2015-10-29 10:00:00 CET
2015-10-29 10:00:06 CET
REGULATED INFORMATION
Fingrid Oyj - Interim report (Q1 and Q3)
Fingrid Group's Interim report 1 January - 30 September 2015
Helsinki, Finland, 2015-10-29 10:00 CET (GLOBE NEWSWIRE) -- Fingrid Oyj
Interim report 29 October 2015 at 11.00 EET
The consolidated financial statements have been drawn up in accordance with the
International Financial Reporting Standards (IFRS). Unless otherwise indicated,
the figures in parentheses refer to the same period of the previous year.
Financial development in January-September 2015
-- The Group's turnover in January-September was EUR 427.7 (419.0) million
-- The Group's operating profit was EUR 105.2 (116.3) million
-- Consolidated profit for the period was EUR 67.4 (87.4) million
-- Cash flow from the Group's operations, after capital expenditure, was EUR
65.7 (92.0) million
-- Interest-bearing net borrowing amounted to EUR 1,036.8 (1,069.6) million
-- Capital expenditure totalled EUR 100.4 (87.1) million
-- The equity ratio was 32.5 (30.4) per cent
-- Earnings per share totalled EUR 20,278 (26,288)
Financial development in July-September 2015
-- The Group's turnover in July-September was EUR 134.6 (113.6) million
-- The Group's operating profit for July-September was EUR 23.1 (17.3) million
-- Consolidated profit for the July-September period was EUR 15.1 (11.2)
million
KEY 1−9/15 1−9/14 change 7−9/15 7−9/14 change 1−12/14
FIGUR % %
ES
--------------------------------------------------------------------------------
Turnov €M 427.7 419.0 2.1 134.6 113.6 18.4 567.2
er
--------------------------------------------------------------------------------
Capita €M 100.4 87.1 15.3 32.6 29.6 10.0 129.5
l
expen
diture
,
gross
--------------------------------------------------------------------------------
- of % 23.5 20.8 24.2 26.1 22.8
turno
ver
--------------------------------------------------------------------------------
Resear €M 1.1 1.2 -9.3 0.3 0.4 -15.7 1.7
ch and
devel
opment
expen
ses
--------------------------------------------------------------------------------
- of % 0.3 0.3 0.2 0.3 0.3
turno
ver
--------------------------------------------------------------------------------
Averag 320 302 6.0 323 314 2.9 305
e
numbe
r of
emplo
yees
--------------------------------------------------------------------------------
Number 316 314 0.6 316 314 0.6 313
of
emplo
yees
at
end
of
perio
d
--------------------------------------------------------------------------------
Salari €M 15.7 15.0 5.0 4.6 4.6 -0.8 20.5
es and
bonus
es,
total
--------------------------------------------------------------------------------
Operat €M 105.2 116.3 -9.5 23.1 17.3 33.3 142.8
ing
profi
t
--------------------------------------------------------------------------------
- of % 24.6 27.8 17.1 15.2 25.2
turno
ver
--------------------------------------------------------------------------------
Profit €M 84.2 109.1 -22.8 18.8 14.1 33.1 132.9
befor
e
taxes
--------------------------------------------------------------------------------
- of % 19.7 26.0 13.9 12.4 23.4
turno
ver
--------------------------------------------------------------------------------
Profit €M 67.4 87.4 -22.9 15.1 11.2 34.0 106.5
for
the
perio
d
--------------------------------------------------------------------------------
Compre €M 71.5 87.6 -18.3 16.1 11.8 37.0 106.1
hensiv
e
incom
e for
the
perio
d
--------------------------------------------------------------------------------
Equity % 32.5 30.4 32.5 30.4 31.0
ratio
--------------------------------------------------------------------------------
Intere €M 1,036.8 1,069.6 -3.1 1,036.8 1,069.6 1,046.1
st-bea
ring
net
borro
wings
--------------------------------------------------------------------------------
Net 1.5 1.6 1.5 1.6 1.6
geari
ng
--------------------------------------------------------------------------------
Earnin € 20,278.08 26,288.42 -22.9 4,534.04 3,382.84 34.0 32,027.89
gs per
share
--------------------------------------------------------------------------------
Divide € 21,655.44
nd,
Serie
s A
share
s
--------------------------------------------------------------------------------
Divide € 16,038.49
nd,
Serie
s B
share
s
--------------------------------------------------------------------------------
Equity € 202,535 194,997 3.9 200,568
per
share
--------------------------------------------------------------------------------
Divide % 67.6
nd
payou
t
ratio
, A
share
s
--------------------------------------------------------------------------------
Divide % 50.1
nd
payou
t
ratio
, B
share
s
--------------------------------------------------------------------------------
Number
of
share
s
--------------------------------------------------------------------------------
- qty 2,078 2,078 2,078 2,078 2,078
Serie
s A
share
s
--------------------------------------------------------------------------------
- qty 1,247 1,247 1,247 1,247 1,247
Serie
s B
share
s
--------------------------------------------------------------------------------
Total qty 3,325 3,325 3,325 3,325 3,325
--------------------------------------------------------------------------------
CEO Jukka Ruusunen: “The price gap between Finland and Sweden exploded in the
third quarter. Fingrid made significant investment decisions.”
“In the third quarter of 2015, the average day-ahead Nordic market price fell
to EUR 13.31 per megawatt hour, whereas the corresponding price last year was
EUR 31.80 per megawatt hour. The main reason for the low price level was the
high hydropower production in Sweden and Norway. In this market situation, the
transmission capacity between Finland and Sweden has not been sufficient to
transmit all the available low-cost electricity from other Nordic countries to
Finland, which is why the area price for Finland was clearly higher than that
of the other Nordic countries. In July-September 2015, Finland's area price was
EUR 30.13 per megawatt hour, whereas in the corresponding period last year it
was EUR 37.83 per megawatt hour. As a result, the congestion income between
Finland and Sweden rose to a record-high EUR 129.5 million, while last year it
was EUR 71.5 million. The congestion income is divided evenly between the
transmission system operators of the two countries.
