2014-10-28 10:30:00 CET
2014-10-28 10:30:04 CET
REGULATED INFORMATION
Fingrid Oyj - Interim report (Q1 and Q3)
Fingrid Group's Interim Report 1 January – 30 September 2014
Helsinki. Finland, 2014-10-28 10:30 CET (GLOBE NEWSWIRE) -- Fingrid Oyj
Interim Report 28.10.2014 at 11:30 EET
Figures in brackets refer to the corresponding period the previous year, unless
otherwise stated.
Financial development January - September 2014
-- The Group's turnover between January and September was EUR 419 (388)
million.
-- The Group's operating profit was EUR 116 (79) million.
-- The Group's profit for the review period was EUR 87 (43) million.
-- The cash flow from the Group's operations deducted by investments was EUR
92 (-7) million.
-- Net interest-bearing liabilities totalled EUR 1,070 (1,029) million.
-- Investments totalled EUR 87 (130) million.
-- The equity ratio was 30.4% (28.6%).
-- Earnings per share totalled EUR 26,288 (12,991).
Financial development July - September 2014
-- The Group's turnover between July and September was EUR 114 (108) million.
-- Operating profit for the third quarter of the year was EUR 17 (10) million.
-- The Group's profit for the review period July - September was EUR 11 (3)
million.
KEY Jan-Sept Jan-Sept Change July-Se July-Se Change Jan-Dec/
FIGURES /14 /13 % pt/14 pt/13 % 2013
--------------------------------------------------------------------------------
Turnover MEUR 419.0 388.0 8.0 113.6 107.8 5.4 543.1
--------------------------------------------------------------------------------
Investme MEUR 87.1 130.5 -33.2 29.6 66.9 -55.7 225.3
nts,
gross
--------------------------------------------------------------------------------
- % of % 20.8 33.6 26.1 62.1 41.5
turnove
r
--------------------------------------------------------------------------------
Research MEUR 1.2 1.2 3.1 0.3 0.3 6.6 1.8
and
develop
ment
expense
s
--------------------------------------------------------------------------------
- % of % 0.3 0.3 0.3 0.3 0.3
turnove
r
--------------------------------------------------------------------------------
Personne 302 278 8.6 314 289 8.7 277
l,
average
--------------------------------------------------------------------------------
Personne 314 286 9.8 314 287
l at the
end of
period
--------------------------------------------------------------------------------
Salaries MEUR 15.0 13.5 10.7 4.6 4.1 11.9 19.0
and
remuner
ations
total
--------------------------------------------------------------------------------
Operatin MEUR 116.3 78.8 47.5 17.3 9.9 75.1 115.3
g profit
--------------------------------------------------------------------------------
- % of % 27.8 20.3 15.2 9.2 21.2
turnove
r
--------------------------------------------------------------------------------
Profit MEUR 109.1 56.9 91.7 14.1 4.2 233.1 87.3
before
taxes
--------------------------------------------------------------------------------
- % of % 26.0 14.7 12.4 3.9 16.1
turnove
r
--------------------------------------------------------------------------------
Profit MEUR 87.4 43.2 102.4 11.2 3.3 237.9 90.7
for the
financi
al
period
--------------------------------------------------------------------------------
Comprehe MEUR 87.6 42.6 105.4 11.8 7.0 68.1 86.1
nsive
income
for the
financi
al
period
--------------------------------------------------------------------------------
Return % 6.3
on
investm
ents
(ROI)
--------------------------------------------------------------------------------
Return % 15.0
on
equity
(ROE)
--------------------------------------------------------------------------------
Equity % 30.4 28.6 29.5
ratio
--------------------------------------------------------------------------------
Interest MEUR 1 069.6 1 028.7 4.0 1 076.7
-bearing
net
liabili
ties
--------------------------------------------------------------------------------
Grearing 1.6 1.7 1.7
--------------------------------------------------------------------------------
Profit/s € 26 288.4 12 991.5 102.4 3 382.8 1 001.2 237.9 27 277.9
hare
--------------------------------------------------------------------------------
Dividend € 29 788.3
/A
shares
--------------------------------------------------------------------------------
Dividend € 16 038.5
/B
shares
--------------------------------------------------------------------------------
Equity/s € 194 997 180 231 8.2 193 293
hare
--------------------------------------------------------------------------------
Dividend % 109.2
payout
ratio A
shares
--------------------------------------------------------------------------------
Dividend % 58.8
payout
ratio B
shares
--------------------------------------------------------------------------------
Number
of
shares
--------------------------------------------------------------------------------
- Series shares 2 078 2 078 2 078
A
shares
--------------------------------------------------------------------------------
- Series shares 1 247 1 247 1 247
B
shares
--------------------------------------------------------------------------------
Total shares 3 325 3 325 3 325
--------------------------------------------------------------------------------
Fingrid Oyj's President & CEO Jukka Ruusunen: "Market fluctuations are visible
in main grid pricing"
Electricity imports from the Nordic countries have been exceptionally great in
comparison with recent years, and combined with increased electricity exports
to the Baltic countries throughout the start of the year, have increased
Fingrid's congestion income. However, the two factors have also increased costs
resulting from compensating for the loss of electricity during transmission.
