“Landsvirkjun’s earnings in the year 2016 are acceptable despite a decrease year over year.
External conditions were not favourable in the year 2016. Aluminium prices continued to be low despite moving higher in the second half of the year. Our revenues are still in some part connected to aluminium prices. Sold volume also decreased between years, contrary to plans, due to customer operational difficulties. In spite of this, revenues were nearly the same between years.
Strong cash flow enabled the Company to do more than meet its investments in the new hydro-electric power station at Burfell II and the geothermal power plant at Theistareykir. It is satisfactory to be able to continue this development without increasing debt, but on the contrary, decrease debt.
The decrease in debt during the last few years has had a good effect on the Company’s operations, which can be seen by the substantially lower interest expense between years.
Landsvirkjun’s credit rating was raised by one grade in January 2017 which adds up to an advancement of three grades in the last years. The Company´s current credit rating, without a state guarantee, is investment grade and in this respect the company is drawing closer to comparable companies in the neighbouring countries.”