HS Orka hf announces Consolidated Financial Statements for the six months ended June 30, 2017



Consolidated Financial Statements for the six months ended June 30, 2017 of HS Orka hf. (the “Company”) were approved at a Board of Directors meeting on 9 August 2017. The financial statements of HS Orka hf. are prepared in accordance with International Financial Reporting Standards as adopted by the European Union and are stated in Icelandic krona (ISK). Our financial statements can be found here.  

Net profit for the period was ISK 1,995 million, up from ISK 1,278 million in the same period of 2016, with the movement predominantly due to non-cash gains in the period further discussed below. 

Operating revenue was ISK 3,722 million against 3,507 million in the first six months of 2016, with the increase primarily due to our continued growth in the sale of electricity to the retail market. Aluminum prices moved favorably in the period leading to increased revenue from aluminum based sales (23.7% of sales were linked to the price of aluminum in the period. This was partially offset by the strengthening of the ISK against the US dollar. 

Production cost increased by 17.7% to ISK 3,225 million in the first six months of 2017 due to an increase in power purchases and non-routine maintenance costs associated with the steam gathering system at the Reykjanes power plant. 

Finance-related income increased from ISK 874 million in the comparative first half to ISK 1,744 million in 2017. This increase was driven primarily by a rise in forecast aluminum prices during the period, which resulted in a gain of ISK 1,609 million (2016: ISK 841 million gain) related to the fair value of embedded derivatives in power purchase agreements. Currency gains in the period were ISK 181 million compared to a gain of ISK 150 million in 2016.  

A total comprehensive profit of ISK 1,933 million was recorded against ISK 1,193 million profit in the first six months of 2016. The Company’s equity ratio is 70.7% compared to 66.7% at year-end 2016.

Further information can be provided by Ásgeir Margeirsson, Managing Director of HS Orka hf., tel. 855 9301.