FORTUM – For a cleaner world

Investor / Analyst material February 2019 Disclaimer

This presentation does not constitute an invitation to underwrite, subscribe for, or otherwise acquire or dispose of any Fortum shares. Past performance is no guide to future performance, and persons needing advice should consult an independent financial adviser. Any references to the future represent the management’s current best understanding. However the final outcome may differ from them.

2 Content

Fortum today 4 – 20 European and Nordic power markets 21 – 30 Fortum’s nuclear fleet 31 – 34 Russia 35 – 37 Thermal capacity in Russia 37 Historical achieved prices 38 Interim Report Jan-Sep 2018 39 – 63 Debt portfolio as of 30.9.2018 64 IR contacts 65

3 Appr. 123,000 shareholders

• Power and heat company in the Nordic Finnish households countries, Russia, Poland and the Baltics 9.5% Financial and • Listed at the Helsinki Stock Exchange insurance institutions 1.6% since 1998 Other Finnish • Among the most traded shares on investors the Nasdaq Helsinki stock exchange 7.3% Finnish • Market cap ~17 billion euros State 50.8%

Foreign investors 30.8%

31 December 2018 4 Capital returns: 2018 EUR 1.10 per share ~ EUR 1 billion*

Fortum’s dividend policy is based on 5 year dividend per share (EUR) history the following preconditions: • The dividend policy ensures that shareholders receive a fair remuneration for their entrusted capital, supported 1,4 1.3 by the company’s long-term strategy that aims at * increasing earnings per share and thereby the dividend. 1,2 0,2 1.1 1.1 1.1 1.1 • When proposing the dividend, the Board of Directors 1,0 1.1 looks at a range of factors, including the macro 0,8 environment, balance sheet strength as well as future investment plans. 0,6

Fortum's target is to pay a stable, sustainable 0,4 and over time increasing dividend of 50-80% of 0,2

earnings per share excluding one-off items 0,0 Fortum has since 1998 annually paid dividends in 2014 2015 2016 2017 2018

total ~15,557 MEUR 37% 24% 196% 112% 116%

*The BoD proposal for the AGM 5 Positioning Fortum for the decade of electricity – For a cleaner world

Illustrative Profitability

4. Build options for significant new businesses

3. Drive focused growth in the power value chain

Increasing uncertainty

2. Ensure value creation from investments and portfolio optimisation

Competitive 1. Pursue operational excellence benchmark portfolio and increased flexibility

Time Today 2020’s 2030’s

6 Fortum’s strategic priorities in a changing energy market

1. Pursue operational excellence and 2. Ensure value creation from investments increased flexibility and portfolio optimisation

• Ensure benchmark performance • Increase shareholder value from Uniper • Focus on cash flow and efficient use of • Optimise portfolio to fit the changing business balance sheet environment

3. Drive focused growth in the power 4. Build options for significant value chain new businesses

• Grow in CO2-free power generation • Create new sizeable profit contributor • Develop value-adding offerings and independent of power prices solutions for customers • Build on industrial logic and synergies with current businesses and competences

7 Our strategic route

Skandinaviska Birka Energi Länsivoima Elnova Østfold Elverk 50% Fortum →100% 50% → 100% 50% Stockholm Gullspång merged Shares in Hafslund Gullspång with Stockholm Energi Stora Kraft Birka Energi TGC-1 E.ON Divestment 50% → 100% established Finland of Lenenergo Shares in shares Länsivoima Lenenergo shares → Lenenergo Oil business 45% → District heating spin-off TGC-10 65% IVO FORTUM in Poland →

NESTE 1996 1997 1998 2000 2002 2003 2005 2006 2007 2008

2011 2012 2014 2015 2016 2017 2018

Divestment of Divestment of Divestment of electricity Divestment of DUON Nordkraft wind power ​​Shares in Uniper heat operations non-strategic distribution business electricity distribution outside of heat business business Stockholm Ekokem Restructuring Divestment of Divestment of electricity ownership in Hafslund ownership in distribution and heat businesses Hafslund Produksjon Divestment of Divestment of Turebergs ​​Russian wind power JV Fingrid shares small scale hydro Divestment of Grangemouth Recycling power plant

Divestment of Gasum shares

8 Our current geographical presence

NORDIC COUNTRIES RUSSIA KEY FIGURES 2018 Power generation PAO Fortum Sales EUR 5.2 bn 43.5 TWh Comparable Heat sales Power generation operating profit EUR 1.0 bn 5.9 TWh 29.5 TWh Balance sheet EUR 22 bn Electricity customers Heat sales Personnel 8,300 2.4 million 20.7 TWh

