Record breaking year in energy generation and operating performance
Landsvirkjun’s operations were successful in 2017. Records were set regarding energy sales and production. Energy sales amounted to 14.3 TWh and revenue was also the highest in Company history. External conditions were beneficial to the Company. For example, aluminium prices increased 23% between years.
The Group’s operating profit before depreciation, EBITDA, amounted to USD 346 million in the year 2017. The development in EBITDA has been in line with the Company’s revenue development. The strengthening of the ISK increased costs in USD but the effect of the development in the exchange rate of the ISK is mostly evened out in the Company’s EBITDA. It though decreases the Company´s EBITDA ratio.
Depreciation and impairment loss increased by USD 9 million between years. This is mainly due to a one-off impairment loss in geothermal heat which decreases profit before unrealised financial items.
The Company´s interest rates take into account market interest rates at each given period. The Company hedges interest rate risk in part with the use of derivatives. At the end of 2017 68% of interest bearing liabilities had fixed interest rates, taking into account derivative agreements.
Operating results will continue to be dependent on the development of aluminium prices, interest rates and currency. Landsvirkjun’s revenue is partly linked to aluminium prices and changes in world market aluminium prices will therefore continue to influence Landsvirkjun's future income. The price of aluminium has increased significantly and if unchanged will have a positive effect on Landsvirkjun’s operating results.
You can download the Financial Statements for 2017 in electronic form here. The documents contain the financial statements as a whole in Acrobat (pdf) document and the key figures in an Excel (xls) document.