Financial position

Icelandair Group’s financial position is strong despite unprecedented challenges in 2020. Assets at year-end amounted to USD 1,034.2 million. Capital expenditures totalled USD 49.2 million in 2020. Total liquidity was USD 331.4 million at year-end, thereof cash and marketable securities USD 159.4 million.

Balance sheet

Total assets USD 1.0 billion at year-end

Total assets amounted to USD 1,034.2 million at year-end, decreasing from the beginning of the year by USD 1,676.6 million. The decrease is driven by the divestment of Icelandair Hotels, which lowered assets by USD 271.4 million and COVID-19 related impairments of USD 136.1 million. Thereof, impairments related to goodwill of USD 116.2 million and impairments of investments in associates of USD 19.9 million.

Equity ratio 23%

Total equity amounted to USD 232.8 million at year-end 2020. New shares in the amount of ISK 23 billion (USD 166.9 million equivalent) were issued following a share offering in September. In association with the offering, the Company issued warrants in the amount of ISK 5.75 billion (USD 16.2 million equivalent), which is equal to 25% of the nominal amount of the new shares. The fair value of the warrants at issue date, amounting to USD 16.2 million was recognized through retained earnings and as a liability. In 2020, the Company recognized loss on changes in fair value of its warrant liability in the amount of USD 10.5 million as a rise in the Company’s share price translates to an increase in the warrant liability. At year-end 2020, the warrant liability thus amounted to USD 27.8 million. When the warrants are exercised, or expire, the warrant liability will be reversed through retained earnings neutralizing their effects on that item.

Overview share capital ISK
Share Capital 1 January 2020 5,437,660,653
Increase of share capital 23,000,000,000
Share Capital 31 December 2020 28,437,660,653
Overview equity USD thousands
Equity 1 January 2020 482,478
Total comprehensive loss -408,814
Shares issued 166,873
Warrants issued -16,197
Divestment of non-controlling interest 8,469
Equity 31 December 2020 232,809
USD thousands 2020 2019 2018 2017 2016
Comprehensive income -408,814 -34,833 -110,427 48,477 138,650
(Loss) Profit for the year -376,176 -57,779 -55,570 37,538 89,068
Equity 232,809 482,478 471,379 596,545 568,213
Equity Ratio 23% 29% 32% 42% 44%

Interest-bearing debt including lease liabilities down by USD 192.7 million

Interest-bearing debt amounted to USD 263.6 million, down by USD 123.8 million compared to 31 December 2019. Excluding assets held for sale at the same time last year, interest-bearing debt decreased by USD 57.7 million. Net interest-bearing debt, excluding net lease liabilities, amounted to USD 104.2 million, and net lease liabilities amounted to USD 133.9 million.

Interest-bearing and net interest bearing debt

Cash Flow and Investments

USD thousand 2020 2019 Change
Net cash from operating activities -193,219 119,878 -313,097
Net cash to investing activities -2,279 -138,657 136,378
Net cash to/from financing activities 79,659 -44,940 124,599
Increase / decrease in cash and cash equivalents -115,839 -63,719 -52,120
Cash and cash equivalents at 31 December 117,657 235,073 -117,416

Cash from operation activities

Investment in operation assets

Total liquidity USD 331.4 million at year-end 2020

Icelandair Group took decisive action to maintain and strengthen its liquidity in 2020. These included cost cuts, lay-offs, renegotiations with unions, key creditors and vendors, securing a government guaranteed credit line and raising new equity. As a result, total liquidity amounted to USD 331.4 million at year-end 2020. Thereof cash and cash equivalents amounted to USD 118 million and marketable securities amounted to USD 42 million. In addition, the Company had USD 172.0 million in committed undrawn revolving facilities, whereof USD 120 million were in the form of a credit line 90% guaranteed by the Icelandic government.

Total investments in 2020 USD 41.8 million

Investments in operating assets amounted to USD 41.8 million. Thereof USD 37.8 million was used for investments in aircraft spare parts and overhaul of own engines.

The Company announced a sale of three of its Boeing 757-200 aircraft in late 2020, one of which was delivered in December with the two remaining aircraft expected to be delivered in Q1 2021.

Other investments amounted to USD 4 million and included investments in buildings and ground handling and other equipment.