Market prices for reserves required by the electricity system have been more
affordable than previously. Cross-border transmission income relating to
Russian imports have been at a low level due to the small volume of imports.
The great fluctuation in market-driven profits and costs is visible in main
grid pricing. Fingrid has decided to lower grid fees for next year by an
average of two per cent. In addition, grid fees will be reduced by around 50
per cent in December this year. The basic outlook for the market situation will
remain the same until the third Olkiluoto unit is commissioned. The
transmission situation may be affected by changes to the capacity fee system in
use in Russia.
Fingrid's investment programme has progressed on schedule and in accordance
with cost plans. The power line project between Hikiä and Forssa progressed as
planned during the summer months. In Ostrobothnia, work on a project between
Kokkola and Oulu began in September. The project between Ulvila and Kristiina
has progressed according to plan and the overall project will be complete
during autumn this year.
Fingrid Group's Interim Report 1 January - 30 September 2014
Accounting principles
Fingrid's interim report has been drawn up in accordance with standard IAS 34,
Interim Financial Reporting. In this interim report, Fingrid has followed the
same principles as in the annual financial statements for 2013, with the
exception of hedge accounting for electricity derivatives, which was stopped at
the start of 2014. As a result of this, the entire change in the fair value of
the derivatives in question was recorded and will continue to 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.
Financial result
The Group's turnover for the third quarter of the year was EUR 114 (108)
million. Grid service income during the third quarter was 58 (54) million.
Other operating income was 0 (1) million euros. Costs during the third quarter
were 105 (108) million.
The Group's turnover between January and September was EUR 419 (388) million.
Grid service income increased during early 2014 to EUR 244 (228) million,
primarily as a result of the eight per cent rise in tariffs implemented from
the start of the year. Other operating income was 2 (3) million euros. Costs
for January-September were EUR 316 (318) million.
Between January and September, electricity consumption in Finland totalled 60.8
(61.8) terawatt hours. The sale of imbalance power was EUR 110 (113) million.
Fingrid's congestion income from connections between Finland and Sweden grew
significantly to EUR 36 (12) million. The increase in congestion income arose
from a market situation in which Finland imported a significant amount of
electricity from Sweden. Cross-border transmission income on the connection
between Finland and Russia fell to EUR 6 (10) million. This is due to a
decrease in imports from Russia. Congestion income between Finland and Estonia
decreased and ITC income rose compared with the level in the corresponding
period of last year.
The sale of imbalance power was EUR 110 (113) million. Imbalance power costs
fell from last year to EUR 76 (89) million. Imbalance service prices were
reduced from 1 August 2014. Loss energy costs rose to EUR 49 (43) million due
to a larger difference between the Finnish regional price and system price and
due to larger energy losses compared with the reference period. At the end of
September, approximately 97 (99) per cent of Fingrid's projected loss energy
procurement for the remaining part of 2014 had been hedged at an average price
of EUR 43.5 (47.5) per megawatt hour.
The costs of reserves to ensure grid operational reliability fell to EUR 46
(49) million as the result of a decrease in the market prices of reserves and a
favourable market situation. Depreciations totalled EUR 68 (60) million euros.
Maintenance costs fell to EUR 11 (15) million since costs in the previous year
were elevated by the cost of repairs to the Fenno-Skan 1 direct current
connection. Personnel costs were EUR 18 (17) million.
