Fortum Oyj · OMXHEX:FORTUM
Fortum Oyj — Fortum Oyj Corp Ord — Q1 2022 Earnings Presentation
21 slides from Fortum Oyj's earnings presentation, May 12, 2022
Slide 1: Interim Report January-March 2022
Interim Report January-March 2022 Fortum Corporation 12 May 2022
Slide 2: Markus Rauramo, President and CEO
Markus Rauramo President and CEO 2
Slide 3: Earnings shift into later quarters of 2022 following Uniper's gas storage optimisation
Earnings shift into later quarters of 2022 following Uniper’s gas storage optimisation Comp. OP Comp. EPS OCF1 Leverage2 Q1 2022 0.94 1,171 831 <2 Market volatility and increased 1.0 uncertainties managed by securing sufficient liquidity -438 -0.11 -1,529 headroom Q1 2021 Q1 2022 Q1 2021 Q1 2022 Q1
Slide 4: Update on Fortum Group's Russian businesses
Update on Fortum Group’s Russian businesses Fortum prepares for a controlled exit from the Pretax impairments of EUR 2.1 bn of Russian Russian market businesses and assets • We will not make any new investments decisions or Impairments finance our Russian businesses. Asset Segment Amount • We are pr
Slide 5: Europe is experiencing a severe energy crisis
Europe is experiencing a severe energy crisis Energy commodities reaching new record highs Political push for energy independence EUR EUR //MWh MWh Gas Gasprice price(TTF) (TTF) USD USD //t t Coal price Coal price (ICE (ICE Rotterdam) Rotterdam) 250 250 500 500 Realised Realised • Extreme price leve
Slide 6: Fortum's strategy is synchronised with REPowerEU
Fortum’s strategy is synchronised with REPowerEU Fortum Group is well positioned to reduce Europe’s energy dependence and to accelerate the green transition For a cleaner world Transform own Strengthen and grow in Leverage strong position Partner with Industrial operations to carbon CO2-free power g
Slide 7: Bernhard Günther, CFO
Bernhard Gunther CFO @fortum
Slide 8: Key financials
Key financials Q1 affected by significant earnings shift MEUR I/2022 I/2021 2021 LTM in Uniper’s gas storage business into coming quarters Sales 43,623 21,493 112,400 134,530 Comparable EBITDA -104 1,479 3,817 2,234 Comparable LTM EPS at EUR 0.95 despite negative Q1 result Comparable operating profi
Slide 9: Q1 dominated by gas storage optimisation effect shifting earnings into Q2-Q4
Q1 dominated by gas storage optimisation effect shifting earnings into Q2-Q4 Reconciliation of comparable operating profit Generation (EUR million) higher achieved power price with strong physical optimisation but lower volumes Russia one-off effect in 2021 and declining CSAs (Nyagan 1) City Solutio
Slide 10: P&L - reported IFRS figures dominated by changes in fair values and impairments
P&L - reported IFRS figures dominated by changes in fair values and impairments MEUR I/2022 I/2021 2021 LTM Items affecting comparability includes Sales 43,623 21,493 112,400 134,530 Materials and services -43,618 -19,491 -105,170 -129,297 • EUR -1.1 bn changes in fair values Other -109 -523 -3,413
Slide 11: Balance sheet driven by increased commodity prices
Balance sheet driven by increased commodity prices MEUR 31-Mar-22 31-Dec-21 MEUR 31-Mar-22 31-Dec-21 Property, plant and equipment and right-of-use 17,111 19,049 Total equity 8,762 13,665 assets Derivative financial Derivative financial Financial derivatives substantially up 143,810 82,488 150,077 8
Slide 12: Operating cash flow turn negative in Q1
Operating cash flow turn negative in Q1 EUR million I/2022 I/2021 2021 LTM Comparable EBITDA -104 1,479 3,817 2,234 Non-cash and other items 386 278 1,506 1,615 Interest received 14 13 75 76 Change in working capital impacted by Interest paid -95 -61 -202 -237 operational liquidity measures in the U
Slide 13: Leverage below target, gross debt down
Leverage below target, gross debt down Solid credit metrics debt debt 'BBB' long-term issuer credit rating, 81 2,235 216 netnet -214 Credit Watch Negative -1,529 'BBB' long-term issuer credit rating, 789 Financial stable outlook Financial Target ratio: Financial net CF from Investments Divest- FX an
Slide 14: Outlook
Outlook Hedging 2022 Estimated annual capital Generation Nordic hedges: expenditure, including maintenance For rest of 2022: 80% hedged at EUR 35 per MWh and excluding acquisitions, of appr. EUR 1,500 million of which For 2023: 55% hedged at EUR 33 per MWh maintenance capital expenditure (Q4: 50% at
Slide 15: Q&A
Q&A
Slide 16: Generation: Higher achieved power prices
Generation: Q1 Q1'22 Q1'21 Higher achieved power prices Volumes (TWh) 5.4 6.7 6.3 6.3 Q1 2022 vs. Q1 2021 Hydro Nuclear • Comparable operating profit increased mainly due to MEUR I/ I/ 2022 2021 2021 LTM – Higher achieved power prices of EUR 44.1 +EUR 6.9 per MWh – Lower hydropower volumes due to lo
Slide 17: Water reservoirs
Nord Pool system price driven to new price record Reservoir content (TWh) Water reservoirs 120 120 • Compared to long-term average, Nordic water reservoirs 100 100 increased during Q1 from -11 TWh to -6 TWh. Mild and windy 80 80 winter conditions led to below normal hydro generation in the first 60
Slide 18: Russia: Solid underlying performance
Russia: Q1 Q1'22 Q1'21 Solid underlying performance Volumes (TWh) 8.3 8.4 6.2 7.5 Q1 2022 vs. Q1 2021 Power Heat • Comparable operating profit decreased by 39%, to EUR 61 million MEUR I/ I/ 2022 2021 2021 LTM – Negative effect from the CSA expiry for Nyagan 1 – Impact of the Russian rouble exchange
Slide 19: City Solutions: Structural changes and lower volumes
City Solutions: Q1 Q1'22 Q1'21 Structural changes and lower volumes Volumes (TWh) 3.4 4.4 0.6 1.3 Power Heat Q1 2022 vs. Q1 2021 • Comparable operating suffered from structural changes including MEUR I/ I/ the sale of the Baltic district heating business in 2021 and the 250- 2022 2021 2021 LTM MW Pa
Slide 20: Consumer Solutions: Challenging market environment
Consumer Solutions: Number of Challenging market environment customers (‘000) MAR 2022 2,210 DEC 2021 2,230 Q1 2022 vs. Q1 2021 • Comparable operating profit broadly unchanged on the quarter. MEUR I/ I/ 2022 2021 2021 LTM • Higher temperatures in the Nordics compared to clearly colder weather in the
Slide 21: Uniper: Intra-year earnings shift
Uniper: Q1 Q1'22 Q1'21 Intra-year earnings shift Volumes (TWh) 11.5 10.7 14.1 12.3 3.5 3.3 3.4 3.6 Q1 2022 vs. Q1 2021 Hydro Nuclear Thermal CE Thermal RUS • Comparable operating profit turned substantially negative mainly MEUR* I/ I/ due to gas storage optimisation that deferred earnings to later 2