2013-02-18 10:00:01 CET
2013-02-18 10:00:12 CET
REGULATED INFORMATION
Fingrid Oyj - Annual Financial Report
Fingrid Oyj Annual Review and Financial Statements 2012
Helsinki, Finland, 2013-02-18 10:00 CET (GLOBE NEWSWIRE) -- Fingrid Oyj
Financial Statement Release 18.2.2013 at 11.00 EET
Fingrid Oyj's review for January - December 2012: profit improved significantly
October - December 2012
-- Revenue of the Group between October and December 154 million euros (108
million euros in 2011)
-- Operating profit of the Group in the last quarter 38 (17) million euros
January - December 2012
-- Revenue between January and December 522 (438) million euros
-- Operating profit of the Group 95 (57) million euros
-- Profit of the Group for the financial year 67 (33) million euros
-- Cash flow from the operations of the Group after capital expenditure -1
(-148) million euros
-- Interest-bearing net borrowings 1,030 (1,020) million euros
-- Capital expenditure 139 (244) million euros
-- Equity ratio 27.3 (25.7) per cent
-- Earnings per share 20,159 (9,924) euros
Key figures
--------------------------------------------------------------------------------
1-12/12 1-12/11 change 10-12/ 10-12/ change
% 12 11 %
--------------------------------------------------------------------------------
Turnover M€ 522.1 438.5 19.1 153.7 107.9 42.5
--------------------------------------------------------------------------------
Capital expenditure, M€ 139.0 244.4 -43.1 56.4 76.4 -26.2
gross
--------------------------------------------------------------------------------
- of revenue % 26.6 55.7 36.7 70.9
--------------------------------------------------------------------------------
Research and M€ 1.5 1.8 -16.4 0.6 0.6 -6.4
development expenses
--------------------------------------------------------------------------------
- of revenue % 0.3 0.4 0.4 0.6
--------------------------------------------------------------------------------
Personnel, average 269 263 2.3
--------------------------------------------------------------------------------
Personnel, end of year 275 266 3.4
--------------------------------------------------------------------------------
Salaries and bonuses, M€ 18.2 17.2 5.8 5.3 4.6 14.3
total
--------------------------------------------------------------------------------
Operating profit M€ 94.6 56.6 67.3 38.5 17.1 125.1
--------------------------------------------------------------------------------
- of revenue % 18.1 12.9 25.0 15.8
--------------------------------------------------------------------------------
Profit before taxes M€ 88.3 34.2 158.2 35.0 8.3 321.0
--------------------------------------------------------------------------------
- of revenue % 16.9 7.8 22.8 7.7
--------------------------------------------------------------------------------
Profit for the M€ 67.0 33.0 103.0 26.7 13.8 92.9
financial period
--------------------------------------------------------------------------------
Comprehensive income M€ 73.2 -0.2 27.5 3.8
for the financial
period
--------------------------------------------------------------------------------
Return on investment % 5.6 3.6
(ROI)
--------------------------------------------------------------------------------
Return on equity (ROE) % 12.4 6.5
--------------------------------------------------------------------------------
Equity ratio % 27.3 25.7
--------------------------------------------------------------------------------
Interest-bearing net M€ 1,030.3 1,020.2 1.0
borrowings
--------------------------------------------------------------------------------
Net gearing ratio % 180.8 201.1
--------------------------------------------------------------------------------
Earnings per share € 20,159 9,924 103.1 8,032 4,163 92.9
--------------------------------------------------------------------------------
Dividend, series A € 2,018.2 3,962.52
shares 6*
--------------------------------------------------------------------------------
Dividend, series B € 2,018.2 2,018.26
shares 6*
--------------------------------------------------------------------------------
Equity per share € 171,365 152,573 12.3
--------------------------------------------------------------------------------
Dividend payout ratio, % 10.0* 39.9
A shares
--------------------------------------------------------------------------------
Dividend payout ratio, % 10.0* 20.3
B shares
--------------------------------------------------------------------------------
Number of shares at 31
Dec
--------------------------------------------------------------------------------
- Series A shares Pcs. 2,078 2,078 2,078 2,078
--------------------------------------------------------------------------------
- Series B shares Pcs. 1,247 1,247 1,247 1,247
--------------------------------------------------------------------------------
Total Pcs. 3,325 3,325 3,325 3,325
--------------------------------------------------------------------------------
*The Board of Directors' proposal to the Annual General Meeting
Jukka Ruusunen, Fingrid's President and CEO, on the financial statements:
“Fingrid's profit was improved by the increase of 30 per cent in the grid
tariffs and by the congestion income on the border between Finland and Sweden
resulting from the major area price differences. On the other hand, the Russian
cross-border transmission income and inter-TSO compensations in the European
marketplace decreased considerably because the electricity imports from Russia
came down. Especially the costs of reserves which safeguard the system security
of the transmission system increased on 2011. The maintenance management costs
were increased by the repair of a fault in the Fenno-Skan 2 cable.
Net borrowing by the company grew somewhat due to Fingrid's sizeable capital
investment programme. During 2012, Fingrid issued a public bond valued at 300
million euros and with a maturity of 12 years under the company's International
Medium Term Note Programme.
Fingrid's capital expenditure in the transmission system totalled 139 million
euros. Fingrid had several ongoing capital investment projects for ensuring
system security and the adequacy of transmission capacity in the future.
The system security of the transmission grid was excellent after two inferior
years. The number of disturbances in the grid was at the average level, but the
disadvantage inflicted on the customers and society as a result of the
disturbances was very small.
The year was exceptional in the electricity market. There was abundant supply
of Nordic hydropower throughout the year, which clearly brought down the price
level in the wholesale market. However, the Finnish market did not benefit
fully from the inexpensive hydropower. One of the two submarine cables between
Finland and Sweden was out of order for much of the year, which is why the full
transmission capacity between Finland and Sweden could not be utilised. As a
result, a record-high amount of congestion income, 88 million euros, was
accumulated at the border between Finland and Sweden.”
Accounting principles
Information published in this release is based on Fingrid's audited financial
statement of 2012 that is published with this release. In the preparation of
this release, Fingrid has complied with the same accounting principles as with
the financial statements of 2012.
Financial result
Revenue of the Fingrid Group in 2012 was 522 million euros (438 million euros
in 2011). Other operating income was 4 (3) million euros. The Group's revenue
between October and December was 154 (108) million euros.
Grid revenue rose to 276 (210) million euros as a result of the tariff increase
of 30 per cent carried out at the beginning of the year. Electricity
consumption in Finland increased by 1.1 per cent from 2011. Fingrid transmitted
the same amount of electricity in its grid as in the previous year, i.e. 64.2
terawatt hours. The sales of imbalance power grew to 152 (146) million euros.