Turnover and other Jan- Jan-Sept Change July-Sept July-Sept Change
income (EUR million) Sept/1 /13 % /14 /13 %
4
--------------------------------------------------------------------------------
Grid service income 244 228 7.0 58 54 7.2
--------------------------------------------------------------------------------
Sales of imbalance power 110 113 -2.6 34 38 -12.0
--------------------------------------------------------------------------------
ITC income 8 6 37.3 2 1 105.2
--------------------------------------------------------------------------------
Cross-border 6 10 -38.8 2 2 -11.6
transmission income
--------------------------------------------------------------------------------
Finland-Estonia 2 3 -32.3 1 1 131.7
congestion income*
--------------------------------------------------------------------------------
Peak load capacity 6 12 -48.5 2 2 -14.9
income**
--------------------------------------------------------------------------------
Finland-Sweden 36 12 188.3 12 8 53.5
congestion income
--------------------------------------------------------------------------------
Other turnover 7 5 62.9 3 2 81.2
--------------------------------------------------------------------------------
Other operating income 2 3 -36.6 0 1 -34.8
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Turnover and other 421 391 7.6 114 108 5.2
income total
--------------------------------------------------------------------------------
Costs (EUR million) Jan- Jan- Change July-Se July-Se Change
Sept/1 Sept/1 % pt/14 pt/13 %
4 3
--------------------------------------------------------------------------------
Purchase of imbalance power 76 89 -14.9 24 31 -20.8
--------------------------------------------------------------------------------
Cost of loss energy 49 43 13.3 15 16 -7.0
--------------------------------------------------------------------------------
Depreciation 68 60 14.1 23 20 13.3
--------------------------------------------------------------------------------
EstLink grid rents* 0 3 -100.0 1 -100.0
--------------------------------------------------------------------------------
Reserve costs 46 49 -7.5 18 17 2.5
--------------------------------------------------------------------------------
Personnel costs 18 17 7.4 5 5 6.1
--------------------------------------------------------------------------------
Peak load capacity costs** 6 11 -49.3 2 2 -17.0
--------------------------------------------------------------------------------
Maintenance management costs 11 15 -22.2 5 5 -11.7
--------------------------------------------------------------------------------
ITC transmission costs 8 9 -5.1 3 4 -22.1
--------------------------------------------------------------------------------
Other costs 35 22 56.8 11 7 55.5
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Costs total 316 318 -0.4 105 108 -2.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Operating profit excluding 105 74 42.1 9 1 1 003.0
fair value of commodity
derivatives
--------------------------------------------------------------------------------
Operating profit of Group, 116 79 47.5 17 10 75.1
IFRS
--------------------------------------------------------------------------------
*Fingrid's income from the congestion income between Finland and Estonia was
EUR 1.9 million. There were no costs (Finland-Estonia grid rents) during the
review period, since the EstLink connection has been under Fin-grid's ownership
since 30.12.2013. Before the transferral of ownership, congestion income
between Finland and Estonia was paid as grid rent to the owners of the
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. (Laki sähköntuotannon ja -kulutuksen
välistä tasapainoa varmistavasta tehoreservistä 117/2011).
The Group's operating profit for the third quarter of the year was EUR 17 (10)
million. Profit before taxes was EUR 14 (4) million. Profit for the period
under review was EUR 11 (3) million and the comprehensive income was 12 (7)
million. The net cash flow of the Group deducted by investments was EUR -5
(-46) million negative.
The Group's operating profit for the start of the year was EUR 116 (79)
million. Profit before taxes was EUR 109 (57) million. The greatest positive
differences from the corresponding period last year are explained by changes in
the fair value of derivatives (EUR 23 million) and by congestion income in the
Nordic countries (EUR 23 million). Profit for the financial period was EUR 87
(43) million and the comprehensive income was 88 (43) million. The net cash
flow of the Group deducted by investments was EUR 92 (-7) million positive at
the start of the year. The equity ratio was 30.4 (28.6) per cent at the end of
the review period.
In September, Fingrid decided to reduce its grid fees for December by
approximately 50 per cent because the company sets its grid fees annually with
the aim of moderate profit permitted by the authorities. During the review
period, decisions were made concerning Fingrid's pricing for 2015. Grid service
prices for next year will be reduced on average by two per cent in comparison
to the current unit prices for this year.
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 this six-month period.
Investments and maintenance
At the end of September, Fingrid made procurement decisions on the basic
maintenance of substations and power lines for 2015-2017. Nationwide grid basic
maintenance agreements were put out to tender for both substations and power
lines by work area. The procurement value for substation basic maintenance is
approximately EUR 14 million and the value of power line basic maintenance is
approximately EUR 6 million.
During the review period, Fingrid made a contract with ABB Oy concerning the
construction of substations in Hirvisuo and Kuolajärvi. The sizeable 400/110/20
kilovolt substation in Hirvisuo, Kokkola, is part of a strategic procurement
entity to strengthen the aging 220 kilovolt network in Ostrobothnia, whose
transmission capacity is now inadequate. The value of the contract is
approximately EUR 10 million.
Fingrid's investment programme has progressed according to plan. The major
project between Hikiä and Forssa progressed on schedule during the summer
months. In addition to new construction, part of the historic Rautarouva (Iron
Lady) power line is dismantled.
In September, foundation work began on the Hirvisuo-Pyhänselkä project, which
will strengthen the Ostrobothnian network's transmission capacity and allow for
the connection of new electricity producers. The project between Ulvila and
Kristinestad has progressed according to plan and the overall project will be
complete during autumn this year.
Power system
Electricity consumption in Finland between July and September totalled 18.0
(18.2) terawatt hours. During the same period, 15.6 (15.2) TWh of electricity
was transmitted in Fingrid's grid, representing 86.7 per cent of the
electricity consumption in Finland.
Between January and September, electricity consumption in Finland totalled 60.8
(61.7) TWh. During the same period, 49.6 (47.7) TWh of electricity was
transmitted in Fingrid's grid, representing 81.6 per cent of the electricity
consumption in Finland.
