Financial position and cash flow

Cash flow

In January–June 2012, total net cash from operating activities increased slightly to EUR 872 (864)  million. Capital expenditures in cash flow increased by EUR 74 million to EUR 577 (503) million. Proceeds from divestments totalled EUR 301 (535) million in cash flow. Cash flow before financing activities, i.e. dividend distributions and financing, decreased by EUR 303 million to EUR 579 (882) million. The strong SEK during the first half of the year had a negative impact on the cash flow through realised net foreign exchange losses amounting to EUR 113 (251) million related to rollover of foreign exchange contracts hedging loans to Fortum Swedish subsidiaries.

During the reporting period, dividends totalling EUR 888 million were paid on 23 April 2012 using the cash and cash equivalents.  

Assets and capital employed

Total assets decreased by EUR 379 million to EUR 22,619 (22,998 at year-end 2011) million. Non-current assets increased by EUR 432 million from EUR 20,210 million to EUR 20,642 million. The majority, EUR 391 million, came from the increased value of property, plants and equipment; due to the investments, strengthening Swedish krona and other currencies. The decrease in current assets was EUR 811 million, totalling EUR 1,977 million. The majority of the decrease relates to the lower amount of cash and cash equivalents, EUR 327 million, decrease in trade and other receivables EUR 275 million, and the EUR 183 million decrease in assets held for sale relating to divestments closed during January–June.

Capital employed was EUR 17,848 (17,931 at year-end 2011) million, a decrease of EUR 83 million. The decrease was due to the lower amount of total assets totalling EUR 379 million, and a decrease in interest-free liabilities, totalling EUR 296 million.

Equity

Total equity was EUR 10,024 (10,161 at year-end 2011) million, of which equity attributable to owners of the parent company totalled EUR 9,472 (9,632 at year-end 2011) million and non-controlling interests EUR 552 (529 at year-end 2011) million. The decrease in equity attributable to owners of the parent company totalled EUR 160 million and arose mainly from net profit for the period, amounting to EUR 681 million and from the dividends paid totalling EUR 888 million.

Financing

Net debt increased during the second quarter by EUR 897 million to EUR 7 420 (7,023 at year-end 2011) million mainly as a result of dividend payment in April of EUR 888 million.

At the end of June 2012, the Group’s liquid funds totalled EUR 404 (747 at year-end 2011) million. Liquid funds include cash and bank deposits held by OAO Fortum amounting to EUR 240 (211 at year-end 2011) million. In addition to the liquid funds, Fortum had access to approximately EUR 2.7 billion of undrawn committed credit facilities.

The Group's net financial expenses during January-June 2012 were EUR 149 (127) million. The increase in financial expenses is mainly attributable to higher market interest rates and higher average net debt during the first half of the year. Net financial expenses also include changes in the fair value of financial instruments of EUR 8 (3) million.

Fortum Corporation's long-term credit rating from S&P, A (negative) and Fortum Corporation’s long-term credit rating from Moody’s, A2 (stable), remained unchanged.

Key figures

For the last twelve months, net debt to EBITDA was 2.9 (2.3 at year-end 2011) and comparable net debt to EBITDA 3.2 (3.0 at year-end 2011), impacted by EUR 888 million in dividend payments. Gearing was 74% (69% at year-end 2011) and the equity-to-assets ratio 44% (44% at year-end 2011). For the last twelve months, return on capital employed was 11.3% (14.8% at year-end 2011) and return on equity 14.0% (19.7% at year-end 2011). Equity per share was EUR 10.66 (10.84 at year-end 2011).