The increase in the sales of imbalance power was influenced by the higher
volume of imbalance power and by the raise in the balance service fees at the
beginning of July. Fingrid's cross-border transmission income on the connection
between Finland and Russia decreased by 12 million euros from the previous year
due to a significantly smaller volume of electricity imports from Russia.
Fingrid's congestion income on the interconnection between Finland and Estonia
decreased as a result of fewer hours with a different price of electricity
between the two countries. The congestion income on the interconnection between
Finland and Estonia was 6 (10) million euros, which was paid to the owners of
the transmission connection. Fingrid's congestion income on the interconnection
between Finland and Sweden rose considerably due to the market situation and
great differences in the area prices of electricity. The congestion income
between Finland and Sweden was 44 (16) million euros. European inter-TSO
compensation income decreased by 12 million euros mainly due to reduced
electricity exports from Finland to Sweden.
The costs of imbalance power grew slightly from the previous year to 133 (131)
million euros due to the higher volume of imbalance power. The loss energy
costs rose by 2 million euros from the corresponding period in 2011. The
average price of loss energy purchases, considering price hedging, was 52.86
(52.85) euros per megawatt hour. The increase in the loss energy costs was
influenced by the small growth in the volume of loss energy. The depreciation
costs increased by 8 million euros as significant new capital investment
projects were completed. The costs of reserves, which safeguard the system
security of the power system, rose by 11 million euros during the period under
review because the temporary purchases of frequency controlled reserves in the
hourly market in Finland and from the other Nordic TSOs were more expensive
than earlier. The personnel costs increased to 22 (20) million euros partly
owing to an increase in the number of personnel. The maintenance management
costs rose by 3 million euros, mainly due to the repair costs of the Fenno-Skan
2 cable fault. The inter-TSO compensation costs went up by 2 million euros,
because electricity imports from Sweden to Finland increased considerably from
2011.
Revenue and other operating income, (million €)
--------------------------------------------------------------------------------
1-12/1 1-12/1 change 10-12/1 10-12/1 change
2 1 % 2 1 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Grid service revenue 276 210 31.4 85 59 45.4
Sales of imbalance power 152 146 4.5 48 25 91.2
Cross-border transmission 11 22 -52.6 3 5 -32.0
Finland-Estonia congestion 6 10 -32.8 1 1 -7.8
income*
Finland - Sweden congestion 44 16 180.6 8 4 95.1
income
Peak load capacity** 19 7 159.0 5 5 0.3
ITC income 10 22 -55.1 3 7 -66.6
Feed-in tariff for peat 0 -100.0
Other revenue 3 5 -35.5 1 2 -60.8
Other operating income 4 3 28.9 2 1 44.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Revenue and other income 526 441 19.1 156 109 42.6
total
Costs (million €)
--------------------------------------------------------------------------------
1-12/1 1-12/1 change 10-12/ 10-12/ change
2 1 % 12 11 %
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Purchase of imbalance power 133 131 1.2 40 22 85.8
Purchase of loss energy 65 63 2.6 17 16 6.0
Depreciation 76 68 11.5 20 18 13.0
Reserves 39 28 38.2 10 7 35.7
Personnel 22 20 8.9 7 6 13.0
Maintenance management 21 18 16.6 6 6 -0.3
Peak load capacity** 18 7 159.9 5 5 -0.5
ITC charges 14 12 14.9 3 4 -13.5
Estlink grid rents* 6 9 -32.9 1 1 -20.0
Other costs 25 23 9.4 8 7 19.8
--------------------------------------------------------------------------------
Costs total 419 380 10.2 116 90 28.4
Operating profit excluding the 107 62 74.2 39 19 111.1
change in the fair value of
commodity derivatives
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit of Group 95 57 67.3 38 17 125.1
*Fingrid's income from the congestion income between Finland and Estonia was
6.5 million euros. The costs (grid rents between Finland and Estonia) were 6.4
million euros, which was paid to the owners of the Estlink transmission
connection. The difference of 0.1 million euros received by Fingrid was created
during disturbances on the Estlink connection.
**The peak load capacity income and costs are related to the securing of the
sufficiency of electricity during peak consumption hours within the framework
of the Finnish Peak Load Capacity Act.
The operating profit of the Group was 95 (57) million euros. Of the change in
the fair value of commodity derivatives, -13 (-5) million euros were recognised
in the income statement. The operating profit in the last quarter was 38 (17)
million euros.
The consolidated profit for the year was 67 (33) million euros. The
consolidated total comprehensive income was 73 (0) million euros. The cash flow
from the operations of the Group deducted by capital expenditure was -1 (-148)
million euros due to the considerably better profit and smaller level of
capital expenditure.
The return on investment was 5.6 (3.6) per cent and the return on equity 12.4
(6.5) per cent. The equity ratio was 27.3 (25.7) per cent at the end of the
review period.
Revenue of the parent company was 504 (434) million euros and profit for the
financial year 41 (22) million euros.
Capital expenditure
Fingrid's annual capital expenditure in the transmission system has been
extensive for several years. The company's gross capital expenditure in 2012
was 139 million euros (244 million euros in 2011). Of this amount, a total of
94 (173) million euros were used for the transmission grid and 26 (68) million
euros for reserve power. IT-related capital expenditure was approximately 11
(3) million euros. The sharp increase in capital expenditure is the result of
the connection of new generating capacity to the transmission system, the
promotion of the functioning of the electricity market, renewal of the ageing
grid, and regional changes in electricity consumption and production patterns
in Finland.
Research and development was allocated a total of 1.5 (1.8) million euros. Some
50 research and development projects were in progress in 2012. The foremost R&D
input was placed on the analysis of reserve types and needs, utilisation of
status measurements at the power system level in the maintaining of system
security and in the optimisation of transmission capacity, and development of a
110 kilovolt tower type suited for use on arable land. There were also numerous
research projects for controlling wind power production in the power system.
Fingrid had several capital investment projects for ensuring system security
and the adequacy of transmission capacity in the future. One of the biggest
projects is the one between Yllikkälä and Huutokoski for reinforcing the grid
in Eastern Finland. Three sub-projects were completed within it in 2012, and
the last transmission line section will be completed in the spring of 2013. The
biggest reserve power plant unit in Finland was commissioned in Forssa towards
the end of the year. The plant brings 320 megawatts of additional fast
disturbance reserve to the transmission system.
EstLink 2, the joint project by Fingrid and the Estonian transmission system
operator Elering has made progress on schedule and within budget. The submarine
cable was laid in the Baltic Sea in two campaigns during the autumn. The HVDC
connection will be commissioned in early 2014.
Towards the end of 2012, Fingrid made a capital investment decision concerning
the Hirvisuo - Pyhänselkä 400 kilovolt transmission line project. The project
will upgrade the west coast of Finland to the 400 kilovolt voltage level. The
total length of the transmission line is 215 kilometres. In addition to it,
there will be a new Hirvisuo substation, and a number of other substations will
be expanded.
