Annual financial statements 2020
-The largest year of construction in the company’s history

The 2020 annual financial statements were approved by the Board of Directors on February 18, 2021.

Main points of the annual financial statements:

  • Earnings before interest and taxes (EBIT) were $ 46.6 million compared to $ 50.2 million a year ago.
  • Income in 2020 was $ 27.3 million compared to $ 30.3 million in 2019.
  • Net cash availability at year-end was $ 25.8 million and net cash from continuing operations was $ 53.9 million.
  • Total assets at year-end were $ 911.4 million compared to $ 852.3 million in 2019.
  • Net worth at year-end was $ 404.8 million compared to $ 391.3 million in 2019.
  • The annual return was 6.9% in 2020 compared to 7.4% in 2019.

Guðlaug Sigurðardóttir, CFO at Landsnet, believed that 2020 was a year of challenge, construction and stability, despite the fact that the year was marked by volatile weather conditions and a pandemic. The economic impact of Covid-19 had little impact on the financial statements, which show good operating results and financial stability.
“The results of the annual financial statements presented today show that the company’s operations are strong and that we have maintained financial stability in difficult circumstances. In recent years, stability has been achieved in the company’s operating environment, which is very important and forms the basis for an efficient one In order to achieve the development and operation of the transmission network, there were major weather problems in the first half of the year, which had a significant impact on the transmission network and overall operation. We then focused on infrastructure development and projects carried out by the government after the storms The year 2020 was the largest year of construction in the company’s history and we are proud to have achieved our goals despite difficult external conditions. The construction exceeded expectations despite the challenges of the Covid-19 epidemic and individual delays were dealt with by reorganizing Pr objects. We have successfully adapted to this d by adapting daily operations to the risk assessment published by the civil protection authority and by working closely with our employees and external parties, the effects of the pandemic on the company’s operations were minimized. We are optimistic about the new year. The project conditions remain demanding. The outlook for funding is positive and exciting times lie ahead as we continue to strengthen the transmission network. “”

Profit and Loss Account

  • Operating income was $ 130.5 million in 2020 compared to $ 140.3 million a year earlier. The company has three main sources of income: income from energy-intensive users, income from transmission to distribution system operators, and income from the sale of transmission losses and ancillary services.
      • Revenue from energy-intensive users decreased by $ 3.2 million between the years. The energy transfer to energy-intensive users decreased by 2.1% this year. The tariff for energy-intensive users was temporarily lowered between July 1st, 2019 and August 1st, 2020 in order to meet the transitional provisions of the Electricity Act, according to which energy-intensive users must be reimbursed before 2020.
      • Income from transfers to merchants decreased by $ 3.6 million between years. The transfer to dealers decreased by 4.0%. The tariff for traders is in ISK and the weakening of the ISK against the USD impacted the annual result.
      • The income from transmission losses and ancillary services in the transmission network decreased between the years due to exchange rate adjustments. The tariff for this service is based on costs + 1.5%. The 2020 energy loss tariff was based on tenders for each quarter and has been modified to reflect changes in these offers.
  • Operating expenses decreased by $ 6.3 million between years. The average ISK to USD exchange rate in 2020 was 135.27 compared to 122.65 in 2019. Additional costs were incurred over the year due to weather damage and increased maintenance costs. Subsequent repairs began in December 2019 and were completed in the fall. The weakening of the ISK exacerbated costs. General operating expenses, excluding depreciation, decreased $ 3.7 million between years. Electricity purchases due to transmission losses and the purchase of ancillary services decreased $ 3.3 million due to foreign exchange rates.
  • The effect of exchange rate fluctuations is reflected in certain items of income and expenses, but the overall effect was not significant on income from operations before financial items.
  • Earnings before interest and taxes (EBIT) were $ 46.6 million compared to $ 50.2 million a year ago, a decrease of $ 3.6 million between years.
  • Net financial expenses were $ 12.6 million, down from $ 12.7 million in 2019, or a decrease of $ 0.1 million between years.
  • Landsnet’s profit in 2020 was $ 27.3 million. This is evident from the income statement, which reflects the financial guidance for the year and forecasts operating revenue of $ 27.2 million. In 2019 profit was $ 30.3 million.
  • The company’s EBITDA was $ 76.9 million in 2020 compared to $ 79.8 million a year earlier.


Balance sheet

  • The company’s total assets at year-end were $ 911.4 million compared to $ 852.3 million in 2019.
  • Net cash availability at year-end was $ 25.8 million and net cash from continuing operations was $ 53.9 million.
  • Total debt at year-end was $ 506.6 million compared to $ 461.0 million in 2019.
  • The equity ratio at the end of the year was 44.4% compared to 45.9% in the previous year.

2020 was a great investment year. The Kröflulína and Hólasandslína projects (between Fljótsdalur and Akureyri) were the biggest projects of the year. Other projects were a voltage increase in the east and a cable installation between Sauðárkrókur and Varmahlíð. These transfer structures were not put into operation in 2020 and are classified as transfer structures or under construction in the annual financial statements.

Dividends of $ 9.5 million were paid in 2020 from earnings in 2019.

Operational outlook

The company’s budget for 2021 projects a profit of $ 30.4 million from the company’s operations. The sales plan is based on the amount and price changes known to the company. The cost estimate is based on the company’s actual operating costs, taking into account the criteria used to determine the revenue cap. The company’s construction plans for the year amount to approximately $ 86.6 million. Construction financing is ongoing and access to credit markets is good.

About the annual financial statements
The annual financial statements for 2020 were prepared in accordance with the International Financial Reporting Standards (IFRS). These financial statements are presented in USD, the company’s functional currency. The annual financial statements were approved by the Board of Directors on February 18, 2021.

Via Landsnet
Landsnet was founded in 2005 and is responsible for the operation of the Icelandic power transmission system, one of the most important parts of Iceland’s infrastructure. Our job is to operate and develop Iceland’s power transmission system and to manage its system operations.
For more information, please contact Guðlaug Sigurðardóttir, CFO of Landsnet.

For more information, see the Landsnet website: www.landsnet.is where the annual accounts are also available.

  • Landsnet hf. Announcement 2020

  • Landsnet Financial Report 2020