The company made significant investment decisions during the review period. An
investment to develop the Länsisalmi substation in Vantaa will improve the
supply of electricity in the Helsinki area and will secure functions that are
vital to society in the capital region. The investment is valued at
approximately EUR 20 million. The expansion of the Kristinestad substation will
allow hundreds of megawatts of wind power to be connected to the national grid
and will improve the reliability of the electricity network in Southern
Ostrobothnia. The investment is valued at roughly EUR 10 million. In addition
to substantial investment decisions, the company concluded new substation
maintenance agreements covering DC connections over the years 2016-2020. The
company's new operating model aims to improve the availability and reliability
of the DC connections, which significantly affect the electricity market's
operations and the price of electricity in Finland.”
Fingrid Group's Interim Report 1.1.−30.9.2015
Accounting principles
Fingrid's Interim Report has been drawn up in accordance with the standard IAS
34 Interim Financial Reporting. In preparing this Interim Report, Fingrid has
applied the same accounting principles as those used for its 2014 financial
statements.
Financial result
The Group's third quarter turnover was EUR 134.6 (113.6) million. Grid service
income in Q3 totalled EUR 56.5 (58.3) million. Other operating income totalled
EUR 0.3 (0.4) million. Costs during the period amounted to EUR 99.5 (105.1)
million.
The Group's turnover for January-September was EUR 427.7 (419.0) million. Grid
service income declined during the first three quarters of the year to EUR
232.2 (243.5) million due to lower electricity consumption and the two-percent
reduction in grid pricing enacted at the start of the year. Other operating
income totalled EUR 2.2 (2.1) million. Costs during January-September amounted
to EUR 304.9 (316.5) million.
Between January and September electricity consumption totalled 60.3 (60.9)
terawatt hours. Imbalance power sales amounted to EUR 99.2 (110.2) million.
Fingrid's congestion income from connections between Finland and Sweden grew to
64.7 (35.7) million. The significant growth in congestion income was caused by
an exceptional situation in the marketduring the review period. The differences
between the area prices of Finland and Sweden were considerably larger than
they were in 2014, an outcome of the extremely low wholesale price of
electricity in the Nordic countries. Cross-border transmission income from the
connection between Finland and Russia increased to EUR 8.2 (5.9) million. The
increase was due to the growth in Russian imports, which is attributed to the
weakening rouble. Fingrid's congestion income from connections between Finland
and Estonia grew to 3.4 (1.9) million as a result of the market situation.
Imbalance power costs fell from the previous year's level to EUR 68.6 (75.8)
million, largely due to the decline in reserve costs. Loss energy costs
increased to EUR 50.8 (48.9) million due to the higher volume of loss energy
than in the comparison period and to the substantial price difference between
the Finnish area price and systemic price. At the end of September,
approximately 101 (97) per cent of Fingrid's projected loss energy procurement
for the remaining part of 2015 was hedged at an average price of EUR 39.7
(43.5) per megawatt hour.
As a consequence of the good market situation for frequency controlled
reserves, the cost of reserves to safeguard the system security of the national
grid decreased to EUR 42.0 (45.7) million. Depreciation amounted to EUR 69.9
(68.3) million, and maintenance costs to EUR 11.3 (11.4) million. Personnel
costs grew as a consequence of the increased number of personnel and were EUR
19.0 (17.7) million.
Turnover and other income 1−9/15 1−9/14 change % 7−9/15 7−9/14 change %
(€M)
--------------------------------------------------------------------------------
Grid service income 232 244 -4.6 57 58 -3.1
--------------------------------------------------------------------------------
Imbalance power sales 99 110 -10.0 29 34 -12.3
--------------------------------------------------------------------------------
ITC income 11 8 29.4 4 2 151.8
--------------------------------------------------------------------------------
Cross-border transmission 8 6 38.7 1 2 -39.6
income
--------------------------------------------------------------------------------
Finland-Estonia congestion 3 2 81.3 0 1 -84.3
income
--------------------------------------------------------------------------------
Peak load capacity income* 6 6 -4.1 2 2 -12.8
--------------------------------------------------------------------------------
Finland-Sweden congestion 65 36 81.2 40 12 240.6
income
--------------------------------------------------------------------------------
Other turnover 3 7 -55.0 1 3 -65.1
--------------------------------------------------------------------------------
Other operating income 2 2 5.1 0 0 -19.8
--------------------------------------------------------------------------------
Turnover and other income 430 421 2.1 135 114 18.3
total
--------------------------------------------------------------------------------
Costs (€M) 1−9/15 1−9/14 change 7−9/15 7−9/14 change
% %
--------------------------------------------------------------------------------
Purchase of imbalance power 69 76 -9.5 21 24 -14.8
--------------------------------------------------------------------------------
Loss energy costs 51 49 4.0 20 15 33.2
--------------------------------------------------------------------------------
Depreciation 70 68 2.4 24 23 4.7
--------------------------------------------------------------------------------
Cost of reserves 42 46 -8.0 13 18 -28.3
--------------------------------------------------------------------------------
Personnel costs 19 18 7.3 6 5 4.7
--------------------------------------------------------------------------------
Peak load capacity costs* 6 6 0.3 2 2 0.3
--------------------------------------------------------------------------------
Maintenance costs 11 11 -0.5 4 5 -6.1
--------------------------------------------------------------------------------
ITC charges 7 8 -9.9 3 3 -7.7
--------------------------------------------------------------------------------
Other costs 30 35 -13.6 8 11 -25.3
--------------------------------------------------------------------------------
Costs total 305 316 -3.6 100 105 -5.3
--------------------------------------------------------------------------------
Operating profit, excl. the 125 105 19.5 35 9 296.7
change in the fair value of
commodity derivatives
--------------------------------------------------------------------------------
Consolidated operating profit, 105 116 -9.5 23 17 33.3
IFRS
--------------------------------------------------------------------------------
* Peak load capacity income and costs are related to the securing of sufficient
electricity supply during peak consumption hours in compliance with the Finnish
Peak Load Capacity Act.
