Notes to the condensed consolidated interim financial statements

4. Segment information

Sales

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power sales excluding indirect taxes 755 794 1,703 1,828 3,458 3,333
Heating sales 251 284 855 955 1,602 1,502
Network transmissions 211 202 507 501 905 911
Other sales 67 36 120 66 196 250
Total 1,284 1,316 3,185 3,350 6,161 5,996
             
             
Sales by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 1) 535 574 1,190 1,267 2,481 2,404
- of which internal 79 -24 126 -127 -24 229
Heat 1) 321 322 946 1,047 1,737 1,636
- of which internal 2 1 11 0 8 19
Russia 198 195 508 490 920 938
- of which internal - - - - - -
Distribution 223 215 531 526 973 978
- of which internal 7 4 17 8 15 24
Electricity Sales 1) 135 183 382 556 900 726
- of which internal 6 22 32 71 95 56
Other 1) 29 19 73 49 108 132
- of which internal -25 39 -17 117 115 -19
Netting of Nord Pool transactions 2) -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
1) Sales, both internal and external, includes effects from realised hedging contracts. Effect on sales can be negative or positive depending on the average contract price and realised spot price.
2) Sales and purchases with Nord Pool Spot is netted on Group level on an hourly basis and posted either as revenue or cost depending on if Fortum is a net seller or net buyer during any particular hour.
             
             
Comparable operating profit by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
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
             
             
Operating profit by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
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
             
             
Non-recurring items by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 1) 0 2 47 2 2 47
Heat 2) 0 -1 58 79 86 65
Russia 3) 11 0 11 0 0 11
Distribution 0 192 5 193 193 5
Electricity Sales - 0 - 1 3 2
Other 0 0 0 0 0 0
Total 11 193 121 275 284 130
1) Including a gain of EUR 47 million recognised on the divestment of small hydropower plants in Finland in Q1 2012.
2) Including a gain of EUR 58 million recognised on the divestment of certain heat businesses (Fortum Energiaratkaisut Oy and Fortum Termest AS) in Q1 2012.
3) Including a gain of EUR 11 million recognised on the disposal of heating network assets in Surgut, Russia in Q2 2012.
             
Non-recurring items include capital gains and losses.
             
             
Other items affecting comparability by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 1) -8 12 -29 176 273 68
Heat -3 1 -9 15 16 -8
Russia - - - - - -
Distribution 1 0 3 0 -10 -7
Electricity Sales 0 13 2 -19 -27 -6
Other 1 42 -1 65 64 -2
Total -9 68 -34 237 316 45
1) Including effects from the accounting of Fortum's part of the Finnish State Nuclear Waste Management Fund with (EUR million): -7 -8 -16 -12 -28 -32
             
Other items affecting comparability mainly include effects from financial derivatives hedging future cash-flows where hedge accounting is not applied according to IAS 39. Other segment includes mainly the effect arising from changes in hedge accounting status on group level. In Power segment there are also effects from the accounting of Fortum's part of the Finnish State Nuclear Waste Management Fund where the asset in the balance sheet cannot exceed the related liabilities according to IFRIC interpretation 5.
             
Comparable EBITDA by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 250 284 619 636 1,310 1,293
Heat 72 74 283 294 471 460
Russia 36 30 113 87 148 174
Distribution 101 106 260 277 482 465
Electricity Sales 11 10 20 22 29 27
Other -26 -23 -42 -37 -66 -71
Total 444 481 1,253 1,279 2,374 2,348
             
             
Depreciation, amortisation and impairment charges by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 28 27 56 54 109 111
Heat 49 49 99 98 193 194
Russia 32 31 61 54 108 115
Distribution 52 46 101 93 187 195
Electricity Sales 0 0 0 1 2 1
Other 2 2 4 4 7 7
Total 163 155 321 304 606 623
             
             
Share of profit/loss in associates and joint ventures by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 1), 2) -7 -12 -14 -16 3 5
Heat 1 5 10 9 19 20
Russia 21 30 21 38 30 13
Distribution 1 3 2 11 14 5
Electricity Sales 0 0 0 1 2 1
Other 10 -11 0 31 23 -8
Total 26 15 19 74 91 36
1) Including effects from the accounting of Fortum's associates part of Finnish and Swedish Nuclear Waste Management Funds with (EUR million): -2 -2 -4 -3 -6 -7
2) The main part of the associated companies in Power are power production companies from which Fortum purchases produced electricity at production costs including interest costs, production taxes and income taxes.
             