Electricity transmission between Finland and Sweden consisted extensively of
imports to Finland. Between July and September, 4.7 (4.3) TWh of electricity
were imported from Sweden to Finland, and 0.3 (0.04) TWh were exported from
Finland to Sweden. Between January and September, 14.0 (9.1) TWh of electricity
were imported from Sweden to Finland, and 0.1 (0.7) TWh were exported from
Finland to Sweden. The transmission capacity between the countries has
occasionally been limited due to disturbance in the direct current connections
running between Finland and Sweden. Technical research carried out on the
Fenno-Skan 1 cable found that the cable cannot be used to transmit electricity
at full power. The cable's maximum transmission power was permanently reduced
from 1 July 2014 to a maximum of 400 megawatts.
Electricity transmission between Finland and Estonia has been dominated by
exports from Finland to Estonia. The new EstLink 2 connection has clearly
increased the transmission of electricity between Finland and Estonia. The
volume of electricity imported from Estonia from July to September was 0.01
(0.1) TWh, and 0.6 (0.3) TWh were exported from Finland to Estonia. The volume
of electricity imported from Estonia to Finland between January and September
was 0.04 (0.4) TWh, and 2.9 (0.9) TWh were exported from Finland to Estonia.
Transmission capacity was occasionally limited due to disturbance in the direct
current connections running between Finland and Estonia.
Between July and September, 0.6 (0.7) TWh of electricity were imported from
Russia to Finland, and the import volume between January and September was 1.9
(3.4) TWh. The transmission capacity between Russia and Finland has been fully
available for use with the exception of annual maintenance work carried out on
the Russian network in July. The transmission capacity was lower than usual
during the maintenance work, but nevertheless sufficient to meet market needs.
As was the case last year, the import of electricity from Russia has been low.
There are, however, large fluctuations in imports within 24 hour periods.
As a member of the Power and District Heat Pool, Fingrid was involved in the
organisation of the VALVE (Valot verkkoon 2014) disturbance exercise held in
Rovaniemi on 23 September 2014 by power companies and authorities. The major
disturbance exercise tested the nationwide restoration of electricity supply in
the event of major disturbance.
During the summer, the number of disturbance incidents in the grid was higher
than usual. Thunderstorms caused the majority of disturbance, but some
disturbance was caused by device and planning errors.
Power system operation Jan-Sept/ Jan-Sept/ July-Sept/ July-Sept/
14 13 14 13
--------------------------------------------------------------------------------
Electricity consumption in Finland 60.8 61.8 18.0 18.2
TWh
--------------------------------------------------------------------------------
Fingrid's transmission volume TWh 49.6 47.7 15.6 15.2
--------------------------------------------------------------------------------
Fingrid's loss energy volume TWh 0.9 0.8 0.3 0.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Electricity transmission Finland -
Sweden
Exports to Sweden TWh 0.1 0.7 0.03 0.04
--------------------------------------------------------------------------------
Imports from Sweden TWh 14.0 9.1 4.7 4.3
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Electricity transmission Finland -
Estonia
Exports to Estonia TWh 2.9 0.9 0.6 0.3
--------------------------------------------------------------------------------
Imports from Estonia TWh 0.04 0.4 0.01 0.1
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Electricity transmission Finland -
Russia
Imports from Russia TWh 1.9 3.4 0.6 0.7
--------------------------------------------------------------------------------
Electricity market
The average price (system price) in the Nordic electricity exchange during the
third quarter, between July and September, was EUR 31.80 (35.85)/MWh and the
area price for Finland was EUR 37.83 (42.70)/MWh. Between January and
September, the average price in the Nordic spot market was EUR 29.23
(38.85)/MWh, and the area price for Finland was EUR 35.88 (41.58)/MWh.
Finland's counter trade costs between January and September were approximately
EUR 8.6 (0.6) million.
Counter trade Jan- Jan-Sept July-Sept July-Sept
Sept/1 /13 /14 /13
4
--------------------------------------------------------------------------------
Counter trade between Finland and 5.9 0.3 2.0 0.1
Sweden, MEUR
--------------------------------------------------------------------------------
Counter trade between Finland and 0.6 0.0 0.4 0.0
Estonia, MEUR
--------------------------------------------------------------------------------
Counter trade between Finland's internal 2.1 0.2 0.2 0.0
connections, MEUR
--------------------------------------------------------------------------------
Total counter trade, MEUR 8.6 0.6 2.6 0.1
--------------------------------------------------------------------------------
Factors that had the most significant effect on the growth in counter trade
costs were the disruptions in the Fenno-Skan 1 and 2 connections in March and
June, which amounted to EUR 2.9 million; the fault in the 400 kV
Petäjäskoski-Letsi border line amounting to EUR 1.3 million, and the running of
local power stations to ensure operational reliability during outages required
by network construction work in early summer, which amounted to EUR 1.2
million.
Electricity market Jan- Jan-Sept July-Sept July-Sept
Sept/1 /13 /14 /13
4
--------------------------------------------------------------------------------
Nord Pool system price, average €/MWh 29.23 38.85 31.80 35.85
--------------------------------------------------------------------------------
Area price Finland, average €/MWh 35.88 41.58 37.83 42.70
--------------------------------------------------------------------------------
Congestion income between Finland and 71.5 24.8 23.7 15.5
Sweden, million €*
--------------------------------------------------------------------------------
Congestion hours between Finland and 49.1 16.6 53.8 31.0
Sweden %*
--------------------------------------------------------------------------------
Congestion income between Finland and 3.7 5.5 2.6 1.1
Estonia, million €*
--------------------------------------------------------------------------------
Congestion hours between Finland and 8.8 27.6 12.6 23.0
Estonia %*
--------------------------------------------------------------------------------
*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.
