Good operating surplus and debt ratio falls
The annual accounts of Hafnarfjörður municipality for the year 2022 were presented to the town council today, 4 May 2023. The operating surplus for Sections A and B amounted to 872 million króna in 2022. The result is in line with the forecast. The debt ratio continues to fall and stood at 85.1% at the end of 2022.
Good operating surplus and debt ratio falls
The annual accounts of the Municipality of Hafnarfjörður for the year 2022 were presented to the town council today, 4 May 2023. The operating surplus for Sections A and B amounted to 872 million króna in 2022. The result is in line with the forecast. The surplus from the operation of Section A amounted to 255 million króna, which is 126 million króna over the forecast. Operating working capital from Sections A and B amounted to 1,749 million króna, corresponding to 4.11% of total revenues. The debt ratio continues to fall and stood at 85% at the end of 2022.
The development will yield a permanent increase in council tax revenue.
,The municipal treasury's performance is slightly better than forecast, and the operating surplus is healthy. This is a very positive outcome, as the running of local authorities is challenging at present.says Rósa Guðbjartsdóttir, the mayor. „In Hafnarfjörður, there is significant development of new residential and business districts, which requires extensive infrastructure development. Such growth is costly in the short term, but the significant increase in the town's population and thousands of new jobs will later bring a considerable increase in revenue for the municipality. Alongside this significant growth, it is essential to maintain fiscal discipline and ensure the sustainable operation of core services. Now that inflation is on the rise, it is fortunate that the council's total debt has seen little increase in real terms since 2014, as is clearly demonstrated by its falling debt ratio. It can therefore be said that the council's finances are becoming increasingly robust.“ says Rósa Guðbjartsdóttir, the mayor, further.
Operating revenue amounted to 42.6 billion króna in 2022 and operating expenses were 37.3 billion króna. The operating result before depreciation and finance items was a positive 5.3 billion króna. Plots worth 7.4 billion króna were sold, and 4.9 billion króna was recognised as income from plot sales and 2.5 billion króna as a reduction in property valuations. Net finance amounted to 3.0 billion króna, approximately 1.7 billion over budget, due to negative price and interest rate developments compared to the original assumptions.
Debt ratio falls from 101% to 85% over the year
The municipality's loan repayments exceeded new borrowing by 1.1 billion krónur last year. Hafnarfjörður's debt ratio fell during the year from 101% to 85%, and is therefore well below the 150% debt ratio limit set by the regulations on financial benchmarks and supervision of local authorities' finances. Investments in 2022 amounted to 3.3 billion króna, a 21% decrease year-on-year. Total assets at the end of the year were 84.6 billion króna, an increase of 11.1 billion króna year-on-year. The municipality's total debt and liabilities amounted to 56.5 billion króna. Pension liabilities account for almost a third of the municipality's total debt and liabilities. Own funds amounted to 28.2 billion króna at the end of the year, and the equity ratio was 33.31%.
The population of Hafnarfjörður was 30,508 on 1 December 2022, compared to 29,742 the previous year, an increase of 766 or 2.61%.