ENTSO-E, the European Network of Transmission System Operators for Electricity,
published its ten-year network development plan and the plan for the Baltic Sea
region in the summer of 2012. The Nordic network plan was drawn up on the basis
of these.
Power system
Electricity consumption in Finland in 2012 totalled 85.2 terawatt hours (84.2
terawatt hours in 2011). A total of 64.2 (64.2) terawatt hours of electricity
was transmitted in Fingrid's grid, representing 75.4 per cent of the
electricity consumption in Finland.
Electricity transmissions between Finland and Sweden in 2012 consisted mainly
of imports to Finland. The capacity offered to the market was limited by a
cable fault and by the work required by the automation reform in the submarine
cable connections. A total of 14.8 (5.9) terawatt hours of electricity were
imported from Sweden to Finland during 2012, and 0.4 (4.0) terawatt hours were
exported from Finland to Sweden.
The direction of transmissions in electricity transmission between Finland and
Estonia varied, with the dominating direction being from Finland to Estonia.
The transmission capacity was available to the market in the normal manner. The
volume of electricity imports from Estonia to Finland on the Estlink connection
was 0.4 (1.6) terawatt hours, and 1.5 (0.5) terawatt hours of electricity were
exported from Finland to Estonia.
Electricity imports from Russia were at a much lower level than in the previous
years. Almost the full transmission capacity was made available. Electricity
imports from Russia to Finland totalled 4.4 (10.8) terawatt hours in 2012.
The number of disturbances in the Finnish grid was at the average level.
However, the calculatory disadvantage inflicted on the customers and society as
a result of the disturbances was very small. The most significant disorder
affecting customers occured in the Vaasa region in August, when 63,000 people
were left without electricity for a few minutes.
Power system operation 1-12/12 1-12/11 10-12/12 10-12/11
-------------------------------------------------------------------------------
Electricity consumption in Finland TWh 85.2 84.2 23.3 21.5
Fingrid's transmission volume TWh 64.2 64.2 17.2 16.2
Fingrid's loss energy volume TWh 1.2 1.2 0.3 0.3
Electricity transmissions Finland-Sweden
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
exports to Sweden TWh 0.4 4.0 0.2 0.7
imports from Sweden TWh 14.8 5.9 3.2 2.2
Electricity transmissions Finland-Estonia
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
exports to Estonia TWh 1.5 0.5 0.3 0.2
imports from Estonia TWh 0.4 1.6 0.1 0.3
Electricity transmissions Finland-Russia
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
imports from Russia TWh 4.4 10.8 1.4 2.3
Electricity market
The Nordic electricity market was characterised by very abundant supply of
hydropower throughout the year. This clearly lowered the price level in the
wholesale market. The average price of spot electricity at the electricity
exchange (system price) in 2012 was 31 euros per megawatt hour (47 euros per
megawatt hour in 2011), and the average area price for Finland was 37 (49)
euros per megawatt hour.
The Finnish market did not benefit fully from the inexpensive hydropower,
because one of the two submarine cables between Finland and Sweden was out of
order for a large part of the year. The market could have accommodated more
electricity than on average from the west, but the transmission capacity was
not sufficient due to the failures on the connections. As a result, a
record-high amount of 88 million euros of congestion income was created on the
border between Finland and Sweden. Fingrid's share of this was 44 million
euros.
Supply in the Finnish market area was also influenced by the fact that
electricity imports from Russia decreased considerably. The imports had
remained at a steady level for decades but started to fluctuate and decrease
rapidly in the autumn of 2011. In 2012 the imports were only about one third of
the earlier level of imports.
In 2012, Fingrid used 4.7 (1.6) million euros for counter trade. This mainly
resulted from disturbances on the cross-border connections and partly from
transmission restrictions within Finland.
The active development of the single European market continued. In line with
the EU's third legislative package on the electricity market, the preparation
of several market rules was launched within ENTSO-E, and the first proposals
were completed. At the same time, the full integration of the various market
areas was prepared,initially concerning North-Western Europe.
Electricity market
--------------------------------------------------------------------------------
1-12/1 1-12/1 10-12/1 10-12/1
2 1 2 1
--------------------------------------------------------------------------------
Nord Pool system price, average €/MWh 31 47 37 34
--------------------------------------------------------------------------------
Area price Finland, average €/MWh 37 49 41 37
--------------------------------------------------------------------------------
Congestion income between Finland and Sweden 88.5 31.2 16.0 8.2
million €
--------------------------------------------------------------------------------
Congestion hours between Finland and Sweden % 35.1 22.9 32.0 12.0
--------------------------------------------------------------------------------
Congestion income between Finland and Estonia 12.9 19.6 1.5 1.2
million €
--------------------------------------------------------------------------------
Congestion hours between Finland and Estonia % 34.7 45.5 22.4 31.0
--------------------------------------------------------------------------------
*The congestion income between Finland and Sweden as well as between Finland
and Estonia is divided between the relevant TSOs in equal proportions. The
income and costs of the transmission connections are presented in the tables
under Financial result.
Financing
The financial position of the Group continued to be satisfactory. During 2012,
Fingrid issued a public bond amounting to 300 million euros and with a maturity
of 12 years under the company's International Medium Term Note Programme. The
public listing of the bond started on London Stock Exchange on 3 April 2012.
The net financial costs excluding the change in the fair value of derivatives
were 21 million euros (19 million euros in 2011). Interest income was 3 (4)
million euros. The net financial costs in accordance with IFRS were 7 (23)
million euros, including the positive change of 14 million euros (negative 3
million euros) in the fair value of derivatives.
The financial assets at 31 December 2012 totalled 214 (204) million euros. The
interest-bearing borrowings totalled 1,244 (1,224) million euros, of which
1,032 (845) million euros were long-term and 212 (379) million euros were
short-term. The counterparty risk arising from the currency derivative
contracts and interest rate derivative contracts was 77 (63) million euros.
International rating agencies updated Fingrid Oyj's credit ratings in 2012. On
16 October 2012, Fitch Ratings affirmed Fingrid Oyj's senior unsecured debt
rating of A+, long-term Issuer Default Rating (IDR) of A and short-term IDR of
F1. Fitch Ratings rated the outlook on the long-term IDR as stable. Standard &
Poor's Rating Services (S&P) updated Fingrid's long-term credit rating at AA-
and the short-term rating at A-1+ on 2 November 2012. S&P assessed Fingrid's
outlook to be negative. On 14 December 2012, Moody's Investors Service updated
Fingrid's long-term credit rating at A1 and the short-term rating at P-1.
Moody's rated the outlook to be stable.
Personnel and compensation systems
The Fingrid Group and Fingrid Oyj employed 275 persons, including temporary
employees, at the end of 2012. The corresponding figure a year before was 266.
