Fortum - Comprehensive Company Overview
Fortum is a Finnish multinational energy company that operates in the fields of electricity generation, transmission, and distribution, as well as district heating and cooling. With a strong presence in Northern Europe, Fortum aims to provide reliable and sustainable energy solutions to its customers while minimizing its environmental impact.
The company's primary mission is to become a leader in the transition to a low-carbon economy by developing and implementing innovative energy solutions that meet the changing needs of its customers. Fortum's core values include a commitment to safety, reliability, and sustainability, as well as a focus on innovation and customer satisfaction.
Fortum offers a range of key products and services, including electricity generation and transmission, district heating and cooling, and energy efficiency solutions. The company's electricity generation business provides renewable energy sources such as wind and hydro power, while its district heating and cooling business delivers sustainable heat and cooling solutions to homes and businesses.
Fortum's energy efficiency solutions help customers reduce their energy consumption and costs, while also minimizing their environmental impact. The company's innovative technologies and services enable customers to optimize their energy use and reduce their reliance on fossil fuels.
Fortum is committed to becoming a leader in the transition to a low-carbon economy by developing and implementing innovative energy solutions that meet the changing needs of its customers. With a strong focus on sustainability, safety, and customer satisfaction, Fortum is well-positioned for long-term success and growth.
Key Products/Services
Fortum's key products and services include:
Electricity generation and transmission: Fortum generates and transmits electricity from renewable sources such as wind and hydro power, providing reliable and sustainable energy solutions to its customers.
District heating and cooling: Fortum delivers sustainable heat and cooling solutions to homes and businesses, reducing greenhouse gas emissions and improving air quality.
Energy efficiency solutions: Fortum offers innovative technologies and services that help customers reduce their energy consumption and costs, while also minimizing their environmental impact.
Mission and Values
Fortum's primary mission is to become a leader in the transition to a low-carbon economy by developing and implementing innovative energy solutions that meet the changing needs of its customers. The company's core values include:
Safety: Fortum prioritizes the safety of its employees, customers, and the environment.
Reliability: Fortum is committed to providing reliable and sustainable energy solutions to its customers.
Sustainability: Fortum aims to minimize its environmental impact while promoting sustainable development and reducing greenhouse gas emissions.
Innovation: Fortum invests in research and development to stay ahead of the curve in terms of innovative energy solutions and technologies.
Customer satisfaction: Fortum prioritizes customer satisfaction and strives to provide personalized and tailored energy solutions that meet the unique needs of each customer.
Risk Analysis
Fortum operates in a competitive energy market with various risks, including:
Market volatility: The energy market is subject to price volatility, which can impact Fortum's revenue and profitability.
Regulatory changes: Changes in regulations and policies can impact Fortum's operations and profitability.
Competition: Fortum faces intense competition from other energy companies, which can impact its market share and pricing power.