The Group's operating profit in the first nine months of the year was EUR 105.2
(116.3) million. Profit before taxes was EUR 84.2 (109.1) million. The biggest
differences from the corresponding period last year are explained by changes in
the market value of derivatives (EUR -45.1 million) and lower grid service
income (EUR -11.3 million), and by the congestion income from the connections
between Finland and Sweden (EUR +29.0 million). Profit for the financial period
was EUR 67.4 (87.4) million and the comprehensive income was EUR 71.5 (87.6)
million. The Group's net cash flow from operations, with net capital
expenditure deducted, was EUR 65.7 (92.0) million in the first nine months of
the year. The equity ratio was 32.5 (30.4) per cent at the end of the review
period.
The Group's profit for the financial period is characterised by seasonal
fluctuations, which is why the profit for the entire year cannot be directly
estimated on the basis of profit from the period under review.
Investments and maintenance
Fingrid's investment programme has proceeded according to plan. The company
made major investment decisions during the review period. In order to meet the
growing need for electricity transmission between eastern and western Finland,
the old transmission connection is being modernised to considerably increase
its capacity. As part of this major project, a decision was made to build a
transmission line between Lieto and Forssa. The contractor chosen was Dalekovod
j.s.c Zagreb. The total value of the project is EUR 17.5 million, and
construction will begin in autumn 2015.
The expansion of the Kristinestad substation will allow hundreds of megawatts
of wind power to be connected to the grid and will improve the reliability of
the electricity network in Southern Ostrobothnia. The project's investment
costs will amount to some EUR 10 million and it will be completed in autumn
2017.
An investment to develop the Länsisalmi substation in Vantaa will improve the
supply of electricity in the Helsinki area and will secure functions that are
vital to society in the capital region. Construction work will begin in 2016,
and the project is due for completion in 2017. The investment costs are
estimated at EUR 20 million.
In order to reinforce the transmission capacity in Ostrobothnia and the capital
region, Fingrid concluded an agreement with Hyosung Corporation on the delivery
of three power transformers in 2017 and 2018. The procurement is valued at EUR
8.5 million.
In order to improve the availability and reliability of DC connections which
significantly affect electricity market operations and the price of electricity
in Finland, Fingrid concluded substation maintenance agreements covering DC
connections over the years 2016-2020. ABB Oy Power Systems will provide the
service for Rauma's Fenno-Skan and Espoo's Estlink 1 connections and Siemens
Osakeyhtiö for Anttila's EstLink 2 connection.
Power system
Between July and September, electricity consumption in Finland totalled 18.0
(18.0) terawatt hours. Inter-TSO in the same period amounted to 1.3 (0.7)
terawatt hours. The total electricity transmission in Finland was 19.3 (18.7)
terawatt hours. Fingrid transmitted a total of 16.3 (15.6) terawatt hours in
its grid, representing 77.8 (77.9) per cent of the total electricity
transmission in Finland. During this period, Fingrid transmitted 15.0 (14.9)
terawatt hours of electricity to its customers which amounts to 83.2 (82.9) per
cent of Finland's total consumption.
In January-September, electricity consumption in Finland amounted to 60.3
(60.9) terawatt hours. Inter-TSO in the same period amounted to 4.2 (2.9)
terawatt hours. The total electricity transmission in Finland was 64.5 (63.7)
terawatt hours. Fingrid transmitted a total of 50.2 (49.6) terawatt hours in
its grid, representing 77.8 (77.9) per cent of the total electricity
transmission in Finland. During this period, Fingrid transmitted 46.0 (46.7)
terawatt hours of electricity to its customers which amounts to 76.3 (76.7) per
cent of Finland's total consumption.
Between July and September, 4.9 (4.7) terawatt hours of electricity were
imported from Sweden to Finland, and 0.2 (0.0) terawatt hours were exported
from Finland to Sweden. In January-September, 13.2 (14.1) terawatt hours of
electricity were imported from Sweden to Finland and 0.2 (0.10) terawatt hours
were exported from Finland to Sweden. A high volume of electricity continued to
be imported from Sweden during the review period.
In July-September, 1.2 (0.6) terawatt hours were exported to Estonia. In
January-September, 3.8 (2.7) terawatt hours were exported to Estonia.
Between July and September, 0.3 (0.6) terawatt hours of electricity were
imported from Russia to Finland and between January and September imports
totalled 2.9 (1.9) terawatt hours. Electricity imports from Russia were low as
in the previous year. There are major intraday variations in import volumes,
however. No electricity was exported to Russia during the reporting period.
The transmission capacity between Finland and its neighbouring countries was
fully available in the electricity markets, with the exception of planned
maintenance work. The transmission capacity of the EstLink 2 connection between
Finland and Estonia was reduced by 100 megawatts until October, due to a faulty
submarine cable.
There were no major disturbances on the national grid during the period under
review.
