Operating results surpass last year's by more than 9 billion

The combined operating results of Reykjavík City's interim financial statement for Section A – Core Operations and Section B reported a surplus of ISK 10.7 billion. This represents an ISK 9.1 billion improvement over the same period in 2024. Property revaluation at Félagsbústaðir Social Housing positively affected operating results, which came in 2 billion above budget. Net financial costs totaled ISK 19.8 billion and were ISK 1.9 billion lower in the first nine months of this year compared to last year. Operating results for Section A – Core Operations and Section B before depreciation and financial items (EBITDA) reached ISK 45.1 billion, an improvement of about ISK 3.4 billion over the same period last year.

Results for Section A – Core Operations showed a surplus of ISK 2.1 billion during the period, representing an ISK 3.3 billion improvement over the previous year. Core operations, defined as operating results before financial items and depreciation (EBITDA), were positive by ISK 10.3 billion.

Operations during this period were marked by fluctuations in both revenues and expenses. For example, tax revenues were ISK 2.3 billion above budget, but pension liability costs were ISK 3.4 billion over budget. Wage expenses increased by ISK 6.9 billion year-over-year, driven by new collective wage agreements. Overall, operations for Section A – Core Operations departments and service areas were balanced during the period.

The City Council approved the budget for 2026 this week. Economic uncertainty has grown, and recent economic forecasts predict slower economic growth, higher inflation and weaker labor market prospects. Export prospects are also weaker, but indicators suggest these developments have so far had limited impact on the labor market and households in Reykjavík.

Negative impact of Norðurál payment default

Reykjavík Energy presented a revised financial forecast for 2026 on Nov. 24 after Norðurál, the utility's largest single customer, notified the company that it would default on its payments due to repeated failures at its aluminum smelter at Grundartangi. As a result, proposals for changes to Reykjavík City's budget for next year were presented to the City Executive Council on Nov. 27. The 2026-2030 budget assumes that all financial policy objectives will be met starting in 2025.

The interim financial statement can be viewed on the Stock Exchange website.