The number of permanent personnel was 261 (252).
Of the personnel employed by the company, 23.8 (23.7) per cent were women and
76.2 (76.3) per cent were men at the end of the year.
Number of permanent personnel
-----------------------------------------
age 2012 2011
-----------------------------------------
-----------------------------------------
24 to 29 years 22 24
30 to 34 years 34 33
35 to 39 years 41 41
40 to 44 years 37 32
45 to 49 years 38 40
50 to 54 years 36 37
55 to 59 years 30 23
60 to 65 years 23 21
over 65 years 0 1
-----------------------------------------
During 2012, a total of 9,528 (14,333) hours were used for personnel training,
with an average of 37 (57) hours per person. Employee absences on account of
illness in 2012 accounted for 2 per cent of the total working hours. In
addition to a compensation system which is based on the requirements of each
position, Fingrid applies quality and incentive bonus schemes. The Board of
Directors approved the principles for the remuneration systems of the company's
personnel and executive management group for 2013.
Board of Directors and corporate management
Fingrid Oyj's Annual General Meeting was held in Helsinki on 22 March 2012.
Helena Walldén, M.Sc. (Tech.), was elected as the Chairman of the Board. Juha
Majanen, Budget Counsellor and the Head of Fiscal Policy Unit of the Ministry
of Finance was elected as the Vice Chairman. The other Board members elected
were Sirpa Ojala, CEO of Digita Oy, Esko Torsti, Head of Non-listed Investments
of Ilmarinen Mutual Pension Insurance Company, and Esko Raunio, Director,
Private Market Investments, of Tapiola Mutual Pension Insurance Company.
The Board members until 22 March 2012 were Helena Walldén, Arto Lepistö, Elina
Engman (until 29 February 2012), Timo Kärkkäinen and Esko Raunio.
PricewaterhouseCoopers Oy was elected as the auditor of the company.
The Board of Directors has two committees: an audit committee and a
remuneration committee. The members of the audit committee from 22 March 2012
were Juha Majanen (Chairman), Esko Torsti and Helena Walldén. The members of
the audit committee until 22 March 2012 were Arto Lepistö (Chairman), Helena
Walldén and Timo Kärkkäinen.
The remuneration committee consisted of Helena Walldén (Chairperson) and Sirpa
Ojala from 22 March 2012. Until 22 March 2012, the members of the remuneration
committee were Helena Walldén (Chairperson) and Arto Lepistö.
Jukka Ruusunen serves as the President & CEO of the company.
A corporate governance statement, required by the Finnish Corporate Governance
Code, has been provided separately. The statement and other information
required by the Code are also available on the company's website at
www.fingrid.fi.
Risk management
The biggest risk in terms of the company and society is a major disturbance
related to the functioning of the power system. A comprehensive disturbance in
the power system may be caused by several simultaneous faults in the grid,
inoperability of Fingrid's operation control system, insufficiency of
production capacity, external events, or problems related to operation support
systems or data security, preventing grid operation entirely or partially.
Fingrid is prepared for a widespread disturbance concerning Finland or the
Nordic power system by making capital investments in the transmission grid and
in reserve power. In its strategy, the company focuses on the versatile
utilisation of the operation control system, expedited disturbance clearing,
and management of power shortage situations. Fingrid also makes preparations
for disturbance situations by means of various reserves, procedural guidelines,
contingency plans, and exercises.
Other significant risks are an unfavourable trend in official regulation,
capital investments which have become unnecessary, unanticipated capital
investments, an unexpected increase in costs or reduction in income, financing
risks, personnel risks, reputation risks, risks related to information
technology and telecommunications, and asset risks.
Fingrid's operations are subject to official regulation and supervised by the
Energy Market Authority. Risks related to an unfavourable trend in official
regulation, such as changes in the Finnish or European regulation or
legislation, can weaken the financial position of the company or its
opportunities to pursue the objectives related to the development of the
electricity market. The company aims to establish well-working co-operation and
interaction with the various stakeholders and to contribute actively to the
reports and task forces of authorities. Fingrid works within ENTSO-E, the
European Network of Transmission System Operators for Electricity, hence making
preparations for and contributing to the impacts of regulation.
Capital investments which have become unnecessary, or unanticipated capital
investments may be the result of issues such as regional changes in electricity
consumption, changes in electricity production, changes in the international
situation, changes in regulation, or technological changes. The objective is to
avoid potentially incorrect or unanticipated capital expenditure by means of
continuous dialogue and close co-operation with customers, other transmission
system operators, and other stakeholders. Fingrid draws up transparent,
comprehensive and sustainable grounds for capital investments, and updates the
grid plans regularly. The company creates flexibility in the capital investment
programme and executes the projects in a timely fashion.
Fingrid's major financial risks include an unforeseen increase in costs or
decrease in income. This could be caused by unexpected changes in market-based
costs. Increased costs could be a result of for example the realisation of
counterparty risk, increase in electricity exchange prices or interest rate
level or unexpected faults. Correspondingly, a decrease in income may be the
result of a sharp decline in electricity consumption, realisation of
counterparty risk related to the service businesses, or a reduction in
transmission and congestion income. An unanticipated increase in costs or
decrease in income is restricted by enhancing financial control in the Group
and assessment concerning financial latitude. Fingrid can change the grid
tariff annually. Derivatives are used for hedging against changes in the price
of electricity or in the interest rate level. The counterparty risk related to
obligations of parties having a contractual relationship with Fingrid is
limited contractually, by defining limits and by regularly monitoring the
financial position of the counterparties.
The financial risks include currency risks, transaction risks, interest rate
risks, commodity risks, liquidity and refinancing risks, and credit risks.
Financial risks can be caused by disturbances in the capital and money markets,
realisation of counterparty risks in terms of derivatives or investments,
realisation credit risks in operations, or disturbances in payments traffic.
The risks are limited by means of derivatives, monitoring of counterparties,
and by determining upper limits for investments in financial securities and
counterparties. Moreover, the refinancing risk caused by disorders in the money
and capital markets is reduced by the even maturity profile of debt and
versatile sources of funding. The financial risks are described in more detail
in note 34 to the consolidated financial statements (IFRS).
The personnel risks are related to competence and occupational safety. In terms
of occupational safety, risks related to electrical safety as well as
construction and repair projects are the foremost risks. The competence and
occupational safety risks are limited by the company's strategic long-term
personnel planning and allocated training programmes for both the company's own
personnel and service providers. Fingrid audits the work sites systematically
in order to enhance safety at work.
Reputation risk can be attributable to a number of reasons, such as serious
disturbances or accidents, changes in prices, expropriation of land areas, or
delayed upgrades of the grid. These risks are reduced by means of effective
risk and change management as well as responsible, transparent and equitable
operations and active stakeholder efforts.
