Landsvirkjun’s first quarter results
Strong demand and an upward trend in prices to industrial customers
Key figures from the interim financial statements
- Profit before unrealised financial items amounted to USD 82.5 million, compared to USD 50.1 million for the same period of the prior year, an increase by 64.5%.
- The profit for the period was USD 115.2 million, compared to USD 31 million for the same period of the prior year.
- Operating revenues amounted to USD 164.8 million, increasing by USD 34.1 million (26.1%) from the same period of the prior year.
- Net debt decreased by USD 110 million from the beginning of the year and amounted to USD 1,390.9 million at the end of March.
- Cash flow from operations amounted to USD 131 million, which is an increase of 53.4% compared to the same period of the prior year.
- The average price to industrial customers excluding transmission was USD 41 per megawatt hour, the highest price for one quarter in Landsvirkjun’s history.
Hörður Arnarson, CEO:
“Landsvirkjun’s operations were good during the quarter in particularly challenging circumstances which were affected by high energy demand, a prolonged period of low reservoir inflow and frequent bad weather at the company’s operating locations. Primary energy delivery to industrial customers increased by 2% and by 20% to homes and smaller companies. However, a temporary curtailment on curtailable power agreements was necessary during the period. The curtailment has now been eased.
Profit before unrealised financial items, which gives the clearest picture of the company’s results, increased by 64.5% from the prior year and was USD 82.5 million and has never been higher. The increase in profit can mainly be attributed to the higher power prices to industrial customers. The profit for the period after taxes was USD 115.2 million, 3.7 fold that of the prior year, and about half of the profit can be traced to unrealised financial items.
Cash flow was particularly strong during the period, amounting to USD 131 million, leading to a USD 110 million reduction in net debt.
The average price to industrial customers excluding transmission cost was higher than it has ever been in Landsvirkjun’s history, amounting to USD 41 per megawatt hour. As a result of recent renegotiations, most of Landsvirkjun’s customers now pay a price usually seen in the countries we compare ourselves with. This positive development is in line with our role, to maximise the value of the renewable energy resources which the company has been entrusted with and to return the dividend to our owner, the Icelandic nation.
Power plant operations were good during the period despite challenges posed by bad weather in February and low water levels which are among the worst ever experienced by Landsvirkjun. These circumstances were difficult for Landsvirkjun’s employees, who deserve thanks for a job well done.”
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