“The Company’s performance in the first half of the year was good when taking into account a difficult external environment. Profit before unrealised financial items amounted to USD 64.5 million, the fourth best period in Company history. It is a sign of strong core operations and powerful cash generation that while we are currently constructing two power plants, net debt continues to decrease.
Operating revenue decreased compared to the same period in 2015, mainly due to lower aluminium prices. Prices in aluminium markets will continue to affect Landsvirkjun’s operations, but we have put an emphasis on reducing the effects of this link when contracts are renewed and new contracts are entered into. At the beginning of the year Landsvirkjun was upgraded by Standard & Poor’s to investment grade, which will contribute to a continued low interest expense, an important factor for the Company’s future operations and will give us more options to refinance debt without a state guarantee.
We are aware of strong demand for Icelandic renewable energy from various sectors. In order to increase energy generation, construction is under way at a geothermal power plant at Theistareykir and an extension of Burfell hydropower plant.”