Drawbacks related to information technology and telecommunications may be
caused by an accident in ICT hardware facilities, long-term inoperability of
telecommunications, or a serious failure in a critical ICT system where such a
failure poses a direct and significant impediment to the company's operations.
Such a situation may also be caused by a work error or serious breach of data
security. The company aims to make contingencies for these risks so that the
company has sufficient and solid ICT expertise and that ICT is secured in terms
of the facilities, telecommunications and systems. Contingency plans are drawn
up for the critical systems, and the company monitors and forecasts potential
cyber security threats.
Asset risks cover significant failures in Fingrid's assets beyond repair, or a
reduction in the usability of the assets. These may include failures which are
significant in terms of volume or asset value. Other reasons of asset risks can
include significant and unanticipated factors. Fingrid manages the asset risk
through means such as preventive maintenance management, comprehensive
insurance policies for the key grid components, detailed definition of projects
and maintenance management, stringent quality control, and use of proven
technology and competent suppliers.
In addition to the foremost risks affecting the company, Fingrid has
identified, as part of its corporate social responsibility, the risks that have
a major impact on society. Fingrid has also taken into account the management
of these risks, and it influences the risks through a variety of measures. The
foremost risks shared by Fingrid and society comprise a risk of a major
disturbance as described above, lack of confidence in the electricity market,
environmental risk, postponement of significant upgrades of the transmission
system, and long-term transmission capacity restrictions.
The loss of confidence in the electricity market is a significant risk for
Fingrid and society. This risk may be realised for example as a result of
congestions in the transmission system or high prices of electricity. The
company aims to contribute to the integration of the European electricity
market and to secure the intensification of market mechanisms by constructing
new cross-border transmission connections whenever necessary and by publishing
market information which has bearing on the transparency of the market.
From the point of view of society, the most significant environmental risks are
related to environmental damage and to the requirements of environmental
legislation. The foremost risks related to environmental matters include delays
in capital investment projects due to the assessment of environmental impacts,
and changes in environmental legislation. The preparatory measures for the
environmental risks comprise proactive assessment of environmental impacts,
monitoring of legislation, prevention of accidents by means of technical
solutions, further development of terms of contract, and audits.
Risks to society also include the postponement of significant upgrades in the
transmission system and long-term transmission capacity restrictions.
Significant upgrades in the transmission system may be delayed because of the
postponement of the permit process, economic situation, lack of resources,
strike, or general strike, among others. The postponement may cause
restrictions in the electricity market. Long-term transmission capacity
restrictions may be caused by for example technical failures or problems with
power system security. The risks are controlled by securing the critical items
in the transmission grid and on the cross-border connections and by means of
efficient outage planning.
Share capital
The minimum share capital of the company is 55,900,000 euros and the maximum
share capital is 223,600,000 euros, within which limits the share capital may
be increased or lowered without amending the articles of association. At
present, the share capital is 55,922,485.55 euros. The shares of the company
are divided into series A shares and series B shares.
The number of series A shares is 2,078 and the number of series B shares is
1,247. The votes and dividends related to the shares are described in more
detail in the notes to the financial statements and in the articles of
association available on the website of the company.
Corporate responsibility
Fingrid's corporate responsibility management is founded on the company's
strategy. Corporate responsibility is guided by the Code of Conduct of the
company. In 2012, the executive management group verified that the essential
corporate responsibility issues are up to date. The primary responsibility
objectives were also set.
The reporting takes into account the requirements of state ownership steering
and other recommendations ensuring the company's good governance. In our
operating model based on solid procurement expertise and outsourcing, one of
the key objectives is to enhance the requirements concerning the responsibility
of the operations, and to monitor the supervision of their attainment in the
procurement chain.
Environmental matters
Fingrid's environmental responsibility is controlled by the company's land use
and environmental policy. The key is to reduce the environmental impacts of the
operations and to ensure environmental safety. The proper ways of working are
secured through terms of contract, training, and monitoring. Environmental
issues are reported in the annual report and on the internet site.
Fingrid's primary environmental impacts are caused by transmission lines,
substations and reserve power plants, which represent visible and necessary
infrastructure in our environment. Transmission lines have in particular land
use and landscape effects, and both positive and negative impacts on wildlife
and biodiversity. Like all other electrical equipment, transmission lines
create electrical and magnetic fields around them. The foremost environmental
considerations of substations and reserve power plants are related to the
storage and handling of fuels and chemicals. The company improves the
transmission system and aims at achieving minimum electricity transmission
losses in a cost effective manner, thus enhancing energy efficiency. A
reduction in greenhouse gas emissions is also considered as important. The
efficient re-use and recycling of building and demolition waste is important in
all construction work.
Fingrid has a total of 26,214 tonnes of creosote-impregnated or CCA-impregnated
wooden towers, categorised as hazardous waste. Impregnated wood categorised as
hazardous waste is also used in cable trench covers. The related disposal costs
of approx. 1.9 million euros have been entered in the financial statements
under provisions for liabilities and charges, which in turn have been added
correspondingly to property, plant and equipment. Equipment used in Fingrid's
substations contains 29 tonnes of sulphur hexafluoride (SF6 gas), which is
categorised as a greenhouse gas. However, no provision has been made for the
disposal cost of this gas because it can be re-used after cleaning.
Fingrid's reserve power plants are subject to an environmental permit and
covered by the EU's emissions trading scheme. The correctness of the measuring
and reporting systems for fuel consumption is verified by an independent
accredited emissions trading verifier. A total of 21,317 units of emission
allowances were returned. Emissions trading has minor financial significance
for Fingrid.
Fingrid serves as the issuing body for guarantees of origin of electricity in
Finland. The guarantee is included in the system required by the RES-E
directive of the European Union.
Events after the closing of the financial year and estimate of future outlook
On 16 January 2013, the international rating agency Standard & Poor's Rating
Services (S&P) revised Fingrid Oyj's outlook from negative to stable. The
credit ratings remained unchanged in other respects. S&P affirmed Fingrid's
long-term credit rating at AA-, short-term rating at A-1+, and senior unsecured
debt rating at AA-.
In other respects, there have been no material events or changes in Fingrid's
business or financial situation after the closing of the financial year.
The company raised the transmission tariffs by 15 per cent from 1 January 2013.
Fingrid will continue the implementation of its long-term capital expenditure
programme of 1,700 million euros. The capital investments will be financed by
increasing external financing.
Due to exceptionally high congestion income in financial year 2012, Fingrid
Group's profit for the financial year in 2013 without the change in the fair
value of derivatives is expected to to decline slightly compared to the
previous year. The uncertainty involved in congestion income and in
cross-border income on the interconnections from Russia makes it difficult to
forecast the profit for the entire financial year.
The Board of Directors' proposal for the distribution of profit
Fingrid Oyj's distributable funds in the financial statements are 52,500,000.00
euros.
