Energy company Fortum’s figures for the beginning of the year exceeded analysts’ average expectations.
Energy company Fortum’s January–March turnover of EUR 2,015 million fell short of EUR 2,265 million in the comparison period a year ago, but exceeded by Vara Research the consensus forecast of 1,828 million euros collected by seven analysts.
Fortum’s comparable EBITDA at the beginning of the year was 662 million euros. Analysts on average expected a comparable EBITDA of 549 million euros, while in the comparison period a year ago it was 781 million euros.
Fortum’s comparable operating profit was 530 million euros, while analysts’ consensus had predicted 451 million euros. In January–March of last year, Fortum’s comparable operating result reached 698 million euros.
Fortum’s earnings per share at the beginning of the year was EUR 0.53, while analysts expected EUR 0.39 on average. In the comparison period, earnings per share were EUR 0.60.
CEO of Fortum Markus Rauramon according to, the reason for the decline in earnings is, among other things, the drop in gas and electricity prices in Europe.
The downward pressure on prices was mainly due to the mild winter in continental Europe, the continued import of liquefied natural gas at a good level and the steadily growing renewable electricity production.
“The drop in the spot price of electricity in the Nordic countries is also reflected in our first quarter result. The achieved electricity price was at a good level, albeit significantly lower than a year ago,” says Rauramo in the announcement.
Rauramo says that Fortum started arbitration proceedings against the Russian state in February. The company is demanding compensation for the illegal takeover of its Russian assets to protect its legal position and shareholder interests.
“The development of national economies in Fortum’s geographical areas is still weak and inflation is at a high level, but interest rates are expected to start falling during the summer,” says Rauramo.
“Political strikes in Finland had no significant direct effects on Fortum’s financial results.”
An increase in production is likely
Fortum does not give profit guidance, but at the beginning of the year it told about its outlook for the years 2024–2025.
Fortum completes its outlook by saying that its current annual wholesale production is about 47 terawatt hours, with an increase of about 2 terawatt hours due to the third unit of the Olkiluoto nuclear power plant and the Pjelax wind farm.
Regarding the Generation segment, Fortum already said that for the year 2024, around 70 percent of its Nordic wholesale electricity production is protected at a price of 47 euros per megawatt hour. By 2025, approximately 40 percent of electricity production is protected at a price of 43 euros per megawatt hour.
At the beginning of the year, Fortum estimated that its investments for the current year will be around EUR 550 million without acquisitions. The estimate includes annual maintenance investments, the value of which is approximately EUR 300 million.
The summary of Fortum’s outlook does not mention the estimate of investments for the next few years, which was previously reported in connection with the financial statements. In connection with the financial statements, Fortum estimates that it will invest approximately EUR 1.7 billion in the years 2024–2026 without acquisitions.
Of these, the company estimates growth investments to cover 800 million euros and annual maintenance investments to 300 million euros.