Interim Report January-June 2008

Fortum Corporation
Interim Report January-June 2008
17 July 2008 at 9:00 EET

Solid first half-year results
Strong performance in Power Generation

- Comparable operating profit EUR 984 (810) million, +21%
- Profit before taxes EUR 908 (962) million, -6%
- Earnings per share EUR 0.78 (0.85), -8%
- IFRS mark-to-market booking decreased reported operating profit by 56 million
in the second quarter
- Strong cash flow from operating activities EUR 1,039 (1,070) million
- Good hedging positions

--------------------------------------------------------------------------------
| Key figures        |   II/ |   II/ |    I-II/ |   I-II/ |     2007 |     LTM |
|                    |   08  |   07  |      08  |     07  |          |         |
--------------------------------------------------------------------------------
| Sales, EUR million | 1,322 |   959 |    2,762 |   2,299 |    4,479 |   4,942 |
--------------------------------------------------------------------------------
| Operating profit,  |   348 |   327 |      957 |     817 |    1,847 |   1,987 |
| EUR million        |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Comparable         |   403 |   298 |      984 |     810 |    1,564 |   1,738 |
| operating profit,  |       |       |          |         |          |         |
| EUR million        |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Profit before      |   310 |   301 |      908 |     962 |    1,934 |   1,880 |
| taxes, EUR million |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Earnings per       |  0.27 |  0.26 |     0.78 |    0.85 |     1.74 |    1.68 |
| share, EUR         |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Net cash from      |   497 |   573 |    1,039 |   1,070 |    1,670 |   1,639 |
| operating          |       |       |          |         |          |         |
| activities, EUR    |       |       |          |         |          |         |
| million            |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Shareholders'      |       |       |     8.08 |    8.68 |     9.43 |     N/A |
| equity per share,  |       |       |          |         |          |         |
| EUR                |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Interest-bearing   |       |       |    6,254 |   4,610 |    4,466 |     N/A |
| net debt           |       |       |          |         |          |         |
| (at end            |       |       |          |         |          |         |
| of period), EUR    |       |       |          |         |          |         |
| million            |       |       |          |         |          |         |
--------------------------------------------------------------------------------
| Average number of  |       |       |  887,131 | 890,770 |  889,997 | 888,503 |
| shares, 1,000s     |       |       |          |         |          |         |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Key financial ratios           |     2007 |       LTM |    2007* |      LTM* |
--------------------------------------------------------------------------------
| Return on capital employed, %  |     16.5 |      14.9 |     14.0 |      13.8 |
--------------------------------------------------------------------------------
| Return on shareholders'        |     19.1 |      19.1 |     15.8 |      17.5 |
| equity, %                      |          |           |          |           |
--------------------------------------------------------------------------------
| Net debt/EBITDA                |      1.9 |       2.5 |      2.2 |       2.8 |
--------------------------------------------------------------------------------
*Adjusted for REC and Lenenergo gains

Fortum's comparable operating profit improved significantly from a year ago,
driven by better results in the Power Generation segment. Fortum's consistent
hedging performance, higher average Nord Pool spot prices and higher hydro power
volumes contributed to the improvement.

Fortum's profit before taxes and earnings per share in the first half of the
year were lower than a year ago. This is partly due to the non-recurring gain of
EUR 180 million, corresponding to EUR 0.20 per share, booked in Fortum's
first-quarter results last year.

Fortum's profit before taxes and earning per share were negatively affected by
mark-to-market accounting of its power derivatives portfolio (IAS 39
requirements). As the Nord Pool forward prices for power have increased during
the second quarter, the value of Fortum's sold power forwards in the Power
Generation segment's hedge portfolio has decreased and the value of bought power
forwards in the Markets segment has increased. The total accounting impact due
to IAS 39 mark-to-market requirements in Fortum's reported operating profit was
EUR -17 (+12 in H1/07) million in the first half of 2008 and EUR -56 (+30)
million in the second quarter.

Fortum's net cash from operating activities remained strong at EUR 1,039 (1,070)
million.

The TGC-10 income statement has been consolidated from 1 April 2008 onwards.

Fortum filed the mandatory public tender offer to TGC-10 minorities. The period
of offer is from 30 April until 18 July 2008. The tender offer covers 23.51% of
the share capital of TGC-10 and has been launched at a price of 111.8 roubles
(approximately 3 euros) per share to be fully paid in cash. Fortum has already
acquired a 76.49% share in TGC-10.

In the second quarter, the Power Generation segment's achieved Nordic power
price was EUR 47.9 (36.0) per megawatt-hour (MWh), up by 33% from the previous
year and clearly higher than the average spot price of electricity in Nord Pool,
the Nordic power exchange. The average system spot price of electricity in Nord
Pool was EUR 34.6 (22.5) per MWh, approximately 54% higher than the same period
the previous year. During the second quarter, the Finnish and Swedish area
prices were above the system price levels, being EUR 46.4 (23.7) per MWh in
Finland and EUR 46.4 (23.6) per MWh in Sweden.

Fortum has previously accounted for its 25.7% shareholding in TGC-1 on
historical cost. However, as TGC-1 has started to publish IFRS information on a
regular basis, Fortum has adopted the use of equity accounting for TGC-1.
Fortum's share of TGC-1's 2007 financial result has been booked in Fortum's
second-quarter results, representing EUR 18 million of the EUR 36 million total
in the share of profit of associates and joint ventures.

Financial results

April - June

Group sales were EUR 1,322 (959) million.

Group operating profit totalled EUR 348 (327) million. Reported operating profit
was negatively affected by mark-to-market accounting of Fortum's power
derivatives portfolio (IAS 39 requirements). The negative effect on the Power
Generation segment's reported operating profit was approximately EUR 115 million
in the quarter. The mark-to-market value of Markets' hedge portfolio increased
during the quarter, improving its reported operating profit by EUR 46 million
for the quarter.

Comparable operating profit increased to EUR 403 (298) million.

Sales by segment
--------------------------------------------------------------------------------
| EUR million      |     II/ |    II/ |  I-II/ |   I-II/ |     2007 |      LTM |
|                  |     08  |    07  |    08  |     07  |          |          |
--------------------------------------------------------------------------------
| Power Generation |     721 |    522 |  1,438 |   1,163 |    2,350 |    2,625 |
--------------------------------------------------------------------------------
| Heat             |     284 |    252 |    777 |     731 |    1,356 |    1,402 |
--------------------------------------------------------------------------------
| Distribution     |     180 |    172 |    412 |     397 |      769 |      784 |
--------------------------------------------------------------------------------
| Markets          |     411 |    351 |    930 |     870 |    1,683 |    1,743 |
--------------------------------------------------------------------------------
| Russia           |     152 |      - |    152 |       - |        - |      152 |
--------------------------------------------------------------------------------
| Other            |      21 |     22 |     41 |      41 |       81 |       81 |
--------------------------------------------------------------------------------
| Netting of Nord  |    -369 |   -204 |   -795 |    -505 |   -1,163 |   -1,453 |
| Pool             |         |        |        |         |          |          |
| transactions     |         |        |        |         |          |          |
--------------------------------------------------------------------------------
| Eliminations     |     -78 |   -156 |   -193 |    -398 |     -597 |     -392 |
--------------------------------------------------------------------------------
| Total            |   1,322 |    959 |  2,762 |   2,299 |    4,479 |    4,942 |
--------------------------------------------------------------------------------

Comparable operating profit by segment
--------------------------------------------------------------------------------
| EUR million      |     II/ |    II/ |  I-II/ |   I-II/ |     2007 |      LTM |
|                  |     08  |    07  |    08  |     07  |          |          |
--------------------------------------------------------------------------------
| Power Generation |     384 |    217 |    779 |     547 |    1,095 |    1,327 |
--------------------------------------------------------------------------------
| Heat             |      27 |     36 |    148 |     173 |      290 |      265 |
--------------------------------------------------------------------------------
| Distribution     |      49 |     52 |    136 |     130 |      231 |      237 |
--------------------------------------------------------------------------------
| Markets          |     -15 |      3 |    -25 |     -11 |       -1 |      -15 |
--------------------------------------------------------------------------------
| Russia           |     -33 |      - |    -33 |       - |        - |      -33 |
--------------------------------------------------------------------------------
| Other            |      -9 |    -10 |    -21 |     -29 |      -51 |      -43 |
--------------------------------------------------------------------------------
| Total            |     403 |    298 |    984 |     810 |    1,564 |    1,738 |
--------------------------------------------------------------------------------

Operating profit by segment
--------------------------------------------------------------------------------
| EUR million      |     II/ |    II/ |  I-II/ |   I-II/ |     2007 |      LTM |
|                  |     08  |    07  |    08  |     07  |          |          |
--------------------------------------------------------------------------------
| Power Generation |     260 |    243 |    691 |     543 |    1,115 |    1,263 |
--------------------------------------------------------------------------------
| Heat             |      37 |     33 |    167 |     175 |      294 |      286 |
--------------------------------------------------------------------------------
| Distribution     |      51 |     53 |    137 |     132 |      233 |      238 |
--------------------------------------------------------------------------------
| Markets          |      31 |      7 |     11 |      -5 |       12 |       28 |
--------------------------------------------------------------------------------
| Russia           |     -33 |      - |    -33 |       - |      244 |      211 |
--------------------------------------------------------------------------------
| Other            |       2 |     -9 |    -16 |     -28 |      -51 |      -39 |
--------------------------------------------------------------------------------
| Total            |     348 |    327 |    957 |     817 |    1,847 |    1,987 |
--------------------------------------------------------------------------------

January-June

Group sales were EUR 2,762 (2,299) million.

Group operating profit totalled EUR 957 (817) million. Reported operating profit
was negatively affected by mark-to-market accounting of Fortum's power
derivatives portfolio (IAS 39 requirements). The negative effect on the Power
Generation segment's reported operating profit was EUR 71 million in the first
half of the year. The value of Markets' hedge portfolio increased during the
period, improving its reported operating profit by EUR 36 million.

Comparable operating profit increased to EUR 984 (810) million.

Profit before taxes was EUR 908 (962) million.

The Group's net financial expenses increased to EUR 119 (72) million. The
increase is mainly attributable to a higher average level of debt and higher
interest rates.

Hafslund ASA is showing the fair value change in the REC shareholding through
the income statement, while Fortum is showing the fair value change in equity.
The cumulative fair value change booked in Fortum's equity and based on the
remaining number of shares reported by Hafslund ASA was EUR 356 million at the
end of June 2008.

Minority interests accounted for EUR 26 (35) million. The minority interests are
mainly attributable to Fortum Värme Holding AB, in which the City of Stockholm
has a 50% economic interest.

Taxes for the period totalled EUR 187 (174) million. The tax rate according to
the income statement was 20.6% (18.1%). The tax rate in the first half of 2007
was lowered by the non-taxable gain of EUR 180 million from Hafslund's sale of
REC shares.

The profit for the period was EUR 695 (753) million. Fortum's earnings per share
were EUR 0.78 (0.85).

Return on capital employed was 14.9% for the last twelve months (16.5% at
year-end 2007), and return on shareholders' equity was 19.1% for the last twelve
months (19.1% at year-end 2007). The adjusted return on capital employed and
return on shareholders' equity, excluding the REC and Lenenergo gains, were
13.8% and 17.5%, respectively, for the last twelve months (at year-end 2007
14.0% and 15.8%, respectively.)

Market conditions

According to preliminary statistics, the Nordic countries consumed 91 (89) TWh
of electricity during the second quarter of the year. During the first half of
the year, the Nordic countries consumed about 205 (205) TWh.

Year 2008 started with the Nordic water reservoirs being 9 TWh above the
long-term average. At the end of June, they were 7 TWh above the long-term
average and 3 TWh above the corresponding level last year.

During the second quarter, the average system spot price for power in Nord Pool
was EUR 34.6 (22.5) per MWh or 54% higher than in the corresponding period in
2007. The Nord Pool spot price was higher mainly due to higher fuel and CO2
prices. During the second quarter, the Finnish and Swedish area prices were
above the system price levels due to exceptional malfunctions in transmission
connections, for example between Sweden and Norway, combined with strong
hydrological situation in Norway.

During the second quarter, the average market price of CO2 emission allowances
(EUA) for 2008 was EUR 25.7 per tonne CO2. In 2007, the corresponding price for
CO2 emission allowances for 2007 was EUR 0.4 per tonne CO2. Coal and oil prices
continued to increase during the second quarter of 2008.

In Germany, the average spot price for the second quarter was EUR 65.5 (33.2)
per MWh, significantly higher than in the Nordic area. This resulted in a net
export from the Nordic area to Germany. A new connection between Norway and
Netherlands, NorNed, was taken into use.

According to preliminary statistics, the electricity consumption in Russia
increased by almost 5% in the first half of 2008 compared to the first half of
2007.

Total power and heat generation figures

Fortum's total power generation during January-June 2008 was 32.4 (27.6) TWh, of
which 28.0 (27.1) TWh was in the Nordic countries, representing 14% (13%) of the
total Nordic electricity consumption. Fortum's total heat generation during
January-June 2008 was 18.3 (14.4) TWh, of which 11.7 (12.4) TWh was in the
Nordic countries. The increase in the power and heat generation volumes is
mainly due to the inclusion of TGC-10, consolidated from the beginning of April.

At quarter end, Fortum's total power generating capacity 13,677 (10,920 at the
end of 2007) MW, of which 10,747 (10 775 at the end of 2007) MW was in the
Nordic countries. At quarter end, Fortum's total heat production capacity was
25,101 (11,223 at the end of 2007) MW, of which 9,415 (9,381 at the end of 2007)
MW was in the Nordic countries.

Fortum's total power and heat generation figures are presented below. In
addition, the segment reviews include the respective figures by segment.

--------------------------------------------------------------------------------
| Fortum's total      |    II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| power and heat      |    08  |    07  |     08 |      07 |         |         |
| generation in       |        |        |        |         |         |         |
| Europe, TWh         |        |        |        |         |         |         |
--------------------------------------------------------------------------------
| Power generation    |   13.4 |   12.4 |   28.6 |    27.6 |    52.2 |    53.2 |
--------------------------------------------------------------------------------
| Heat generation     |    4.9 |    4.6 |   13.9 |    14.4 |    26.1 |    25.6 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Fortum's total      |    II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| power and heat      |    08  |    07  |     08 |      07 |         |         |
| generation in       |        |        |        |         |         |         |
| Russia, TWh         |        |        |        |         |         |         |
--------------------------------------------------------------------------------
| Power generation    |    3.8 |      - |    3.8 |       - |       - |     3.8 |
--------------------------------------------------------------------------------
| Heat generation     |    4.4 |      - |    4.4 |       - |       - |     4.4 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Fortum's own power  |    II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| generation by       |    08  |    07  |    08  |     07  |         |         |
| source, TWh, total  |        |        |        |         |         |         |
| in the Nordic       |        |        |        |         |         |         |
| countries           |        |        |        |         |         |         |
--------------------------------------------------------------------------------
| Hydropower          |    6.1 |    5.0 |   12.4 |    11.4 |    20.0 |    21.0 |
--------------------------------------------------------------------------------
| Nuclear power       |    6.1 |    6.3 |   13.0 |    12.8 |    24.9 |    25.1 |
--------------------------------------------------------------------------------
| Thermal power       |    0.9 |    0.9 |    2.6 |     2.9 |     6.2 |     5.9 |
--------------------------------------------------------------------------------
| Total               |   13.1 |   12.2 |   28.0 |    27.1 |    51.1 |    52.0 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Fortum's own power  |    II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| generation by       |    08  |    07  |    08  |     07  |         |         |
| source, %, total in |        |        |        |         |         |         |
| the Nordic          |        |        |        |         |         |         |
| countries           |        |        |        |         |         |         |
--------------------------------------------------------------------------------
| Hydropower          |     46 |     41 |     44 |      42 |      39 |      41 |
--------------------------------------------------------------------------------
| Nuclear power       |     47 |     52 |     47 |      47 |      49 |      48 |
--------------------------------------------------------------------------------
| Thermal power       |      7 |      7 |      9 |      11 |      12 |      11 |
--------------------------------------------------------------------------------
| Total               |    100 |    100 |    100 |     100 |     100 |     100 |
--------------------------------------------------------------------------------

Total power and heat sales figures

Fortum's total power sales January-June 2008 were 37.0 (31.7) TWh, of which 31.7
(31.1) TWh were in the Nordic countries. This represents approximately 15% (15%)
of Nordic electricity consumption during January-June 2008. Fortum's total heat
sales January-June 2008 were 19.2 (14.7) TWh, of which 11.1 (11.3) TWh were in
the Nordic countries.

--------------------------------------------------------------------------------
| Fortum's total    |      II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| electricity *)    |      08  |    07  |    08  |     07  |         |         |
| and heat sales in |          |        |        |         |         |         |
| Europe, EUR       |          |        |        |         |         |         |
| million           |          |        |        |         |         |         |
--------------------------------------------------------------------------------
| Electricity sales |      704 |    515 |  1,463 |   1,190 |   2,370 |   2,643 |
--------------------------------------------------------------------------------
| Heat sales        |      224 |    202 |    619 |     590 |   1,096 |   1,125 |
--------------------------------------------------------------------------------
*) Nord Pool transactions are calculated as a net amount of hourly
sales and purchases at the Group level.

--------------------------------------------------------------------------------
| Fortum's total    |      II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| electricity and   |      08  |    07  |    08  |     07  |         |         |
| heat sales in     |          |        |        |         |         |         |
| Russia, EUR       |          |        |        |         |         |         |
| million           |          |        |        |         |         |         |
--------------------------------------------------------------------------------
| Electricity sales |      105 |      - |    105 |       - |       - |     105 |
--------------------------------------------------------------------------------
| Heat sales        |       43 |      - |     43 |       - |       - |      43 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Fortum's total    |      II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| electricity       |      08  |    07  |    08  |     07  |         |         |
| sales *) by area, |          |        |        |         |         |         |
| TWh               |          |        |        |         |         |         |
--------------------------------------------------------------------------------
| Sweden            |      7.3 |    6.9 |   15.7 |    15.3 |    27.6 |    28.0 |
--------------------------------------------------------------------------------
| Finland           |      7.2 |    6.6 |   15.0 |    14.8 |    29.0 |    29.2 |
--------------------------------------------------------------------------------
| Russia            |      4.8 |      - |    4.8 |       - |       - |     4.8 |
--------------------------------------------------------------------------------
| Other countries   |      0.6 |    0.7 |    1.5 |     1.6 |     3.1 |     3.0 |
--------------------------------------------------------------------------------
| Total             |     19.9 |   14.2 |   37.0 |    31.7 |    59.7 |    65.0 |
--------------------------------------------------------------------------------
*) Nord Pool transactions are calculated as a net amount of hourly
sales and purchases at the Group level.

--------------------------------------------------------------------------------
| Fortum's total    |      II/ |    II/ |  I-II/ |   I-II/ |    2007 |     LTM |
| heat sales by     |      08  |    07  |    08  |     07  |         |         |
| area, TWh         |          |        |        |         |         |         |
--------------------------------------------------------------------------------
| Sweden            |      1.6 |    1.7 |    5.0 |     5.2 |     9.2 |     9.0 |
--------------------------------------------------------------------------------
| Finland           |      2.3 |    2.0 |    6.0 |     6.0 |    11.1 |    11.1 |
--------------------------------------------------------------------------------
| Russia            |      4.3 |      - |    4.3 |       - |       - |     4.3 |
--------------------------------------------------------------------------------
| Poland            |      0.6 |    0.5 |    2.1 |     1.9 |     3.5 |     3.7 |
--------------------------------------------------------------------------------
| Other countries** |      0.7 |    0.5 |    1.8 |     1.6 |     3.3 |     3.5 |
--------------------------------------------------------------------------------
| Total             |      9.5 |    4.7 |   19.2 |    14.7 |    27.1 |    31.6 |
--------------------------------------------------------------------------------
**) Including the UK, which is reported in the Power Generation segment, other
sales.

Fortum's emissions subject to EU's trading scheme

During the first half of 2008, approximately 92% (91%) of the power generated by
Fortum within the EU countries was CO2-free.

Fortum's total CO2 emissions subject to the EU's emissions trading scheme (ETS)
in the first half of the year amounted to 3.4 million tonnes of CO2. Fortum's
average CO2 emissions subject to the ETS were approximately 8.7 million tonnes
per year during 2005-2007.