The company's Board of Directors will propose to the Annual General Meeting of
Shareholders that:
- 2,018.26 euros of dividend per share be paid, totalling 6,710,714.50 euros
- 45,789,285.50 euros be carried over as unrestricted equity.
Annual General Meeting 2013
Fingrid Oyj's Annual General Meeting is preliminarily scheduled 19 March 2013.
Helsinki, Finland, 18 February 2013
Fingrid Oyj
Board of Directors
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
Notes 1 Jan - 31 1 Jan - 31
Dec 2012 Dec 2011
1,000 € 1,000 €
--------------------------------------------------------------------------------
REVENUE 2 522,064 438,456
Other operating income 3 3,835 2,976
Raw materials and consumables used 4 -267,103 -241,503
Employee benefits expenses 5 -22,135 -20,334
Depreciation 6 -75,665 -67,879
Other operating expenses 7, 8, -66,376 -55,153
9
--------------------------------------------------------------------------------
OPERATING PROFIT 94,621 56,563
Finance income 10 3,126 3,551
Finance costs 10 -10,293 -26,106
--------------------------------------------------------------------------------
Finance income and costs -7,167 -22,554
Portion of profit of associated companies 845 193
PROFIT BEFORE TAXES 88,299 34,201
Income taxes 11 -21,269 -1,204
--------------------------------------------------------------------------------
PROFIT FOR THE FINANCIAL YEAR 67,029 32,998
================================================================================
OTHER COMPREHENSIVE INCOME
Cash flow hedges 12 6,112 -33,399
Translation reserve 12 92 240
Available-for-sale financial assets 12 1 -48
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 73,235 -209
================================================================================
Profit attributable to:
Equity holders of parent company 67,029 32,998
Total comprehensive income attributable to:
Equity holders of the company 73,235 -209
Earnings per share, € 13 20,159 9,924
Earnings per share for profit attributable to
the equity holders of the parent company:
Undiluted earnings per share, € 13 20,159 9,924
Diluted earnings per share, € 13 20,159 9,924
Notes are an integral part of the financial statements
CONSOLIDATED BALANCE SHEET
--------------------------------------------------------------------------------
ASSETS Notes 31 Dec. 31 Dec.
2012 2011
1,000 € 1,000 €
--------------------------------------------------------------------------------
NON-CURRENT ASSETS
Intangible assets:
Goodwill 15 87,920 87,920
Other intangible assets 16 91,085 89,737
--------------------------------------------------------------------------------
179,005 177,657
Property, plant and equipment: 17
Land and water areas 13,933 13,671
Buildings and structures 126,385 98,345
Machinery and equipment 527,112 450,700
Transmission lines 684,187 689,929
Other property, plant and equipment 8,188 3,009
Advance payments and purchases in progress 124,870 163,908
--------------------------------------------------------------------------------
1,484,674 1,419,561
Investments: 18
Equity investments in associated companies 8,292 7,947
Available-for-sale investments 302 301
--------------------------------------------------------------------------------
8,594 8,247
Receivables:
Derivative instruments 29 81,678 57,495
Deferred tax assets 26 21,683 19,873
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
103,361 77,368
TOTAL NON-CURRENT ASSETS 1,775,634 1,682,834
--------------------------------------------------------------------------------
CURRENT ASSETS
Inventories 19 10,443 6,706
Derivative instruments 29 3,884 14,288
Trade receivables and other receivables 20 88,251 64,633
Financial assets recognized in income statement 21 207,426 202,387
at fair value
Cash and cash equivalents 22 6,411 1,454
TOTAL CURRENT ASSETS 316,415 289,468
--------------------------------------------------------------------------------
TOTAL ASSETS 2,092,049 1,972,301
================================================================================
Notes are an integral part of the financial statements.
CONSOLIDATED BALANCE SHEET
--------------------------------------------------------------------------------
---------------------------------------------------------------------
-----------
EQUITY AND LIABILITIES Notes 31 Dec. 31 Dec.
2012 2011 1,000 € 1,000 €
--------------------------------------------------------------------------------
EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE
PARENT COMPANY
Share capital 25 55,922 55,922
Share premium account 25 55,922 55,922
Revaluation reserve 25 -7,565 -13,679
Translation reserve 25 643 551
Retained earnings 25 464,865 408,586
--------------------------------------------------------------------------------
TOTAL EQUITY 569,788 507,304
--------------------------------------------------------------------------------
NON-CURRENT LIABILITIES
Deferred tax liabilities 26 152,579 140,340
Borrowings 27 1,032,199 845,154
Provisions 28 1,869 1,897
Derivative instruments 29 30,127 34,472
--------------------------------------------------------------------------------
1,216,773 1,021,864
CURRENT LIABILITIES
Borrowings 27 211,932 378,841
Derivative instruments 29 10,770 670
Trade payables and other liabilities 30 82,786 63,623
--------------------------------------------------------------------------------
305,488 443,133
TOTAL LIABILITIES 1,522,261 1,464,997
--------------------------------------------------------------------------------
TOTAL EQUITY AND LIABILITIES 2,092,049 1,972,301
================================================================================
Notes are an integral part of the financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY, 1,000 €
--------------------------------------------------------------------------------
-
--------------------------------------------------------------------------------
-
Attributable to equity holders of the parent company
Notes Share Share Revalua Transla Retaine Total
capita premium tion tion d equity
l account reserve reserve earning
s
--------------------------------------------------------------------------------
Balance at 1 Jan 55,922 55,922 19,768 312 382,299 514,224
2011
--------------------------------------------------------------------------------
Comprehensive
income
Profit or loss 25 32,998 32,998
Other comprehensive
income
Cash flow hedges 12 -33,399 -33,399
Translation reserve 12 240 240
Items related to 12 -48 -48
long-term asset
items
available-for-sale
--------------------------------------------------------------------------------
Total other -33,447 240 -33,207
comprehensive
income adjusted by
tax effects
--------------------------------------------------------------------------------
Total comprehensive income -33,447 240 32,998 -209
--------------------------------------------------------------------------------
Transactions with
owners
Dividends relating 25 -6,711 -6,711
to 2010
--------------------------------------------------------------------------------
Balance at 31 Dec 55,922 55,922 -13,679 551 408,586 507,304
2011
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Balance at 1 Jan 55,922 55,922 -13,679 551 408,586 507,304
2012
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Comprehensive
income
Profit or loss 25 67,029 67,029
Other comprehensive
income
Cash flow hedges 12 6,112 6,112