POLAND BALTIC COUNTRIES Power generation Power generation 0.6 TWh 0.7 TWh Heat sales Heat sales 3.5 TWh 1.4 TWh

9 Still a highly fragmented Nordic power market Fortum has largest electricity customer base in the Nordics

Power generation in 2017 Electricity retail 402 TWh 15 million customers >350 companies ~350 companies

Vattenfall Others Fortum

Others Vattenfall 37% Statkraft 52% Ørsted

E.ON BKK Fjordkraft Ørsted Fortum Agder Energi SEAS-NVE Norsk Hydro Uniper Helen SE-Syd Energi PVO E-CO Energi Din El, Göteborg Jämtkraft

10 Source: Fortum, company data, shares of the largest actors, pro forma 2017 figures Fortum mid-sized European power generation player; major producer in global heat

Power generation Heat production Customers

Largest producers in Europe and Russia, 2016 Largest global producers, 2016 Electricity customers in EU, 2016 TWh TWh Millions

EDF Gazprom Enel RWE T Plus Rosenergoatom Inter RAO UES EDF Enel Veolia RWE Gazprom RusHydro Uniper EDF E.ON RusHydro Sibgenco Iberdrola ENGIE EuroSibEnergo Inter RAO UES Fortum CEZ Vattenfall Quadra DEI NNEGC Energoat. Vattenfall Centrica Iberdrola Beijing DH Fortum TGC-2 EDP EPH SIBECO ENGIE EuroSibEnergo KDHC Statkraft Vattenfall CEZ Minskenergo T Plus Lukoil EnBW PGE PGE PGE EnBW Tatenergo EDP DTEK SSE DTEK PGNiG Tauron EPS Ørsted Gas Natural E.ON Stockholm Exergi Fenosa Sibgengo CEZ Fortum Verbund TGC-14 DEI Helen Ørsted 0 100 200 300 400 500 600 0 20 40 60 80 100 120 140 0 10 20 30 40

11 Source: Company information, Fortum analyses, 2016 figures pro forma Biggest nuclear and hydro generators in Europe and Russia

1) Formerly Natural Gas Fenosa 12 Source: Company information, Fortum analyses, 2016 figures pro forma Fortum in the Nordic electricity value chain

Large customers Nordic wholesale market Power Retail generation customers

Power exchange and Private customers, bilateral agreements small businesses

13 Fortum's power and heat production by source

Fortum's power generation in 2018 Fortum's heat production in 2018

Natural gas 38% Natural gas 64%

Solar 0.5% Total Total Nuclear Waste 0.5% generation Others 1% production Wind 1% power Peat 1% Biomass 1% 74.6 TWh 30% Heat pumps, 29.8 TWh Coal 3% electricity 3% Waste 7%

Biomass 8% Hydropower 26% Coal 16%

Note: Fortum’s power generation capacity 13,724 MW and heat production capacity 15,009 MW

14 Fortum's European power and heat production by source

Fortum's European power generation in 2018 Fortum's heat European production in 2018

Nuclear power 50% Coal 28%

Biomass 24% Natural gas 1% European European Wind 1% generation Others 2% production Waste 1% 44.7 TWh 9.4 TWh Biomass 2% Peat 4% Coal 2% Natural gas 10%

Heat pumps, Hydropower 43% electricity 10% Waste 22%

Note: Fortum’s European power generation capacity 8,811 MW and heat production capacity 4,780 MW

15 Fortum’s Nordic, Baltic and Polish generation capacity

GENERATION CAPACITY MW NORWAY MW FINLAND MW Hydro 4 672 Price areas Hydro 1 548

Nuclear 2 819 NO4 SE1 NO4, Wind 82 Nuclear 1 485 CHP 785 NO1, CHP 20 CHP 451 Other thermal 376 Generation capacity 102 Other thermal 376 SE2 Wind 159 Generation capacity 3 860 NO3 FI Nordic, Baltic and Polish generation capacity 8 811 NO5 NO1 SWEDEN MW BALTICS AND Figures 31 December 2018 Price areas POLAND MW NO2 SE3 Generation capacity, CHP EE SE2, Hydro 1 550 SE2, Wind 75 in Estonia 49

