Arion Bank hf.
Arion Bank: Discontinued operations and assets held for sale have negative impact on Q3 2019 financial results
Discontinued operations and assets held for sale will have a negative impact of approximately ISK 3 billion after tax on Arion Bank’s Q3 2019 financial results, compared with a loss of ISK 715 million in Q2 2019. Discontinued operations held for sale refer to assets or companies which the Bank intends to sell in the next few months and are placed below net earnings from continuing operations in the income statement.
Increased losses in the quarter are attributable to three factors:
- As a result of the challenging markets, including the low global price of silicon, Arion Bank is making an impairment of ISK 1.5 billion in respect of assets owned by Stakksberg. Stakksberg is a holding company for the silicon plant at Helguvík which is in the process of being sold. Preparations to sell the plant have been ongoing and an environmental impact assessment has been commissioned and new agreements with energy companies negotiated.
- Due to difficult conditions in the travel industry, Arion Bank is making an impairment of ISK 600 million in respect of assets owned by TravelCo. Since acquiring the tour operators belonging to TravelCo, the Bank has been preparing to sell the business and this is aimed to be completed in the next few months.
- Increased losses at Valitor are mainly due to the cost of reducing the workforce and implementing organizational changes at the end of September. These measures cost approximately ISK 200 million. The impact of Valitor on discontinued operations and assets held for sale is approximately ISK 900 million.
The Bank’s financial targets for the next few years, such as return on equity and capital structure, remain unchanged. The Bank will publish its Q3 2019 financial results on 30 October 2019.
For further information please contact Haraldur Gudni Eidsson, Head of Communications at firstname.lastname@example.org, or tel. 354 856 7108, or Theodór Friðbertsson, Head of Investor Relations, email@example.com, tel. 354 444 6760.
This is information that Arion Bank hf. is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication through the agency of the contact persons set out above.