Translation reserve 12 92 92
Items related to 12 1 1
long-term asset
items
available-for-sale
--------------------------------------------------------------------------------
Total other 6,113 92 6,205
comprehensive
income adjusted by
tax effects
--------------------------------------------------------------------------------
Total comprehensive 6,113 92 67,029 73,235
income
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Transactions with
owners
Dividends relating 25 -10,751 -10,751
to 2011
--------------------------------------------------------------------------------
Balance at 31 Dec 2012 55,922 55,922 -7,565 643 464,865 569,788
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT
--------------------------------------------------------------------------------
-
2012 2011
--------------------------------------------------------------------------------
1 Jan - 31 1 Jan - 31
Dec Dec
Notes 1,000 € 1,000 €
--------------------------------------------------------------------------------
Cash flow from operating activities:
Profit for the financial year 25 67,029 32,998
Adjustments:
Business transactions not involving a payment 35 86,206 72,761
transaction
Interest and other finance costs 10,293 26,106
Interest income -3,120 -3,544
Dividend income -6 -7
Taxes 21,269 1,204
Changes in working capital:
Change in trade receivables and other -22,712 -3,159
receivables
Change in inventories -3,736 -606
Change in trade payables and other 22,742 -8,584
liabilities
Change in provisions 28 -29 -2
Financial assets at fair value -488 645
Interests paid -21,787 -22,815
Interests received 3,556 2,899
Taxes paid 11 -14,586 -2,344
--------------------------------------------------------------------------------
Net cash flow from operating activities 144,633 95,552
Cash flow from investing activities:
Purchase of property, plant and equipment 17 -142,747 -241,046
Purchase of intangible assets 16 -5,106 -3,331
Purchase of other assets 18 0
Proceeds from sale of property, plant and 17 612 50
equipment
Dividends received 10 1,335 211
Contributions received 143
--------------------------------------------------------------------------------
Net cash flow from investing activities -145,905 -243,973
Cash flow from financing activities:
Withdrawal of loans 643,535 749,938
Repayment of loans -621,516 -612,649
Dividends paid 25 -10,751 -6,711
--------------------------------------------------------------------------------
Net cash flow from financing activities 11,269 130,579
Net change in cash and cash equivalents 9,996 -17,842
Cash and cash equivalents 1 Jan 203,841 221,683
Cash and cash equivalents 31 Dec 21,22 213,837 203,841
--------------------------------------------------------------------------------
Notes are an integral part of the financial statements.
CONSOLIDATED KEY 2012 2011 2010 2009 2008
INDICATORS
--------------------------------------------------------------------------------
IFRS IFRS IFRS IFRS IFRS
--------------------------------------------------------------------------------
Extent of operations
Turnover million 522.1 438.5 456.3 358.9 382.3
€
Capital expenditure, million 139.0 244.4 144.1 135.6 87.9
gross €
- of turnover % 26.6 55.7 31.6 37.8 23.0
Research and million 1.5 1.8 1.6 1.3 0.9
development expense €
- of turnover % 0.3 0.4 0.3 0.4 0.2
Personnel, average 269 263 260 251 241
Personnel, end of 275 266 263 260 249
year
Salaries and bonuses, million 18.2 17.2 17.2 16.0 15.8
total €
Profitability
Operating profit million 94.6 56.6 74.4 50.8 68.4
€
- of revenue % 18.1 12.9 16.3 14.1 17.9
Profit before taxes million 88.3 34.2 56.3 33.2 37.5
€
- of revenue % 16.9 7.8 12.3 9.3 9.8
Return on investment % 5.6 3.6 5.1 3.9 5.8
(ROI)
Return on equity % 12.4 6.5 8.7 5.7 6.6
(ROE)
Financing and
financial position
Equity ratio % 27.3 25.7 28.6 27.2 26.7
Interest-bearing net million 1,030.3 1,020.2 855.2 797.5 726.7
borrowings €
Share-specific
indicators
Earnings per share € 20,159.2 9,924.1 12,561.9 7,417.4 8,378.5
Dividend, series A € 2,018.26 3,962.52 2,018.26 2,022.29 2,018.26
shares *
Dividend, series B € 2,018.26 2,018.26 2,018.26 2,022.29 2,018.26
shares *
Dividend payout % 10.0* 39.9 16.1 27.3 24.1
ratio, A-shares
Dividend payout % 10.0* 20.3 16.1 27.3 24.1
ratio, B-shares
Equity per share € 171,365 152,573 154,654 134,676 125,600
Number of shares at
31 Dec
- Series A shares qty 2,078 2,078 2,078 2,078 2,078
- Series B shares qty 1,247 1,247 1,247 1,247 1,247
Total qty 3,325 3,325 3,325 3,325 3,325
*The Board of Directors' proposal to the Annual General Meeting
CALCULATION OF KEY INDICATORS
-----------------------------
Return on investment, % = (profit before taxes + interest and other finance
costs) / ((balance sheet total - non-interest bearing liabilities (average for
the year)) x 100
Return on equity, %= profit for the financial year / shareholders' equity
(average for the year) x 100
Equity ratio, %= shareholders' equity / (balance sheet total - advances
received) x 100
Earnings per share, €= profit for the financial year / average number of shares
Dividends per share, € = dividends for the financial year / average number of
shares
Dividend payout ratio, % = (dividend / share ) / (earnings / share)
Equity per share, € = shareholders' equity / number of shares at closing date
Interest-bearing net borrowings, € = interest-bearing borrowings - cash and
cash equivalents
Net gearing ratio, % = (interest-bearing borrowings - cash and cash
equivalents) / shareholders' equity x 100
QUARTERLY FIGURES
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Q4/201 Q3/201 Q2/201 Q1/201 Q4/201 Q3/201 Q2/201 Q1/201
2 2 2 2 1 1 1 1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Turnover Me 153.7 106.0 92.7 169.6 107.9 88.0 91.0 151.6
Operating Me 38.5 7.1 -5.1 54.2 17.1 -4.3 2.0 41.7
profit
Operating % 25.0 6.7 -5.5 32.0 15.8 -4.8 2.2 27.5
profit
Q4/201 Q3/201 Q2/201 Q1/201 Q4/200 Q3/200 Q2/200 Q1/200
0 0 0 0 9 9 9 9
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Turnover Me 138.0 85.6 87.5 145.2 104.5 70.8 68.2 115.4
Operating Me 23.1 4.5 5.9 40.9 16.3 0.1 -0.3 34.8
profit
Operating % 16.7 5.3 6.8 28.1 15.6 0.1 -0.5 30.1
profit
CAPITAL EXPENDITURE, M€
---------------------------------------------------------
1-12/2012 1-12/2011
---------------------------------------------------------
---------------------------------------------------------
Capital expenditure in the grid 94.4 173.5
Substations 44.0 76.8
Transmission lines 50.4 96.7
Capital expenditure in gas turbines 25.6 68.2
Present gas turbine plants 2.3 8.7
New gas turbine plants 23.3 59.5
Other capital expenditure 19.0 2.7
ICT 10.7 2.7
Others 8.3 0.0
---------------------------------------------------------
---------------------------------------------------------
Total capital expenditure 139.0 244.4
R&D EXPENDITURE, M€
-----------------------------------------
1-12/2012 1-12/2011
-----------------------------------------
R&D Expenditure 1.5 1.8
NUMBER OF EMPLOYEES
----------------------------------------------
1-12/2012 1-12/2011
----------------------------------------------
----------------------------------------------
Average 269 263
At the end of the period 275 266
COMMITMENTS AND CONTINGENT LIABILITIES, 2012 2011
1,000 €
-------------------------------------------------------------------------
-------------------------------------------------------------------------