LV SE3, Hydro 1 574 in Latvia 34 SE4 DK1 SE3, Nuclear 1 334 in Lithuania 20 LT SE3, CHP 9 DK2 in Poland 186 Generation capacity 4 542 PL in Latvia, Wind 2 Associated companies’ plants (not included in the MWs) Stockholm DENMARK, DK2 MW Exergi (Former Fortum Värme), Stockholm; TSE, Naantali Generation capacity, CHP 16

16 Fortum a forerunner in sustainability

We engage our customers and society to drive the change towards a cleaner world. Our role is to accelerate this change by reshaping the energy system, improving resource efficiency and providing smart solutions. This way we deliver excellent shareholder value. Fortum is listed in several sustainability indexes and ratings: • CDP Climate Change • STOXX Global ESG Leaders • ECPI® • ISS-oekom Corporate Rating • Euronext Vigeo Eurozone 120 and Euronext Vigeo Europe 120 • MSCI • OMX Sustainability Finland Index • Equileap Gender Equality

17 Fortum's carbon exposure among the lowest in Europe

g CO2/kWh electricity, 2017

974 879 2018 57% of Fortum's total power generation CO2-free 96% of Fortum’s power generation in the EU CO2-free 682

525 476 456 443 411 407 362 307 307 FORTUM 286 TOTAL Average 290

181 174 166 FORTUM 151 139 EU 78 70 52 41 28 13

DEI EPH RWE EDP Uniper A2A CEZ Enel Naturgy EnBW Drax SSE Engie Vattenfall Eneco Ørsted Iberdrola EDF PVO E.ON Verbund Statkraft

Note: All figures, except “Fortum total”, include only European power generation. . 18 Source: PwC, December 2018, Climate Change and Electricity, Fortum Fortum is growing towards gigawatt scale target in solar and wind power production PORTFOLIO TECHNOLOGY STATUS CAPACITY FORTUM SUPPLY STARTS/ Ånstadblåheia 50 MW MW SHARE, MW STARTED NORWAY 179 179 Sørfjord 97 MW Nygårdsfjellet Wind Operational 32 32 2006 and 2011 Blaiken 37 MW (Fortum share) Ånstadblåheia Wind Operational 50 50 Q4 2018 Solberg 38 MW Ulyanovsk-2 25 MW Sørfjord Wind Under construction 97 97 2019 (Fortum share) (Fortum share) SWEDEN 323 75 Blaiken Wind Operational 248 37 (15%) 2017* Nygårdsfjellet Ulyanovsk 35 MW solar power plants Solberg Wind Operational 76 38 (50%) 2018 32 MW 35 MW RUSSIA 2 003 1 092 Bugulchansk Solar Operational 15 15 2016-2017 Pleshanovsk Solar Operational 10 10 2017 Grachevsk Solar Operational 10 10 2017 Solar Under development 110 110 2021-2022 Bhadla 32 MW (Fortum share) Ulyanovsk Wind Operational 35 35 2018 Ulyanovsk-2 Wind Operational 50 25 (50%) 1.1.2019 Amrit 2 MW (Fortum share) Rusnano JV Wind Under construction 200 100 (50%) H1 2020 Rusnano JV Wind Under development 1 573 787 (50%) 2018-2023 Kapeli 5 MW (Fortum share) INDIA 435 335 Amrit Solar Operational 5 2 (46%) 2012 Kapeli Solar Operational 10 5 (46%) 2014 First focus markets Bhadla Solar Operational 70 32 (46%) 2017 Operating wind power plants Pavagada 46 MW Pavagada Solar Operational 100 46 (46%) 2017 Operating solar power plants (Fortum share) Pavagada Solar Under development 250 250 2019 TOTAL 2 941 1 681 Projects under construction PORTFOLIO Under development 1 683 897 Under construction 597 447 Operational 661 337

19 *) Blaiken last stage IV inaugurated in 2017. NOTE: Table numbers not accounting; tells the size of renewables projects. All not consolidated to Fortum capacities. All figures in MW and rounded to nearest megawatt. Additionally, target to invest 200 – 400 million euros in India solar and create partnership for operating assets. Under construction includes investment decisions made The decades of electricity will affect several sectors – and Fortum is well positioned for decarbonisation

Global climate Electricity demand challenge (indicative) (2018-2050) Sector Future solutions, examples Fortum’s current offering, examples

CO -free generation, hydrogen, Power 2 Nuclear, hydro, solar, wind batteries, demand response

