Half year results
Strong results in a fully utilised energy system
Key figures from the interim financial statements
- Profit before unrealised financial items amounted to USD 196 million, compared to USD 154.3 million in the same period of the prior year, an increase of 27% compared to a very strong previous year.
- The profit for the period was USD 114 million, compared to USD 137.5 million in the same period of the previous year, when results included the profit of Landsnet.
- Operating revenues amounted to USD 331.8 million, increasing by USD 36.8 million (12.5%) from the same period of the prior year.
- Net debt decreased by USD 182.4 million from the beginning of the year and amounted to USD 665.7 million at the end of June.
- Cash flow from operations amounted to USD 248.8 million, an increase of 29.7% compared to the same period of the previous year.
- During the second quarter, a USD 125 million revolving credit facility was refinanced with a three year maturity. The terms are favourable, at 45 basis points above the SOFR rate.
- S&P Global Ratings changed the outlook of Landsvirkjun’s credit rating from stable to positive and confirmed the BBB+ rating.
- Landsvirkjun does not prepare consolidated financial statements which include the subsidiaries Icelandic Power Insurance Ltd. and Landsvirkjun Power ehf., as their results are deemed immaterial. Instead, the accounts are prepared in accordance with IAS 27, Separate Financial Statements.
Hörður Arnarson, CEO:
„Landsvirkun’s operations continue to be strong. Profit from core operations increased by 27% from the same period of 2022, a record year in the company’s history. Operating revenues increased by 12.5% from the first half of 2022. This is mainly due to realised hedges as well as continued strong energy sales. However, there have been declines across markets which are connected to the energy price of some of our industrial customers. At the same time, operation expenses have declined by 6% from the prior year.
Cash generation was strong during the period, where cash flow from operations increased by 29.7% and amounted to USD 249 million.
Power plant operations were successful during the first half of the year, in spite of the fact that delivery of energy during the first quarter of the year had to be limited on secondary contracts for data centres and fishmeal producers. This is because energy generation is currently being run at capacity.
As we at Landsvirkjun have pointed out over the past few years, more energy generating capacity is urgently needed, in order to meet the obvious energy demand in our society from the energy transition and general economic growth. Landsvirkjun is working hard to obtain the required licenses in order for the company to meet these demands from society and government policy.“