Fortum Oyj · OMXHEX:FORTUM
Fortum Oyj — Fortum Oyj Corp Ord — FY2021 Earnings Presentation
24 slides from Fortum Oyj's earnings presentation, Mar 3, 2022
Slide 1: Financial Statements 2021
Financial Statements 2021 Fortum Corporation 3 March 2022
Slide 2: Markus Rauramo, President and CEO
Markus Rauramo President and CEO 2
Slide 3: Fortum Group's Russian businesses
Fortum Group’s Russian businesses CEO Statement: Fortum Group* operations in Russia • We are deeply concerned about the war in Fortum Russia – business description 2021 Ukraine. There is no justification for it. Employees 6,902 • Whilst operations continue to run as normal, Power plants 12 including
Slide 4: Strong performance enables highest comparable KPIs in Fortum's history
Strong performance in an exceptional commodity market enables highest comparable KPIs in Fortum’s history Comp. OP1 Comp. EPS2 OCF3 Leverage4 FY 2 536 4 970 2.00 <2 1.67 Higher achieved power prices 1 344 0,18 2 555 and higher generation volumes 1,49 0,2 with strong physical optimisation 2020 2021 2
Slide 5: Energy commodities driving power prices
Energy commodities driving power prices Energy commodities reaching new record highs EUR / MWh Gas price (TTF) USD / t Coal price (ICE Rotterdam) 200 350 Realised Realised • Commodity prices have been 160 280 driving up power prices both on the 120 Futures 1 March 2022 210 Futures 1 March 2022 Conti
Slide 6: Fortum Group is well positioned to drive the energy transition
Fortum Group is well positioned to drive the energy transition and to navigate through the turbulence Political will to accelerate the energy transition Structural increase Elevated price in volatility environment Geopolitical • Global warming • Extreme weather events • Weather dependence of • Suppl
Slide 7: Fortum is executing its strategy
Fortum is executing its strategy Transform own operations to Strengthen and grow in CO2-free Leverage strong position in gas carbon neutral power generation to enable the energy transition Fortum climate targets Supply significant reliable CO2-free power Provide security of supply and flexibility •
Slide 8: Strengthen and grow in CO2-free power generation: Loviisa lifetime extension
Strengthen and grow in CO2-free power generation Loviisa lifetime extension Fortum’s fully-owned Loviisa nuclear power plant lifetime extension Reliable backbone of • Extension potential of operations until 2050 offering the energy transition up to 170 TWh of additional CO2 free power Competitive •
Slide 9: Bernhard Günther, CFO
Bernhard Günther CFO 9
Slide 10: Key financials
Key financials MEUR IV/2021 IV/2020 2021 2020 Extraordinary strong financial KPIs Sales 50,079 21,279 112,400 49,015 Comparable EBITDA on record high Comparable EBITDA 1,416 1,247 3,817 2,434 level of EUR 3.8 billion Comparable operating profit 1,070 928 2,536 1,344 Comparable EPS at EUR 2.00 Compar
Slide 11: 2021, almost all segments improved – volumes and prices contributed
2021, almost all segments improved – volumes and prices contributed Reconciliation of comparable operating profit Generation (EUR million) higher volumes and achieved power price with strong physical optimisation Russia one-off effect and higher power prices offsetting negative FX and declining CSAs
Slide 12: P&L - reported IFRS figures dominated by changes in fair values
P&L - reported IFRS figures dominated by changes in fair values MEUR IV/2021 IV/2020 2021 2020 Strong increase in sales following the Sales 50,079 21,279 112,400 49,015 increase in commodity prices Materials and services -48,003 -19,127 -105,170 -44,298 Items affecting comparability includes Other -
Slide 13: Balance sheet tripled due to derivative financial instruments