             
Participation in associates and joint ventures by segment

EUR million
      June 30
2012
June 30
2011
Dec 31
2011
Power       896 893 921
Heat       167 148 160
Russia       467 466 443
Distribution       102 96 101
Electricity Sales       0 10 0
Other       384 401 395
Total       2,016 2,014 2,020
             
             
Capital expenditure by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 36 35 60 52 131 139
Heat 99 72 166 108 297 355
Russia 126 192 207 267 670 610
Distribution 79 62 123 96 289 316
Electricity Sales 0 1 0 4 5 1
Other 3 4 5 6 16 15
Total 343 366 561 533 1,408 1,436
             
Of which capitalised borrowing costs 19 12 37 24 53 66
             
             
Gross investments in shares by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 0 1 0 17 17 0
Heat 0 - 0 22 32 10
Russia 0 0 0 0 24 24
Distribution - - - - - -
Electricity Sales - - - - - -
Other 5 0 5 0 1 6
Total 5 1 5 39 74 40
             
             
Gross divestments in shares by segment

EUR million
Q2 2012 Q2 2011 Q1-Q2
2012
Q1-Q2
2011
2011 Last
twelve
months
Power 0 2 63 2 3 64
Heat 0 -3 195 196 203 202
Russia 0 5 0 5 23 18
Distribution 0 322 37 323 323 37
Electricity Sales - 1 - 6 16 10
Other 0 - 0 - 0 0
Total 0 327 295 532 568 331

See Note 7 and additional cash flow information for more information about the gross divestment in shares in Q1-Q2 2012.

Net assets by segment

EUR million
June 30
2012
June 30
2011
Dec 31
2011
Power 6,258 5,998 6,247
Heat 4,072 3,911 4,191
Russia 3,437 3,051 3,273
Distribution 3,700 3,487 3,589
Electricity Sales 28 77 11
Other 227 387 208
Total 17,722 16,911 17,519
       
       
Comparable return on net assets by segment

%
  Last
twelve
months
Dec 31
2011
Power   19.5 19.9
Heat   7.1 7.4
Russia   2.5 3.5
Distribution   7.7 8.6
Electricity Sales   80.7 33.5
Other   -23.4 -12.7
       
Return on net assets by segment

%
  Last
twelve
months
Dec 31
2011
Power   21.3 24.6
Heat   8.5 9.9
Russia   2.9 3.5
Distribution   7.7 13.7
Electricity Sales   51.2 4.2
Other   -29.1 5.3
       
Return on net assets is calculated by dividing the sum of operating profit and share of profit of associated companies and joint ventures with average net assets. Average net assets are calculated using the opening balance and end of each quarter values.
       
Assets by segments

EUR million
June 30
2012
June 30
2011
Dec 31
2011
Power 7,218 6,834 7,134
Heat 4,403 4,262 4,597
Russia 3,841 3,441 3,692
Distribution 4,178 3,978 4,187
Electricity Sales 231 300 249
Other 837 625 628
Eliminations -504 -230 -306
Assets included in Net assets 20,204 19,210 20,181
Interest-bearing receivables 1,273 1,178 1,219
Deferred taxes 146 152 150
Other assets 592 168 717
Liquid funds 404 811 731
Total assets 22,619 21,519 22,998
       
Liabilities by segments

EUR million
June 30
2012
June 30
2011
Dec 31
2011
Power 960 836 887
Heat 331 351 406
Russia 404 390 419
Distribution 478 491 598
Electricity Sales 203 223 238
Other 610 238 420
Eliminations -504 -230 -306
Liabilities included in Net assets 2,482 2,299 2,662
Deferred tax liabilities 2,037 1,887 2,013
Other liabilities 252 335 392
Total liabilities included in Capital employed 4,771 4,521 5,067
Interest-bearing liabilities 7,824 7,594 7,770
Total equity 10,024 9,404 10,161
Total equity and liabilities 22,619 21,519 22,998
       
Other assets and Other liabilities not included in segment's Net assets consists mainly of income tax receivables and liabilities, accrued interest expenses, derivative receivables and liabilities qualifying as hedges and receivables and liabilities for interest rate derivatives.
       
Number of employees June 30
2012
June 30
2011
Dec 31
2011
Power 2,019 1,995 1,847
Heat 2,439 2,793 2,504
Russia 4,272 4,497 4,379
Distribution 907 928 898
Electricity Sales 528 518 519
Other 683 611 633
Total 10,848 11,342 10,780
       
Average number of employees Q1-Q2
2012
Q1-Q2
2011
2011
Power 1,883 1,856 1,873
Heat 2,388 2,748 2,682
Russia 4,337 4,421 4,436
Distribution 870 901 902
Electricity Sales 517 510 510
Other 649 594 607
Total 10,644 11,030 11,010
       
Average number of employees is based on a monthly average for the whole period in question.