4°C + Electric vehicles, E-mobility, Transport hydrogen/biofuels for heavy transport pyrolysis

Low-CO DH/CHP, Biofuel, Heating & cooling 2 heat pumps, hydrogen waste-to-energy DH/CHP

Electrified processes, hydrogen, Industry B2B solutions 1.5°C +++ resource efficiency, CCS

Recycling, Other Plastic recycling biomaterials (e.g. fractioning)

DH/CHP = District heating/combined heat and power CCS = Carbon capture and storage

20 Europe needs to eliminate CO2 emissions to reach climate goals

77,000 000

66,000 000

Greenhouse gas emissions .)

eq 55,000 000 2

Coal Power (MtCO 44,000 000 - 40% (minimum targets from 1990 level) 33,000 000 Transport1 Oil

emissions Energy-related - 60% Buildings2 emissions 22,000 000 Gas

Industry3 European 11,000 000 - 80% Other4 EU 2050 roadmap target Other - 95% 00 -100% 1990 1995 2000 2005 2010 TODAY2015 2020 2025 2030 2035 2040 2045 2050

1 including international aviation and marine 2 residential and commercial heating & cooling 21 3 iron & steel and chemicals are among the biggest contributors 4 non-energy related emissions: industrial processes and product use, waste management, agriculture, fugitive emissions Source: IEA World Energy Outlook 2017, Eurostat, Eurelectric, Fortum Industrial Intelligence Building the utility of the future

FUTURE UTILITY Hydrogen and methane for Power-to-Gas traffic and industrial use Sustainable materials

• Sustainable hydrogen Hydrogen, methane • Recycling production and excess heat Electricity • Energy recovery • Synthetic “clean” gas production UTILITY TODAY

Electricity Decarbonising Decarbonising Raw CO2 power generation heat production material

CO -sink Bio economy 2 Customer solutions Heat • Carbon capture and • Traffic fuels storage • Bio-based material • Carbon capture and Electricity Electricity production utilisation Heat

22 Market coupling milestones – Cross-border power flows optimised by power exchanges

• Day-ahead market coupling between NL, BE and FR since 2006 2014 • Germany – Nord Pool coupling started 11/2009 2018-2020 • Market coupling for Central Western Europe (DE, FR, NL, BE) since 11/2010 with 2015 a continued coupling with Nord Pool. NorNed (NO-NL) and BritNed (UK-NL) included in 2011 • Nord Pool price area for Estonia in 2010, Lithuania in 2012 and Latvia in 2013. Poland coupled with Nord Pool since 2010 2010- • Czech, Slovakia and Hungary coupled together since 2012. Romania joined in 2014 2013 • A common market coupling for the whole western Europe was started in 2014. Italy and Slovenia joined in 2015, Croatia in June 2018 and Ireland in October 2018 2009 • Flow-based cross-border capacity allocation for further trade optimisation taken into use in May 2015 for the CWE region. Nordic flow-based implementation is planned for 2021 2012-2014 • CEE (Central Eastern Europe) market coupling region to join possibly in 2020 with flow-based capacity allocation. Switzerland waiting for agreement with the EU • In addition to day-ahead coupling, European-wide intraday market coupling has started with Nordic, Baltic and Continental western European markets in June 2018. Intraday coupling further to central eastern Europe is planned for summer 2019 • Balancing market integration under development as well, based on both regional projects and the EU Guideline on Electricity Balancing, in force since 18 December 2017

23 Current transmission capacity from Nordic area is over 6,000 MW

COUNTRIES TRANSMISSION CAPACITY MW From Nordics To Nordics Denmark - Germany 2,225 2,100 Sweden - Germany 615 615 Sweden - Poland 600 600 Sweden - Lithuania 700 700

Norway - Netherlands 723 723 320 Finland - Estonia 1,016 1,016 Finland - Russia 320 1,300 1,016 Total 6,199 7,054 700 723 • Theoretical maximum in transmission capacity ~40 TWh per annum, but restrictions especially between DK & DE 2,225 • Net export from the Nordic area to Continental Europe and Baltics 600 during the year 2018 was 10 TWh 615 • Net export during the relatively wet year 2017 was 15 TWh • Approximately 25 TWh of net export is now reachable