Fortum's total annual CO2 allowance allocation for its power and heat plants is
approximately 6.1 million tonnes per year during 2008-2012. In Finland, Fortum's
CO2 allocation is approximately 4.1 million tonnes of CO2 per annum,
representing 11% of the Finnish national allocation. In Sweden, Fortum's free
CO2 allocation is approximately 0.2 million tonnes of CO2 per annum,
representing 0.7% of the Swedish national allocation.

SEGMENT REVIEWS

Power Generation

The business area comprises power generation and sales in the Nordic countries
and the provision of operation and maintenance services in the Nordic area and
selected international markets. The Power Generation segment sells its
production to Nord Pool. The segment includes the business units Generation,
Portfolio Management and Trading (PMT), and Service.

--------------------------------------------------------------------------------
| EUR million      |    II/ |   II/ |   I-II/ |    I-II/ |     2007 |      LTM |
|                  |    08  |   07  |     08  |      07  |          |          |
--------------------------------------------------------------------------------
| Sales            |    721 |   522 |   1,438 |    1,163 |    2,350 |    2,625 |
--------------------------------------------------------------------------------
| - power sales    |    638 |   441 |   1,284 |    1,007 |    2,019 |    2,296 |
--------------------------------------------------------------------------------
| - other sales    |     83 |    81 |     154 |      156 |      331 |      329 |
--------------------------------------------------------------------------------
| Operating profit |    260 |   243 |     691 |      543 |    1,115 |    1,263 |
--------------------------------------------------------------------------------
| Comparable       |    384 |   217 |     779 |      547 |    1,095 |    1,327 |
| operating profit |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Net assets (at   |        |       |   5,524 |    5,657 |    5,599 |          |
| period-end)      |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Return on net    |        |       |         |          |     19.2 |     22.2 |
| assets, %        |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Comparable       |        |       |         |          |     18.9 |     21.3 |
| return on net    |        |       |         |          |          |          |
| assets, %        |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Gross            |     32 |    24 |      50 |       40 |      145 |      155 |
| investments      |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Number of        |        |       |   3,790 |    3,550 |    3,511 |          |
| employees        |        |       |         |          |          |          |
--------------------------------------------------------------------------------

The segment's power generation during the second quarter amounted to 12.3 (11.3)
TWh in the Nordic countries.

In January-June, the segment's power generation in the Nordic countries was 25.5
(24.4) TWh. In January-June, approximately 98% (97%) of the segment's power
generation was CO2-free.

--------------------------------------------------------------------------------
| Nordic power     |    II/ |   II/ |   I-II/ |    I-II/ |     2007 |      LTM |
| generation by    |    08  |   07  |     08  |      07  |          |          |
| source, TWh      |        |       |         |          |          |          |
--------------------------------------------------------------------------------
| Hydropower       |    6.1 |   5.0 |    12.4 |     11.4 |     20.0 |     21.0 |
--------------------------------------------------------------------------------
| Nuclear power    |    6.1 |   6.3 |    13.0 |     12.8 |     24.9 |     25.1 |
--------------------------------------------------------------------------------
| Thermal power    |    0.1 |   0.0 |     0.1 |      0.2 |      1.2 |      1.1 |
--------------------------------------------------------------------------------
| Total            |   12.3 |  11.3 |    25.5 |     24.4 |     46.1 |     47.2 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Power generation |    II/ |   II/ |   I-II/ |    I-II/ |     2007 |      LTM |
| by area, TWh     |    08  |   07  |     08  |      07  |          |          |
--------------------------------------------------------------------------------
| Sweden           |    6.9 |   6.5 |    14.8 |     14.4 |     26.0 |     26.4 |
--------------------------------------------------------------------------------
| Finland          |    5.3 |   4.8 |    10.6 |     10.0 |     20.1 |     20.7 |
--------------------------------------------------------------------------------
| Other countries  |    0.2 |   0.2 |     0.6 |      0.5 |      1.1 |      1.2 |
--------------------------------------------------------------------------------
| Total            |   12.4 |  11.5 |    26.0 |     24.9 |     47.2 |     48.3 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Nordic sales     |   13.3 |   12.5 |     27.9 |     27.1 |     51.8 |   52.6 |
| volume, TWh      |        |        |          |          |          |        |
--------------------------------------------------------------------------------
| of which         |    1.0 |    1.4 |      2.1 |      2.8 |      5.2 |    4.5 |
| pass-through     |        |        |          |          |          |        |
| sales            |        |        |          |          |          |        |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Sales price,     |    II/ |    II/ |    I-II/ |    I-II/ |     2007 |    LTM |
| EUR/MWh          |    08  |    07  |      08  |      07  |          |        |
--------------------------------------------------------------------------------
| Generation's     |   47.9 |   36.0 |     46.2 |     37.8 |     39.7 |   44.1 |
| Nordic power     |        |        |          |          |          |        |
| price*           |        |        |          |          |          |        |
--------------------------------------------------------------------------------
*) For the Power Generation segment in the Nordic countries, excluding
pass-through sales.

During the second quarter, the average system spot price in Nord Pool was EUR
34.6 per MWh, Finnish and Swedish area prices being EUR 46.4 per MWh, while
Generation's achieved Nordic power price was EUR 47.9 per MWh, up by 33% from a
year ago. Generation's sales volume without pass-though items was 12.3 (11.1)
TWh in the second quarter. During January-June 2008, the average system spot
price in Nord Pool was EUR 36.3 per MWh, Finnish and Swedish area prices being
on average EUR 42.8 per MWh, while Generation's achieved Nordic power price was
EUR 46.2 per MWh, up by 22% from a year ago.

The comparable operating profit of the Power Generation segment was clearly
higher in the second quarter than in the corresponding period last year. The
improvement was mainly due to a higher achieved Nordic power price, thanks to
increased average hedge price and higher average spot price. In addition, higher
hydro power generation contributed positively. The positive effects were partly
offset by the higher nuclear capacity tax in Sweden and the decrease in nuclear
power generation due to the different timing of the annual outages compared to
the previous year.

In January-June 2008, the comparable operating profit of the Power Generation
segment was higher than last year. The segment's achieved Nordic power price was
higher. Hydro and nuclear power generation volumes increased. These were partly
offset by the higher nuclear capacity tax in Sweden.

In the beginning of April, Fortum submitted the Environmental Impact Assessment
(EIA) report of the third nuclear power plant unit in Loviisa to the Finnish
Ministry of Employment and the Economy. The EIA indicates that a 1,000-1,800 MW
nuclear power plant unit (Loviisa 3) can be built on the Hästholmen island in
Loviisa. After the Ministry issues its statement, Fortum will make decisions
regarding the possible application for a decision in principle.

In June, Fortum and Metsähallitus (the Finnish national forest enterprise),
agreed to reserve two sea areas in the Bay of Bothnia for large-scale wind power
generation.

Also in June, Fortum Service signed a long-term operation and maintenance
contract with the German Trianel Power Kohlekraftwerk Lünen GmbH & Co. KG, which
is owned by 28 German, Austrian and Dutch regional energy companies. The
agreement covers the new 750-MW coal-fired power plant in Lünen. The work will
be initiated in 2009 and the power plant will be commissioned in autumn 2012.
The contract signed was the second of its kind with Trianel. At present, Fortum
Service is responsible for the operation and maintenance of an 800-MW gas-fired
CHP power plant in Hamm in Germany.

Heat

The business area comprises heat generation and sales in the Nordic countries
and other parts of the Baltic Rim. Fortum is a leading heat producer in the
Nordic region. The segment also generates power in combined heat and power
plants (CHP) and sells it to end-customers mainly through long-term contracts,
as well as to Nord Pool. The segment includes the business units Värme,
operating in Sweden, and Heat, operating in mainly other markets.

--------------------------------------------------------------------------------
| EUR million        |     II/ |     II/ |  I-II/ |  I-II/ |    2007 |     LTM |
|                    |     08  |     07  |    08  |    07  |         |         |
--------------------------------------------------------------------------------
| Sales              |     284 |     252 |    777 |    731 |   1,356 |   1,402 |
--------------------------------------------------------------------------------
| - heat sales       |     215 |     193 |    601 |    570 |   1,053 |   1,084 |
--------------------------------------------------------------------------------
| - power sales      |      42 |      35 |    119 |    110 |     202 |     211 |
--------------------------------------------------------------------------------
| - other sales      |      27 |      24 |     57 |     51 |     101 |     107 |
--------------------------------------------------------------------------------
| Operating profit   |      37 |      33 |    167 |    175 |     294 |     286 |
--------------------------------------------------------------------------------
| Comparable         |      27 |      36 |    148 |    173 |     290 |     265 |
| operating profit   |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Net assets (at     |         |         |  3,599 |  3,333 |   3,507 |         |
| period-end)        |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Return on net      |         |         |        |        |     9.3 |     8.8 |
| assets, %          |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Comparable return  |         |         |        |        |     9.2 |     7.1 |
| on net assets, %   |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Gross investments  |      79 |      65 |    191 |    124 |     327 |     394 |
--------------------------------------------------------------------------------
| Number of          |         |         |  2,517 |  2,331 |   2,279 |         |
| employees          |         |         |        |        |         |         |
--------------------------------------------------------------------------------

The segment's heat sales during the second quarter amounted to 4.7 (4.3) TWh,
most of which was generated in the Nordic countries. During the same period,
power sales from CHP production totalled 0.9 (1.0) TWh.

The segment's heat sales during January-June 2008 amounted to 13.9 (13.8) TWh,
most of which was generated in the Nordic countries. During the same period,
power sales from CHP production totalled 2.6 (2.7) TWh. Temperatures have been
above average in all Heat markets, affecting heat demand.

The Heat segment's comparable operating profit during the second quarter was EUR
9 million lower than the previous year, mainly due to higher fuel prices and
other costs. Fortum has also booked a provision in its second-quarter results
for closing down 25% of the town gas distribution network in Stockholm, Sweden.

The Heat segment's comparable operating profit during January-June was EUR 25
million lower than the previous year, mainly due to the higher fuel prices, CO2
emission costs and other costs. Depreciations have increased due to new
investments.

Fortum and Sargas announced in June the results of the pilot project regarding
the testing of the CO2 capture technology at the Värtan power plant in Sweden.
The results were good and showed that the technology for CO2 capture is
adaptable, although further development of storing and logistics is still
needed.

--------------------------------------------------------------------------------
| Heat sales by area, |     II/ |     II/ |  I-II/ |  I-II/ |   2007 |     LTM |
| TWh                 |     08  |     07  |    08  |    07  |        |         |
--------------------------------------------------------------------------------
| Sweden              |     1.6 |     1.7 |    5.0 |    5.2 |    9.1 |     8.9 |
--------------------------------------------------------------------------------
| Finland             |     2.3 |     2.0 |    6.0 |    6.0 |   11.1 |    11.1 |
--------------------------------------------------------------------------------
| Poland              |     0.6 |     0.5 |    2.1 |    1.9 |    3.5 |     3.7 |
--------------------------------------------------------------------------------
| Other countries     |     0.2 |     0.1 |    0.8 |    0.7 |    1.4 |     1.5 |
--------------------------------------------------------------------------------
| Total               |     4.7 |     4.3 |   13.9 |   13.8 |   25.1 |    25.2 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Power sales, TWh    |     II/ |     II/ |  I-II/ |  I-II/ |   2007 |     LTM |
|                     |     08  |     07  |    08  |    07  |        |         |
--------------------------------------------------------------------------------
| Total               |     0.9 |     1.0 |    2.6 |    2.7 |    5.0 |     4.9 |
--------------------------------------------------------------------------------


Distribution

Fortum owns and operates distribution and regional networks and distributes
electricity to a total of 1.6 million customers in Sweden, Finland, Norway and
Estonia.

--------------------------------------------------------------------------------
| EUR million        |     II/ |     II/ |  I-II/ |  I-II/ |    2007 |     LTM |
|                    |     08  |     07  |    08  |    07  |         |         |
--------------------------------------------------------------------------------
| Sales              |     180 |     172 |    412 |    397 |     769 |     784 |
--------------------------------------------------------------------------------
| - distribution     |     151 |     144 |    350 |    336 |     648 |     662 |
| network            |         |         |        |        |         |         |
| transmission       |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| - regional network |      18 |      18 |     41 |     42 |      81 |      80 |
| transmission       |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| - other sales      |      11 |      10 |     21 |     19 |      40 |      42 |
--------------------------------------------------------------------------------
| Operating profit   |      51 |      53 |    137 |    132 |     233 |     238 |
--------------------------------------------------------------------------------
| Comparable         |      49 |      52 |    136 |    130 |     231 |     237 |
| operating profit   |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Net assets (at     |         |         |  3,330 |  3,282 |   3,239 |         |
| period-end)        |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Return on net      |         |         |        |        |     7.7 |     7.8 |
| assets, %          |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Comparable return  |         |         |        |        |     7.6 |     8.3 |
| on net assets, %   |         |         |        |        |         |         |
--------------------------------------------------------------------------------
| Gross investments  |      72 |      42 |    133 |     78 |     237 |     292 |
--------------------------------------------------------------------------------
| Number of          |         |         |  1,221 |  1,103 |   1,063 |         |
| employees          |         |         |        |        |         |         |
--------------------------------------------------------------------------------

In the first half of 2008, the volume of distribution and regional network
transmissions totalled 13.5 (13.5) TWh and 9.0 (9.3) TWh, respectively.

Electricity transmissions via the regional distribution network
totalled 7.5 (7.7) TWh in Sweden and 1.5 (1.6) TWh in Finland.

The comparable operating profit of the Distribution segment was EUR 49 million
in the second quarter, EUR 3 million lower than the previous year. Depreciations
on meters for automatic meter reading have started in the second quarter.

In January-June, the comparable operating profit of the Distribution segment was
EUR 136 million, EUR 6 million higher than the previous year. In 2007, the
segment's results were negatively affected by the winter storms in Sweden.

Installations of new meters and the implementation of automatic meter management
(AMM, smart metering) in Sweden are proceeding according to plan. A total of
327,000 AMM meters out of 581,000 installed meters are activated for monthly
meter reading. Almost 40% of Fortum's Swedish customers are now invoiced based
on automated meter reading.

--------------------------------------------------------------------------------
| Volume of           |     II/ |     II/ |  I-II/ |  I-II/ |    2007 |    LTM |
| distributed         |     08  |      07 |    08  |     07 |         |        |
| electricity in      |         |         |        |        |         |        |
| distribution        |         |         |        |        |         |        |
| network, TWh        |         |         |        |        |         |        |
--------------------------------------------------------------------------------
| Sweden              |     3.1 |     3.1 |    7.4 |    7.4 |    14.3 |   14.3 |
--------------------------------------------------------------------------------
| Finland             |     2.0 |     1.9 |    4.8 |    4.8 |     9.2 |    9.2 |
--------------------------------------------------------------------------------
| Norway              |     0.5 |     0.5 |    1.2 |    1.2 |     2.3 |    2.3 |
--------------------------------------------------------------------------------
| Estonia             |     0.0 |     0.0 |    0.1 |    0.1 |     0.2 |    0.2 |
--------------------------------------------------------------------------------
| Total               |     5.6 |     5.5 |   13.5 |   13.5 |    26.0 |   26.0 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Number of electricity     |   30 Jun 2008 |   30 Jun 2007 |      31 Dec 2007 |
| distribution customers by |               |               |                  |
| area, thousands           |               |               |                  |
--------------------------------------------------------------------------------
| Sweden                    |           874 |           870 |              871 |
--------------------------------------------------------------------------------
| Finland                   |           602 |           585 |              591 |
--------------------------------------------------------------------------------
| Other countries           |           123 |           120 |              122 |
--------------------------------------------------------------------------------
| Total                     |         1,599 |         1,575 |            1,584 |
--------------------------------------------------------------------------------

Markets

Markets is responsible for retail sales of electricity to a total of 1.3 million
private and business customers as well as to other electricity retailers in
Sweden, Finland and Norway. Markets buys its electricity through Nord Pool.
Markets sells approximately 75% of its volumes to business customers and 25% to
retail consumers.

--------------------------------------------------------------------------------
| EUR million         |     II/ |     II/ |  I-II/ |  I-II/ |    2007 |    LTM |
|                     |     08  |     07  |    08  |    07  |         |        |
--------------------------------------------------------------------------------
| Sales               |     411 |     351 |    930 |    870 |   1,683 |  1,743 |
--------------------------------------------------------------------------------
| - power sales       |     397 |     327 |    898 |    823 |   1,582 |  1,657 |
--------------------------------------------------------------------------------
| - other sales       |      14 |      24 |     32 |     47 |     101 |     86 |
--------------------------------------------------------------------------------
| Operating profit    |      31 |       7 |     11 |     -5 |      12 |     28 |
--------------------------------------------------------------------------------
| Comparable          |     -15 |       3 |    -25 |    -11 |      -1 |    -15 |
| operating profit    |         |         |        |        |         |        |
--------------------------------------------------------------------------------
| Net assets (at      |         |         |    236 |    149 |     247 |        |
| period-end)         |         |         |        |        |         |        |
--------------------------------------------------------------------------------
| Return on net       |         |         |        |        |     6.9 |   14.1 |
| assets, %           |         |         |        |        |         |        |
--------------------------------------------------------------------------------
| Comparable return   |         |         |        |        |    -0.6 |  -10.0 |
| on net assets, %    |         |         |        |        |         |        |
--------------------------------------------------------------------------------
| Gross investments   |       2 |       1 |      3 |      2 |       3 |      4 |
--------------------------------------------------------------------------------
| Number of employees |         |         |    817 |    969 |     935 |        |
--------------------------------------------------------------------------------

In the second quarter, Markets' electricity sales totalled 8.3 (9.0) TWh. The
decrease in the sales volume was mainly due to some expired long-term business
customer contracts. For the first six months of the year, sales were 19.5 (20.9)
TWh.

The segment was positively affected by the mark-to-market accounting of its
power derivatives portfolio (IAS 39), improving its reported operating profit by
EUR 46 million for the quarter.

Markets' second-quarter comparable operating profit was clearly negative, mainly
due to high procurement costs. The high procurement costs were partly due to the
high Nord Pool area prices for Finland and Sweden. The unusually high area price
differences in the Nord Pool area are at least partly explained by the
continuing transmission line outage between southern Norway and Sweden. The
tight market situation, especially in the Finnish retail market, continued.

The retail market represents around 25% of Market's annual sales volumes,
approximately 10 TWh per annum in a typical year. Approximately 50% of this
volume is usually sold in Sweden, 40% in Finland and the remaining 10% in
Norway. Around 3 TWh of the approximately 4 TWh total to Finnish retail
customers is sold through current price contracts.

According to the statistics of the Finnish Energy Market Authority
(Energiamarkkinavirasto), the average retail price in Finland was around EUR 52
per MWh in early July for a customer with ~5 MWh annual consumption, excluding
value added tax. The average retail price in Finland is thus below the Nord Pool
market price for the Finnish price area: both spot and forward quotations were
above EUR 60 per MWh in early July.

Fortum announced a 9% price increase in its current price products in Finland on
26 June 2008. The price increase will be effective from August 1. Following the
increase, Fortum's average price for its current price product in Finland will
be very close to the overall Finnish retail price average in early July.

Due to continuing unsatisfactory business performance, Fortum has launched a
programme to restructure the Markets business. Cost-saving actions have been
initiated as a part of the programme. Fortum is currently in the process of
recruiting a new head for the segment. Management changes in e.g. Markets' power
procurement and the customer service unit have been implemented.

Russia

The segment comprises power and heat generation and sales in Russia. The segment
includes TGC-10 and Fortum's holding in TGC-1. TGC-10 is accounted for as a
subsidiary and fully consolidated from 1 April 2008. TGC-1 is an associated
company and accounted for using the equity method.