Balance sheet tripled due to derivative financial instruments MEUR 31-Dec-21 31-Dec-20 MEUR 31-Dec-21 31-Dec-20 Financial derivatives substantially up following the strong increase in Property, plant and commodity prices and high portfolio equipment and right-of-use 19,049 19,367 Total equity 13,665
Slide 14: Strong cash flow management to secure financial flexibility
Strong cash flow management to secure financial flexibility EUR million IV/2021IV/2020 2021 2020 Comparable EBITDA 1,416 1,247 3,817 2,434 Non-cash and other items 940 282 1,506 394 Interest received 27 14 75 46 Change in non-cash /other items Interest paid -39 -51 -202 -208 and working capital was
Slide 15: Leverage below target and good access to debt capital market
Leverage below target and good access to debt capital market -6,234 Solid credit metrics debt debt 'BBB' long-term issuer credit rating, stable outlook netnet 'BBB' long-term issuer credit rating, Financial stable outlook , Financial Target ratio: < 2x Financial net debt / Comp. EBITDA Fortum’s obje
Slide 16: Outlook
Outlook Hedging 2022 Estimated annual capital Generation Nordic hedges: expenditure, including maintenance For 2022: 75% hedged at EUR 34 per MWh and excluding acquisitions, of appr. (Q3: 65% at EUR 32) For 2023: 50% hedged at EUR 31 per MWh EUR 1,500 million of which (Q3: 40% at EUR 31) maintenance
Slide 17: Fortum – For a cleaner world
~. @fortum For a cleaner world
Slide 18: Higher power prices
Higher power prices System spot power price, Nord Pool Achieved power price, Generation segment EUR/MWh EUR/MWh 96,2 55 51,9 100 43,7 75 68,3 44 35,2 37,2 38,1 Significantly higher spot power 33 prices in the Nordics 50 42,1 41,9 22 25 Higher achieved power prices 13,8 11 0 0 Q4/2020 Q1/2021 Q2/2021
Slide 19: Water reservoirs
Nord Pool system price driven to new price record Reservoir content (TWh) • Q4 precipitation and inflows realised clearly above normal, Water reservoirs 120 breaking the trend of previous quarters in 2021. 100 • Compared to long-term average, Nordic water reservoirs 80 increased during Q4 from -18 T
Slide 20: Generation: Higher achieved power prices
Generation: Q4 Q4'21 Higher achieved power prices Volumes (TWh) 6,1 6,4 6,3 Q4'20 4,8 Q4 2021 vs. Q4 2020 Hydro Nuclear • Comparable operating profit more than doubled mainly due to FY FY'21 Volumes FY'20 23,3 – Higher achieved power prices of EUR 51.9, +16.7 per MWh (TWh) 22,4 23,5 21.0 – Significa
Slide 21: Russia: Solid underlying performance
Russia: Q4 Q4'21 Solid underlying performance Volumes (TWh) 7,7 7,3 5,5 Q4'20 6,1 Q4 2021 vs. Q4 2020 Power Heat • Comparable operating profit up by 5% to EUR 80 million FY FY'21 Volumes FY'20 – Slight negative effect of changes in CSA payments, lower bond yield, (TWh) 28,6 27,1 and higher power pri
Slide 22: City Solutions: Performance improved
City Solutions: Q4 Q4'21 Performance improved Volumes (TWh) 3.0 Q4'20 3,1 0,7 1.0 Q4 2021 vs. Q4 2020 Power Heat • Comparable operating profit improved as a result of clearly higher FY FY'21 Volumes FY'20 heat sales volumes and higher prices in all heating areas (TWh) 10,0 9,6 • This excludes the Ba
Slide 23: Consumer Solutions: Challenging market environment
Consumer Solutions: Number of Challenging market environment customers (‘000) DEC 2021 2 230 DEC 2020 2 390 Q4 2021 vs. Q4 2020 • Negative impacted by higher electricity purchase costs. MEUR IV/ IV/ 2021 2020 2021 2020 • The cold weather in the Nordics during December resulted in higher than expecte
Slide 24: Uniper: Solid underlying performance
Uniper: Q4 Solid underlying performance Volumes Q4'21 Q4'20 (TWh) 12,5 11,9 10,6 8,8 3,8 3,4 3,7 2,8 Q4 2021 vs. Q4 2020 Hydro Nuclear Thermal CE Thermal RUS • The Global Commodities business’ result slightly down. FY FY'21 FY'20 40,9 43,2 Volumes* 28,5* • Negative effects in Global Commodities’ tra