Pledges
Pledge covering property lease agreements 47 47
Pledged account in favor of the Customs Office 280 150
Pledged account covering electricity exchange purchases 127
-------------------------------------------------------------------------
-------------------------------------------------------------------------
327 323
Unrecorded investment commitments 217,193 218,072
Other financial commitments
Counter guarantee in favor of an associated company 1,700 1,700
Credit facility commitment fee and commitment fee:
Commitment fee for the next year 459 401
Commitment fee for subsequent years 1,218 1,584
-------------------------------------------------------------------------
-------------------------------------------------------------------------
3,378 3,685
DERIVATIVE INSTRUMENTS, 1,000 €
--------------------------------------------------------------------------------
-
--------------------------------------------------------------------------------
-
2012 2011
--------------------------------------------------------------------------------
Intere Fair Fair Net Nominal Fair Fair Net Nominal
s rate value value fair value value value fair value
and Pos. Neg. value 31.12.12 Pos. Neg. value 31.12.11
curre 31.12. 31.12.1 31.12.1 31.12. 31.12.1 31.12.1
ncy 12 2 2 11 1 1
deriv
atives
--------------------------------------------------------------------------------
Cross- 78,713 -6,621 72,092 418,578 73,198 -9,592 63,606 518,841
curren
cy
swaps
--------------------------------------------------------------------------------
Forwar -90 -90 2,837 -384 -384 24,700
d
contr
acts
--------------------------------------------------------------------------------
Intere 15,032 -9,733 5,299 406,000 6,019 -7,262 -1,243 301,000
st
rate
swaps
--------------------------------------------------------------------------------
Intere 2 2 810,000 814 814 880,000
st
rate
optio
ns,
bough
t
--------------------------------------------------------------------------------
Total 93,747 -16,444 77,303 1,637,415 80,032 -17,238 62,793 1,724,541
================================================================================
Electr Fair Fair Net Volume Fair Fair Net Volume
icity value value fair TWh value value fair TWh
deriv Pos. Neg. value 31.12.12 Pos. Neg. value 31.12.11
atives 31.12. 31.12.1 31.12.1 31.12. 31.12.1 31.12.1
12 2 2 11 1 1
--------------------------------------------------------------------------------
Electr -16,844 -16,844 2.68 -22,814 -22,814 3.81
icity
forwa
rd
contr
acts,
desig
nated
as
hedge
accou
nting
NASDA
Q OMX
Commo
dities
--------------------------------------------------------------------------------
Electr -10,450 -10,450 1.20 -75 -75 0.01
icity
forwa
rd
contr
acts,
not
desig
nated
as
hedge
accou
nting
NASDA
Q OMX
Commo
dities
--------------------------------------------------------------------------------
Total -27,294 -27,294 3.88 -22,889 -22,889 3.82
================================================================================
Interest rate options included in interest and currency derivatives are
interest rate cap contracts with identical structures. The reference rate of
the contract is the 6 month Euribor, and at the effective date a contract
includes 6 or 8 caplets. The option premium has been paid in full to the
counterparty at the contract date.
The electricity derivatives hedge future costs of energy losses.
The net fair value of derivatives indicates the realized profit/loss if they
had been reversed on the last business day of 2012.
Maturity of derivative contracts:
Nominal value, 2013 2014 2015 2016 2017 2017+ Total
1,000 €
--------------------------------------------------------------------------------
Interest rate 80,000 36,000 30,000 70,000 30,000 160,000 406,000
swaps
Interest rate 145,000 445,000 220,000 810,000
options
Cross-currency 34,957 43,526 98,650 155,392 58,835 27,217 418,578
swaps
Forward 1,847 321 669 2,837
contracts
--------------------------------------------------------------------------------
Total 261,804 524,847 349,319 225,392 88,835 187,217 1,637,415
================================================================================
TWh 2013 2014 2015 2016 2017 2017+ Total
-------------------------------------------------------------------
Electricity derivatives 1.13 1.17 0.79 0.53 0.26 3.88
-------------------------------------------------------------------
Total 1.13 1.17 0.79 0.53 0.26 3.88
===================================================================
Shareholders by category Number of shares Of all Of votes
qty shares %
%
------------------------------------------------------------------------
------------------------------------------------------------------------
Public organisations 1,767 53.14 70.86
------------------------------------------------------------------------
Financial and insurance institutions 1,558 46.86 29.14
------------------------------------------------------------------------
Total 3,325 100.00 100.00
------------------------------------------------------------------------
Shareholders Number of shares Of all Of votes
qty shares % %
------------------------------------------------------------------------------
------------------------------------------------------------------------------
Republic of Finland 1,382 41.56 55.42
------------------------------------------------------------------------------
Mutual Pension Insurance Company Ilmarinen 661 19.88 17.15
------------------------------------------------------------------------------
Varma Mutual Pension Insurance Company 405 12.18 5.41
------------------------------------------------------------------------------
National Emergency Supply Agency 385 11.58 15.44
------------------------------------------------------------------------------
Tapiola Mutual Pension Insurance Company 150 4.51 2.01
------------------------------------------------------------------------------
Suomi Mutual Life Assurance Company 75 2.26 1.00
------------------------------------------------------------------------------
Pohjola Insurance Ltd 75 2.26 1.00
------------------------------------------------------------------------------
Mandatum Life Insurance Company Limited 54 1.62 0.72
------------------------------------------------------------------------------
Tapiola General Mutual Insurance Company 50 1.50 0.67
------------------------------------------------------------------------------
Tapiola Mutual Life Assurance Company 47 1.41 0.63
------------------------------------------------------------------------------
If P&C Insurance Company Ltd 25 0.75 0.33
------------------------------------------------------------------------------
Imatran Seudun Sähkö Oy 10 0.30 0.13
------------------------------------------------------------------------------
Fennia Life Insurance Company 6 0.18 0.08
------------------------------------------------------------------------------
Total 3,325 100.00 100.00
------------------------------------------------------------------------------
Appendices
Fingrid Oyj's annual review and financial statements 2012
Fingrid Oyj's corporate governance statement
Further information:
Jukka Ruusunen, President & CEO, tel. +358 (0)30 395 5140 or +358 (0)40 593 8428
Tom Pippingsköld, CFO, tel. +358 (0)30 395 5157 or +358 (0)40 519 5041
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