President and CEO Pekka Lundmark:
(text from Fortum January-June Half-Year Financial Report 2018)
"In September 2017, we announced our intention to launch an offer to become the largest shareholder in Uniper. Since then we have worked persistently to achieve this target. The final regulatory clearances were granted in mid-June, and on 26 June 2018, we closed our offer, thereby becoming the largest shareholder with a 47.35% stake in Uniper.
As Uniper’s largest shareholder we will be a committed, long-term and active partner to the company – to the benefit of all stakeholders. It is fair to say that the process leading up to this day has not been without challenges. Now is the time to reset our relationship with Uniper, and we have reinitiated discussions with Uniper leadership on how to best achieve this. As an initial concrete measure, we have nominated Markus Rauramo, the CFO of Fortum, to join the Supervisory Board of Uniper.
The second quarter was positive for Fortum also in other respects. Following the strong development in the first quarter, market prices continued to evolve favourably with clearly increasing power and emission prices. This is positive for Fortum, which is also reflected in our improved hedging prices for the rest of 2018 and next year.
The increased prices and successful production optimisation clearly boosted the results of the Generation segment and consequently the Fortum Group. The results of City Solutions were a disappointment, with the warm weather reducing heat volumes. The weaker result in our recycling and waste business also burdened the results.
Since the Uniper investment has tightened our balance sheet, our intention is to prioritise our capital expenditure and focus on cash flow optimisation, as we already announced in our first-quarter interim report. These measures are proceeding well. In the second quarter, we focused on efficiency improvements, divested our 10% minority ownership in Hafslund Produksjon, and restructured parts of our renewables portfolio, all actions that clearly contribute to strengthening our cash flow.
In June we agreed to sell the majority of our 185-MW solar power production capacity in India in order to free up capital for further investments. Only three weeks later we won the right to build 250 MW of new solar power in India. We are continuing our renewables investments also in Russia. In June we won the right to build 110 MW of solar power and, together with our partner Rusnano, 823 MW of wind power. All of this is part of our ‘capital recycling‘ strategy, by which we intend to use partnerships and other forms of cooperation to create a more asset-light structure and thereby enable more investments into building new renewable capacity."