Environmental risks: Fortum is exposed to environmental risks, including climate change and natural disasters, which can impact its operations and profitability.
Valuation
| 2022 | 2023 | 2024 | 2025 | 2026 (e) | 2027 (e) | 2028 (e) | |
|---|---|---|---|---|---|---|---|
| Number of Shares (million) | 897.3 | 897.3 | 897.3 | 897.3 | 897.3 | 897.3 | 897.3 |
| Target Valuation (MEur) | 35166.3 | 19874.8 | 15683.2 | 13189.0 | 10485.3 | 7613.7 | 7613.7 |
| Target Price | 39.19 | 22.15 | 17.48 | 14.7 | 11.69 | 8.49 | 8.49 |
| Potential, % | 152.2 | 69.6 | 27.8 | -18.4 | -50.0 | -63.7 | -63.7 |
| Recommendation | Buy | Buy | Buy | Hold | Sell | Sell | Sell |
| MCAP (MEur) | 13943.5 | 11718.3 | 12274.6 | 16168.7 | 20987.0 | 20987.0 | 20987.0 |
| Price | 15.54 | 13.06 | 13.68 | 18.02 | 23.39 | 23.39 | 23.39 |
| EV | 15027.0 | 12660.0 | 12642.0 | 17648.0 | 22363.0 | 21289.0 | 20134.0 |
| P/S | 0.16 | 1.67 | 2.12 | 3.24 | 3.91 | 4.4 | 4.44 |
| EV/S | 0.17 | 1.81 | 2.18 | 3.54 | 4.16 | 4.46 | 4.26 |
| EV/EBIT | 11.55 | 6.89 | 11.0 | 19.94 | 26.27 | 34.67 | 48.39 |
| P/E | 17.17 | 7.18 | 10.91 | 22.46 | 29.43 | 42.72 | 63.05 |
| P/B | 1.8 | 1.39 | 1.35 | 1.89 | 2.52 | 2.38 | 2.29 |
| P/OCF | -45.57 | 6.44 | 8.82 | 19.25 | 15.91 | 13.25 | 12.61 |
| EV/OCF | -49.11 | 6.96 | 9.08 | 21.01 | 16.96 | 13.44 | 12.1 |
| P/FCF | 4.64 | 3.6 | 6.15 | 71.23 | 24.75 | 19.54 | 18.18 |
| EV/FCF | 5.0 | 3.89 | 6.33 | 77.74 | 26.37 | 19.82 | 17.44 |
Income Statement
| 2022 | 2023 | 2024 | 2025 | 2026 (e) | 2027 (e) | 2028 (e) | |
|---|---|---|---|---|---|---|---|
| Revenue | 86748.0 | 6998.0 | 5799.0 | 4989.0 | 5372.2 | 4769.2 | 4728.5 |
| Rev. Growth, % | -22.8 | -91.9 | -17.1 | -14.0 | 7.7 | -11.2 | -0.9 |
| Ebit | 1301.0 | 1838.0 | 1149.0 | 885.0 | 851.2 | 614.0 | 416.0 |
| Ebit Growth, % | -48.2 | 41.3 | -37.5 | -23.0 | -3.8 | -27.9 | -32.2 |
| Ebit, % | 1.5 | 26.3 | 19.8 | 17.7 | 15.8 | 12.9 | 8.8 |
| Profit | 812.0 | 1633.2 | 1125.4 | 719.8 | 713.2 | 491.2 | 332.8 |
| EPS | 0.9 | 1.82 | 1.25 | 0.8 | 0.79 | 0.55 | 0.37 |
| Profit Growth, % | -71.1 | 101.1 | -31.1 | -36.0 | -0.9 | -31.1 | -32.2 |
| Profit, % | 0.9 | 23.3 | 19.4 | 14.4 | 13.3 | 10.3 | 7.0 |
Balance Sheet
| 2022 | 2023 | 2024 | 2025 | 2026 (e) | 2027 (e) | 2028 (e) | |
|---|---|---|---|---|---|---|---|
| Inventory | 465.0 | 452.0 | 420.0 | 512.0 | 510.8 | 559.6 | 627.0 |
| Acc. Receivable | 1767.0 | 1286.0 | 1007.0 | 889.0 | 806.7 | 789.0 | 771.6 |
| Cash | 3919.0 | 4183.0 | 4136.0 | 2903.0 | 2474.0 | 3548.1 | 4702.7 |
| Equity | 7737.0 | 8439.0 | 9074.0 | 8539.0 | 8323.2 | 8814.4 | 9147.3 |
| ROE, % | 10.5 | 19.4 | 12.4 | 8.4 | 8.6 | 5.6 | 3.6 |
| ROCE, % | 10.2 | 13.6 | 8.5 | 6.8 | 7.0 | 4.8 | 3.2 |
| Net Debt | 1084.0 | 942.0 | 367.0 | 1479.0 | 1376.0 | 301.9 | -852.7 |
| Gearing, % | 14.0 | 11.2 | 4.0 | 17.3 | 16.5 | 3.4 | -9.3 |
| Equity ratio, % | 32.7 | 45.0 | 52.4 | 51.9 | 54.4 | 60.2 | 65.1 |
| Acc. Payable | 1657.0 | 1181.0 | 956.0 | 826.0 | 486.2 | 273.7 | 156.4 |
| Total Assets | 23642.0 | 18739.0 | 17307.0 | 16444.0 | 15295.9 | 14653.9 | 14055.7 |
| ROA, % | 3.4 | 8.7 | 6.5 | 4.4 | 4.7 | 3.4 | 2.4 |
Cash Flow
| 2022 | 2023 | 2024 | 2025 | 2026 (e) | 2027 (e) | 2028 (e) | |
|---|---|---|---|---|---|---|---|
| Operating Cash Flow | -306.0 | 1820.0 | 1392.0 | 840.0 | 1318.7 | 1583.6 | 1664.1 |
| Investment Cash Flow | 3312.0 | 1434.0 | 604.0 | -613.0 | -470.8 | -509.5 | -509.5 |
| Free Cash Flow | 3006.0 | 3254.0 | 1996.0 | 227.0 | 848.0 | 1074.1 | 1154.6 |
| OCF/CAPEX | 0.0 | 0.0 | 0.0 | 1.37 | 2.8 | 3.11 | 3.27 |
| Financial Cash Flow | -7268.0 | -2641.0 | -2043.0 | -1461.0 | -1253.0 | 0.0 | 0.0 |
Disclaimer
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