currency exchange developments were more favorable
than now. 

Orkuveita Reykjavíkur´s condensed consolidated interim financial statements for
the first quarter of 2011 were approved by the Board of Directors. 

Orkuveita Reykjavikur's condensed consolidated interim financial statements are
in accordance with international financial reporting standards as adopted by
the EU. 

Bjarni Bjarnason, CEO of OR:

“Orkuveita Reykjavíkur has refocused on core business activities, the
utilities. These Financial Statements carry positive signs, especially with
respect to revenues. There is also progress on the expense side, but still we
face challenges in managing cost.” 

Highlights of the first quarter 2011

Orkuveita Reykjavikur´s operations returned a profit of ISK 2.318 million in
the first quarter of 2011. The comparative period 2010 resulted in a profit of
ISK 7.187 million. 

Operating revenues for the first quarter of 2011 amounted to ISK 8.693 million.
Operating revenues for the first quarter of 2010 amounted to ISK 7.422 million. 

EBITDA of the Company for the first quarter of 2011 was ISK 5.467 million and
ISK 4.232 million in the comparative period 2010. 

Financial income and expenses were positive for the first quarter 2011 and
amounted to ISK 445 million. The amount for the first quarter 2010 was positive
by ISK 7.916 million. 

Total assets 31 March 2011 were ISK 296.122 million and were ISK 286.540
million at year-end 2010. 

Equity of the Company 31 March 2011 was ISK 55.165 million and was ISK 52.847
million at year-end 2010. 

Total liabilities of the Company 31 March 2011 were ISK 240.958 million
compared to ISK 233.694 million at year-end 2010. 

The equity ratio was 18.6% as at 31 March 2011 compared to 18.4% at year-end
2010. 



Other issues and prospects

The Board of Directors agreed in August 2010 to secure the income stream of the
Company by raising rates, strategic charge setting and curtailing of
operations. Furthermore, in March 2011 The Board of Directors and OR's owners
agreed upon an extensive action plan to secure a more solid foundation for the
company‘s operation and activities for years 2011 through 2016. The plan
comprises reduction and postponement of investments, economization, increased
tariffs and a subordinated loan from the Company´s owners. These actions will
ensure sufficient operating capital for the years 2011 through 2016 without the
need to enter into further borrowings. 

The Company plans to conclude the enlargement of the power plant at Hellisheiði
by commissioning the 5th phase of the plant, producing of 90 MW electricity, in
Q3 and Q4 2011. 



For further information contact Bjarni Bjarnason, CEO Orkuveita Reykjavikur,
tel: +354 516 7707. 



Orkuveita Reykjavíkur Interim Financial Statements 1 January to 31 March 2011
All amounts are in ISK millions                                              
Interim statement                                      2011              2010
of comprehensive income                            1.1-31.3          1.1-31.3
Operating revenue                                     8.693             7.422
Operating expenses                                  (3.226)           (3.189)
EBITDA                                                5.467             4.232
Depreciation, amortisation                          (2.025)           (1.952)
Financial income and (expenses)                         445             7.916
Results from associated companies                         0              (74)
Profit before income tax                              3.887            10.123
Income tax                                          (1.569)           (2.936)
Profit for the period                                 2.318             7.187
Attributable to:                                                             
Equity holders of the Company                         2.318             7.187
Minority interest in subsidiaries                         0                 0
Profit for the period                                 2.318             7.187
Net cash from operating activities                    3.939             2.957
Statement of financial position                   31.3.2011        31.12.2010
Non-current assets                                  284.823           278.270
Current assets                                       11.299             8.270
Total assets                                        296.122           286.540
Equity                                               55.165            52.847
Non-current liabilities                             211.037           212.162
Current liabilities                                  29.921            21.531
Equity and liabilities                              296.122           286.540
Ratios                                                                       
Working capital ratios                                 0,38              0,38
Equity ratios                                         18,6%             18,4%

Attachments:

Orkuveita Reykjavíkur -Interim Financial Statements Q1 2011.pdf