S&P Global Ratings on March 21 changed its outlook on Landsvirkjun to positive from stable, citing the Icelandic power generator's reduced exposure to relatively volatile aluminum prices over the past few years.

The company's contracts with its customers were mostly indexed to the price of aluminum, resulting to earnings volatility. According to S&P Global Ratings, Landsvirkjun lowered that exposure by renegotiating power contracts to remove the link to aluminum. Now, only about 10% of the company's revenue is linked to aluminum prices, compared to about 65% in 2009.

"The outlook revision to positive indicates that we now expect Landsvirkjun to report FFO to debt of about 16% in 2019, compared with 14.6% in 2018 and 12.0% in 2017," said the rating agency, which also affirmed the company's issuer credit rating at BBB/A-2.

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