--------------------------------------------------------------------------------
| EUR million       |     II/ |     II/ |   I-II/ |   I-II/ |  2007 |      LTM |
|                   |     08  |     07  |     08  |     07  |       |          |
--------------------------------------------------------------------------------
| Sales             |     152 |       - |     152 |       - |     - |      152 |
--------------------------------------------------------------------------------
| - power sales     |     105 |       - |     105 |       - |     - |      105 |
--------------------------------------------------------------------------------
| - heat sales      |      43 |       - |      43 |       - |     - |       43 |
--------------------------------------------------------------------------------
| - other sales     |       4 |       - |       4 |       - |     - |        4 |
--------------------------------------------------------------------------------
| Operating profit  |     -33 |       - |     -33 |       - |   244 |      211 |
--------------------------------------------------------------------------------
| Comparable        |     -33 |       - |     -33 |       - |     - |      -33 |
| operating profit  |         |         |         |         |       |          |
--------------------------------------------------------------------------------
| Net assets (at    |         |         |   2,329 |     305 |   456 |          |
| period-end)       |         |         |         |         |       |          |
--------------------------------------------------------------------------------
| Return on net     |         |         |         |         |  66.3 |     19.5 |
| assets, %         |         |         |         |         |       |          |
--------------------------------------------------------------------------------
| Comparable return |         |         |         |         |   0.0 |     -1.4 |
| on net assets, %  |         |         |         |         |       |          |
--------------------------------------------------------------------------------
| Gross investments |      43 |       - |   1,074 |       - |   245 |    1,319 |
--------------------------------------------------------------------------------
| Number of         |         |         |   7,188 |       - |     - |          |
| employees         |         |         |         |         |       |          |
--------------------------------------------------------------------------------

Fortum acquired 76.49% of TGC-10 shares in March 2008 through an auction held by
RAO UES of Russia and the additional share issue of the company. TGC-10 operates
in well-developed industrial regions of the Urals and Western Siberia. The
rapidly growing activities of oil and gas companies and the significant increase
in the housing construction are the main drivers behind the increasing power and
heat demand in the region.

The segment's power sales during the second quarter amounted to 3.8 TWh. During
the same period, heat sales from CHP production in the segment totalled 4.4 TWh.

The segment booked an operating loss in the second quarter of 2008. The loss can
be explained by TGC-10's standalone loss of EUR 14 million, the surplus value
depreciation of EUR 13 million (depreciation on the EUR 1,032 million that has
been allocated to the fair value of TGC-10's property, plant and equipment), and
integration costs of EUR 6 million. TGC-10's business is typically very
seasonal: its results usually are strongest during the first and last quarters
of the year. TGC-10 figures have been consolidated starting from the beginning
of April 2008. The standalone loss for the consolidated second quarter is mainly
explained by seasonality.

Fortum's share of TGC-1's 2007 financial result has been booked in the segment's
second-quarter results, representing EUR 18 million in the share of profit of
associates and joint ventures. The share of profit of associates and joint
ventures is not included in the operating profit.

Russian power sector reform is continuing. Starting from 1 July, 25% of all
produced power is sold on the competitive market. The wholesale power market is
expected to be fully liberalised by 2011. The capacity market was launched at
the beginning of July, as planned. RAO UES, the former monopoly in the power and
heat sector in Russia, has ceased to exist as of 1 July 2008. Its regulatory
functions were divided between different governmental bodies.

TGC-10 has an extensive investment programme aiming to increase its power
capacity to 5,300 MW by 2013. The total cost of the programme is estimated to
amount to EUR 2.2 billion, according to the company's current plan.

The major part of the investment programme is the construction of Nyagan CHP,
the biggest greenfield project in the Russian power industry in the last 25
years. A groundbreaking ceremony for the Nyagan CHP construction took place on
11 June 2008. The first two units of the CHP will be launched in 2011 and the
third one by the end of 2012. The power capacity of the three units will be
1,200 MW.

Fortum is putting considerable focus on the integration of TGC-10 as a part of
Fortum. The integration process started in April 2008.

Fortum has filed with TGC-10 the mandatory public tender offer to the company's
minorities. The period of offer is from 30 April until 18 July 2008. The tender
offer covers 23.51% of the share capital of TGC-10 and has been launched at a
price of 111.8 roubles (approximately EUR 3) per share to be fully paid in cash.
The tender price is the same price Fortum paid for its shares acquired through
the auction and share issue, and it represents a significant premium to the
market price.

Capital expenditures, divestments and investments in shares

Capital expenditures and investments in shares in January-June totalled EUR
1,459 (253) million. Investments, excluding acquisitions, were EUR 408 (236)
million.

POWER GENERATION

In June, Fortum and Hafslund Infratek ASA signed a letter of intent with the aim
to combine Fortum Service's Infrastructure Solutions operations with Hafslund
Infratek. The deal concerns all Infrastructure Solutions operations in Sweden,
Norway and Finland and altogether 1,050 Fortum Service employees. According to
the plan, Fortum will receive newly issued shares in Hafslund Infratek ASA,
listed on the Oslo Stock Exchange. This transaction will bring Fortum's
ownership of the combined company to 33%. Hafslund ASA, today the majority
shareholder of Hafslund Infratek, will hold 43.3% of the shares in the combined
company.

HEAT

In June, Fortum decided to invest in a new CHP plant in Pärnu, Estonia. The
total value of the investment is around EUR 80 million. The production capacity
of the plant will be 45 megawatts (MW) of heat and 23 MW of electricity. The
plant is planned to be operational by the end of 2010.

The large CHP plant projects in Espoo, Finland, Tarto, Estonia, and Czestochowa,
Poland, proceeded. The preparations continued for the CHP plants in Järvenpää,
Finland, and Värtan and Brista, Sweden.

DISTRIBUTION

Investments, excluding acquisitions, were EUR 133 (78) million. The AMM
investment represented EUR 57 (9) million of the total for the segment.

RUSSIA

The second-quarter capital expenditure in the Russian segment amounted to EUR 45
million. Practically all of this was related to the EUR 2.2 billion investment
programme.

Financing

Net debt increased during the second quarter by EUR 1,026 million to EUR 6,254
million
(year-end 2007: EUR 4,466 million). The increase in net debt is due to the EUR
1,198 million dividend payment made in April.

Net debt to EBITDA for the last twelve months was 2.5 (1.9 at the year end
2007). The increase in net debt in 2008 is mainly due to the acquisition of
76.49% of TGC-10 and the dividend payment. Net debt to EBITDA excluding the
Lenenergo sales gain for the last twelve months was 2.8 (2.2 at the end of 2007)

The Group's net financial expenses were EUR 119 (72) million. The increase is
attributable to higher average net debt and higher average interest rates for
the first half of 2008 compared to the corresponding period last year. Net
financial expenses include fair value loss on financial instruments of EUR 3
(profit +2) million.

In June, Standard & Poor's Ratings Services affirmed its 'A-' long-term
corporate credit ratings on Fortum Corporation. The outlook is stable. Fortum
Corporation's long-term credit rating from Moody's was 'A2' (outlook stable).

Shares and share capital

In January-June 2008, a total of 299.7 (497.1) million Fortum Corporation
shares, totalling EUR 8,435 million, were traded. Fortum's market
capitalisation, calculated using the closing quotation of the last trading day
of the quarter, was EUR 28,621 million. The highest quotation of Fortum
Corporation shares on the OMX Nordic Exchange Helsinki in the first half of the
year 2008 was EUR 33.00, the lowest EUR 23.27, and the volume-weighted average
quotation EUR 28.18. The closing quotation on the last trading day of the
quarter was EUR 32.26 (23.19).

Relating to the 2002B share option scheme, a total of 0.6 million options for a
total of EUR 15.7 million were traded during the first half of 2008.

A total of 68,850 shares subscribed on the basis of share option schemes were
entered into the trade register in the second quarter of 2008. At the end of the
second quarter, Fortum Corporation did not own its own shares.

After registrations, Fortum Corporation's share capital is EUR 3,042,188,906.20
and the total number of registered shares is 887,191,443 at the end of the
second quarter of 2008. The share capital of Fortum Corporation increased by a
total of EUR 234,090.

At quarter-end, the amount of shares that can still be subscribed for and
registered under the share option schemes is a maximum of 0.1% (1,175,602
shares) of Fortum's quarter-end share capital and voting rights.

At quarter-end, the Finnish state's holding in Fortum was 50.8%. The proportion
of nominee registrations and direct foreign shareholders was 36.1%.

Currently, the Board of Directors has no unused authorisations from the Annual
General Meeting of Shareholders to issue convertible loans or bonds with
warrants or to issue new shares. The Board of Directors has an authorisation
from the Annual General Meeting of Shareholders on 1 April 2008 to buy Fortum
Corporation's own shares. The authorisation, amounting to EUR 300 million or 15
million shares, is valid until the next Annual General Meeting.

Group personnel

The average number of employees in the Group during the period from January to
June was 12,603 (8,257). The number of employees at the end of the period was
16,069 (8,541). The increase in the number of employees is due to the
acquisition of TGC-10.

Outlook

The key market driver influencing Fortum's business performance is the Nordic
wholesale price of electricity. Key drivers behind the wholesale price
development are the Nordic hydrological situation and supply-demand balance, CO2
emissions allowance prices and fuel prices. The exchange rates of the Swedish
krona and Russian rouble also affect Fortum's reported results.

Fortum's financial results are exposed to a number of strategic, financial and
operational risks. For further details on Fortum's risks and risk management,
see Fortum's Operating and Financial Review and Financial Statements for 2007.

In Russia, one of the key assumptions in the TGC-10 acquisition is the
continuation of the Russian power sector reform. In the beginning of July, the
share of the liberalised energy market increased from 15% to 25%. At the same
time, the capacity market was started with the same degree of liberalisation.
The wholesale power market is expected to be fully liberalised in 2011.

TGC-10 is committed and contractually obligated to a significant investment
programme, amounting to approximately EUR 2.2 billion. The programme is
estimated to be completed during 2013. The contractual obligations of TGC-10's
investment programme include penalty clauses tied to the availability of the new
generating capacity.

According to general market information, electricity consumption in the Nordic
countries is predicted to increase by about 1% a year over the next few years.

In early-July 2008, the Nordic water reservoirs were about 6 TWh above the
long-term average and 1 TWh below the corresponding level of 2007. In mid-July,
the market price for emission allowances (EUA) for 2008 was about EUR 26-28 per
tonne CO2. At the same time, the electricity forward price for the rest of 2008
was around EUR 60-63 per MWh and for 2009 around EUR 61-63 per MWh.

The first and last quarters of the year are usually the strongest quarters for
the power and heat businesses.

Fortum Power Generation's achieved Nordic power price typically depends on e.g.
the hedge ratio, hedge price, spot price, availability and utilisation of
Fortum's flexible production portfolio and currency fluctuations. If Fortum did
not hedge any of its production volumes, a 1 EUR/MWh change in the Nordic spot
price would result in approximately a EUR 50 million change in Fortum's annual
operating profit.

At the beginning of July 2008, Fortum had hedged approximately 70% of the Power
Generation segment's estimated Nordic electricity sales volume for the rest of
2008 at approximately EUR 46 per MWh. For the calendar year 2009, approximately
45% of the Power Generation segment's estimated Nordic electricity sales volume
was hedged at approximately EUR 51 per MWh. These hedge ratios may vary
significantly depending on Fortum's actions on the electricity derivatives
markets. Hedge prices are also influenced by changes in the SEK/EUR exchange
rates, as part of the hedges are conducted in SEK.

The acquisition of TGC-10 is expected to marginally dilute Fortum's EPS during
2008 and 2009. Fortum expects the full benefits of its targeted annual
efficiency improvements in TGC-10 to reach at least EUR 30 million.

Fortum's results in the first half of 2008 were good. The Group's financial
position is strong. With its flexible and climate-benign production portfolio,
Fortum continues to be well positioned for the future.


Espoo, 16 July 2008
Fortum Corporation
Board of Directors

Further information:
Mikael Lilius, President and CEO, tel. +358 10 452 9100
Juha Laaksonen, CFO,
tel. +358 10 452 4519

The financial statements have been prepared in accordance with International
Accounting Standard (IAS) 34, Interim Financial Reporting, as adopted by the EU.
The interim financials have not been audited.

Publication of results in 2008:
Interim Report January-September will be published on 22 October 2008.

Distribution:
OMX Nordic Exchange Helsinki
Key media
www.fortum.com

Information on the financial statements release, including detailed quarterly
information, is available on Fortum's website at: www.fortum.com/investors

