Orkuveita Reykjavíkur - Company Announcement

Moody’s changes outlook to stable on Reykjavik Energy’s B1 rating

Reykjavik, 2013-12-16 12:20 CET (GLOBE NEWSWIRE) -- Moody's Investors Service
has today affirmed the B1 issuer rating of Reykjavik Energy (Orkuveita
Reykjavikur) and changed the rating outlook to stable from negative. 

In Moody's rationale is stated that the rating recognises OR's improved access
to liquidity and the progress the company has made with regard to strengthening
its financial profile over the past two years and it hails RE's “very strong
management commitment” in implementing the Company's strict five-year Plan,
intended to turn around the operations. 

In the attached release, Moody's recognises that the biggest challenge for RE
has been around executing asset sales. RE has managed to sell assets for a
total of ISK 7.4 billion, which is close to the company's target of ISK 8.1
billion set for the years 2011-13. 

It may be added that the sale of Reykjavik Energy's shares in HS Veitur in the
amount of ISK 1.5 billion is now for confirmation by RE's owners. 

Moody's notes, in the release, that statutory unbundling of Reykjavik Energy's
operations, which is to be completed by January 1st 2014, does not affect RE's
rating.

Attachments:

Moodys Rating Action.pdf