Orkuveita Reykjavíkur - Company Announcement

Moody’s upgrades OR’s rating

Reykjavik, 2015-12-02 23:38 CET (GLOBE NEWSWIRE) -- Improved operational
performance, strengthened liquidity position, effective cash management, and
reduced financial leverage are among the rationale Moody’s gives for its
upgrade of Orkuveita Reykjavíkur’s (OR, Reykjavík Energy) issuer rating to Ba3
from B1 with a stable outlook. 

The attached rating action proceeds from the following paragraphs:

The upgrade of OR's issuer rating to Ba3 reflects the progress the company has
made with regard to improving its operational performance, strengthening its
liquidity position and reducing financial leverage against the background of an
improving macroeconomic environment and market conditions in Iceland. It also
takes into account of Moody's expectation that OR should be able to maintain
its improved financial profile and better withstand adverse aluminium, foreign
exchange and interest rate movements. 

OR's financial profile has improved as a result of the company's successful
execution of a five-year plan approved by the board of directors in March 2011.
The company has outperformed against almost all targets, including those to
increase revenues, reduce costs, and postpone certain investments. Overall, OR
has already exceeded the Plan's goals more than one year ahead of its intended
completion date in December 2016. 


         Contact:
         Ingvar Stefansson
         CFO
         + 354 516 6100

Attachments:

Moodys Rating Action Dec 2015.pdf