--------------------------------------------------------------------------------
| FORTUM GROUP                                                                 |
--------------------------------------------------------------------------------
| JANUARY-JUNE 2008                                                            |
--------------------------------------------------------------------------------
| Interim Financial Statements are unaudited                                   |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| CONSOLIDATED    |       |      |       |      |      |       |       |       |
| INCOME          |       |      |       |      |      |       |       |       |
| STATEMENT       |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| MEUR            |       | Note |    Q2 |   Q2 | Q1-Q | Q1-Q2 |  2007 |  Last |
|                 |       |      |  2008 | 2007 |    2 |  2007 |       | twelv |
|                 |       |      |       |      | 2008 |       |       |     e |
|                 |       |      |       |      |      |       |       | month |
|                 |       |      |       |      |      |       |       |     s |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Sales           |       |    4 | 1 322 |  959 |    2 | 2 299 | 4 479 | 4 942 |
|                 |       |      |       |      |  762 |       |       |       |
--------------------------------------------------------------------------------
| Other income    |       |      |   -42 |   43 |   19 |    48 |   393 |   364 |
--------------------------------------------------------------------------------
| Materials and   |       |      |  -465 | -316 | -986 |  -802 |    -1 |    -1 |
| services        |       |      |       |      |      |       |   572 |   756 |
--------------------------------------------------------------------------------
| Employee        |       |      |  -137 | -124 | -273 |  -250 |  -495 |  -518 |
| benefit costs   |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Depreciation,   |       |   4, |  -135 | -111 | -246 |  -223 |  -451 |  -474 |
| amortisation    |       |   12 |       |      |      |       |       |       |
| and impairment  |       |      |       |      |      |       |       |       |
| charges         |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Other expenses  |       |      |  -195 | -124 | -319 |  -255 |  -507 |  -571 |
--------------------------------------------------------------------------------
| Operating       |       |      |   348 |  327 |  957 |   817 | 1 847 | 1 987 |
| profit          |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Share of profit |       |   4, |    36 |   15 |   70 |   217 |   241 |    94 |
| of associates   |       |   13 |       |      |      |       |       |       |
| and joint       |       |      |       |      |      |       |       |       |
| ventures        |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Interest        |       |      |   -95 |  -55 | -155 |   -99 |  -220 |  -276 |
| expense         |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Interest income |       |      |    27 |   16 |   44 |    28 |    76 |    92 |
--------------------------------------------------------------------------------
| Fair value      |       |      |    -1 |    0 |   -3 |     2 |     7 |     2 |
| gains and       |       |      |       |      |      |       |       |       |
| losses on       |       |      |       |      |      |       |       |       |
| financial       |       |      |       |      |      |       |       |       |
| instruments     |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Other financial |       |      |    -5 |   -2 |   -5 |    -3 |   -17 |   -19 |
| expenses - net  |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Finance costs - |       |      |   -74 |  -41 | -119 |   -72 |  -154 |  -201 |
| net             |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Profit before   |       |      |   310 |  301 |  908 |   962 | 1 934 | 1 880 |
| income tax      |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Income tax      |       |    9 |   -65 |  -65 | -187 |  -174 |  -326 |  -339 |
| expense         |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Profit for the  |       |      |   245 |  236 |  721 |   788 | 1 608 | 1 541 |
| period          |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Attributable    |       |      |       |      |      |       |       |       |
| to:             |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Equity holders  |       |      |   243 |  231 |  695 |   753 | 1 552 | 1 494 |
| of the Company  |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Minority        |       |      |     2 |    5 |   26 |    35 |    56 |    47 |
| interest        |       |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
|                 |       |      |   245 |  236 |  721 |   788 | 1 608 | 1 541 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per share for  |      |       |      |      |       |       |       |
| profit attributable to  |      |       |      |      |       |       |       |
| the equity              |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| holders of the company  |   10 |       |      |      |       |       |       |
| during the year (in €   |      |       |      |      |       |       |       |
| per share)              |      |       |      |      |       |       |       |
--------------------------------------------------------------------------------
| Basic              |    |      |  0.27 | 0.26 | 0.78 |  0.85 |  1.74 |  1.68 |
--------------------------------------------------------------------------------
| Diluted            |    |      |  0.27 | 0.26 | 0.78 |  0.84 |  1.74 |  1.68 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| CONSOLIDATED BALANCE    |    |          |           |           |            |
| SHEET                   |    |          |           |           |            |
--------------------------------------------------------------------------------
| MEUR                    |    |     Note |   June 30 |   June 30 |     Dec 31 |
|                         |    |          |      2008 |      2007 |       2007 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSETS                  |    |          |           |           |            |
--------------------------------------------------------------------------------
| Non-current assets      |    |          |           |           |            |
--------------------------------------------------------------------------------
| Intangible assets       |    |       12 |       426 |        79 |         85 |
--------------------------------------------------------------------------------
| Property, plant and     |    |       12 |    13 118 |    11 311 |     11 343 |
| equipment               |    |          |           |           |            |
--------------------------------------------------------------------------------
| Participations in       |    |    4, 13 |     2 461 |     2 471 |      2 853 |
| associates and joint    |    |          |           |           |            |
| ventures                |    |          |           |           |            |
--------------------------------------------------------------------------------
| Share in State Nuclear  |    |       16 |       528 |       458 |        516 |
| Waste Management Fund   |    |          |           |           |            |
--------------------------------------------------------------------------------
| Other long-term         |    |          |        86 |       103 |         99 |
| investments             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Deferred tax assets     |    |          |        42 |         4 |          3 |
--------------------------------------------------------------------------------
| Derivative financial    |    |        6 |       221 |       106 |        153 |
| instruments             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Long-term               |    |          |       811 |       695 |        736 |
| interest-bearing        |    |          |           |           |            |
| receivables             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Total non-current       |    |          |    17 693 |    15 227 |     15 788 |
| assets                  |    |          |           |           |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current assets          |    |          |           |           |            |
--------------------------------------------------------------------------------
| Inventories             |    |          |       316 |       301 |        285 |
--------------------------------------------------------------------------------
| Derivative financial    |    |        6 |       260 |       181 |        140 |
| instruments             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Trade and other         |    |          |     1 015 |       863 |      1 034 |
| receivables             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Cash and cash           |    |          |     1 247 |       879 |        427 |
| equivalents             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Total current assets    |    |          |     2 838 |     2 224 |      1 886 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total assets            |    |          |    20 531 |    17 451 |     17 674 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EQUITY                  |    |          |           |           |            |
--------------------------------------------------------------------------------
| Capital and reserves    |    |          |           |           |            |
| attributable to the     |    |          |           |           |            |
--------------------------------------------------------------------------------
| Company's equity        |    |          |           |           |            |
| holders                 |    |          |           |           |            |
--------------------------------------------------------------------------------
| Share capital           |    |       14 |     3 042 |     3 037 |      3 040 |
--------------------------------------------------------------------------------
| Other restricted funds  |    |          |        82 |        78 |         78 |
--------------------------------------------------------------------------------
| Fair value and other    |    |          |        82 |       704 |        715 |
| reserves                |    |          |           |           |            |
--------------------------------------------------------------------------------
| Retained earnings       |    |          |     3 961 |     3 917 |      4 526 |
--------------------------------------------------------------------------------
| Total                   |    |          |     7 167 |     7 736 |      8 359 |
--------------------------------------------------------------------------------
| Minority interest       |    |          |       925 |       278 |        292 |
--------------------------------------------------------------------------------
| Total equity            |    |          |     8 092 |     8 014 |      8 651 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| LIABILITIES             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Non-current liabilities |    |          |           |           |            |
--------------------------------------------------------------------------------
| Interest-bearing        |    |       15 |     6 543 |     4 565 |      4 288 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Derivative financial    |    |        6 |       373 |       135 |        139 |
| instruments             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Deferred tax            |    |          |     1 808 |     1 788 |      1 687 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Nuclear provisions      |    |       16 |       528 |       458 |        516 |
--------------------------------------------------------------------------------
| Pension and other       |    |          |       270 |       152 |        144 |
| provisions              |    |          |           |           |            |
--------------------------------------------------------------------------------
| Other liabilities       |    |          |       464 |       470 |        486 |
--------------------------------------------------------------------------------
| Total non-current       |    |          |     9 986 |     7 568 |      7 260 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Current liabilities     |    |          |           |           |            |
--------------------------------------------------------------------------------
| Interest-bearing        |    |       15 |       958 |       924 |        605 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Derivative financial    |    |        6 |       509 |       142 |        260 |
| instruments             |    |          |           |           |            |
--------------------------------------------------------------------------------
| Trade and other         |    |          |       986 |       803 |        898 |
| payables                |    |          |           |           |            |
--------------------------------------------------------------------------------
| Total current           |    |          |     2 453 |     1 869 |      1 763 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total liabilities       |    |          |    12 439 |     9 437 |      9 023 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total equity and        |    |          |    20 531 |    17 451 |     17 674 |
| liabilities             |    |          |           |           |            |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
|                         |    |          |           |           |            |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| CONSOLIDATED STATEMENT OF CHANGES IN TOTAL EQUITY                            |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR    |  Share | Othe |  Fair | Trea | Retain | Attribu | Minori |   Total |
|         | capita |    r | value | sury |     ed |   table |     ty |         |
|         |      l | rest |   and | shar | earnin |  to the |        |         |
|         |        | rict | other |   es |     gs |  equity |        |         |
|         |        |   ed | reser |      |        | holders |        |         |
|         |        | fund |   ves |      |        |         |        |         |
|         |        |    s |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |  3 040 |   78 |   715 |    - |  4 526 |   8 359 |    292 |   8 651 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 31.12.2 |        |      |       |      |        |         |        |         |
| 007     |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Transla |        |    4 |       |      |    -62 |     -58 |    -19 |     -77 |
| tion    |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| other   |        |      |       |      |        |         |        |         |
| differe |        |      |       |      |        |         |        |         |
| nces    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |  -208 |      |        |    -208 |     -3 |    -211 |
| flow    |        |      |       |      |        |         |        |         |
| hedges  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Other   |        |      |  -429 |      |        |    -429 |        |    -429 |
| fair    |        |      |       |      |        |         |        |         |
| value   |        |      |       |      |        |         |        |         |
| adjustm |        |      |       |      |        |         |        |         |
| ents 1) |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    4 |  -637 |    - |    -62 |    -695 |    -22 |    -717 |
| gains   |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| losses  |        |      |       |      |        |         |        |         |
| not     |        |      |       |      |        |         |        |         |
| recogni |        |      |       |      |        |         |        |         |
| sed in  |        |      |       |      |        |         |        |         |
| Income  |        |      |       |      |        |         |        |         |
| stateme |        |      |       |      |        |         |        |         |
| nt      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Net     |        |      |       |      |    695 |     695 |     26 |     721 |
| profit  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    4 |  -637 |    - |    633 |       0 |      4 |       4 |
| recogni |        |      |       |      |        |         |        |         |
| sed     |        |      |       |      |        |         |        |         |
| income  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Stock   |      2 |      |       |      |        |       2 |        |       2 |
| options |        |      |       |      |        |         |        |         |
| exercis |        |      |       |      |        |         |        |         |
| ed      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |       |      | -1 198 |  -1 198 |        |  -1 198 |
| dividen |        |      |       |      |        |         |        |         |
| d 2)    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Changes |        |      |     4 |      |        |       4 |    629 |     633 |
| due to  |        |      |       |      |        |         |        |         |
| busines |        |      |       |      |        |         |        |         |
| s       |        |      |       |      |        |         |        |         |
| combina |        |      |       |      |        |         |        |         |
| tions   |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |  3 042 |   82 |    82 |    - |  3 961 |   7 167 |    925 |   8 092 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 30.06.2 |        |      |       |      |        |         |        |         |
| 008     |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total   |  3 023 |   74 |   511 |    - |  4 300 |   7 908 |    253 |   8 161 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 31.12.2 |        |      |       |      |        |         |        |         |
| 006     |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Transla |        |      |       |      |    -10 |     -10 |     -6 |     -16 |
| tion    |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| other   |        |      |       |      |        |         |        |         |
| differe |        |      |       |      |        |         |        |         |
| nces    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |   -47 |      |        |     -47 |        |     -47 |
| flow    |        |      |       |      |        |         |        |         |
| hedges  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Other   |        |      |   240 |      |        |     240 |        |     240 |
| fair    |        |      |       |      |        |         |        |         |
| value   |        |      |       |      |        |         |        |         |
| adjustm |        |      |       |      |        |         |        |         |
| ents 1) |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    - |   193 |    - |    -10 |     183 |     -6 |     177 |
| gains   |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| losses  |        |      |       |      |        |         |        |         |
| not     |        |      |       |      |        |         |        |         |
| recogni |        |      |       |      |        |         |        |         |
| sed in  |        |      |       |      |        |         |        |         |
| Income  |        |      |       |      |        |         |        |         |
| stateme |        |      |       |      |        |         |        |         |
| nt      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Net     |        |      |       |      |    753 |     753 |     35 |     788 |
| profit  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    - |   193 |    - |    743 |     936 |     29 |     965 |
| recogni |        |      |       |      |        |         |        |         |
| sed     |        |      |       |      |        |         |        |         |
| income  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Stock   |     14 |      |       |      |        |      14 |        |      14 |
| options |        |      |       |      |        |         |        |         |
| exercis |        |      |       |      |        |         |        |         |
| ed      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |       |      | -1 122 |  -1 122 |        |  -1 122 |
| dividen |        |      |       |      |        |         |        |         |
| d 2)    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Changes |        |    4 |       |      |     -4 |       0 |        |       0 |
| between |        |      |       |      |        |         |        |         |
| restric |        |      |       |      |        |         |        |         |
| ted and |        |      |       |      |        |         |        |         |
| unrestr |        |      |       |      |        |         |        |         |
| icted   |        |      |       |      |        |         |        |         |
| equity  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Changes |        |      |       |      |        |       - |     -4 |      -4 |
| due to  |        |      |       |      |        |         |        |         |
| busines |        |      |       |      |        |         |        |         |
| s       |        |      |       |      |        |         |        |         |
| combina |        |      |       |      |        |         |        |         |
| tions   |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |  3 037 |   78 |   704 |    - |  3 917 |   7 736 |    278 |   8 014 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 30.6.20 |        |      |       |      |        |         |        |         |
| 07      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Total   |  3 023 |   74 |   511 |    - |  4 300 |   7 908 |    253 |   8 161 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 31.12.2 |        |      |       |      |        |         |        |         |
| 006     |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Transla |        |      |       |      |    -25 |     -25 |    -11 |     -36 |
| tion    |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| other   |        |      |       |      |        |         |        |         |
| differe |        |      |       |      |        |         |        |         |
| nces    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |  -168 |      |        |    -168 |     -2 |    -170 |
| flow    |        |      |       |      |        |         |        |         |
| hedges  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Other   |        |      |   372 |      |        |     372 |        |     372 |
| fair    |        |      |       |      |        |         |        |         |
| value   |        |      |       |      |        |         |        |         |
| adjustm |        |      |       |      |        |         |        |         |
| ents 1) |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    - |   204 |    - |    -25 |     179 |    -13 |     166 |
| gains   |        |      |       |      |        |         |        |         |
| and     |        |      |       |      |        |         |        |         |
| losses  |        |      |       |      |        |         |        |         |
| not     |        |      |       |      |        |         |        |         |
| recogni |        |      |       |      |        |         |        |         |
| sed in  |        |      |       |      |        |         |        |         |
| Income  |        |      |       |      |        |         |        |         |
| stateme |        |      |       |      |        |         |        |         |
| nt      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Net     |        |      |       |      |  1 552 |   1 552 |     56 |   1 608 |
| profit  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |      - |    - |   204 |    - |  1 527 |   1 731 |     43 |   1 774 |
| recogni |        |      |       |      |        |         |        |         |
| sed     |        |      |       |      |        |         |        |         |
| income  |        |      |       |      |        |         |        |         |
| for the |        |      |       |      |        |         |        |         |
| period  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Stock   |     17 |      |       |      |        |      17 |        |      17 |
| options |        |      |       |      |        |         |        |         |
| exercis |        |      |       |      |        |         |        |         |
| ed      |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cash    |        |      |       |      | -1 122 |  -1 122 |        |  -1 122 |
| dividen |        |      |       |      |        |         |        |         |
| d 2)    |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Repurch |        |      |       | -175 |        |    -175 |        |    -175 |
| ase of  |        |      |       |      |        |         |        |         |
| own     |        |      |       |      |        |         |        |         |
| shares  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Cancell |        |      |       |  175 |   -175 |       0 |        |       0 |
| ation   |        |      |       |      |        |         |        |         |
| of own  |        |      |       |      |        |         |        |         |
| shares  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Changes |        |    4 |       |      |     -4 |       0 |        |       0 |
| between |        |      |       |      |        |         |        |         |
| restric |        |      |       |      |        |         |        |         |
| ted and |        |      |       |      |        |         |        |         |
| unrestr |        |      |       |      |        |         |        |         |
| icted   |        |      |       |      |        |         |        |         |
| equity  |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Changes |        |      |       |      |        |       0 |     -4 |      -4 |
| due to  |        |      |       |      |        |         |        |         |
| busines |        |      |       |      |        |         |        |         |
| s       |        |      |       |      |        |         |        |         |
| combina |        |      |       |      |        |         |        |         |
| tions   |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
| Total   |  3 040 |   78 |   715 |    - |  4 526 |   8 359 |    292 |   8 651 |
| equity  |        |      |       |      |        |         |        |         |
| at      |        |      |       |      |        |         |        |         |
| 31.12.2 |        |      |       |      |        |         |        |         |
| 007     |        |      |       |      |        |         |        |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Includes the fair value change of Renewable Energy Corporation (REC)      |
| shareholding in Hafslund and the effect of Hafslund's sale of REC shares.    |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
|    See Note 13 Changes in participations in associates and joint ventures.   |
--------------------------------------------------------------------------------
| 2) See Note 11 Dividends.  |                                       |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| CONDENSED CONSOLIDATED CASH FLOW STATEMENT                                   |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR       |   | Note |     Q2 | Q2 2007 |  Q1-Q2 |   Q1-Q2 |  2007 |   Last |
|            |   |      |   2008 |         |   2008 |    2007 |       | twelve |
|            |   |      |        |         |        |         |       | months |
--------------------------------------------------------------------------------
| Cash flow  |   |      |        |         |        |         |       |        |
| from       |   |      |        |         |        |         |       |        |
| operating  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Operating  |   |      |    483 |     438 |  1 203 |   1 040 | 2 298 |  2 461 |
| profit     |   |      |        |         |        |         |       |        |
| before     |   |      |        |         |        |         |       |        |
| depreciati |   |      |        |         |        |         |       |        |
| ons        |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Non-cash   |   |      |     55 |      -6 |     18 |      -5 |  -286 |   -263 |
| flow items |   |      |        |         |        |         |       |        |
| and        |   |      |        |         |        |         |       |        |
| divesting  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Financial items and   |    -35 |     133 |    -80 |      95 |   -10 |   -185 |
| realised foreign      |        |         |        |         |       |        |
| exchange gains and    |        |         |        |         |       |        |
| losses                |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Taxes      |   |      |   -123 |    -119 |   -200 |    -237 |  -383 |   -346 |
--------------------------------------------------------------------------------
| Funds from |   |      |    380 |     446 |    941 |     893 | 1 619 |  1 667 |
| operations |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Change in  |   |      |    117 |     127 |     98 |     177 |    51 |    -28 |
| working    |   |      |        |         |        |         |       |        |
| capital    |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Total net  |   |      |    497 |     573 |  1 039 |   1 070 | 1 670 |  1 639 |
| cash from  |   |      |        |         |        |         |       |        |
| operating  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow  |   |      |        |         |        |         |       |        |
| from       |   |      |        |         |        |         |       |        |
| investing  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Capital    |   |   4, |   -215 |    -113 |   -379 |    -213 |  -592 |   -758 |
| expenditur |   |   12 |        |         |        |         |       |        |
| es 1)      |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Acquisitio |   |    7 |      0 |       0 |   -764 |      -8 |   -10 |   -766 |
| n of       |   |      |        |         |        |         |       |        |
| subsidiari |   |      |        |         |        |         |       |        |
| es, net of |   |      |        |         |        |         |       |        |
| cash       |   |      |        |         |        |         |       |        |
| acquired   |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Acquisitio |   |   13 |      0 |       0 |     -8 |       0 |  -271 |   -279 |
| n of       |   |      |        |         |        |         |       |        |
| associates |   |      |        |         |        |         |       |        |
| 2)         |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Acquisitio |   |      |     -1 |      -2 |     -1 |      -2 |    -4 |     -3 |
| n of other |   |      |        |         |        |         |       |        |
| long-term  |   |      |        |         |        |         |       |        |
| investment |   |      |        |         |        |         |       |        |
| s          |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Proceeds   |   |      |      1 |       2 |      5 |       9 |    14 |     10 |
| from sales |   |      |        |         |        |         |       |        |
| of fixed   |   |      |        |         |        |         |       |        |
| assets     |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Proceeds from  |    7 |      0 |       0 |      0 |       0 |     0 |      0 |
| sales of       |      |        |         |        |         |       |        |
| subsidiaries,  |      |        |         |        |         |       |        |
| net of cash    |      |        |         |        |         |       |        |
| disposed       |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Proceeds   |   |   13 |      0 |       4 |      0 |       4 |   304 |    300 |
| from sales |   |      |        |         |        |         |       |        |
| of         |   |      |        |         |        |         |       |        |
| associates |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Proceeds   |   |      |      0 |       0 |      0 |       0 |    29 |     29 |
| from sales |   |      |        |         |        |         |       |        |
| of other   |   |      |        |         |        |         |       |        |
| long-term  |   |      |        |         |        |         |       |        |
| investment |   |      |        |         |        |         |       |        |
| s          |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Change in  |   |      |    -20 |      -1 |    -50 |     -37 |   -79 |    -92 |
| interest-b |   |      |        |         |        |         |       |        |
| earing     |   |      |        |         |        |         |       |        |
| receivable |   |      |        |         |        |         |       |        |
| s          |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Total net  |   |      |   -235 |    -110 | -1 197 |    -247 |  -609 | -1 559 |
| cash used  |   |      |        |         |        |         |       |        |
| in         |   |      |        |         |        |         |       |        |
| investing  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow  |   |      |    262 |     463 |   -158 |     823 | 1 061 |     80 |
| before     |   |      |        |         |        |         |       |        |
| financing  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Cash flow  |   |      |        |         |        |         |       |        |
| from       |   |      |        |         |        |         |       |        |
| financing  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Net change |   |      |     64 |     469 |  2 321 |   1 009 |   488 |  1 800 |
| in loans   |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Dividends  |   |      | -1 198 |  -1 122 | -1 198 |  -1 122 |    -1 | -1 198 |
| paid to    |   |      |        |         |        |         |   122 |        |
| the        |   |      |        |         |        |         |       |        |
| Company's  |   |      |        |         |        |         |       |        |
| equity     |   |      |        |         |        |         |       |        |
| holders    |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Repurchase |   |      |      - |       - |      - |       - |  -175 |   -175 |
| of own     |   |      |        |         |        |         |       |        |
| shares     |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Other      |   |      |   -125 |       1 |   -124 |      11 |    18 |   -117 |
| financing  |   |      |        |         |        |         |       |        |
| items      |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Total net  |   |      | -1 259 |    -652 |    999 |    -102 |  -791 |    310 |
| cash used  |   |      |        |         |        |         |       |        |
| in         |   |      |        |         |        |         |       |        |
| financing  |   |      |        |         |        |         |       |        |
| activities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| Total net  |   |      |        |         |        |         |       |        |
| increase   |   |      |        |         |        |         |       |        |
| (+)/decrea |   |      |        |         |        |         |       |        |
| se (-) in  |   |      |        |         |        |         |       |        |
| cash       |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------
| and        |   |      |   -997 |    -189 |    841 |     721 |   270 |    390 |
| marketable |   |      |        |         |        |         |       |        |
| securities |   |      |        |         |        |         |       |        |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) Capital expenditures in cash-flow do not include not yet paid             |
| investments. Capitalised borrowing costs are included in interest costs      |
| paid.                                                                        |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 2) Acquisition of associates include share issues.                           |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| KEY       |     |         |       |      |        |        |        |        |
| RATIOS    |     |         |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| MEUR      |     | June 30 | March |  Dec |   Sept |   June |  March |   Last |
|           |     |    2008 |    31 |   31 |     30 |     30 |     31 | twelve |
|           |     |         |  2008 | 2007 |   2007 |   2007 |   2007 | months |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EBITDA,   |     |   1 203 |   720 |    2 |  1 663 |  1 040 |    602 |  2 461 |
| MEUR      |     |         |       |  298 |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings  |     |    0.78 |  0.51 | 1.74 |   1.33 |   0.85 |   0.59 |   1.68 |
| per share |     |         |       |      |        |        |        |        |
| (basic),  |     |         |       |      |        |        |        |        |
| EUR       |     |         |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital   |     |  15 593 |    16 |   13 | 13 764 | 13 503 | 12 593 | 15 593 |
| employed, |     |         |   868 |  544 |        |        |        |        |
| MEUR      |     |         |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Interest- |     |   6 254 | 5 228 |    4 |  4 456 |  4 610 |  3 932 |    N/A |
| bearing   |     |         |       |  466 |        |        |        |        |
| net debt, |     |         |       |      |        |        |        |        |
| MEUR      |     |         |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital         |   1 459 | 1 227 |  972 |    646 |    253 |    115 |  2 178 |
| expenditure and |         |       |      |        |        |        |        |
| gross           |         |       |      |        |        |        |        |
| investments in  |         |       |      |        |        |        |        |
| shares, MEUR    |         |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Capital         |   | 408 |   175 |  655 |    382 |    236 |    100 |    827 |
| expenditure,    |   |     |       |      |        |        |        |        |
| MEUR            |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on       |   | 14. |  17.3 | 16.5 |   15.1 |   14.8 |   18.0 |   14.9 |
| capital         |   |   6 |       |      |        |        |        |        |
| employed, % 1)  |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Adjusted return |   |     |       | 14.0 |        |        |        |   13.8 |
| on capital      |   |     |       |      |        |        |        |        |
| employed, % 2)  |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on       |   | 17. |  21.0 | 19.1 |   17.8 |   17.2 |   21.1 |   19.1 |
| shareholders'   |   |   2 |       |      |        |        |        |        |
| equity, % 1)    |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Adjusted return |   |     |       | 15.8 |        |        |        |   17.5 |
| on              |   |     |       |      |        |        |        |        |
| shareholders'   |   |     |       |      |        |        |        |        |
| equity, % 2)    |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net debt /      |   | 2.6 |   1.8 |  1.9 |    2.1 |    2.2 |    1.6 |    2.5 |
| EBITDA 1)       |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Adjusted Net    |   |     |       |  2.2 |    2.3 |        |        |    2.8 |
| debt / EBITDA   |   |     |       |      |        |        |        |        |
| 3)              |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest        |   | 8.6 |  14.1 | 12.8 |   12.4 |   11.5 |   15.3 |   10.8 |
| coverage        |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Funds from      |   | 30. |  42.9 | 36.3 |   33.9 |   36.1 |   45.5 |   26.7 |
| operations/inte |   |   1 |       |      |        |        |        |        |
| rest-bearing    |   |     |       |      |        |        |        |        |
| net debt, % 1) |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gearing, %      |   |  77 |    56 |   52 |     52 |     58 |     52 |    N/A |
--------------------------------------------------------------------------------
| Equity per      |   | 8.0 |  9.53 | 9.43 |   9.21 |   8.68 |   8.22 |    N/A |
| share, EUR      |   |   8 |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Equity-to-asset |   |  39 |    44 |   49 |     48 |     46 |     43 |    N/A |
| s ratio, %      |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Average number  |   |  12 | 8 356 |    8 |  8 305 |  8 257 |  8 165 |    N/A |
| of employees    |   | 603 |       |  304 |        |        |        |        |
--------------------------------------------------------------------------------
| Number of       |   |  16 |    15 |    8 |  8 306 |  8 541 |  8 190 |    N/A |
| employees       |   | 069 |   689 |  303 |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Average number  |   | 887 |   887 |  889 |    890 |    890 |    890 |    888 |
| of shares, 1    |   | 131 |   085 |  997 |    984 |    770 |    263 |    503 |
| 000 shares      |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Diluted         |   | 888 |   888 |  891 |    892 |    893 |    893 |    889 |
| adjusted        |   | 165 |   177 |  395 |    815 |    140 |    252 |    533 |
| average number  |   |     |       |      |        |        |        |        |
| of shares, 1    |   |     |       |      |        |        |        |        |
| 000 shares      |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Number of       |   | 887 |   887 |  886 |    892 |    891 |    890 |    N/A |
| registered      |   | 191 |   123 |  683 |    119 |    472 |    685 |        |
| shares, 1 000   |   |     |       |      |        |        |        |        |
| shares          |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
| Number of       |   | N/A |   N/A |  N/A |    N/A |    N/A |    N/A |    N/A |
| shares          |   |     |       |      |        |        |        |        |
| excluding       |   |     |       |      |        |        |        |        |
| treasury        |   |     |       |      |        |        |        |        |
| shares, 1000    |   |     |       |      |        |        |        |        |
| shares          |   |     |       |      |        |        |        |        |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) Quarterly figures are annualised.                                         |
--------------------------------------------------------------------------------
| 2) Adjusted for REC and Lenenergo gains in 2007.                             |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 3) Based on EBITDA excluding capital gain from the |          |         |    |
| sale of Fortum's holding in Lenenergo amounting to |          |         |    |
| EUR 232 million.                                   |          |         |    |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
|    For definitions, see Note 23.                                             |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| NOTES TO THE            |       |       |   |        |         |        |    |
| CONSOLIDATED INTERIM    |       |       |   |        |         |        |    |
| FINANCIAL STATEMENTS    |       |       |   |        |         |        |    |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1. BASIS OF PREPARATION                                                      |
--------------------------------------------------------------------------------
The condensed interim financial statements have been prepared in accordance
with International Accounting Standard (IAS) 34, Interim Financial Reporting, as
adopted by the EU. The condensed interim financial report should be read in
conjunction with the annual financial statements for the year ended 31 December
2007.
--------------------------------------------------------------------------------
| 2. ACCOUNTING POLICIES                                                       |
--------------------------------------------------------------------------------
The accounting policies adopted are consistent with those of the Group's annual
financial statements for the year ended 31 December 2007, except for changes
listed below.