At the start of the year, Fingrid launched an investigative project to
determine a future electricity market information exchange solution for at
least ten years. The investigation includes an assessment of the current
information exchange situation and future needs. Factors relating to the
selection of a solution were examined in September in a discussion event
attended by over 120 information exchange specialists. As the result of its
investigative work, Fingrid will present Datahub as the electricity market
information exchange solution for the future. The final decision on the
implementation of Datahub will be made by the Ministry of Employment and the
Economy.
Financing
The financial position of the Group continued to be satisfactory. The Group's
net financing costs between July and September were EUR 3 (6) million. The net
financing costs between January and September were EUR 8 (23) million,
including the change of EUR 8 million positive (9 million negative) in the fair
value of derivatives.
Financial assets recognised at fair value in the income statement, and cash and
cash equivalents amounted to EUR 180 (222) million on 30 September 2014.
Moreover, the company also has an undrawn revolving credit facility of EUR 250
million.
Interest-bearing borrowings totalled EUR 1,294 (1,250) million, of which EUR
1,014 (1,042) million were non-current and EUR 235 (208) million were current.
The counterparty risk involved in the derivative contracts relating to
financing was EUR 47 (52) million.
Personnel
The Group's overall number of personnel was on average 302 (278), of which 276
(264) were in a permanent employment relationship.
Auditing
The consolidated figures in this Interim Report are unaudited.
Events after the review period and development for the rest of the year
In September, Fingrid decided to reduce its grid fees for December by
approximately 50 per cent because the company sets its grid fees annually with
the aim of moderate profit permitted by the authorities.
The profit for the entire year 2014 before taxes and without any changes in the
fair value of derivatives is estimated to be on the same level as last year. It
is difficult to predict Fingrid's financial result for the entire year due to
the uncertainty involved in reserve costs, congestion income, loss energy costs
and cross-border transmission with Russia.
On 14 October 2014, international credit rating agency Standard & Poor's Rating
Services (S&P) lowered Fingrid Oyj's credit rating to A+, outlook stable. The
credit rating was lowered as a direct result of a decline in the credit rating
of the State of Finland. As such, ratings from S&P are "A+" (long-term global
scale rating), previously "AA-" and "A-1" (short-term global scale rating),
previously "A-1+". The "K1" rating (Nordic regional scale rating) remained
unchanged. The company's Stand-Alone Credit Profile, which is the basis for the
credit rating and which does not take into account support from state
ownership, remains at "a".
Appendices: Tables for the Interim Report 1 January - 30 September 2014
Further information: Jukka Ruusunen, President & CEO, tel. +358 30 395 5140 or
+358 40 593 8428
Appendices: Tables for the Interim Report 1 January - 30 September 2014
Condensed consolidated Jan-Se Jan-Se Change July-S July-S Change Jan-De
statement of pt/201 pt/201 ept/20 ept/20 c/2013
comprehensive income, 4 3 14 13
EUR million
--------------------------------------------------------------------------------
Turnover 419.0 388.0 31.0 113.6 107.8 5.8 543.1
--------------------------------------------------------------------------------
Other operating income 2.1 3.3 -1.2 0.4 0.6 -0.2 4.1
--------------------------------------------------------------------------------
Depreciation -68.3 -59.8 -8.5 -22.7 -20.0 -2.7 -81.7
--------------------------------------------------------------------------------
Operating expenses -236.5 -252.6 16.1 -74.1 -78.6 4.5 -350.2
--------------------------------------------------------------------------------
Operating profit 116.3 78.8 37.4 17.3 9.9 7.4 115.3
--------------------------------------------------------------------------------
Financing income and -8.1 -22.6 14.5 -3.5 -5.9 2.4 -28.7
costs
--------------------------------------------------------------------------------
Portion of profit of 0.9 0.6 0.3 0.3 0.2 0.0 0.7
associated companies
--------------------------------------------------------------------------------
Profit before taxes 109.1 56.9 52.2 14.1 4.2 9.9 87.2
--------------------------------------------------------------------------------
Income taxes -21.7 -13.7 -8.0 -2.8 -0.9 -1.9 3.4
--------------------------------------------------------------------------------
Profit for the financial 87.4 43.2 44.2 11.2 3.3 7.9 90.7
period
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Other comprehensive
income
--------------------------------------------------------------------------------
Cash flow hedges 0.0 0.0 3.6 -3.6 -4.0
--------------------------------------------------------------------------------
Translation reserve 0.2 -0.6 0.7 0.5 0.1 0.4 -0.6
--------------------------------------------------------------------------------
Items related to 0.0 0.0 0.0 0.0 0.0 0.0 0.0
long-term asset items
available for sale
--------------------------------------------------------------------------------
Total comprehensive 87.6 42.6 44.9 11.8 7.0 4.8 86.1
income for the
financial period
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Profit attributable to:
--------------------------------------------------------------------------------
Equity holders of the 87.4 43.2 44.2 11.2 3.3 7.9 90.7
company
--------------------------------------------------------------------------------
Total comprehensive
income attributable to:
--------------------------------------------------------------------------------