Power system operation 1−9/15 1−9/14 7−9/15 7−9/14
--------------------------------------------------------------------------------
Electricity consumption in Finland, TWh 60.3 60.9 18.0 18.0
--------------------------------------------------------------------------------
TSO transmission in Finland, TWh 4.2 2.9 1.3 0.7
--------------------------------------------------------------------------------
Transmission within Finland, TWh 64.5 63.7 19.3 18.7
--------------------------------------------------------------------------------
Fingrids electrity transmission volume, TWh 50.2 49.6 16.3 15.6
--------------------------------------------------------------------------------
Fingrid's electricity transmission to customers, 46.0 46.7 15.0 14.9
TWh
--------------------------------------------------------------------------------
Fingrid's loss energy volume, TWh 1.0 0.9 0.4 0.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Electricity transmission Finland - Sweden
Exports to Sweden TWh 0.2 0.1 0.0 0.0
--------------------------------------------------------------------------------
Imports from Sweden, TWh 13.2 14.1 4.9 4.7
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Electricity transmission Finland - Estonia
Exports to Estonia, TWh 3.8 2.7 1.2 0.6
--------------------------------------------------------------------------------
Electricity transmission Finland - Russia
Imports from Russia, TWh 2.9 1.9 0.3 0.6
--------------------------------------------------------------------------------
Electricity market
In the third quarter of the year, the average day-ahead Nordic market price
(system price) of electricity between July and September was EUR 13.31 (31.80)
per megawatt hour and the area price for Finland was EUR 30.13 (37.83) per
megawatt hour. In January-September, the average day-ahead market price for the
Nordics was EUR 20.66 (29.23) per megawatt hour and Finland's area price was
EUR 29.35 (35.88) per megawatt hour.
Congestion income between Finland and Sweden totalled EUR 129.5 (71.5) million.
The increase in congestion income resulted from the growing price gap between
Finland and Sweden due to the low level of Sweden's area price. The main reason
for the low price level was the high hydropower production in Sweden and
Norway.
Fingrid lowered its balance service prices by 27 per cent from 1 October 2015,
because the reserve procurement costs were considerably lower than predicted.
Electricity market 1−9/15 1−9/14 7−9/15 7−9/14
--------------------------------------------------------------------------------
Nord Pool system price, average €/MWh 20.66 29.23 13.31 31.80
--------------------------------------------------------------------------------
Area price Finland, average €/MWh 29.35 35.88 30.13 37.83
--------------------------------------------------------------------------------
Congestion income between Finland and Sweden, 129.5 71.5 80.9 23.7
€M*
--------------------------------------------------------------------------------
Congestion hours between Finland and Sweden %* 46.9 47.7 70.4 53.8
--------------------------------------------------------------------------------
Congestion income between Finland and Estonia, 6.8 3.7 0.4 2.6
€M*
--------------------------------------------------------------------------------
Congestion hours between Finland and Estonia %* 13.0 10.3 2.5 16.9
--------------------------------------------------------------------------------
* The congestion income between Finland and Sweden and between Finland and
Estonia is divided equally between the relevant TSOs. The income and costs of
the transmission connections are presented in the tables in the ‘Financial
result' section.
** The method of calculating congestion hours between Finland and Sweden has
changed for this interim report. From this report onwards, congestion hour
refers to an hour during which Finland's day-ahead area price differs from both
Sweden's SE1 and its SE3 area prices. According to the previous calculation
method, a congestion hour was considered an hour in which the Finnish area
price differed from either the SE1 or SE3 area price. The new method is
estimated to give a better picture of the operations of the joint Nordic
market, from the perspective of Finnish market operators. The historical data
in the interim report is presented using the new calculation method. The change
in the method of calculating congestion hours has no influence on the
calculation of congestion income.
During the third quarter of the year, Fingrid used EUR 0.2 (2.1) million for
countertrade. The costs were mostly caused by the need for Finland's internal
connections.
In the first nine months of 2015, Fingrid used EUR 2.9 (8.6) million for
countertrade. The biggest costs were caused by disturbances in the DC
connection between Finland and Sweden in February and May and by countertrade
carried out to maintain system security in March and April during transmission
outages in Ostrobothnia and northern Finland.
Countertrade 1−9/15 1−9/14 7−9/15 7−9/14
--------------------------------------------------------------------------------
Countertrade between Finland and Sweden, €M 0.5 5.9 0.0 2.0
--------------------------------------------------------------------------------
Countertrade between Finland and Estonia, €M 0.8 0.6 0.0 0.4
--------------------------------------------------------------------------------
Countertrade between Finland's internal 1.6 2.1 0.2 0.2
connections, €M
--------------------------------------------------------------------------------
Total countertrade, €M 2.9 8.6 0.2 2.6
--------------------------------------------------------------------------------
Financing
The company's financial position remained satisfactory and liquidity remained
good. The company's net financial costs between July and September were EUR 4.3
(3.5) million. Between January and September the company's net financial costs
amounted to EUR 21.1 (8.1) million, including the change in the fair value of
derivatives of EUR 5.8 million negative (EUR 7.9 million positive). Financial
and cash assets recognised at fair value through profit and loss on 30
September 2015 were EUR 101.7 (179.5) million. As planned, the company reduced
the level of its financial and cash assets during the review period to achieve
a more capital structure. Fingrid agreed with the banks on a total of EUR 50
million in uncommitted overdraft facilities in order to secure liquidity. An
undrawn committed revolving credit facility of EUR 250 million is additionally
available to the company.
Interest-bearing borrowings totaled EUR 1,138.5 (1,249.1) million, of which
non-current borrowings accounted for EUR 939.5 (1,014.0) million and current
borrowings for EUR 199.0 (235.1) million.
The change in the fair value of electricity derivatives during the period under
review includes EUR 5.4 million from a dismantled hedge fund resulting from the
discontinuation of hedge accounting, as an item reducing the Group's result.
The counterparty risk arising from derivative contracts relating to financing
was EUR 16 (47) million. Fingrid's foreign exchange and commodity price risks
were generally fully hedged.
Personnel
The total number of personnel employed by the Group averaged 320 (302), of
which 283 (276) were in a permanent employment relationship.