Early adoption of IFRS 8 Operating Segments
Following the acquisition of the Russian company TGC-10, Fortum has changed its
segment reporting during Q1 2008. A new Russia segment was introduced, which
then meant that the new segment structure has one segment based on geographical
area, combined with segments based on type of business operations. Due to the
change in segments structure, Fortum has early adopted IFRS 8 Operating
segments.
The new Russia segment includes:
- TGC-10, which has been consolidated from 31 March 2008 (see Note 7)
- the TGC-1 shareholding, which was transferred from the Power Generation
segment
- minor assets from shareholdings in Lenenergo spin-off companies, transferred
from Distribution, Markets and Other segments
In addition to introducing a new segment, assets and profits from the associated
company Hafslund have been transferred from Power Generation segment to Other
segment.
Segments Power Generation, Heat, Distribution and Markets as well as Other
remained as previously reported with exception from the items stated above.
Power Generation consists of the business units Generation, Portfolio Management
and Trading (PMT) as well as Service. The business units Generation and PMT have
from a financial reporting perspective one common set of financial measures. No
separate pricing mechanism is in use between the business units. Service
business unit provides services both internal and external, but its core
activities refer to Generation business. The two business units Heat and Värme
are aggregated to the Heat segment based on the similarity in the nature of
business, customers etc.
Financial target setting, follow up and allocation of resources in the Group's
performance management process are based on the business units' comparable
operating profit including share of profit from associated companies and
comparable return on net assets.
Consolidation by segment is based on the same principles as for the Group as a
whole. Inter-segment transactions are based on commercial terms. Due to the
large number of customers and the variety of its business activities, there are
no individual customer whose business volume is material compared with Fortum's
total business volume. Power Generation segment is selling the produced
electricity mainly through Nord Pool. For further information regarding the
segments business activities and geographical areas, see the Financial
statements 2007 Note 5 Primary Segment information.
Comparison numbers for 2007 have been restated, resulting in the following
effects in operating profit and non-recurring items:
- the non-recurring gain on the sale of Lenenergo shares (EUR 232 million) in Q3
2007, transferred from Distribution segment to the new Russia segment
- the gain on the sale of WGC-5 shares (EUR 12 million) in Q4 2007, transferred
from Power Generation segment to the new Russia segment
- share of profits from associates regarding Hafslund during 2007, including the
gain from Hafslund's divestment of shares in REC in Q1 2007, has been
transferred from Power Generation segment to Other segment.
New interpretations
The following new interpretations are mandatory for the financial year ending 31
December 2008:
- IFRIC 11 IFRS 2: Group and treasury share transactions The share-based payment
arrangements established within Fortum Group are not subject to IFRIC 11
because they are cash-settled.
- IFRIC 14 IAS 19 - The limit on a defined benefit asset, minimum funding
requirements and their interaction provides guidance how to assess the limit in
IAS 19 on the amount of the surplus that can be recognised as an asset in
particular when there is a minimum funding requirement. IFRIC 14 is not
expected to have a significant impact on Group's accounts. The interpretation
has not yet been endorsed in the EU.
- IFRIC 12 Service concession arrangements is not relevant to Fortum as no
member of the Group is a service concession operator providing for public sector
services. The interpretation has not yet been endorsed in the EU.
These new interpretations have not had any effect on the reported income
statement, balance sheet or disclosures.
For further information on accounting of associates, see Note 13 below.

--------------------------------------------------------------------------------
| 3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS                              |
--------------------------------------------------------------------------------
The preparation of Interim financial statements requires management to make
judgements, estimates and assumptions that affect the reported amounts of assets
and liabilities, income and expense. Annual results may differ from these
estimates.
In preparing these interim financial statements, the significant judgements made
by management in applying the Group's accounting policies and the key sources of
estimation uncertainty were the same as those that applied to the annual
financial statements as at and for the year ended 31 December 2007.