Equity holders of the 87.6 42.6 44.9 11.8 7.0 4.8 86.1
company
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Earnings per share 26 288 12 991 13 297 3 383 1001 2 382 27 278
(euros) belonging to
the owners of parent
company, calculated
from profit*
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
* no dilution effect
Condensed consolidated balance sheet, EUR 30 Sept 30 Sept Change 31 Dec
million 2014 2013 2013
--------------------------------------------------------------------------------
ASSETS
--------------------------------------------------------------------------------
Non-current assets
--------------------------------------------------------------------------------
Goodwill 87.9 87.9 0.0 87.9
--------------------------------------------------------------------------------
Intangible assets 93.4 91.5 1.9 92.8
--------------------------------------------------------------------------------
Property, plant and equipment 1 622.5 1 553.3 69.2 1 623.4
--------------------------------------------------------------------------------
Investments 11.4 8.7 2.7 10.7
--------------------------------------------------------------------------------
Derivatives 47.6 53.1 -5.5 42.3
--------------------------------------------------------------------------------
Receivables 13.1 16.8 -3.7 18.0
--------------------------------------------------------------------------------
Current assets
--------------------------------------------------------------------------------
Inventories 13.4 10.7 2.7 11.4
--------------------------------------------------------------------------------
Derivatives 8.7 2.2 6.4 2.1
--------------------------------------------------------------------------------
Receivables 53.4 54.3 -0.9 76.0
--------------------------------------------------------------------------------
Financial assets recognised at fair value 112.3 196.9 -84.6 195.0
in the income statement
--------------------------------------------------------------------------------
Cash and cash equivalents 67.2 24.9 42.3 22.3
--------------------------------------------------------------------------------
Total assets 2 130.9 2 100.4 30.5 2 182.0
--------------------------------------------------------------------------------
SHAREHOLDERS' EQUITY AND LIABILITIES
--------------------------------------------------------------------------------
Shareholders' equity belonging to the
owners of the parent company
--------------------------------------------------------------------------------
Shareholders' equity 648.4 599.3 49.1 642.7
--------------------------------------------------------------------------------
Non-current liabilities
--------------------------------------------------------------------------------
Non-current interest-bearing liabilities 1 014.0 1 042.4 -28.4 975.3
--------------------------------------------------------------------------------
Derivatives 39.4 33.5 5.9 38.8
--------------------------------------------------------------------------------
Other non-current liabilities 125.3 148.9 -23.6 121.5
--------------------------------------------------------------------------------
Current liabilities
--------------------------------------------------------------------------------
Current interest-bearing liabilities 235.1 208.1 27.0 318.7
--------------------------------------------------------------------------------
Derivatives 4.0 1.7 2.3 15.5
--------------------------------------------------------------------------------
Other current liabilities 64.7 66.5 -1.8 69.5
--------------------------------------------------------------------------------
Total shareholders' equity and liabilities 2 130.9 2 100.4 30.5 2 182.0
--------------------------------------------------------------------------------
Consolidated statement of changes in total equity, EUR million
--------------------------------------------------------------------------------
-
Attributable to Share Share Fair Translati Retained Total
equity holders of capita premium value on earnings equity
the parent company l account reserves reserve
--------------------------------------------------------------------------------
Balance on 1 January 55.9 55.9 -7.6 0.6 464.9 569.8
2013
--------------------------------------------------------------------------------
Comprehensive income
for the financial
period
--------------------------------------------------------------------------------
Profit or loss for 43.2 43.2
the financial period
--------------------------------------------------------------------------------
Other comprehensive
income
--------------------------------------------------------------------------------
Cash flow hedges 0.0 0.0
--------------------------------------------------------------------------------
Translation reserve -0.6 -0.6
--------------------------------------------------------------------------------
Items related to 0.0 0.0
long-term asset
items available for
sale
--------------------------------------------------------------------------------
Total other 0.0 -0.6 -0.6
comprehensive income
adjusted by tax
effects
--------------------------------------------------------------------------------
Comprehensive income 0.0 -0.6 43.2 42.6
--------------------------------------------------------------------------------
Transactions with
owners
--------------------------------------------------------------------------------
Dividend relating to -13.1 -13.1
2012
--------------------------------------------------------------------------------
Balance on 30 55.9 55.9 -7.6 0.1 494.9 599.3
September 2013
--------------------------------------------------------------------------------
Comprehensive income
for the financial
period
--------------------------------------------------------------------------------
Profit or loss for 47.5 47.5
the financial period