Other matters
In an arrangement completed on 1 July 2015, Pohjola Insurance Ltd transferred a
total of 149 of its Fingrid B Shares to Aino Ky. On 1 July 2015, the State
Pension Fund sold altogether 181 of its Fingrid B Shares to Aino Ky.
Through an arrangement completed on 25 September 2015, the State Pension Fund
and Elo Mutual Pension Insurance Company invested the majority of their Fingrid
B shares in Aino Ky.
Asta Sihvonen-Punkka, Lic.Sc. (Econ.), was appointed Fingrid's new Senior Vice
President of Electricity Market Development on 8 September 2015. She will join
Fingrid on 1 January 2016 and assume responsibility for electricity market
development as of 1 March 2016. The Senior Vice President of Electricity Market
Development is a member of Fingrid's executive management group and reports to
the company's President and CEO, Jukka Ruusunen.
Auditing
This Interim Report is unaudited.
Events after the review period and outlook for the rest of the year
On 28 October 2015, Fingrid Oyj decided on the grid fees for 2016. The company
targets annually the reasonable return permitted in the regulation. The pricing
for next year is based on the drafts drawn up by the Energy Authority on 2
October 2015 for confirmation decisions and regulatory methods for electricity
network operations for the period 2016-2023.
In a stock exchange release dated 2 October 2015, Fingrid announced that,
contrary to earlier projections, Fingrid Oyj's result for the 2015 financial
year, excluding taxes and changes in the fair value of derivatives, is expected
to improve considerably from 2014 due to an exceptionally high amount of
congestion income. At the same time, it was announced that it is likely that
the company will close the 2015 regulatory period with surplus revenue. This
surplus has been taken into account in the grid fees for 2016 as a factor
lowering the amount of the increase. Accordingly, Fingrid Oyj will raise the
grid fees in 2016 by an average of 14 per cent.
The company's debt service capacity is expected to remain stable.
Notes: Tables for Fingrid's Interim Report 1 January −30 September 2015
Further information:
Jan Montell, Chief Financial Officer, tel. +358 30 395 5213 or +358 40 592 4419
(can be reached on Thursday, 29 October 2015) or
Jukka Ruusunen, President & CEO, tel. +358 30 395 5140 or +358 40 593 8428 (can
be reached on Friday, 30 October 2015)
Notes: Tables for Fingrid´s Interim Report 1 January - 30 September 2015
CONSOLIDATED STATEMENT
OF
COMPREHENSIVE INCOME
--------------------------------------------------------------------------------
€M 1−9/20 1−9/20 Change 7−9/20 7−9/20 Change 1−12/2
15 14 15 14 014
--------------------------------------------------------------------------------
Turnover 427.7 419.0 8.7 134.6 113.6 20.9 567.2
--------------------------------------------------------------------------------
Other operating income 2.2 2.1 0.1 0.3 0.4 -0.1 4.6
--------------------------------------------------------------------------------
Depreciation -69.9 -68.3 -1.6 -23.7 -22.7 -1.1 -91.5
--------------------------------------------------------------------------------
Operating expenses -254.8 -236.5 -18.2 -88.1 -74.1 -14.0 -337.4
--------------------------------------------------------------------------------
Operating profit 105.2 116.3 -11.1 23.1 17.3 5.8 142.8
--------------------------------------------------------------------------------
Finance income and costs -21.1 -8.1 -13.0 -4.3 -3.5 -0.8 -10.7
--------------------------------------------------------------------------------
Share of profit of 0.1 0.9 -0.8 0.0 0.3 -0.3 0.9
assoc. companies
--------------------------------------------------------------------------------
Profit before taxes 84.2 109.1 -24.9 18.8 14.1 4.7 132.9
--------------------------------------------------------------------------------
Income taxes -16.8 -21.7 4.9 -3.7 -2.8 -0.8 -26.4
--------------------------------------------------------------------------------
Profit for the period 67.4 87.4 -20.0 15.1 11.2 3.8 106.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other comprehensive
income
--------------------------------------------------------------------------------
Cash flow hedges 4.3 4.3 1.4 1.4
--------------------------------------------------------------------------------
Translation reserve -0.2 0.2 -0.4 -0.4 0.5 -0.9 -0.4
--------------------------------------------------------------------------------
Items related to
long-term asset
--------------------------------------------------------------------------------
Items available for sale 0.0 0.0 0.0 0.0 0.0 0.0 0.0
--------------------------------------------------------------------------------
Total comprehensive 71.5 87.6 -16.0 16.1 11.8 4.3 106.1
income for the
financial period
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit attributable to:
--------------------------------------------------------------------------------
Shareholders of the 67.4 87.4 -20.0 15.1 11.2 3.8 106.5
company
--------------------------------------------------------------------------------
Comprehensive income
attributable to:
--------------------------------------------------------------------------------
Shareholders of the 71.5 87.6 -16.0 16.1 11.8 4.4 106.1
company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share on
profit attributable to
--------------------------------------------------------------------------------
shareholders of the 20,278 26,288 -6,010 4,534 3,383 1,151 32,028
parent company (EUR)*:
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
* no dilution effect
CONDENSED CONSOLIDATED BALANCE SHEET,
--------------------------------------------------------------------------------
€M 1−9/201 1−9/201 Change 1−12/201
5 4 4
--------------------------------------------------------------------------------
ASSETS
--------------------------------------------------------------------------------
Non-current assets
--------------------------------------------------------------------------------
Goodwill 87.9 87.9 0.0 87.9
--------------------------------------------------------------------------------
Intangible assets 95.4 93.4 2.0 95.0
--------------------------------------------------------------------------------
Property, plant and equipment 1,656.4 1,622.5 33.9 1,640.5
--------------------------------------------------------------------------------
Investments 9.9 11.4 -1.5 10.8
--------------------------------------------------------------------------------
Derivatives 34.9 47.6 -12.7 42.1
--------------------------------------------------------------------------------
Receivables 14.6 13.1 1.5 13.3
--------------------------------------------------------------------------------
Total non-current assets 1,899.2 1,876.0 23.2 1,889.5
--------------------------------------------------------------------------------Current assets
--------------------------------------------------------------------------------
Inventories 12.7 13.4 -0.7 12.8
--------------------------------------------------------------------------------
Derivatives 5.8 8.7 -2.8 11.2
--------------------------------------------------------------------------------
Receivables 51.0 53.4 -2.4 57.7
--------------------------------------------------------------------------------
