Financial results

April - June

In the second quarter of 2012, Group sales were EUR 1,284 (1,316) million. The comparable operating profit totalled EUR 281 (348) million. Group operating profit totalled EUR 283 (609) million. Fortum's operating profit for the period was affected by non-recurring items, IFRS accounting treatment (IAS 39) of derivatives mainly used for hedging Fortum's power production and nuclear fund adjustments amounting to EUR 2 (261) million.

The share of profits from associates in the second quarter was EUR 26 (15) million. The share of profits from Hafslund and TGC-1 are based on the companies' published first-quarter interim reports. In addition, the share of profits from TGC-1's fourth-quarter 2011 is included in Note 14.

Sales by division
EUR million II/12 II/11 I-II/12 I-II/11 2011 LTM
Power 535 574 1,190 1,267 2,481 2,404
Heat 321 322 946 1,047 1,737 1,636
Russia 198 195 508 490 920 938
Distribution* 223 215 531 526 973 978
Electricity Sales* 135 183 382 556 900 726
Other 29 19 73 49 108 132
Netting of Nord Pool transactions -88 -150 -276 -516 -749 -509
Eliminations -69 -42 -169 -69 -209 -309
Total 1,284 1,316 3,185 3,350 6,161 5,996
* Part of the Electricity Solutions and Distribution Division
             
Comparable operating profit by division
EUR million II/12 II/11 I-II/12 I-II/11 2011 LTM
Power 222 257 563 582 1,201 1,182
Heat 23 25 184 196 278 266
Russia 4 21 52 55 74 71
Distribution* 49 60 159 184 295 270
Electricity Sales* 11 10 20 21 27 26
Other -28 -25 -46 -41 -73 -78
Total 281 348 932 997 1,802 1,737
* Part of the Electricity Solutions and Distribution Division
             
Operating profit by division
EUR million II/12 II/11 I-II/12 I-II/11 2011 LTM
Power 214 271 581 760 1,476 1,297
Heat 20 25 233 290 380 323
Russia 15 21 63 55 74 82
Distribution* 50 252 167 377 478 268
Electricity Sales* 11 23 22 3 3 22
Other -27 17 -47 24 -9 -80
Total 283 609 1,019 1,509 2,402 1,912
* Part of the Electricity Solutions and Distribution Division

January - June

In January–June, Group sales were EUR 3,185 (3,350) million. The comparable operating profit totalled EUR 932 (997) million. Group operating profit totalled EUR 1,019 (1,509) million. Fortum's operating profit for the period was affected by non-recurring items, IFRS accounting treatment (IAS 39) of derivatives mainly used for hedging Fortum's power production and nuclear fund adjustments.

Non-recurring items, mark-to-market effects and nuclear fund adjustments in January–June 2012 amounted to EUR 87 (512) million. Changes in fair values of derivatives hedging future cash flow accounted for EUR -18 (249) million. Non-recurring items totalled EUR 121 (275) million and were mainly related to the divestments of shares in power and heat operations. (Note 4.)

The share of profits of associates and joint ventures was EUR 19 (74) million. The decrease from last year was mainly due to lower share of profits from Hafslund ASA, and TGC-1 as well as the share of profits from Fingrid Oyj, which was divested during Q2 2011.

The Group’s net financial expenses increased to EUR 149 (127) million. The increase is attributable to higher interest expenses, mainly due to higher SEK interest rates and to higher average net debt in 2012 than during the comparable period in 2011. Net financial expenses were also negatively affected by changes in the fair value of financial instruments of EUR 8 (3) million.

 Profit before taxes was EUR 889 (1,456) million.

Taxes for the period totalled EUR 165 (232) million. The tax rate according to the income statement was 18.5% (15.9%). The tax rate, excluding mainly the impact of the share of profits of associated companies and joint ventures as well as non-taxable capital gains, was 21.1% (21.1%).

The profit for the period was EUR 724 (1,224) million. Fortum's earnings per share were EUR 0.77 (1.29), of which EUR 0.10 (0.47) per share relates to items affecting comparability.

Non-controlling (minority) interests amounted to EUR 43 (74) million. These are mainly attributable to Fortum Värme Holding AB, in which the city of Stockholm has a 50% economic interest. The decrease compared to last year is mainly due to the minority's share, EUR 32 million, of the gain recognised in the first quarter 2011 from the divestment of Fortum Värme’s heat businesses outside the Stockholm area.