--------------------------------------------------------------------------------
Other comprehensive
income
--------------------------------------------------------------------------------
Cash flow hedges -4.0 -4.0
--------------------------------------------------------------------------------
Translation reserve -0.1 -0.1
--------------------------------------------------------------------------------
Items related to 0.0 0.0
long-term asset
items available for
sale
--------------------------------------------------------------------------------
Total other -4.0 -0.1 -4.1
comprehensive income
adjusted by tax
effects
--------------------------------------------------------------------------------
Comprehensive income -4.0 -0.1 47.5 43.4
--------------------------------------------------------------------------------
Balance on 1 January 55.9 55.9 -11.6 0.0 542.4 642.7
2014
--------------------------------------------------------------------------------
Comprehensive income
for the financial
period
--------------------------------------------------------------------------------
Profit or loss for 87.4 87.4
the financial period
--------------------------------------------------------------------------------
Other comprehensive
income
--------------------------------------------------------------------------------
Cash flow hedges 0.0 0.0
--------------------------------------------------------------------------------
Translation reserve 0.2 0.2
--------------------------------------------------------------------------------
Items related to 0.0 0.0
long-term asset
items available for
sale
--------------------------------------------------------------------------------
Total other 0.0 0.2 0.2
comprehensive income
adjusted by tax
effects
--------------------------------------------------------------------------------
Comprehensive income 0.0 0.2 87.4 87.6
--------------------------------------------------------------------------------
Transactions with
owners
--------------------------------------------------------------------------------
Dividend relating to -81.9 -81.9
2013
--------------------------------------------------------------------------------
Balance on 30 55.9 55.9 -11.6 0.2 547.9 648.4
September 2014
--------------------------------------------------------------------------------
QUARTERLY FIGURES
Q3/2014 Q2/2014 Q1/2014 Q4/2013 Q3/2013 Q2/2013
----------------------------------------------------------------------------
Turnover MEUR 113.6 114.1 191.3 155.1 107.8 109.5
----------------------------------------------------------------------------
Operating profit MEUR 17.3 19.7 79.3 36.5 9.9 -10.2
----------------------------------------------------------------------------
Operating profit % 15.2 17.2 41.5 23.5 9.2 -9.3
----------------------------------------------------------------------------
INVESTMENTS, EUR MILLION Jan-Sept/2014 Jan-
Sept/2013
----------------------------------------------------
Grid investments 79.0 120.0
----------------------------------------------------
Substations 44.9 50.5
----------------------------------------------------
Transmission lines 34.0 69.5
----------------------------------------------------
----------------------------------------------------
Gas turbine investments 0.9 2.4
----------------------------------------------------
Current gas turbine plants 0.0
----------------------------------------------------
New gas turbine plants 0.9 2.4
----------------------------------------------------
----------------------------------------------------
Other investments 7.3 8.1
----------------------------------------------------
ICT 7.2 6.9
----------------------------------------------------
Other 0.0 1.2
----------------------------------------------------
----------------------------------------------------
Total investments 87.1 130.5
----------------------------------------------------
RESEARCH AND DEVELOPMENT EXPENSES, EUR MILLION
------------------------------------------------------------------------
Jan- Jan-Sept/2013
Sept/2014
------------------------------------------------------------------------
Research and development expenses 1.2 1.2
------------------------------------------------------------------------
DERIVATIVE AGREEMENTS, EUR MILLION
--------------------------------------------------------------------------------
30 Sept 2014
--------------------------------------------------------------------------------
Interest and currency derivatives Fair value Fair value Net fair Nominal
pos. neg. value value
--------------------------------------------------------------------------------
Cross-currency swaps 39 -7 32 345
--------------------------------------------------------------------------------
Forward contracts 4 4 90
--------------------------------------------------------------------------------
Interest rate swaps 23 -12 11 471
--------------------------------------------------------------------------------
Call options, 0 0 320
bought
--------------------------------------------------------------------------------
Total 67 -19 47 1226
================================================================================
--------------------------------------------------------------------------------
Electricity Fair value Fair value Net fair Volume
derivatives pos. neg. value TWh
--------------------------------------------------------------------------------
Electricity forward contracts, -27 -27 4.23
NASDAQ OMX Commodities*
================================================================================
--------------------------------------------------------------------------------
Total 0 -27 -27 4.23
================================================================================
* Fingrid has ceased hedge accounting for electricity derivatives from the
beginning of 2014. The hedge fund in the balance sheet will be dismantled
during 2015 and 2016.