Financial assets recognised in income
--------------------------------------------------------------------------------
statement at fair value 79.8 112.3 -32.5 116.7
--------------------------------------------------------------------------------
Cash and cash equivalents and financial 21.9 67.2 -45.3 62.6
assets
--------------------------------------------------------------------------------
Total current assets 171.1 254.9 -83.8 261.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Total assets 2,070.3 2,130.9 -60.6 2,150.5
--------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY AND LIABILITIES
--------------------------------------------------------------------------------
Equity attributable to shareholders of the
parent Company
--------------------------------------------------------------------------------
Shareholders' equity 673.4 648.4 25.1 666.9
--------------------------------------------------------------------------------
Non-current liabilities
--------------------------------------------------------------------------------
Interest-bearing 939.5 1,014.0 -74.5 962.3
--------------------------------------------------------------------------------
Derivatives 68.1 39.4 28.6 45.0
--------------------------------------------------------------------------------
Non-interest-bearing 124.0 125.3 -1.3 124.7
--------------------------------------------------------------------------------
Total non-current liabilities 1,131.5 1,178.7 -47.2 1,132.0
--------------------------------------------------------------------------------
Current liabilities
--------------------------------------------------------------------------------
Interest-bearing 199.0 235.1 -36.1 263.0
--------------------------------------------------------------------------------
Derivatives 9.5 4.0 5.4 17.0
--------------------------------------------------------------------------------
Non-interest-bearing 56.9 64.7 -7.8 71.6
--------------------------------------------------------------------------------
Total current liabilities 265.4 303.8 -38.4 351.6
--------------------------------------------------------------------------------
Total shareholders' equity and liabilities 2,070.3 2,130.9 -60.6 2,150.5
--------------------------------------------------------------------------------
Consolidated statement of changes in total equity, €M
--------------------------------------------------------------------------------
-
Equity attributable to Share Share Revalua Transla Retain Shareho
shareholders tion tion ed lders'
of the parent company capita premium reserve reserve earnin equity
l account s gs total
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Balance on 1 January 2014 55.9 55.9 -11.6 0.0 542.4 642.7
--------------------------------------------------------------------------------
Comprehensive income for
the financial period
--------------------------------------------------------------------------------
Profit or loss 87.4 87.4
--------------------------------------------------------------------------------
Other comprehensive income
--------------------------------------------------------------------------------
Translation reserve 0.2 0.2
--------------------------------------------------------------------------------
Items related to long-term 0.0 0.0
asset items available for
sale
--------------------------------------------------------------------------------
Total other comprehensive 0.0 0.2 0.2
income adjusted by tax
effects
--------------------------------------------------------------------------------
Total comprehensive income 0.0 0.2 87.4 87.6
--------------------------------------------------------------------------------
Transactions with owners
--------------------------------------------------------------------------------
Dividend relating to 2013 -81.9 -81.9
--------------------------------------------------------------------------------
Balance on 30 September 55.9 55.9 -11.6 0.2 547.9 648.4
2014
--------------------------------------------------------------------------------
Comprehensive income for
the financial period
--------------------------------------------------------------------------------
Profit or loss 19.1 19.1
--------------------------------------------------------------------------------
Other comprehensive income
--------------------------------------------------------------------------------
Translation reserve -0.6 -0.6
--------------------------------------------------------------------------------
Items related to long-term 0.0 0.0
asset items available for
sale
--------------------------------------------------------------------------------
Total other comprehensive 0.0 -0.6 -0.6
income adjusted by tax
effects
--------------------------------------------------------------------------------
Total comprehensive income 0.0 -0.6 19.1 18.5
--------------------------------------------------------------------------------
Balance on 1 January 2015 55.9 55.9 -11.5 -0.4 567.0 666.9
--------------------------------------------------------------------------------
Comprehensive income for
the financial period
--------------------------------------------------------------------------------
Profit or loss 67.4 67.4
--------------------------------------------------------------------------------
Other comprehensive income
--------------------------------------------------------------------------------
Cash flow hedges 4.3 4.3
--------------------------------------------------------------------------------
Translation reserve -0.2 -0.2
--------------------------------------------------------------------------------
Items related to long-term 0.0 0.0
asset items available for
sale
--------------------------------------------------------------------------------
Total other comprehensive 4.4 -0.2 4.1
income adjusted by tax
effects
--------------------------------------------------------------------------------
Total comprehensive income 4.4 -0.2 67.4 71.5
--------------------------------------------------------------------------------
Transactions with owners
--------------------------------------------------------------------------------
Dividend relating to 2014 -65.0 -65.0
--------------------------------------------------------------------------------
Balance on 30 September 55.9 55.9 -7.2 -0.7 569.4 673.4
2015
--------------------------------------------------------------------------------
CONSOLIDATED CASH FLOW STATEMENT, €M 1−9/201 1−9/201 Change 1−12/201
5 4 4
--------------------------------------------------------------------------------
Cash flow from operating activities
--------------------------------------------------------------------------------
Profit for the financial period 67.4 87.4 -20.0 106.5
--------------------------------------------------------------------------------
Adjustments 127.2 85.4 41.9 120.5
--------------------------------------------------------------------------------
Changes in working capital -6.8 16.2 -23.0 19.1
--------------------------------------------------------------------------------
Interest paid -16.9 -14.6 -2.2 -21.7
--------------------------------------------------------------------------------
Interest received 0.8 1.0 -0.3 1.2