--------------------------------------------------------------------------------
| 4. SEGMENT INFORMATION                                                       |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| SALES            | Q2 2008 |     Q2 |   Q1-Q2  |  Q1-Q2  |    2007 |    Last |
| MEUR             |         |   2007 |     2008 |    2007 |         |  twelve |
|                  |         |        |          |         |         |  months |
--------------------------------------------------------------------------------
| Power sales      |     809 |    515 |    1 568 |   1 190 |   2 370 |   2 748 |
| excluding        |         |        |          |         |         |         |
| indirect taxes   |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Heating sales    |     267 |    202 |      662 |     590 |   1 096 |   1 168 |
--------------------------------------------------------------------------------
| Network          |     169 |    162 |      391 |     378 |     729 |     742 |
| transmissions    |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Other sales      |      77 |     80 |      141 |     141 |     284 |     284 |
--------------------------------------------------------------------------------
| Total            |   1 322 |    959 |    2 762 |   2 299 |   4 479 |   4 942 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| SALES BY SEGMENT | Q2 2008 |     Q2 |   Q1-Q2  |  Q1-Q2  |    2007 |    Last |
| MEUR             |         |   2007 |     2008 |    2007 |         |  twelve |
|                  |         |        |          |         |         |  months |
--------------------------------------------------------------------------------
| Power Generation |     721 |    522 |    1 438 |   1 163 |   2 350 |   2 625 |
--------------------------------------------------------------------------------
| - of which       |      21 |     92 |       74 |     248 |     323 |     149 |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Heat             |     284 |    252 |      777 |     731 |   1 356 |   1 402 |
--------------------------------------------------------------------------------
| - of which       |       0 |     11 |        7 |      35 |      38 |      10 |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Distribution     |     180 |    172 |      412 |     397 |     769 |     784 |
--------------------------------------------------------------------------------
| - of which       |       2 |      2 |        5 |       4 |       9 |      10 |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Markets          |     411 |    351 |      930 |     870 |   1 683 |   1 743 |
--------------------------------------------------------------------------------
| - of which       |      34 |     32 |       66 |      76 |     155 |     145 |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Russia           |     152 |      - |      152 |       - |       - |     152 |
--------------------------------------------------------------------------------
| - of which       |       - |      - |        - |       - |       - |       - |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Other            |      21 |     22 |       41 |      41 |      81 |      81 |
--------------------------------------------------------------------------------
| - of which       |      21 |     19 |       41 |      35 |      72 |      78 |
| internal         |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Netting of Nord  |    -369 |   -204 |     -795 |    -505 |  -1 163 |  -1 453 |
| Pool             |         |        |          |         |         |         |
| transactions 1)  |         |        |          |         |         |         |
--------------------------------------------------------------------------------
| Eliminations     |     -78 |   -156 |     -193 |    -398 |    -597 |    -392 |
--------------------------------------------------------------------------------
| Total            |   1 322 |    959 |    2 762 |   2 299 |   4 479 |   4 942 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) Sales and purchases with Nord Pool is netted on Group level on an hourly  |
| basis and posted either as revenue or cost depending on if Fortum is a net   |
| seller or net buyer during any particular hour.                              |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| OPERATING       |     Q2 | Q2 2007 |   Q1-Q2  |  Q1-Q2  |    2007 |     Last |
| PROFIT BY       |   2008 |         |     2008 |    2007 |         |   twelve |
| SEGMENTS        |        |         |          |         |         |   months |
| MEUR            |        |         |          |         |         |          |
--------------------------------------------------------------------------------
| Power           |    260 |     243 |      691 |     543 |   1 115 |    1 263 |
| Generation      |        |         |          |         |         |          |
--------------------------------------------------------------------------------
| Heat            |     37 |      33 |      167 |     175 |     294 |      286 |
--------------------------------------------------------------------------------
| Distribution    |     51 |      53 |      137 |     132 |     233 |      238 |
--------------------------------------------------------------------------------
| Markets         |     31 |       7 |       11 |      -5 |      12 |       28 |
--------------------------------------------------------------------------------
| Russia          |    -33 |       - |      -33 |       - |     244 |      211 |
--------------------------------------------------------------------------------
| Other           |      2 |      -9 |      -16 |     -28 |     -51 |      -39 |
--------------------------------------------------------------------------------
| Total           |    348 |     327 |      957 |     817 |   1 847 |    1 987 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| COMPARABLE       |    Q2 2008 |     Q2 | Q1-Q2 |  Q1-Q2  |    2007 |    Last |
| OPERATING PROFIT |            |   2007 |  2008 |    2007 |         |  twelve |
| BY SEGMENTS      |            |        |       |         |         |  months |
| MEUR             |            |        |       |         |         |         |
--------------------------------------------------------------------------------
| Power Generation |   |    384 |    217 |   779 |     547 |   1 095 |   1 327 |
--------------------------------------------------------------------------------
| Heat             |   |     27 |     36 |   148 |     173 |     290 |     265 |
--------------------------------------------------------------------------------
| Distribution     |   |     49 |     52 |   136 |     130 |     231 |     237 |
--------------------------------------------------------------------------------
| Markets          |   |    -15 |      3 |   -25 |     -11 |      -1 |     -15 |
--------------------------------------------------------------------------------
| Russia           |   |    -33 |      - |   -33 |       - |       - |     -33 |
--------------------------------------------------------------------------------
| Other            |   |     -9 |    -10 |   -21 |     -29 |     -51 |     -43 |
--------------------------------------------------------------------------------
| Comparable       |   |    403 |    298 |   984 |     810 |   1 564 |   1 738 |
| operating profit |   |        |        |       |         |         |         |
--------------------------------------------------------------------------------
| Non-recurring    |   |      0 |      4 |     2 |       5 |     250 |     247 |
| items            |   |        |        |       |         |         |         |
--------------------------------------------------------------------------------
| Other items      |   |    -55 |     25 |   -29 |       2 |      33 |       2 |
| effecting        |   |        |        |       |         |         |         |
| comparability    |   |        |        |       |         |         |         |
--------------------------------------------------------------------------------
| Operating profit |   |    348 |    327 |   957 |     817 |   1 847 |   1 987 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| NON-RECURRING   | Q2 2008 | Q2 2007 | Q1-Q2  | Q1-Q2  |     2007 |      Last |
| ITEMS BY        |         |         |   2008 |   2007 |          |    twelve |
| SEGMENTS        |         |         |        |        |          |    months |
| MEUR            |         |         |        |        |          |           |
--------------------------------------------------------------------------------
| Power           |       0 |       2 |      0 |      2 |        2 |         0 |
| Generation      |         |         |        |        |          |           |
--------------------------------------------------------------------------------
| Heat            |       0 |       1 |      2 |      1 |        2 |         3 |
--------------------------------------------------------------------------------
| Distribution    |       0 |       0 |      0 |      1 |        0 |        -1 |
--------------------------------------------------------------------------------
| Markets         |       0 |       0 |      0 |      0 |        0 |         0 |
--------------------------------------------------------------------------------
| Russia          |       0 |       - |      0 |      - |      244 |       244 |
--------------------------------------------------------------------------------
| Other           |       0 |       1 |      0 |      1 |        2 |         1 |
--------------------------------------------------------------------------------
| Total           |       0 |       4 |      2 |      5 |      250 |       247 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Non-recurring items mainly include capital gains and losses. The main        |
| capital gain in 2007 was gain on sale of Lenenergo shares (EUR 232 million). |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| OTHER ITEMS EFFECTING  |    Q2 |     Q2 | Q1-Q2 | Q1-Q2  |   2007 |     Last |
| COMPARABILITY BY       |  2008 |   2007 |  2008 |   2007 |        |   twelve |
| SEGMENTS               |       |        |       |        |        |   months |
| MEUR                   |       |        |       |        |        |          |
--------------------------------------------------------------------------------
| Power Generation |     |  -124 |     24 |   -88 |     -6 |     18 |      -64 |
| 1)               |     |       |        |       |        |        |          |
--------------------------------------------------------------------------------
| Heat             |     |    10 |     -4 |    17 |      1 |      2 |       18 |
--------------------------------------------------------------------------------
| Distribution     |     |     2 |      1 |     1 |      1 |      2 |        2 |
--------------------------------------------------------------------------------
| Markets          |     |    46 |      4 |    36 |      6 |     13 |       43 |
--------------------------------------------------------------------------------
| Russia           |     |     - |      - |     - |      - |      - |        - |
--------------------------------------------------------------------------------
| Other            |     |    11 |      0 |     5 |      0 |     -2 |        3 |
--------------------------------------------------------------------------------
| Total            |     |   -55 |     25 |   -29 |      2 |     33 |        2 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Including     |     |       |        |       |        |        |          |
| effects from the |     |       |        |       |        |        |          |
| accounting of    |     |       |        |       |        |        |          |
| Fortum's part of |     |       |        |       |        |        |          |
--------------------------------------------------------------------------------
| the Finnish State      |    -8 |     -4 |   -17 |     -9 |     17 |        9 |
| Nuclear Waste          |       |        |       |        |        |          |
| Management Fund with   |       |        |       |        |        |          |
| (EUR million):         |       |        |       |        |        |          |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| DEPRECIATION,       |     Q2 |     Q2 | Q1-Q2  |  Q1-Q2  |   2007 |     Last |
| AMORTISATION AND    |   2008 |   2007 |   2008 |    2007 |        |   twelve |
| IMPAIRMENT CHARGES  |        |        |        |         |        |   months |
| BY SEGMENTS         |        |        |        |         |        |          |
| MEUR                |        |        |        |         |        |          |
--------------------------------------------------------------------------------
| Power       |   |   |     25 |     26 |     49 |      52 |    103 |      100 |
| Generation  |   |   |        |        |        |         |        |          |
--------------------------------------------------------------------------------
| Heat        |   |   |     41 |     40 |     83 |      80 |    163 |      166 |
--------------------------------------------------------------------------------
| Distributio |   |   |     42 |     40 |     83 |      79 |    162 |      166 |
| n           |   |   |        |        |        |         |        |          |
--------------------------------------------------------------------------------
| Markets     |   |   |      2 |      3 |      4 |       7 |     11 |        8 |
--------------------------------------------------------------------------------
| Russia      |   |   |     22 |      - |     22 |       - |      - |       22 |
--------------------------------------------------------------------------------
| Other       |   |   |      3 |      2 |      5 |       5 |     12 |       12 |
--------------------------------------------------------------------------------
| Total       |   |   |    135 |    111 |    246 |     223 |    451 |      474 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| SHARE OF PROFITS |  Q2 2008 |     Q2 | Q1-Q2  | Q1-Q2  |   2007 |       Last |
| IN ASSOCIATES    |          |   2007 |   2008 |   2007 |        |     twelve |
| AND JOINT        |          |        |        |        |        |     months |
| VENTURES BY      |          |        |        |        |        |            |
| SEGMENTS         |          |        |        |        |        |            |
| MEUR             |          |        |        |        |        |            |
--------------------------------------------------------------------------------
| Power        |   |   |    1 |     -6 |     -7 |    -12 |    -23 |        -18 |
| Generation   |   |   |      |        |        |        |        |            |
| 1)           |   |   |      |        |        |        |        |            |
--------------------------------------------------------------------------------
| Heat         |   |   |    1 |      5 |      8 |     12 |     24 |         20 |
--------------------------------------------------------------------------------
| Distribution |   |   |    1 |      3 |     11 |      9 |     18 |         20 |
--------------------------------------------------------------------------------
| Markets      |   |   |    1 |      0 |      1 |      1 |      0 |          0 |
--------------------------------------------------------------------------------
| Russia       |   |   |   18 |      - |     18 |      - |      - |         18 |
--------------------------------------------------------------------------------
| Other        |   |   |   14 |     13 |     39 |    207 |    222 |         54 |
--------------------------------------------------------------------------------
| Total        |   |   |   36 |     15 |     70 |    217 |    241 |         94 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) The main part of the associated companies in Power Generation are     |   |
| power production companies from which Fortum purchases produced          |   |
| electricity at production costs including interest costs and income      |   |
| taxes.                                                                   |   |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| PARTICIPATIONS IN ASSOCIATES AND     |   June 30 |     June 30 |     Dec 31  |
| JOINT VENTURES BY SEGMENTS           |      2008 |        2007 |        2007 |
| MEUR                                 |           |             |             |
--------------------------------------------------------------------------------
| Power          |   |   |   |         |       802 |         775 |         806 |
| Generation     |   |   |   |         |           |             |             |
--------------------------------------------------------------------------------
| Heat           |   |   |   |         |       157 |         146 |         158 |
--------------------------------------------------------------------------------
| Distribution   |   |   |   |         |       242 |         220 |         229 |
--------------------------------------------------------------------------------
| Markets        |   |   |   |         |         8 |           9 |           8 |
--------------------------------------------------------------------------------
| Russia         |   |   |   |         |       481 |         277 |         455 |
--------------------------------------------------------------------------------
| Other          |   |   |   |         |       771 |       1 044 |       1 197 |
--------------------------------------------------------------------------------
| Total          |   |   |   |         |     2 461 |       2 471 |       2 853 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| CAPITAL            |     Q2 | Q2 2007 |  Q1-Q2  | Q1-Q2  |    2007 |    Last |
| EXPENDITURE BY     |   2008 |         |    2008 |   2007 |         |  twelve |
| SEGMENTS           |        |         |         |        |         |  months |
| MEUR               |        |         |         |        |         |         |
--------------------------------------------------------------------------------
| Power Generation   |     32 |      24 |      50 |     40 |      93 |     103 |
--------------------------------------------------------------------------------
| Heat 1)            |     78 |      65 |     169 |    109 |     309 |     369 |
--------------------------------------------------------------------------------
| Distribution 2)    |     72 |      42 |     133 |     78 |     236 |     291 |
--------------------------------------------------------------------------------
| Markets            |      2 |       1 |       3 |      2 |       3 |       4 |
--------------------------------------------------------------------------------
| Russia             |     45 |       - |      45 |      - |       - |      45 |
--------------------------------------------------------------------------------
| Other              |      4 |       4 |       8 |      7 |      14 |      15 |
--------------------------------------------------------------------------------
| Total              |    233 |     136 |     408 |    236 |     655 |     827 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| GROSS INVESTMENTS  |   |    Q2 |     Q2 | Q1-Q2  | Q1-Q2  |   2007 |    Last |
| IN SHARES BY       |   |  2008 |   2007 |   2008 |   2007 |        |  twelve |
| SEGMENTS           |   |       |        |        |        |        |  months |
| MEUR               |   |       |        |        |        |        |         |
--------------------------------------------------------------------------------
| Power         |    |   |     - |      0 |      - |      - |     52 |      52 |
| Generation    |    |   |       |        |        |        |        |         |
--------------------------------------------------------------------------------
| Heat          |    |   |     1 |      0 |     22 |     15 |     18 |      25 |
--------------------------------------------------------------------------------
| Distribution  |    |   |     0 |      0 |      0 |      0 |      1 |       1 |
--------------------------------------------------------------------------------
| Markets       |    |   |     0 |      0 |      0 |      0 |      0 |       0 |
--------------------------------------------------------------------------------
| Russia 1)     |    |   |    -2 |      - |  1 029 |      - |    245 |   1 274 |
--------------------------------------------------------------------------------
| Other         |    |   |     0 |      2 |      0 |      2 |      1 |      -1 |
--------------------------------------------------------------------------------
| Total         |    |   |    -1 |      2 |  1 051 |     17 |    317 |   1 351 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) See Note 7 Acquisitions and disposals.                                    |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| NET ASSETS BY SEGMENTS     |       June 30 |        June 30 |         Dec 31 |
| MEUR                       |          2008 |           2007 |           2007 |
--------------------------------------------------------------------------------
| Power Generation           |         5 524 |          5 657 |          5 599 |
--------------------------------------------------------------------------------
| Heat                       |         3 599 |          3 333 |          3 507 |
--------------------------------------------------------------------------------
| Distribution               |         3 330 |          3 282 |          3 239 |
--------------------------------------------------------------------------------
| Markets                    |           236 |            149 |            247 |
--------------------------------------------------------------------------------
| Russia                     |         2 329 |            305 |            456 |
--------------------------------------------------------------------------------
| Other                      |           825 |          1 052 |          1 237 |
--------------------------------------------------------------------------------
| Total                      |        15 843 |         13 778 |         14 285 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| RETURN ON NET ASSETS BY     |    Last |                              Dec 31 |
| SEGMENTS                     |  twelve |                                2007 |
| %                            |  months |                                     |
--------------------------------------------------------------------------------
| Power Generation             |    22.2 |                                19.2 |
--------------------------------------------------------------------------------
| Heat                         |     8.8 |                                 9.3 |
--------------------------------------------------------------------------------
| Distribution                 |     7.8 |                                 7.7 |
--------------------------------------------------------------------------------
| Markets                      |    14.1 |                                 6.9 |
--------------------------------------------------------------------------------
| Russia                       |    19.5 |                                66.3 |
--------------------------------------------------------------------------------
| Other                        |     1.7 |                                17.1 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| COMPARABLE RETURN ON NET ASSETS   |               Last |              Dec 31 |
| BY SEGMENTS                       |             twelve |                2007 |
| %                                 |             months |                     |
--------------------------------------------------------------------------------
| Power Generation            |     |               21.3 |                18.9 |
--------------------------------------------------------------------------------
| Heat                        |     |                7.1 |                 9.2 |
--------------------------------------------------------------------------------
| Distribution                |     |                8.3 |                 7.6 |
--------------------------------------------------------------------------------
| Markets                     |     |              -10.0 |                -0.6 |
--------------------------------------------------------------------------------
| Russia                      |     |               -1.4 |                 0.0 |
--------------------------------------------------------------------------------
| Other 1)                    |     |                5.3 |                -2.1 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) Excluding approximately EUR 180 million gain in relation to Hafslund's    |
| divestment of REC-shares Q1 2007 included in the share of profits of         |
| associates and joint ventures.                                               |
--------------------------------------------------------------------------------
| Return on net assets is calculated by dividing the sum of operating profit   |
| and share of profit of associated companies and joint ventures with average  |
| net assets. Average net assets are calculated using the opening balance and  |
| end of each quarter values.                                                  |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| ASSETS BY SEGMENTS          |    June 30 |        June 30 |           Dec 31 |
| MEUR                        |       2008 |           2007 |             2007 |
--------------------------------------------------------------------------------
| Power Generation            |      6 026 |          6 161 |            6 154 |
--------------------------------------------------------------------------------
| Heat                        |      3 976 |          3 686 |            3 928 |
--------------------------------------------------------------------------------
| Distribution                |      3 815 |          3 729 |            3 778 |
--------------------------------------------------------------------------------
| Markets                     |        794 |            496 |              630 |
--------------------------------------------------------------------------------
| Russia                      |      2 589 |            305 |              456 |
--------------------------------------------------------------------------------
| Other                       |        920 |          1 166 |            1 392 |
--------------------------------------------------------------------------------
| Assets included in Net      |     18 120 |         15 543 |           16 338 |
| assets                      |            |                |                  |
--------------------------------------------------------------------------------
| Interest-bearing            |        823 |            718 |              747 |
| receivables                 |            |                |                  |
--------------------------------------------------------------------------------
| Deferred taxes              |         42 |              4 |                3 |
--------------------------------------------------------------------------------
| Other assets                |        299 |            307 |              159 |
--------------------------------------------------------------------------------
| Cash and cash equivalents   |      1 247 |            879 |              427 |
--------------------------------------------------------------------------------
| Total assets                |     20 531 |         17 451 |           17 674 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| LIABILITIES BY SEGMENTS     |       June 30 |       June 30 |         Dec 31 |
| MEUR                        |          2008 |          2007 |           2007 |
--------------------------------------------------------------------------------
| Power Generation            |           502 |           504 |            555 |
--------------------------------------------------------------------------------
| Heat                        |           377 |           353 |            421 |
--------------------------------------------------------------------------------
| Distribution                |           485 |           447 |            539 |
--------------------------------------------------------------------------------
| Markets                     |           558 |           347 |            383 |
--------------------------------------------------------------------------------
| Russia                      |           260 |             - |              - |
--------------------------------------------------------------------------------
| Other                       |            95 |           114 |            155 |
--------------------------------------------------------------------------------
| Liabilities included in Net |         2 277 |         1 765 |          2 053 |
| assets                      |               |               |                |
--------------------------------------------------------------------------------
| Deferred tax liabilities    |         1 808 |         1 788 |          1 687 |
--------------------------------------------------------------------------------
| Other liabilities           |           853 |           395 |            390 |
--------------------------------------------------------------------------------
| Total liabilities included  |         4 938 |         3 948 |          4 130 |
| in Capital employed         |               |               |                |
--------------------------------------------------------------------------------
| Interest-bearing            |         7 501 |         5 489 |          4 893 |
| liabilities                 |               |               |                |
--------------------------------------------------------------------------------
| Total equity                |         8 092 |         8 014 |          8 651 |
--------------------------------------------------------------------------------
| Total equity and            |        20 531 |        17 451 |         17 674 |
| liabilities                 |               |               |                |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| AVERAGE NUMBER OF EMPLOYEES |       Q1-Q2  |          Q1-Q2  |          2007 |
|                             |         2008 |            2007 |               |
--------------------------------------------------------------------------------
| Power Generation            |        3 585 |           3 402 |         3 475 |
--------------------------------------------------------------------------------
| Heat                        |        2 390 |           2 313 |         2 302 |
--------------------------------------------------------------------------------
| Distribution                |        1 166 |           1 053 |         1 060 |
--------------------------------------------------------------------------------
| Markets                     |          831 |             935 |           936 |
--------------------------------------------------------------------------------
| Russia                      |        4 110 |               - |             - |
--------------------------------------------------------------------------------
| Other                       |          521 |             554 |           531 |
--------------------------------------------------------------------------------
| Total                       |       12 603 |           8 257 |         8 304 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| NUMBER OF EMPLOYEES         |      June 30 |         June 30 |        Dec 31 |
|                             |         2008 |            2007 |          2007 |
--------------------------------------------------------------------------------
| Power Generation            |        3 790 |           3 550 |         3 511 |
--------------------------------------------------------------------------------
| Heat                        |        2 517 |           2 331 |         2 279 |
--------------------------------------------------------------------------------
| Distribution                |        1 221 |           1 103 |         1 063 |
--------------------------------------------------------------------------------
| Markets                     |          817 |             969 |           935 |
--------------------------------------------------------------------------------
| Russia                      |        7 188 |               - |             - |
--------------------------------------------------------------------------------
| Other                       |          536 |             588 |           515 |
--------------------------------------------------------------------------------
| Total                       |       16 069 |           8 541 |         8 303 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 5. QUARTERLY SEGMENT INFORMATION                                             |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Extended quarterly information is available on Fortum's website              |
| www.fortum.com/investors/financial information.                              |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| QUARTERLY SALES BY     |    Q2 |    Q1 |       Q4 |     Q3 |    Q2 |      Q1 |
| SEGMENTS               |  2008 |  2008 |     2007 |   2007 |  2007 |    2007 |
| MEUR                   |       |       |          |        |       |         |
--------------------------------------------------------------------------------
| Power Generation       |   721 |   717 |      685 |    502 |   522 |     641 |
--------------------------------------------------------------------------------
| - of which internal    |    21 |    53 |        5 |     70 |    92 |     156 |
--------------------------------------------------------------------------------
| Heat                   |   284 |   493 |      439 |    186 |   252 |     479 |
--------------------------------------------------------------------------------
| - of which internal    |     - |     7 |       -1 |      4 |    11 |      24 |
--------------------------------------------------------------------------------
| Distribution           |   180 |   232 |      206 |    166 |   172 |     225 |
--------------------------------------------------------------------------------
| - of which internal    |     2 |     3 |        3 |      2 |     2 |       2 |
--------------------------------------------------------------------------------
| Markets                |   411 |   519 |      482 |    331 |   351 |     519 |
--------------------------------------------------------------------------------
| - of which internal    |    34 |    32 |       49 |     30 |    32 |      44 |
--------------------------------------------------------------------------------
| Russia                 |   152 |     - |        - |      - |     - |       - |
--------------------------------------------------------------------------------
| - of which internal    |     - |     - |        - |      - |     - |       - |
--------------------------------------------------------------------------------
| Other                  |    21 |    20 |       21 |     19 |    22 |      19 |
--------------------------------------------------------------------------------
| - of which internal    |    21 |    20 |       20 |     17 |    19 |      16 |
--------------------------------------------------------------------------------
| Netting of Nord Pool   |  -369 |  -426 |     -437 |   -221 |  -204 |    -301 |
| transactions           |       |       |          |        |       |         |
--------------------------------------------------------------------------------
| Eliminations           |   -78 |  -115 |      -76 |   -123 |  -156 |    -242 |
--------------------------------------------------------------------------------
| Total                  | 1 322 | 1 440 |    1 320 |    860 |   959 |   1 340 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| QUARTERLY OPERATING    |    Q2 |    Q1 |     Q4 |      Q3 |      Q2 |     Q1 |
| PROFIT BY SEGMENTS     |  2008 |  2008 |   2007 |    2007 |    2007 |   2007 |
| MEUR                   |       |       |        |         |         |        |
--------------------------------------------------------------------------------
| Power Generation       |   260 |   431 |    351 |     221 |     243 |    300 |
--------------------------------------------------------------------------------
| Heat                   |    37 |   130 |    121 |      -2 |      33 |    142 |
--------------------------------------------------------------------------------
| Distribution           |    51 |    86 |     51 |      50 |      53 |     79 |
--------------------------------------------------------------------------------
| Markets                |    31 |   -20 |      2 |      15 |       7 |    -12 |
--------------------------------------------------------------------------------
| Russia                 |   -33 |     0 |     12 |     232 |       - |      - |
--------------------------------------------------------------------------------
| Other                  |     2 |   -18 |    -17 |      -6 |      -9 |    -19 |
--------------------------------------------------------------------------------
| Total                  |   348 |   609 |    520 |     510 |     327 |    490 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| QUARTERLY         |         Q2 |     Q1 |     Q4 |      Q3 |     Q2 |     Q1 |
| COMPARABLE        |       2008 |   2008 |   2007 |    2007 |   2007 |   2007 |
| OPERATING PROFIT  |            |        |        |         |        |        |
| BY SEGMENTS       |            |        |        |         |        |        |
| MEUR              |            |        |        |         |        |        |
--------------------------------------------------------------------------------
| Power         |   |   |    384 |    395 |    363 |     185 |    217 |    330 |
| Generation    |   |   |        |        |        |         |        |        |
--------------------------------------------------------------------------------
| Heat          |   |   |     27 |    121 |    120 |      -3 |     36 |    137 |
--------------------------------------------------------------------------------
| Distribution  |   |   |     49 |     87 |     50 |      51 |     52 |     78 |
--------------------------------------------------------------------------------
| Markets       |   |   |    -15 |    -10 |     -1 |      11 |      3 |    -14 |
--------------------------------------------------------------------------------
| Russia        |   |   |    -33 |      - |      - |       - |      - |      - |
--------------------------------------------------------------------------------
| Other         |   |   |     -9 |    -12 |    -16 |      -6 |    -10 |    -19 |
--------------------------------------------------------------------------------
| Total         |   |   |    403 |    581 |    516 |     238 |    298 |    512 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| QUARTERLY     |     |        Q2 |     Q1 |      Q4 |      Q3 |    Q2 |    Q1 |
| NON-RECURRING |     |      2008 |   2008 |    2007 |    2007 |  2007 |  2007 |
| ITEMS BY      |     |           |        |         |         |       |       |
| SEGMENTS      |     |           |        |         |         |       |       |
| MEUR          |     |           |        |         |         |       |       |
--------------------------------------------------------------------------------
| Power      |     |     |      0 |      0 |       0 |       0 |     2 |     0 |
| Generation |     |     |        |        |         |         |       |       |
--------------------------------------------------------------------------------
| Heat       |     |     |      0 |      2 |       1 |       0 |     1 |     0 |
--------------------------------------------------------------------------------
| Distributi |     |     |      0 |      0 |       0 |      -1 |     0 |     1 |
| on         |     |     |        |        |         |         |       |       |
--------------------------------------------------------------------------------
| Markets    |     |     |      0 |      - |      -1 |       1 |     0 |     0 |
--------------------------------------------------------------------------------
| Russia     |     |     |      - |      - |      12 |     232 |     - |     - |
--------------------------------------------------------------------------------
| Other      |     |     |      0 |      0 |       1 |       0 |     1 |     0 |
--------------------------------------------------------------------------------
| Total      |     |     |      0 |      2 |      13 |     232 |     4 |     1 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| QUARTERLY      |     |        Q2 |      Q1 |     Q4 |    Q3 |    Q2 |     Q1 |
| OTHER ITEMS    |     |      2008 |    2008 |   2007 |  2007 |  2007 |   2007 |
| EFFECTING      |     |           |         |        |       |       |        |
| COMPARABILITY  |     |           |         |        |       |       |        |
| MEUR           |     |           |         |        |       |       |        |
--------------------------------------------------------------------------------
| Power       |     |     |   -124 |      36 |    -12 |    36 |    24 |    -30 |
| Generation  |     |     |        |         |        |       |       |        |
| 1)          |     |     |        |         |        |       |       |        |
--------------------------------------------------------------------------------
| Heat        |     |     |     10 |       7 |      0 |     1 |    -4 |      5 |
--------------------------------------------------------------------------------
| Distributio |     |     |      2 |      -1 |      1 |     0 |     1 |      0 |
| n           |     |     |        |         |        |       |       |        |
--------------------------------------------------------------------------------
| Markets     |     |     |     46 |     -10 |      4 |     3 |     4 |      2 |
--------------------------------------------------------------------------------
| Russia      |     |     |      - |       - |      - |     - |     - |      - |
--------------------------------------------------------------------------------
| Other       |     |     |     11 |      -6 |     -2 |     0 |     0 |      0 |
--------------------------------------------------------------------------------
| Total       |     |     |    -55 |      26 |     -9 |    40 |    25 |    -23 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| 1) Including   |     |        -8 |      -9 |     -7 |    33 |    -4 |     -5 |
| effects from   |     |           |         |        |       |       |        |
| the accounting |     |           |         |        |       |       |        |
| of Fortum's    |     |           |         |        |       |       |        |
| part of the    |     |           |         |        |       |       |        |
| Finnish State  |     |           |         |        |       |       |        |
| Nuclear Waste  |     |           |         |        |       |       |        |
| Management     |     |           |         |        |       |       |        |
| Fund with (EUR |     |           |         |        |       |       |        |
| million):      |     |           |         |        |       |       |        |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 6. FINANCIAL RISK   |    |      |       |    |        |         |       |    |
| MANAGEMENT          |    |      |       |    |        |         |       |    |
--------------------------------------------------------------------------------
The Group has not made any significant change in policies regarding risk
management during the period. Aspects of the Group's financial risk management
objectives and policies are consistent with that disclosed in the consolidated
financial statements as at and for the year ended 31 December 2007.
The tables below disclose the notional values or volumes and net fair values for
the Group's derivatives used in different areas mainly for hedging purposes.
--------------------------------------------------------------------------------
| DERIVATIVES    |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| MEUR           |        | June 30 |             June 30 |          | Dec 31  |
|                |        |    2008 |                2007 |          |    2007 |
--------------------------------------------------------------------------------
| Interest and   | Notion |     Net | Notional | Net fair | Notional |     Net |
| currency       |     al |   fair  |    value |    value |    value |   fair  |
| derivatives    |  value |   value |          |          |          |   value |
--------------------------------------------------------------------------------
| Interest rate  |  2 726 |     -11 |    3 858 |      -45 |    3 500 |     -16 |
| swaps          |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| Forward        |  4 509 |      20 |    4 701 |        8 |    4 452 |      30 |
| foreign        |        |         |          |          |          |         |
| exchange       |        |         |          |          |          |         |
| contracts      |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| Forward rate   |    686 |       0 |      540 |        0 |      741 |       0 |
| agreements     |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| Interest rate  |  2 898 |      69 |    2 839 |       -4 |    3 293 |      66 |
| and currency   |        |         |          |          |          |         |
| swaps          |        |         |          |          |          |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Electricity    | Volume |     Net |   Volume | Net fair |   Volume |     Net |
| derivatives    |        |   fair  |          |    value |          |   fair  |
|                |        |   value |          |          |          |   value |
--------------------------------------------------------------------------------
|                |    TWh |    MEUR |      TWh |     MEUR |      TWh |    MEUR |
--------------------------------------------------------------------------------
| Sales swaps    |    138 |  -2 270 |      117 |      -36 |      119 |    -651 |
--------------------------------------------------------------------------------
| Purchase swaps |    107 |   1 782 |       88 |       27 |       88 |     461 |
--------------------------------------------------------------------------------
| Purchased      |      2 |      13 |        8 |        2 |        0 |       0 |
| options        |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| Written        |      6 |     -30 |       13 |       -5 |        2 |      -1 |
| options        |        |         |          |          |          |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Oil            | Volume |     Net |   Volume | Net fair |   Volume |     Net |
| derivatives    |        |   fair  |          |    value |          |   fair  |
|                |        |   value |          |          |          |   value |
--------------------------------------------------------------------------------
|                |   1000 |    MEUR | 1000 bbl |     MEUR | 1000 bbl |    MEUR |
|                |    bbl |         |          |          |          |         |
--------------------------------------------------------------------------------
| Sales swaps    |    657 |     -21 |      990 |       -3 |      460 |      -4 |
| and futures    |        |         |          |          |          |         |
--------------------------------------------------------------------------------
| Purchase swaps |    857 |      28 |    1 325 |        5 |      795 |       9 |
| and futures    |        |         |          |          |          |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Coal           | Volume |     Net |   Volume | Net fair |   Volume |     Net |
| derivatives    |        |   fair  |          |    value |          |   fair  |
|                |        |   value |          |          |          |   value |
--------------------------------------------------------------------------------
|                |     kt |    MEUR |       kt |     MEUR |       kt |    MEUR |
--------------------------------------------------------------------------------
| Sold           |    330 |     -16 |       60 |        0 |      150 |      -1 |
--------------------------------------------------------------------------------
| Bought         |    635 |      33 |      105 |        0 |      375 |       1 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| CO2 emission   | Volume |     Net |   Volume | Net fair |   Volume |     Net |
| allowance      |        |   fair  |          |    value |          |   fair  |
| derivatives    |        |   value |          |          |          |   value |
--------------------------------------------------------------------------------
|                |  ktCO2 |    MEUR |    ktCO2 |     MEUR |    ktCO2 |    MEUR |
--------------------------------------------------------------------------------
| Sold           |  4 507 |     -40 |    3 038 |        0 |    3 101 |     -13 |
--------------------------------------------------------------------------------
| Bought         |  4 502 |      41 |    4 090 |       -1 |    3 121 |      13 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Share          | Notion |     Net | Notional | Net fair | Notional |     Net |
| derivatives    |     al |   fair  |    value |    value |    value |   fair  |
|                |  value |   value |          |          |          |   value |
--------------------------------------------------------------------------------
|                |   MEUR |    MEUR |     MEUR |     MEUR |     MEUR |    MEUR |
--------------------------------------------------------------------------------
| Share forwards |     35 |      53 |       36 |       51 |       36 |      66 |
| 1)             |        |         |          |          |          |         |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 1) Cash-settled share forwards are used as a       |          |         |    |
| hedging instrument for Fortum Group's performance  |          |         |    |
| share arrangement.                                 |          |         |    |
--------------------------------------------------------------------------------

On 20 February 2008, Fortum, the Russian Territorial Generating Company No. 1
(TGC-1) and ECF Project Ltd signed an agreement according to which Fortum will
purchase approximately 5 million tonnes of emission reduction units (ERU) from
TGC-1. The ERUs will come from Joint Implementation projects conducted at
TGC-1's production facilities during the Kyoto Period (2008-2012) of the
European Emissions Trading Scheme.
Depending on the timing of the volumes, the agreement will fully be classified
as an own use contract and valued at cost. Since the timing, volumes (and also
the market price for the ERUs) are uncertain, the agreement is treated as an own
use contract until more information is available, i.e. with no impact to income
statement or balance sheet. The ERUs purchased cover approximately half of
Fortum's annual CO2 emissions.