DERIVATIVE AGREEMENTS, EUR MILLION
--------------------------------------------------------------------------------
30 Sept 2013 31 Dec 2013
--------------------------------------------------------------------------------
Interest and Fair Fair Net Nomina Fair Fair Net Nomina
currency value value fair l value value fair l
derivatives pos. neg. value value pos. neg. value value
--------------------------------------------------------------------------------
Cross-currency 54 -7 47 377 40 -9 31 366
swaps
--------------------------------------------------------------------------------
Forward 0 0 0 20 -1 -1 135
contracts
--------------------------------------------------------------------------------
Interest rate 13 -8 5 461 12 -8 4 471
swaps
--------------------------------------------------------------------------------
Call options, 0 0 475 0 0 350
bought
--------------------------------------------------------------------------------
Total 67 -15 52 1 333 52 -18 34 1 322
================================================================================
--------------------------------------------------------------------------------
Electricity Fair Fair Net Volume Fair Fair Net Volume
derivatives value value fair TWh value value fair TWh
pos. neg. value pos. neg. value
--------------------------------------------------------------------------------
Electricity 0 -12 -12 2.36 -18 -18 1.76
forward
contracts,
NASDAX OMX
Commodities,
designated as
hedge
accounting
--------------------------------------------------------------------------------
Electricity -10 -10 1.66 0 -20 -20 2.21
forward
contracts,
NASDAX OMX
Commodities,
not designated
as hedge
accounting
--------------------------------------------------------------------------------
Total 0 -22 -22 4.01 0 -38 -38 3.97
================================================================================
Fair value hierarchy of financial instruments, EUR 30 Sept 2014
million
--------------------------------------------------------------------------------
Level 1 Level 2 Level 3
--------------------------------------------------------------------------------
Financial assets recognised at fair value
--------------------------------------------------------------------------------
Available-for-sale investments 0 0
--------------------------------------------------------------------------------
Interest and currency derivatives 47
--------------------------------------------------------------------------------
Financial assets recognised at fair value 29 83
--------------------------------------------------------------------------------
Financial assets recognised at fair value total 29 130 0
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Financial liabilities recognised at fair value
--------------------------------------------------------------------------------
Electricity forward contracts, NASDAX OMX Commodities 27
--------------------------------------------------------------------------------
Financial liabilities recognised at fair value total 27 0 0
--------------------------------------------------------------------------------
The assets and liabilities measured at fair value are categorised in a
three-level hierarchy in the fair value presentation. 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 observable market parameters
either directly or indirectly.
Level 3: Inputs are neither publicly quoted nor observable market parameters.
Commitments and contingencies, EUR 30 Sept 2014 30 Sept 2013 31 Dec 2013
million
--------------------------------------------------------------------------------
Pledges/ bank balances 2 1 5
--------------------------------------------------------------------------------
Rental liabilities 31 26 28
--------------------------------------------------------------------------------
Commitment fee of revolving credit 1 1 2
facility
--------------------------------------------------------------------------------
Total 35 29 34
--------------------------------------------------------------------------------
Investment commitments 175 175 137
--------------------------------------------------------------------------------
Other financial liabilities 2 2 2
--------------------------------------------------------------------------------
Changes in property, plant and equipment, 30 Sept 30 Sept 31 Dec
EUR million 2014 2013 2013
--------------------------------------------------------------------------------
Carrying amount at beginning of period 1 623 1 485 1 485
--------------------------------------------------------------------------------
Increases 66 130 222
--------------------------------------------------------------------------------
Decreases 0 -2 -3
--------------------------------------------------------------------------------
Depreciation and amortisation expense -67 -59 -80
--------------------------------------------------------------------------------
Carrying amount at end of period 1 623 1 553 1 623
--------------------------------------------------------------------------------
Transactions with associated companies 30 Sept 2014 30 Sept 2013 31 Dec 2013
-------------------------------------------------------------------------------
Sales 7 5 8
-------------------------------------------------------------------------------
Purchases 31 31 43
-------------------------------------------------------------------------------
Receivables 2 0 3
-------------------------------------------------------------------------------
Liabilities 0 1 0
-------------------------------------------------------------------------------
Transactions with owners, 30 Sept 2014 30 Sept 2013 31 Dec 2013
EUR million
------------------------------------------------------------------
Owners
------------------------------------------------------------------
Purchases 6 5 5
------------------------------------------------------------------
Liabilities 0 0
------------------------------------------------------------------
Other related parties
------------------------------------------------------------------
Sales 43 60 83
------------------------------------------------------------------
Purchases 57 35 50
------------------------------------------------------------------
Receivables 4 3 9
------------------------------------------------------------------
Liabilities 5 2 5
------------------------------------------------------------------
Accounting principles
This interim report has been drawn up in accordance with standard IAS 34,
Interim Financial Reporting. In this interim report, Fingrid has followed the
same principles as in the annual financial statements for 2013.
Segment reporting
The entire business of the Fingrid Group is deemed to comprise transmission
system operation in Finland with system responsibility, only constituting a
single segment. There are no essential differences in the risks and
profitability of individual products and services. This is why segment
reporting in accordance with the IFRS 8 standard is not presented.
Corporate rearrangements
There have been no changes in the Group structure during the review period.
Seasonal fluctuation
The Group's operations are characterised by extensive seasonal fluctuations.
General clause
Certain statements in this release concern the future and are based on the
management's present views.
Due to their nature, they contain some risk and uncertainty and are subject to
changes in economy and the relevant business.
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