--------------------------------------------------------------------------------
Taxes paid -16.1 -13.8 -2.3 -19.7
--------------------------------------------------------------------------------
Net cash flow from operating activities 155.6 161.5 -5.9 206.0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from investing activities
--------------------------------------------------------------------------------
Purchase of property, plant and equipment -102.4 -86.1 -16.2 -124.5
--------------------------------------------------------------------------------
Purchase of intangible assets -2.7 -3.0 0.3 -5.4
--------------------------------------------------------------------------------
Purchase of other assets
--------------------------------------------------------------------------------
Proceeds from sale of other assets 0.5 0.1 0.4 0.1
--------------------------------------------------------------------------------
Proceeds from sale of property, plant and 0.2 0.3 0.0 1.4
equipment
--------------------------------------------------------------------------------
Loans granted -1.6
--------------------------------------------------------------------------------
Dividend received 0.6 0.3 0.2 0.3
--------------------------------------------------------------------------------
Contributions received 15.0 19.9 -4.9 19.9
--------------------------------------------------------------------------------
Interest paid -1.2 -1.1 -0.1 -1.3
--------------------------------------------------------------------------------
Net cash flow from investing activities -89.9 -69.5 -20.4 -111.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Cash flow from financing activities
--------------------------------------------------------------------------------
Proceeds from non-current financing 110.0 -110.0 110.0
(liabilities)
--------------------------------------------------------------------------------
Payments of non-current financing -67.1 -46.7 -20.4 -103.0
(liabilities)
--------------------------------------------------------------------------------
Change in current financing (liabilities) -11.2 -111.1 99.9 -58.0
--------------------------------------------------------------------------------
Dividends paid -65.0 -81.9 16.9 -81.9
--------------------------------------------------------------------------------
Net cash flow from financing activities -143.3 -129.7 -13.6 -132.9
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Change in cash and cash equivalents and -77.6 -37.8 -39.8 -38.0
financial assets
--------------------------------------------------------------------------------
Cash and cash equivalents 1 Jan 179.3 217.3 -38.1 217.3
--------------------------------------------------------------------------------
Cash and cash equivalents 31 Mar. 101.7 179.5 -77.9 179.3
--------------------------------------------------------------------------------
QUARTERLY FIGURES
--------------------------------------------------------------------------
Q3/2015 Q2/2015 Q1/2015 Q4/2014 Q3/2014 Q2/2014
--------------------------------------------------------------------------
Turnover €M 134.6 113.2 179.9 148.2 113.6 114.1
--------------------------------------------------------------------------
Operating profit €M 23.1 9.3 72.8 26.5 17.3 19.7
--------------------------------------------------------------------------
Operating profit % 17.1 8.2 40.5 17.9 15.2 17.2
--------------------------------------------------------------------------
INVESTMENTS, €M 1−9/2015 1−9/2014 Change 1−12/2014
------------------------------------------------------------------
Grid investments 93.7 79.0 14.7 117.5
------------------------------------------------------------------
Substations 51.4 44.9 6.5 63.0
------------------------------------------------------------------
Transmission lines 42.3 34.0 8.3 54.6
------------------------------------------------------------------
------------------------------------------------------------------
Gas turbine investments 0.5 0.9 -0.4 0.8
------------------------------------------------------------------
Existing gas turbine plants 0.0 0.0 0.0 -0.2
------------------------------------------------------------------
New gas turbine plants 0.4 0.9 -0.4 1.0
------------------------------------------------------------------
------------------------------------------------------------------
Other investments 6.3 7.3 -1.0 11.2
------------------------------------------------------------------
ICT 6.3 7.2 -1.0 11.1
------------------------------------------------------------------
------------------------------------------------------------------
Total investments 100.4 87.1 13.3 129.5
------------------------------------------------------------------
RESEARCH AND DEVELOPMENT EXPENSES, €M 1−9/2015 1−9/2014 Change 1−12/2014
----------------------------------------------------------------------------
Research and development expenses 1.1 1.2 -0.1 1.7
----------------------------------------------------------------------------
DERIVATIVE CONTRACTS, €M
--------------------------------------------------------------------------------
-----------------------
30 Sept 2015 30 Sept 2014
31 Dec 2014
--------------------------------------------------------------------------------
----------------------
Intere Fair Fair Net Nomina Fair Fair Net Nomina Fair
Fair Net Nomina
st and value value fair l value value fair l value
value fair l
curre pos. neg. value value pos. neg. value value pos.
neg. value value
ncy
deriv
atives
--------------------------------------------------------------------------------
----------------------
Curren 25 -23 2 258 39 -7 32 345 29
-20 9 321
cy
swaps
--------------------------------------------------------------------------------
----------------------
Forwar 0 0 1 4 4 90 3
3 55
d
contr
acts
--------------------------------------------------------------------------------
----------------------
Intere 24 -10 14 430 23 -12 11 471 27
-12 16 435
st
rate
swaps
--------------------------------------------------------------------------------
----------------------
Call 0 0 150 0 0 320
310
optio
ns.
bough
t
--------------------------------------------------------------------------------
----------------------
Total 49 -33 16 839 66 -19 47 1,226 59
-32 28 1,122
================================================================================
======================
Electr Fair Fair Net Volume Fair Fair Net Volume Fair
Fair Net Volume
icity value value fair TWh value value fair TWh value
value fair TWh
deriv pos. neg. value pos. neg. value pos.
neg. value
atives
--------------------------------------------------------------------------------
----------------------
Electr 0 -47 -46 4.27 0 -27 -27 4.23 0
-32 -32 4.19
icity
forwa
rd
contr
acts,
NASDA
Q OMX
Commo
dities
--------------------------------------------------------------------------------
----------------------
Total 0 -47 -46 4.27 0 -27 -27 4.23 0
-32 -32 4.19
================================================================================
======================
At the start of 2014, the Group terminated hedge accounting for derivatives. As
a result, the entire change in the fair value of the derivatives in question
was recorded and will, in future as well, be recorded in the income statement.