--------------------------------------------------------------------------------
| 7. ACQUISITIONS AND DISPOSALS                                                |
--------------------------------------------------------------------------------
Total Gross investment in subsidiary shares (see definition of key figures)
amounted to EUR 1,051 (17) million of which EUR 1,029 million represents the
acquisition of TGC-10.
In Latvia, Fortum acquired 100% of the shares in Jelgavas Kogeneracija SIA at
the end of March. The acquired company provides district heating to the city of
Jelgava. The annual heat sales are 200 GWh, the sales EUR 10 million, and the
number of employees 170. The gross investment was EUR 10 million.
In Sweden, Fortum acquired additional 11,22% shares in Hofors Energi AB. After
this acquisition Fortum's total ownership of the shares in Hofors Energi AB is
60%. The acquired company provides district heating to the Hofors area. The
annual heat sales are 130 GWh, the sales EUR 7 million, and Fortum has already
earlier taken care of operations in the company. The gross investment was EUR 3
million.
No divestments of shares in subsidiaries have taken place during the period.
Acquisition of TGC-10
In March Fortum acquired 76.49% of TGC-10 which is a Russian territorial
generating company founded in 2006 and operating in the Urals and West Siberia
region. The total installed capacity is 3,000 MW electricity and 15,800 MW heat
with an annual production of 18 TWh electricity and 27 TWh heat. The company is
committed and contractually obligated to an extensive investment plan to further
increase its electricity capacity with 2,300 MW by 2013. The contractual
obligations of TGC-10's investment programme include penalty clauses tied to the
availability of the new generating capacity. Total sales for last twelve months
in TGC-10 were EUR 590 million and operating profit was EUR 26 million based on
Q3 2007 published Interim Financial statements.
The acquisition was made through an acquisition of shares and through
participation in a share issue. On 20 March 2008 Fortum paid for 47.42% of the
shares in TGC-10 through a share issue for approximately EUR 1.3 billion. The
capital received by TGC-10 will remain in the company and will be used to
finance its committed capacity investment programme planned at EUR 2.2 billion.
On 26 March Fortum paid for an additional 29.07% of the shares in TGC-10 from
United Energy Systems of Russia (RAO UES). 29 April Fortum filed the mandatory
public tender offer to TGC-10 minority shareholders. The offer is valid from 30
April until 18 July 2008. The terms and conditions of the mandatory offer can be
viewed at Fortum's website.
The gross investment for the total transaction was EUR 1,029 million, excluding
cash in TGC-10 (mainly coming from the share issue) and including
interest-bearing liabilities in the company. The purchase price allocation is
based on a preliminary balance sheet as of 31 March 2008 of TGC-10. The fair
value adjustments are still preliminary, since all valuation effects have not
been finalised, in particular regarding potential obligations. The main changes
from Q1 2008 were changes to provisions and property, plant and equipment both
in the preliminary balance sheet of TGC-10 as of 31 March and the purchase price
allocation. The Fortum Q2 2008 Interim report includes income statement effect
from TGC-10 from 1 April 2008.

--------------------------------------------------------------------------------
| MEUR                        |             |                 |         TGC-10 |
--------------------------------------------------------------------------------
| Purchase consideration      |             |                 |                |
--------------------------------------------------------------------------------
|      Cash paid              |             |                 |          2 069 |
--------------------------------------------------------------------------------
| Direct costs relating to    |             |                 |              7 |
| the acquisition             |             |                 |                |
--------------------------------------------------------------------------------
| Total purchase              |             |                 |          2 076 |
| consideration               |             |                 |                |
--------------------------------------------------------------------------------
| Fair value of the acquired  |             |                 |          1 737 |
| assets                      |             |                 |                |
--------------------------------------------------------------------------------
| Goodwill                    |             |                 |            339 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
|                             |    Acquired |       Allocated |          Total |
--------------------------------------------------------------------------------
| Fair value of the acquired  | Book Values |     Fair Values |          Value |
| net identifiable assets:    |             |                 |                |
--------------------------------------------------------------------------------
| Cash and cash equivalents   |       1 321 |                 |          1 321 |
--------------------------------------------------------------------------------
| Property, plant and         |         596 |           1 032 |          1 628 |
| equipment                   |             |                 |                |
--------------------------------------------------------------------------------
| Other assets                |         231 |                 |            231 |
--------------------------------------------------------------------------------
| Non-interest-bearing        |        -139 |            -394 |           -533 |
| liabilities                 |             |                 |                |
--------------------------------------------------------------------------------
| Interest-bearing            |        -274 |                 |           -274 |
| liabilities                 |             |                 |                |
--------------------------------------------------------------------------------
| Net identifiable assets     |       1 735 |             638 |          2 373 |
--------------------------------------------------------------------------------
| Minority interests          |        -408 |            -228 |           -636 |
--------------------------------------------------------------------------------
| Total                       |       1 327 |             410 |          1 737 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross investment in TGC-10: |             |                 |                |
--------------------------------------------------------------------------------
| Purchase consideration      |             |                 |          2 076 |
| settled in cash             |             |                 |                |
--------------------------------------------------------------------------------
| Cash and cash equivalents   |             |                 |          1 321 |
| in subsidiaries acquired    |             |                 |                |
--------------------------------------------------------------------------------
| Cash outflow on acquisition |             |                 |            755 |
--------------------------------------------------------------------------------
| Interest-bearing debt in    |             |                 |            274 |
| subsidiaries acquired       |             |                 |                |
--------------------------------------------------------------------------------
| Total                       |             |                 |          1 029 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 8. EXCHANGE RATES                                                            |
--------------------------------------------------------------------------------

The balance sheet date rate is based on exchange rate published by the European
Central Bank for the closing date. The average exchange rate is calculated as an
average of each months ending rate from the European Central Bank during the
year and ending rate previous year.
Key exchange rates for Fortum Group applied in the accounts:
--------------------------------------------------------------------------------
| Average     | June 30 |   March |   Dec 31 |  Sept 30 |  June 30 |  March 31 |
| rate        |    2008 |      31 |     2007 |     2007 |     2007 |      2007 |
|             |         |    2008 |          |          |          |           |
--------------------------------------------------------------------------------
| Sweden      |  9.4088 |  9.4265 |   9.2475 |   9.2185 |   9.2020 |    9.1787 |
| (SEK)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Norway      |  7.9843 |  7.9998 |   8.0253 |   8.0466 |   8.1205 |    8.1563 |
| (NOK)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Poland      |  3.4926 |  3.5676 |   3.7792 |   3.8285 |   3.8439 |    3.8858 |
| (PLN)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Russia      | 36.6348 | 36.4660 |  35.0759 |  34.8320 |  34.6997 |   34.5633 |
| (RUB)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Balance     | June 30 |   March |   Dec 31 |  Sept 30 |  June 30 |  March 31 |
| sheet date  |    2008 |      31 |     2007 |     2007 |     2007 |      2007 |
| rate        |         |    2008 |          |          |          |           |
--------------------------------------------------------------------------------
| Sweden      |  9.4703 |  9.3970 |   9.4415 |   9.2147 |   9.2525 |    9.3462 |
| (SEK)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Norway      |  8.0090 |  8.0510 |   7.9580 |   7.7185 |   7.9725 |    8.1190 |
| (NOK)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Poland      |  3.3513 |  3.5220 |   3.5935 |   3.7730 |   3.7677 |    3.8668 |
| (PLN)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------
| Russia      | 36.9477 | 37.1130 |  35.9860 |  35.3490 |  34.8070 |   34.6580 |
| (RUB)       |         |         |          |          |          |           |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 9. INCOME TAX EXPENSE                                                        |
--------------------------------------------------------------------------------

Tax rate according to the income statement for the period January to June 2008
was 20.6% (18.1%). The tax rate for the period is higher than in the comparable
period 2007 mainly due to the impact of Hafslund's sale of REC shares in March
2007, which impacted the share of profits from associates for the period with
approximately EUR 180 million.
The tax rate used in the income statement is always impacted by the fact that
share of profits of associates and joint ventures is recorded based on Fortum's
share of profits after tax. The tax rate for the period calculated excluding the
share of profits from associates and joint ventures was 22.3% (23.4%).
The tax rate for the full year 2007, excluding the share of profits from
associates and Lenenergo sales gain was 22.3%.

--------------------------------------------------------------------------------
| 10. EARNINGS PER SHARE                                                       |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| The calculation of basic and diluted earnings per share is based on the      |
| following data:                                                              |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
|                            |       Q1-Q2  |        Q1-Q2  |             2007 |
|                            |         2008 |          2007 |                  |
--------------------------------------------------------------------------------
| Earnings (MEUR):           |              |               |                  |
--------------------------------------------------------------------------------
| Profit attributable to the |          695 |           753 |            1 552 |
| equity holders of the      |              |               |                  |
| Company                    |              |               |                  |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Number of shares           |              |               |                  |
| (thousands):               |              |               |                  |
--------------------------------------------------------------------------------
| Weighted average number of |              |               |                  |
| shares for the purpose of  |              |               |                  |
--------------------------------------------------------------------------------
| basic earnings per share   |      887 131 |       890 770 |          889 997 |
--------------------------------------------------------------------------------
| Effect of dilutive share   |        1 034 |         2 370 |            1 398 |
| options                    |              |               |                  |
--------------------------------------------------------------------------------
| Weighted average number of |              |               |                  |
| shares for the purpose of  |              |               |                  |
--------------------------------------------------------------------------------
| diluted earnings per share |      888 165 |       893 140 |          891 395 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 11. DIVIDEND PER SHARE                                                       |
--------------------------------------------------------------------------------
The Annual General Meeting on 1 April 2008 decided to distribute a dividend of
EUR 1.35 per share to the shareholders of which EUR 0.77 per share was paid from
Fortum's recurring earnings and EUR 0.58 per share as additional dividend in
order to steer the company's capital structure towards the target. The total
dividend was EUR 1,198 million based on the amount of shares registered as of 4
April 2008. The dividend was paid out 11 April 2008.
The Annual General Meeting on 28 March 2007 decided to distribute a dividend of
EUR 1.26 per share to the shareholders of which EUR 0.73 per share is in
accordance with the Group´s dividend policy. An additional dividend of EUR 0.53
per share was decided to steer Fortum´s capital structure towards agreed target.
The total dividend was EUR 1,122 million based on the amount of shares
registered as of 2 April 2007. The dividend was paid on 11 April 2007.

--------------------------------------------------------------------------------
| 12. CHANGES IN INTANGIBLE ASSETS AND PROPERTY, PLANT AND EQUIPMENT           |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR                       |      June 30 |        June 30 |          Dec 31 |
|                            |         2008 |           2007 |            2007 |
--------------------------------------------------------------------------------
| Opening balance            |       11 428 |         11 567 |          11 567 |
--------------------------------------------------------------------------------
| Increase through           |        1 999 |             13 |              16 |
| acquisition of subsidiary  |              |                |                 |
| companies                  |              |                |                 |
--------------------------------------------------------------------------------
| Capital expenditures       |          408 |            236 |             654 |
--------------------------------------------------------------------------------
| Capitalised borrowing      |            7 |              0 |               1 |
| costs                      |              |                |                 |
--------------------------------------------------------------------------------
| Changes of nuclear asset   |            - |              - |              25 |
| retirement cost            |              |                |                 |
--------------------------------------------------------------------------------
| Changes of emission rights |            - |             -8 |              -9 |
--------------------------------------------------------------------------------
| Disposals                  |           -3 |             -7 |             -11 |
--------------------------------------------------------------------------------
| Depreciation, amortisation |         -246 |           -223 |            -451 |
| and impairment             |              |                |                 |
--------------------------------------------------------------------------------
| Translation differences    |          -49 |           -188 |            -364 |
--------------------------------------------------------------------------------
| Closing balance            |       13 544 |         11 390 |          11 428 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 13. CHANGES IN PARTICIPATIONS IN ASSOCIATES AND JOINT VENTURES               |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR                      |         June 30 |       June 30 |         Dec 31 |
|                           |            2008 |          2007 |           2007 |
--------------------------------------------------------------------------------
| Opening balance           |           2 853 |         2 197 |          2 197 |
--------------------------------------------------------------------------------
| Share of profits of       |              70 |           217 |            241 |
| associates and joint      |                 |               |                |
| ventures                  |                 |               |                |
--------------------------------------------------------------------------------
| Investments               |               7 |             - |              1 |
--------------------------------------------------------------------------------
| Share issues and          |               1 |             - |            294 |
| shareholders'             |                 |               |                |
| contributions             |                 |               |                |
--------------------------------------------------------------------------------
| Increase through          |              35 |             - |              - |
| acquisition of            |                 |               |                |
| subsidiaries              |                 |               |                |
--------------------------------------------------------------------------------
| Reclassifications         |              -1 |             - |              - |
--------------------------------------------------------------------------------
| Divestments               |               - |             - |            -68 |
--------------------------------------------------------------------------------
| Dividend income received  |             -46 |          -169 |           -178 |
--------------------------------------------------------------------------------
| Fair value and other      |            -458 |           226 |            366 |
| changes in equity         |                 |               |                |
--------------------------------------------------------------------------------
| Closing balance           |           2 461 |         2 471 |          2 853 |
--------------------------------------------------------------------------------

Share of profits from associates and joint ventures
Share of profits from associates in Q2 EUR 36 million (2007: 15 million) mainly
represents Fortum's share of profits in Hafslund EUR 14 million (2007 : 13
million) and TGC-1 EUR 18 million. Fortum's share of profits for Q1-Q2 amounts
to EUR 70 million (2007: 217 million), of which Hafslund represents EUR 39
million (2007: 207 million). See below for accounting principles.
Investments
In Lithuania, Fortum acquired a 14.73% share in UAB Klaipedos Energija from
Stadtwerke Leipzig GmbH on 29 February 2008. Fortum now owns a 19.63% share of
the company. UAB Klaipedos Energija generates and distributes district heat to
the residents and industries in the cities of Klaipeda and Gargzdai. The net
sales of the company are around EUR 27 million, annual heat sales 1 terawatthour
(TWh) and power sales 20 gigawatthours (GWh). The investment was EUR 7 million.
Increase through acquisition of subsidiaries
Through the acquisition of TGC-10 in the end of March 2008, Fortum acquired a
shareholding in Kurgan Generating Company.
Dividends received
During Q2 2008 Fortum has received EUR 40 million in dividends from Hafslund and
Gasum. During Q2 2007 Fortum received EUR 169 million in dividends from
associates, of which EUR 145 million from Hafslund following Hafslund's
divestment of REC shares in March 2007.
Fair value and other changes in equity
Fair value and other changes in equity mainly represents the fair value change
in Hafslund's shareholding in REC. In Q2 the fair value change of the REC shares
was EUR -28 million (2007: 285 million). The fair value change of the REC shares
since year-end was EUR -437 million (2007: 359 million).
Accounting for the share of profits from Hafslund ASA
According to Fortum Group accounting policies the share of profits from Hafslund
has been included in Fortum Group figures based on the previous quarter
information since Hafslund's interim reports are published later than Fortum's
interim reports. Hafslund will publish January-June 2008 results on 17 July
2008.
When calculating the share of profits in Hafslund, Fortum has in accordance with
Fortum's accounting policies reclassified Hafslund's accounting treatment for
the shareholding in Renewable Energy Corporation (REC). Hafslund has classified
the shareholding in REC as financial assets at fair value through profit and
loss while Fortum has classified the REC shareholding as available for sale
financial assets with fair value changes recorded directly through equity, only
when Hafslund divests shares in REC, the cumulative fair value change effects
Fortum's income statement.
Since REC has been listed on the Oslo stock exchange as of 9 May 2006, Fortum is
accounting for the fair value change in REC based on the closing price on the
Oslo stock exchange at each closing date. The amount of shares is based on the
amount published by Hafslund in the previous quarter if other information is not
available.
Hafslund sold 35 million shares in REC in March 2007. In accordance with the
accounting policy Fortum recognised approximately EUR 180 million in relation to
Hafslund's divestment of REC shares as a part of the share of profits from
associates and joint ventures in Q1 2007. The cumulative fair value change in
Fortum's equity, based on the remaining number of shares reported by Hafslund,
was EUR 356 million at 30 June 2008, which represents a decrease with EUR 437
milion from 31 December 2007.
Accounting for the share of profits from TGC-1
Fortum ownes 25.7% of the shares in Territorial Generating Company 1, TGC-1.
TGC-1 was formed in late 2006 by mergers of several Russian companies. TGC-1 has
published IFRS 2007 Financial statements in June 2008. Fortum has in Q2 2008
reporting started to account TGC-1 according to the equity method as TGC-1
prepares IFRS financial statements annually. The share of profits will be
accounted for once a year in Q2 based on published IFRS Financial Statements for
the previous year.
--------------------------------------------------------------------------------
| 14. SHARE CAPITAL                                                            |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR   |   |       Number of |  Share |   Number | Share | Number of | Share |
|        |   |          shares | capita |       of | capit |    shares | capit |
|        |   |         June 30 | l June |   shares |    al |    Dec 31 |    al |
|        |   |            2008 |     30 |  June 30 |  June |      2007 |   Dec |
|        |   |                 |   2008 |     2007 |    30 |           |    31 |
|        |   |                 |        |          |  2007 |           |  2007 |
--------------------------------------------------------------------------------
| Regist |      |  886 683 058 |  3 040 |  887 393 | 3 023 |   887 393 | 3 023 |
| ered   |      |              |        |      646 |       |       646 |       |
| shares |      |              |        |          |       |           |       |
| at 1   |      |              |        |          |       |           |       |
| Januar |      |              |        |          |       |           |       |
| y      |      |              |        |          |       |           |       |
--------------------------------------------------------------------------------
| Shares        |      508 385 |      2 |    4 078 |    14 | 5 199 412 |    17 |
| subscribed    |              |        |      307 |       |           |       |
| with options  |              |        |          |       |           |       |
| and           |              |        |          |       |           |       |
| registered at |              |        |          |       |           |       |
| the end of    |              |        |          |       |           |       |
| the period    |              |        |          |       |           |       |
--------------------------------------------------------------------------------
| Cancellation  |   |        - |      - |        - |     - |    -5 910 |     - |
| of own shares |   |          |        |          |       |       000 |       |
--------------------------------------------------------------------------------
| Registered    |   |  887 191 |  3 042 |  891 471 | 3 037 |   886 683 | 3 040 |
| shares at the |   |      443 |        |      953 |       |       058 |       |
| end of the    |   |          |        |          |       |           |       |
| period        |   |          |        |          |       |           |       |
--------------------------------------------------------------------------------
| Unregistered  |   |        - |        |        - |       |    50 000 |       |
| shares        |   |          |        |          |       |           |       |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 15. INTEREST-BEARING LIABILITIES                                             |
--------------------------------------------------------------------------------

