2016-08-22 18:33:50 CEST

2016-08-22 18:33:50 CEST


BIRTINGARSKYLDAR UPPLÝSNINGAR

Orkuveita Reykjavíkur - Financial Statement Release

OR operations return good results in H1 2016 


Reykjavík, 2016-08-22 18:32 CEST (GLOBE NEWSWIRE) -- Operations of Orkuveita
Reykjavíkur (OR; Reykjavík Energy) return good and stable results. In the first
half of year 2016 profits amounted to ISK 5 billion compared to ISK 2.3 billion
for the same period in 2015. Sustained rationalization and favorable
development in currency exchange rates play part in the improved results. Wages
have increased following recent collective agreements with unions.  OR’s net
interest-bearing debt decreased by ISK 9.0 billion in H1 2016. 

OR’s Board of Directors approved today the company’s consolidated interim
financial statements. 

The Plan coming to an end

In early 2011, OR’s BoD and owners agreed upon a set of actions, known as The
Plan, in response to the company’s serious financial position. It extends
through year 2016 and its main target is improving the cash position by
approximately ISK 50 billion for the period. That goal was already reached in
mid-year 2015. By the end of June 2016, OR’s cash position had improved by ISK
57.1 billion. The Plan contained considerable and sustained austerity in
operations and that tariffs would keep their real-term value. The tariffs had
lost their value noticeably in the years leading to 2011. OR’s owners also
agreed to refrain from receiving dividends for the duration of The Plan. 

Tariffs decrease

January 1st 2017, Veitur Utilities, OR’s wholly owned subsidiary which operates
licensed utilities, will cut their tariffs for electricity distribution and
potable water. Extensive investment in sewage and district-heating systems
prevent cuts in those tariffs. Veitur Utilities’ electric grid serves about
one-half of Iceland’s population and its water works serve 40% of the country’s
population. 

Bjarni Bjarnason, CEO

Reykjavík Energy is doing fine. Our services are solid, the financial results
are good, debt is decreasing and all our finances are improving. It pleases us
that when The Plan expires, at year end, our success in its implementation
allows us to decrease tariffs. Thus, our customers will directly benefit from
the achievement in improving OR’s operations and finances. Now, as we work on
our financial forecast for the coming years, we will evaluate whether dividend
conditions will be met. 

Managers’ overview

Amounts are in ISK million           H1 2012  H1 2013  H1 2014  H1 2015  H1 2016
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Revenues                              19,287   20,111   18,234   20,479   20,955
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Expenses                             (6,560)  (6,679)  (6,379)  (7,443)  (8,215)
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thereof energy purchase and          (2,377)  (2,668)  (2,530)  (3,256)  (3,133)
 transmission                                                                   
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EBITDA                                12,727   13,432   11,855   13,036   12,741
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Depreciation                         (4,585)  (4,496)  (4,331)  (4,799)  (5,303)
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EBIT                                   8,142    8,936    7,524    8,237    7,438
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Result of the period                   (924)    3,736    3,831    2,260    5,029
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Cash flow                                                                       
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Received interest income                  40       81      359      252       57
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Paid interest expense                (2,805)  (2,473)  (2,560)  (2,215)  (1,890)
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Net cash from operating activities     9,988   10,059   10,953   11,042   11,774
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Working capital from operation        10,067   11,174    9,533   10,501   10,617
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         Contact:
         Mr. Bjarni Bjarnason
         CEO
         Tel: +354 516 6100