The hedge fund in the balance sheet will be dismantled in the income statement
during 2015 and 2016 in fixed instalments such that it decreases the result by
EUR 11.6 million.
Fair value hierarchy of financial instruments, €M 30 Sept 2015
--------------------------------------------------------------------------------
Level 1 Level 2 Level 3
--------------------------------------------------------------------------------
Financial assets recognised at fair value
--------------------------------------------------------------------------------
Available-for-sale investments 0 0
--------------------------------------------------------------------------------
Interest and currency derivatives 49
--------------------------------------------------------------------------------
Financial assets recognised at fair value 39 40
--------------------------------------------------------------------------------
Electricity forward contracts. NASDAX OMX Commodities 0
--------------------------------------------------------------------------------
Financial assets recognised in the income statement 40 89
at fair value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial liabilities held at fair value
--------------------------------------------------------------------------------
Interest and currency derivatives, liabilities 33
--------------------------------------------------------------------------------
Electricity forward contracts. NASDAX OMX Commodities 47
--------------------------------------------------------------------------------
Total financial liabilities held at fair value 47 33
--------------------------------------------------------------------------------
In the presentation of fair value, assets and liabilities recognised at fair
value are categorised into a three-level hierarchy. The appropriate hierarchy
is based on the input data of the instrument. The level is determined on the
basis of the lowest level of input for the instrument in its entirety that is
significant to the fair value measurement.
Level 1: inputs are publicly quoted in active markets.
Level 2: inputs are not publicly quoted and are based on observable market
parameters either directly or indirectly.
Level 3: inputs are not publicly quoted and are unobservable market parameters.
Commitments Contingent liabilities, 30 Sept 30 Sept Change 31 Dec
€M 2015 2014 2014
--------------------------------------------------------------------------------
Pledged cash assets 1 2 -1 1
--------------------------------------------------------------------------------
Rental liabilities 27 31 -5 27
--------------------------------------------------------------------------------
Right-of-use agreements for reserve 93 104 -11 100
power plants
--------------------------------------------------------------------------------
Credit facility commitment fees 1 1 0 1
--------------------------------------------------------------------------------
Total 121 138 -17 129
--------------------------------------------------------------------------------
Investment commitments 127 175 -48 144
--------------------------------------------------------------------------------
Other financial liabilities 2 -2 2
--------------------------------------------------------------------------------
Changes in property, plant and 30 Sept 30 Sept Change 31 Dec
equipment, €M 2015 2014 2014
--------------------------------------------------------------------------------
Carrying amount at beginning of 1,640 1,623 17 1,623
period
--------------------------------------------------------------------------------
Increases 84 66 18 107
--------------------------------------------------------------------------------
Decreases 1 0 1 0
--------------------------------------------------------------------------------
Depreciation and amortisation -69 -67 -2 -90
expense
--------------------------------------------------------------------------------
Carrying amount at end of period 1,656 1,623 34 1,640
--------------------------------------------------------------------------------
Transactions with associated 30 Sept 30 Sept Change 31 Dec
companies, €M 2015 2014 2014
--------------------------------------------------------------------------------
Sales 6 7 -1 9
--------------------------------------------------------------------------------
Interest income 0 0
--------------------------------------------------------------------------------
Purchases 29 31 -2 42
--------------------------------------------------------------------------------
Trade receivables 2 2 0 2
--------------------------------------------------------------------------------
Trade payables 0 0 1
--------------------------------------------------------------------------------
Loan receivables 2 2 2
--------------------------------------------------------------------------------
Transactions with owners, €M 30 Sept 2015 30 Sept 2014 Change 31 Dec 2014
-----------------------------------------------------------------------------
Owners
-----------------------------------------------------------------------------
Purchases 6 6 0 6
-----------------------------------------------------------------------------
Trade payables 0 0
-----------------------------------------------------------------------------
Other related parties
-----------------------------------------------------------------------------
Sales 21 23 -1 29
-----------------------------------------------------------------------------
Purchases 41 50 -9 62
-----------------------------------------------------------------------------
Trade receivables 1 4 -3 2
-----------------------------------------------------------------------------
Trade payables 2 5 -3 4
-----------------------------------------------------------------------------
Accounting principles
This Interim Report has been drawn up in accordance with the standard IAS 34
Interim Financial Reporting. In preparing this Interim Report, Fingrid has
applied the same accounting principles as those used for its 2014 financial
statements.
Segment reporting
The entire business of the Fingrid Group is deemed to comprise transmission
grid operation in Finland with system responsibility, constituting a single
segment.
There are no essential differences in the risks and profitability of individual
products and services. For that reason, segment reporting in accordance with
the IFRS 8 standard is not presented.
Corporate restructuring
In a transaction completed on 17 June 2015, Fingrid Oyj sold its shares in
Porvoon Alueverkko Oy to Porvoon Sähköverkko Oy, which is part of the Porvoon
Energia Oy - Borgå Energi Ab Group. The transaction covered Fingrid's entire
ownership in the company, i.e. 1/3 of all of Porvoon Alueverkko Oy's shares and
votes.
Seasonal fluctuations
The Group's operations are characterised by substantial seasonal fluctuations.
General clause
Certain statements in this report are forward-looking and are based on the
current views of the company's management.
Due to their nature, they contain some risks and uncertainties and are subject
to general changes in the economy and the business sector.
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