The reported interest-bearing gross debt increased during the quarter by EUR 36
million from EUR 7,465 million to EUR 7,501 million. No major new financing
transactions were made in the Group during the second quarter.
Cash decreased by EUR 990 million from EUR 2,237 million to EUR 1,247 million
including cash held by TGC-10 amounting to EUR 1,190 million. The decrease in
cash is due to dividend payment in April of EUR 1,198 million.
During the first quarter Fortum raised a syndicated loan facility of EUR 3,500
million. The loan facility is structured as a 3 year term loan of EUR 2,000
million to be used for acquisition financing of TGC-10, and as a 5 year
revolving credit facility of EUR 1,500 million to be used for general corporate
purposes. As per the end of the first quarter EUR 2,100 million of the new
facility was drawn.
The amount of re-borrowing from the Finnish State Nuclear Waste Management Fund
was increased by EUR 50 million to EUR 708 million in the first quarter. Fortum
also increased the amount of short term financing by issuing Commercial Papers
(CPs) in the Finnish and Swedish markets. During the first quarter a long term
Eurobond (originally issued in 2001) of EUR 500 million was repaid.
--------------------------------------------------------------------------------
| 16. NUCLEAR RELATED     |     |        |           |           |             |
| ASSETS AND LIABILITIES  |     |        |           |           |             |
--------------------------------------------------------------------------------
| MEUR                    |     |        |   June 30 |   June 30 |     Dec 31  |
|                         |     |        |      2008 |      2007 |        2007 |
--------------------------------------------------------------------------------
| Carrying values in the  |     |        |           |           |             |
| balance sheet:          |     |        |           |           |             |
--------------------------------------------------------------------------------
| Nuclear provisions      |     |        |       528 |       458 |         516 |
--------------------------------------------------------------------------------
| Share in the State      |     |        |       528 |       458 |         516 |
| Nuclear Waste           |     |        |           |           |             |
| Management Fund         |     |        |           |           |             |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Legal liability and actual share of    |           |           |             |
| the State Nuclear Waste Management     |           |           |             |
| Fund:                                  |           |           |             |
--------------------------------------------------------------------------------
| Liability for nuclear waste management |       816 |       685 |         816 |
| according to the Nuclear Energy Act    |           |           |             |
--------------------------------------------------------------------------------
| Funding obligation      |     |        |       698 |       649 |         698 |
| target                  |     |        |           |           |             |
--------------------------------------------------------------------------------
| Fortum's share of the State   |        |       698 |       649 |         673 |
| Nuclear Waste Management Fund |        |           |           |             |
--------------------------------------------------------------------------------
Nuclear related provisions
The provisions related to nuclear waste management, i.e. decommissioning of the
power plant and spent fuel, are based on cash-flows for future costs which are
also the basis for the legal liability. An updated cost estimate is done every
year and an updated technical plan is made every third year. The legal liability
decided by the government in January 2008 was based on an updated technical plan
and Fortum accounted for the effects based on the submitted proposal in Q3 2007.
Fortum's share in the State Nuclear Waste Management Fund
Fortum contributes funds to the State Nuclear Waste Management Fund based on the
yearly funding obligation target decided by the governmental authorities in
January each year in connection with the decision of size of the legal
liability. The fund is from an IFRS perspective overfunded with EUR 170 million,
since Fortum's share of the Fund as of 30 June 2008 is EUR 698 million and the
carrying value in the balance sheet is EUR 528 million.
Effects to comparable operating profit and operating profit
Following the updated technical plan, Fortum had in Q3 2007 a one-time effect to
Comparable operating profit of EUR -13 million in the Power Generation segment
mainly due to changes in estimated cash-flows for disposal of spent fuel. Any
costs increase which is related to already spent fuel is always recognised
immediately in Comparable operating profit.
Operating profit in Power Generation segment is affected by the accounting
principle for Fortum's share of the Finnish Nuclear Waste Management Fund, since
the carrying value of the Fund in Fortum's balance sheet can maximum be equal to
the amount of the provisions according to IFRS. As long as the Fund is
overfunded from an IFRS perspective, the effects to operating profit from this
adjustment will be positive if the provisions increase more than the Fund and
negative if actual value of the fund increases more than the provisions. This
accounting effect is not included in Comparable operating profit in Fortum
financial reporting, see Other items effecting comparability in Note 4 and 5.
Fortum had an effect from this adjustment in Q3 2007 of EUR +33 million and the
cumulative effect for the full year 2007 was EUR +17 million. The effect in Q2
2008 was EUR -8 million compared to EUR -4 million in Q2 2007. The cumulative
effect 2008 was EUR -17 million compared to EUR -9 million in 2007.
Associated companies
As disclosed in the Financial Statement 2007, Fortum has not been able to
account for the nuclear related assets and provisions according to Fortum
accounting principles for its Swedish nuclear associated companies, since the
separate cash-flow information for the provisions is not available.

--------------------------------------------------------------------------------
| 17. PLEDGED ASSETS         |               |                |                |
--------------------------------------------------------------------------------
| MEUR                       |       June 30 |        June 30 |        Dec 31  |
|                            |          2008 |           2007 |           2007 |
--------------------------------------------------------------------------------
| On own behalf              |               |                |                |
--------------------------------------------------------------------------------
| For debt                   |               |                |                |
--------------------------------------------------------------------------------
| Pledges                    |           228 |            215 |            170 |
--------------------------------------------------------------------------------
| Real estate mortgages      |           138 |             46 |            138 |
--------------------------------------------------------------------------------
| For other commitments      |               |                |                |
--------------------------------------------------------------------------------
| Real estate mortgages      |           206 |            103 |            103 |
--------------------------------------------------------------------------------
| On behalf of associated    |               |                |                |
| companies and joint        |               |                |                |
| ventures                   |               |                |                |
--------------------------------------------------------------------------------
| Pledges and real estate    |             3 |              3 |              3 |
| mortgages                  |               |                |                |
--------------------------------------------------------------------------------

Pledged assets for debt
Finnish participants in the State Nuclear Waste Management Fund are allowed to
borrow from the Fund. In Q1 2008 Fortum increased the reborrowing from the Fund
(see Note 15) and therefore pledged additional Kemijoki shares as a security.
The total amount of shares pledged, have a carrying value of EUR 208 million
(145 million) as of 30 June 2008 (and 31 December 2007 respectively).
Pledged assets for other commitments
Fortum has given real estate mortgages in Naantali and Inkoo power plants in
Finland, total value of EUR 206 million, as a security to the State Nuclear
Waste Management Fund for the uncovered part of the legal liability,
uncertainties and unexpected events.
The size of the securities given is updated yearly in Q2 based on the decisions
regarding the legal liabilities and the funding target which takes place around
year-end every year. The amount of real estate mortgages given as a security
have increased with EUR 103 million during Q2 2008.

--------------------------------------------------------------------------------
| 18. COMMITMENTS                                                              |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR                        |     June 30 |      June 30 |           Dec 31  |
|                             |        2008 |         2007 |              2007 |
--------------------------------------------------------------------------------
| Operating lease commitments |             |              |                   |
--------------------------------------------------------------------------------
| Due within a year           |          25 |           18 |                21 |
--------------------------------------------------------------------------------
| Due after one year and      |          39 |           34 |                31 |
| within five years           |             |              |                   |
--------------------------------------------------------------------------------
| Due after five years        |          93 |           72 |                69 |
--------------------------------------------------------------------------------
| Total                       |         157 |          124 |               121 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Capital commitments for the purchase of property, plant and equipment and    |
| intangible assets amounts to EUR 492 million as at 30 June 2008 (EUR 436     |
| million at year end 2007).                                                   |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 19. CONTINGENT LIABILITIES                                                   |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| MEUR                      |      June 30 |         June 30 |         Dec 31  |
|                           |         2008 |            2007 |            2007 |
--------------------------------------------------------------------------------
| On own behalf             |              |                 |                 |
--------------------------------------------------------------------------------
| Other contingent          |          849 |             162 |             224 |
| liabilities               |              |                 |                 |
--------------------------------------------------------------------------------
| On behalf of associated   |              |                 |                 |
| companies and joint       |              |                 |                 |
| ventures                  |              |                 |                 |
--------------------------------------------------------------------------------
| Guarantees                |          638 |             238 |             235 |
--------------------------------------------------------------------------------
| Other contingent          |          125 |             125 |             125 |
| liabilities               |              |                 |                 |
--------------------------------------------------------------------------------
| On behalf of others       |              |                 |                 |
--------------------------------------------------------------------------------
| Guarantees                |           10 |              14 |              10 |
--------------------------------------------------------------------------------
| Other contingent          |            1 |               1 |               1 |
| liabilities               |              |                 |                 |
--------------------------------------------------------------------------------
Other contingent liabilities on own behalf, EUR 849 million, have increased
with EUR 625 million since 31 December 2007. The reason for the increase is that
Fortum has given a guarantee to cover payments relating to the mandatory public
tender offering for TGC-10. The guarantee expires at year-end 2008.
Guarantees on behalf of associated companies
According to law, nuclear companies operating in Finland and Sweden shall give
securities to the Finnish State Nuclear Waste Management Fund and the Swedish
Nuclear Waste Fund respectively, to guarantee that sufficient funds exist to
cover future expenses of decommissioning of power plant and disposal of spent
fuel.
The guarantee given on behalf of Teollisuuden Voima Oy (TVO) to the Finnish fund
has increased from EUR 32 million at year-end 2007 to EUR 70 million during Q2
2008. The size of the guarantee is updated yearly in Q2, based on the decisions
regarding legal liability and the funding target which takes place around
year-end.
In Sweden, Fortum has given guarantees on behalf of Forsmarks Kraftgrupp AB and
OKG AB to the Swedish fund. Starting on 1 January 2008, a new law applies for
financing of future fees to the fund for spent nuclear fuel and decommisioning
of the plant. Following the implementation of the new law, the total amount of
guarantees relating to nuclear waste management in Sweden have increased from
SEK 1 841 million (EUR 196 million) at year-end 2007 to SEK 5 314 million (EUR
561 million) during Q2 2008. This amount will also apply for 2009.

--------------------------------------------------------------------------------
| 20. LEGAL ACTIONS AND OFFICIAL PROCEEDINGS                                   |
--------------------------------------------------------------------------------

In March the Finnish Market Court decision overruled the conditional decision
given by the Finnish Competition Authority in June 2006 on the acquisition of
E.ON Finland. In their ruling, the Market Court stated that the Finnish
Competition Authority had no grounds for setting conditions, because Fortum
cannot be condidered to have a dominant position in the power generation and
wholesale market. According to the Market Court, the relevant geographical
market area in power generation and wholesale consist of at least Finland and
Sweden. The Finnish Competition authority has appealed the decision to the
Supreme Administrative Court.

--------------------------------------------------------------------------------
| 21. RELATED PARTY TRANSACTIONS                                               |
--------------------------------------------------------------------------------
Related party transactions are described in the annual financial statements as
of the year ended 31 December 2007. No material changes have occurred during the
period.
The Finnish State owned 50.86% of the shares in Fortum 31 December 2007. After
the changes in amount of shares during 2008 increase in amount of shares due to
the share subscriptions under the option schemes, the Finnish state owned 50.83%
of the Company's shares at 30 June 2008.

--------------------------------------------------------------------------------
| ASSOCIATED COMPANY         |                 |               |               |
| TRANSACTIONS               |                 |               |               |
--------------------------------------------------------------------------------
| MEUR                       |         Q2 2008 |      Q2 2007  |          2007 |
--------------------------------------------------------------------------------
| Sales to associated        |              65 |            74 |           129 |
| companies                  |                 |               |               |
--------------------------------------------------------------------------------
| Interest on associated     |              17 |            13 |            26 |
| company loan receivables   |                 |               |               |
--------------------------------------------------------------------------------
| Purchases from associated  |             272 |           255 |           519 |
| companies                  |                 |               |               |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| ASSOCIATED COMPANY         |                 |               |               |
| BALANCES                   |                 |               |               |
--------------------------------------------------------------------------------
| MEUR                       |         June 30 |       June 30 |       Dec 31  |
|                            |            2008 |          2007 |          2007 |
--------------------------------------------------------------------------------
| Long-term interest-bearing |             682 |           600 |           636 |
| loan receivables           |                 |               |               |
--------------------------------------------------------------------------------
| Trade receivables          |              15 |            12 |            17 |
--------------------------------------------------------------------------------
| Other receivables          |               7 |             8 |             7 |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Long-term loan payables    |             184 |           172 |           171 |
--------------------------------------------------------------------------------
| Trade payables             |              10 |            10 |            25 |
--------------------------------------------------------------------------------
| Other payables             |              38 |            20 |            53 |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| TRANSACTIONS AND BALANCES WITH JOINT VENTURES                                |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| Transactions and balances with joint ventures as   |          |         |    |
| at and for the period ended 30 June 2008 are not   |          |         |    |
| material for the Group.                            |          |         |    |
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
| 22. EVENTS AFTER THE BALANCE SHEET DATE                                      |
--------------------------------------------------------------------------------
Fortum Corporation's Annual General Meeting AGM) was held on April 1 2008. The
AGM authorised the board of Directors to repurchase the company's own shares by
using non-restricted equity. The authorisation is valid until the next AGM. The
maximum amount of shares to be repurchased is 15 million shares for a maximum
amount of EUR 300 million.
Shares repurchased shall be cancelled by a separate decision of the Board of
Directors. Regarding the decision for dividend payment, see Note 11.
Norwegian Renewable Energy Corporation (REC) is partly owned by Fortum's
associated company Hafslund ASA. Fortum shows the fair value changes of REC in
equity. At end of June the cumulative fair value change booked in Fortum's
equity was EUR 356 million. REC's share price has decreased since the end of
June. Based on REC's closing price on 14 July the cumulative fair value change
in Fortum's equity would have been EUR 341 million.

--------------------------------------------------------------------------------
| 23. DEFINITION OF |    |      |      |     |       |         |          |    |
| KEY FIGURES       |    |      |      |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| EBITDA (Earnings  | =  | Operating profit +        |         |          |    |
| before interest,  |    | Depreciation,             |         |          |    |
| taxes,            |    | amortisation              |         |          |    |
| depreciation      |    |                           |         |          |    |
--------------------------------------------------------------------------------
| and amortisation) |    | and         |     |       |         |          |    |
|                   |    | impairment  |     |       |         |          |    |
|                   |    | charges     |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Comparable        | =  | Operating profit - non-recurring items - other |    |
| operating profit  |    | items effecting comparability                  |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Non-recurring     | =  | Mainly capital |          |         |          |    |
| items             |    | gains and      |          |         |          |    |
|                   |    | losses         |          |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Other items       | =  | Includes effects from financial            |        |
| effecting         |    | derivatives hedging future cash-flows      |        |
| comparability     |    | where hedge accounting is                  |        |
--------------------------------------------------------------------------------
|                   |    | not applied according to IAS 39 and        |        |
|                   |    | effects from the accounting of Fortum´s    |        |
|                   |    | part of the Finnish                        |        |
--------------------------------------------------------------------------------
|                   |    | Nuclear Waste Fund where the asset in the  |        |
|                   |    | balance sheet cannot exceed the related    |        |
|                   |    | liabilities                                |        |
--------------------------------------------------------------------------------
|                   |    | according to   |          |         |          |    |
|                   |    | IFRIC          |          |         |          |    |
|                   |    | interpretation |          |         |          |    |
|                   |    | 5.             |          |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Funds from        | =  | Net cash from operating activities  |          |    |
| operations (FFO)  |    | before change in working capital    |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital           | =  | Capitalised investments in property, plant and |    |
| expenditure       |    | equipment and intangible assets                |    |
--------------------------------------------------------------------------------
|                   |    | including maintenance,              |          |    |
|                   |    | productivity, growth and            |          |    |
|                   |    | investments required by legislation |          |    |
--------------------------------------------------------------------------------
|                   |    | including borrowing costs           |          |    |
|                   |    | capitalised during construction     |          |    |
|                   |    | period. Maintenance                 |          |    |
--------------------------------------------------------------------------------
|                   |    | investments expand lifetime of an   |          |    |
|                   |    | existing asset, maintain            |          |    |
|                   |    | useage/availability and/or          |          |    |
--------------------------------------------------------------------------------
|                   |    | maintains reliability. Productivity |          |    |
|                   |    | improves productivity an existing   |          |    |
|                   |    | asset. Growth                       |          |    |
--------------------------------------------------------------------------------
|                   |    | investments' purpose is to build    |          |    |
|                   |    | new assets and/or to increase       |          |    |
|                   |    | customer base within                |          |    |
--------------------------------------------------------------------------------
|                   |    | existing businesses. Legislation    |          |    |
|                   |    | investments are done at certain     |          |    |
|                   |    | point of time due to                |          |    |
--------------------------------------------------------------------------------
|                   |    | legal       |     |       |         |          |    |
|                   |    | requirement |     |       |         |          |    |
|                   |    | s.          |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gross investments | =  | Investments in subsidiary shares, shares   |        |
| in shares         |    | in associated companies and other shares   |        |
|                   |    | in available for                           |        |
--------------------------------------------------------------------------------
|                   |    | sale financial assets. Investments in          |    |
|                   |    | subsidiary shares are net of cash and grossed  |    |
|                   |    | with                                           |    |
--------------------------------------------------------------------------------
|                   |    | interest-bearing          |         |          |    |
|                   |    | liabilities in the        |         |          |    |
|                   |    | acquired company.         |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on         | =  | Profit for  |     |       |         |          | x  |
| shareholders'     |    | the year    |     |       |         |          | 10 |
| equity, %         |    |             |     |       |         |          | 0  |
--------------------------------------------------------------------------------
|                   |    | Total       |     |       |         |          |    |
|                   |    | equity      |     |       |         |          |    |
|                   |    | average     |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on capital | =  | Profit before taxes + interest and  |          | x  |
| employed, %       |    | other financial expenses            |          | 10 |
|                   |    |                                     |          | 0  |
--------------------------------------------------------------------------------
|                   |    | Capital     |     |       |         |          |    |
|                   |    | employed    |     |       |         |          |    |
|                   |    | average     |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Return on net     | =  | Operating profit + Share of profit (loss) in   | x  |
| assets, %         |    | associated companies and joint                 | 10 |
|                   |    | ventures                                       | 0  |
--------------------------------------------------------------------------------
|                   |    | Net assets  |     |       |         |          |    |
|                   |    | average     |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Comparable return | =  | Comparable operating profit + Share of profit  | x  |
| on net assets, %  |    | (loss) in associated companies                 | 10 |
|                   |    |                                                | 0  |
--------------------------------------------------------------------------------
|                   |    | and joint ventures (adjusted for IAS 39        |    |
|                   |    | effects and major sales gains or losses)       |    |
--------------------------------------------------------------------------------
|                   |    | Comparable net |          |         |          |    |
|                   |    | assets average |          |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Capital employed  | =  | Total assets - non-interest bearing            |    |
|                   |    | liabilities - deferred tax liabilities -       |    |
|                   |    | provisions                                     |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net assets        | =  | Non-interest bearing assets +              |        |
|                   |    | interest-bearing assets related to the     |        |
|                   |    | Nuclear Waste Fund -                       |        |
--------------------------------------------------------------------------------
|                   |    | non-interest bearing liabilities -         |        |
|                   |    | provisions (non-interest bearing assets    |        |
|                   |    | and liabilities do not include             |        |
--------------------------------------------------------------------------------
|                   |    | finance related items, tax and deferred    |        |
|                   |    | tax and assets and liabilities from fair   |        |
|                   |    | valuations of                              |        |
--------------------------------------------------------------------------------
|                   |    | derivatives where hedge   |         |          |    |
|                   |    | accounting is applied)    |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Comparable net    | =  | Net assets adjusted for non-interest       |        |
| assets            |    | bearing assets and liabilities arising     |        |
|                   |    | from financial derivatives                 |        |
--------------------------------------------------------------------------------
|                   |    | hedging future cash-flows where hedge          |    |
|                   |    | accounting is not applied according to IAS 39  |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest-bearing  | =  | Interest-bearing          |         |          |    |
| net debt          |    | liabilities - cash and    |         |          |    |
|                   |    | cash equivalents          |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Gearing, %        | =  | Interest-be |     |       |         |          | x  |
|                   |    | aring net   |     |       |         |          | 10 |
|                   |    | debt        |     |       |         |          | 0  |
--------------------------------------------------------------------------------
|                   |    | Total       |     |       |         |          |    |
|                   |    | equity      |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity-to-assets  | =  | Total equity   |          |         |          | x  |
| ratio, %          |    | including      |          |         |          | 10 |
|                   |    | minority       |          |         |          | 0  |
|                   |    | interest       |          |         |          |    |
--------------------------------------------------------------------------------
|                   |    | Total       |     |       |         |          |    |
|                   |    | assets      |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Net debt / EBITDA | =  | Interest-be |     |       |         |          |    |
|                   |    | aring net   |     |       |         |          |    |
|                   |    | debt        |     |       |         |          |    |
--------------------------------------------------------------------------------
|                   |    | Operating profit + Depreciation,    |          |    |
|                   |    | amortisation and impairment charges |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Interest coverage | =  | Operating   |     |       |         |          |    |
|                   |    | profit      |     |       |         |          |    |
--------------------------------------------------------------------------------
|                   |    | Net         |     |       |         |          |    |
|                   |    | interest    |     |       |         |          |    |
|                   |    | expenses    |     |       |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Earnings per      | =  | Profit for the |          |         |          |    |
| share (EPS)       |    | period -       |          |         |          |    |
|                   |    | minority       |          |         |          |    |
|                   |    | interest       |          |         |          |    |
--------------------------------------------------------------------------------
|                   |    | Average number of shares  |         |          |    |
|                   |    | during the period         |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Equity per share, | =  | Shareholder |     |       |         |          |    |
| EUR               |    | 's equity   |     |       |         |          |    |
--------------------------------------------------------------------------------
|                   |    | Number of shares excluding treasury |          |    |
|                   |    | shares at the end of the period     |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
| Last twelve       | =  | Twelve months preceding   |         |          |    |
| months            |    | the reporting date        |         |          |    |
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------