Landsvirkjun - Company Announcement

Moody‘s changes Landsvirkjun´s outlook from stable to positive

Moody‘s credit rating agency has changed Landsvirkjun‘s outlook from stable to
positive. According to Moody´s the change of outlook to positive acknowledges
the progress Landsvirkjun has made with regard to improving its business
fundamentals and strengthening its financial profile. 

Positive factors that influence Moody's rating opinion are: Strong position in
the Icelandic energy market, low cost renewable generation asset base and
stable cash flows. However, the company's assessment is constrained by: High
leverage, customer concentration, exposure to aluminium price, foreign exchange
risk and the proportion of outstanding debt linked to floating interest rates. 

Moody's recognizes that Landsvirkjun's financial profile has steadily improved
and that important progress has been made in reducing market risk. In
particular, aluminium price risk has been reduced by renegotiation of the long
term contract with Rio Tinto Alcan, by consistent hedging activities and new
power contracts. Moody's also mentions positive progress that has led to
reduced foreign exchange- and interest rate risk in Landsvirkjun's debt
portfolio. 

Mr. Hördur Arnarson, CEO:"This is good news for Landsvirkjun and an important step to improve the
company's access to international capital markets. This change follows positive
development in the operations of the company and increased financial strength
in the recent years. The company expects this development will continue in the
years to come". 



For further information please contact Rafnar Larusson, CFO Phone nr. +354 515
9000 or by email: rafnar@lv.is

Attachments:

PR_29042015 LV - Final_revised.pdf