24 Nordic, Baltic, Continental and UK markets are integrating – Interconnection capacity will double by end-2023

The Northern Seas Offshore Grid and the Baltic New interconnections will double the Energy Market Integration Plan are included as Nordic export capacity to over 12,000 MW priority electricity corridors in EU’s Infrastructure by end-2023 Guidelines, approved in April 2013 New internal Nordic grid investments provide 1 Two 1,400 MW NO-UK links as EU Projects of for increased available capacity for export to Common Interest: NSL to England due to be the Continent and Baltics ready in 2021, NorthConnect to Scotland under 6 EU’s Connecting Europe Facility co-financing 3rd debate in Norway and not yet permitted EE-LV transmission line, due to be ready in 2020 2 1,400 MW NordLink as first direct NO-DE link is 7 Baltic synchronisation roadmap in June 2018 1 due to start commercial operation in March 2021 prioritised a DC sea cable as the required 6 2 additional PL-LT interconnection by 2025 3 1,400 MW DK-UK Viking Link has got its final permits and is to be built by end-2023 3 8 Svenska Kraftnät and 50Hertz signed 1/2017 8 a cooperation agreement on building the 700 MW 7 4 700 MW COBRAcable from DK to NL is due to Hansa PowerBridge DC link between Sweden 4 5 9 be ready during Q3/2019 and Germany by 2025/26 9 New 400 MW Zealand – DE connection via 5 Jutland – DE capacity will grow by 860 MW by end- Kriegers Flak offshore wind area ready in Q3/2019 2020, with further 1,000 MW increase by end-2023 New interconnectors New Nordic lines Existing interconnectors

25 Nordic year forwards

Year 20Year10 Year Year1119 YearYear12 10 YearYear13 11 YearYear14 12 Year15Year 13 Year16Year 14 Year17Year 15 Year18Year 16 Year19Year 17 Year20Year 18

€/MWh 29 January 2019

70 Year19 Year20

60

50

Nov Dec Jan 2018 2018 2019 40

30

20

10

0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

26 Source: Nasdaq Commodities, Bloomberg Wholesale power prices

EUR/MWh Spot prices Forward prices 100100

9090

8080

7070

6060 German

5050 Nordic 4040 Russian* 3030

2020

1010

29 January 2019 00 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

* Including weighted average capacity price

27 Source: Nord Pool, Bloomberg Finance LP, ATS, NP “Market Council”, Fortum Power Generation in the Baltic Rim in 2017 (2016)

Hydro NORDICS BALTICS Nuclear Sweden 2017 TWh % TWh % Fossil fuel 159 TWh Biomass (152) Hydro *221 55 6 25 Waste Wind Finland Nuclear 85 21 - - 65 TWh Solar (66) Others Norway Fossil fuel 26 7 12 55 149 TWh (149) Biomass 24 6 2 9 Estonia 11 TWh (10) Waste 4 1 0 1

Denmark Wind 40 10 2 10 29 TWh (29) Latvia 7 TWh (6) Solar 1 0 0 0 Lithuania 4 TWh (4) Others 1 0 0 0

Germany Total generation 402 100 22 100 602 TWh Net export Net import (610) Poland 9 TWh 6 TWh 158 TWh (154) *) Normal annual Nordic hydro generation 200 TWh, variation +/- 40 TWh.

Source: ENTSO-E Statistical Factsheet 28 Graph sizes are illustrative. Northern European conventional capacity decreasing

DATE CAPACITY AREA UNIT/ COMMENT Estimated annual net changes in nuclear TRANSMISSI ON and thermal capacity 1.10.2018 - 1100 MW DE Lignite reseve Niederaußem E & F and Jänschwalde F moved to lignite reserve MW 31.12.2018 - 473 MW DE Coal Lünen 6&7, decommissioning 4000 31.3.2019 - 937 MW DE Coal Gersteinwerk, Kiel-Ostufer, decommissioning during 2019 - 619 MW EE Oil shale Closure of four older units in Estonia 2000 1.9.2019 + 700 MW DK1-NL Transmission Cobra cable: trial operation expected to begin in Q3-19 0 1.10.2019 - 800 MW DE Lignite reserve Jänschwalde E, Neurath C 1.10.2019 + 0-400 MW DK2-DE Kriegers Flak Offshore connection between DK2 and DE used for both grid connection of offshore wind -2000 farms and interconnection. -4000 31.12.2019 - 1470 MW DE Phillipsburg 2 Nuclear unit, decommissioning 31.12.2019 - 850 MW SE3 Ringhals 2 Decommissioning 1.1.2020 + 1600 MW FI Olkiluoto 3 Start of regular electricity production expected -6000 in January 2020. -8000 31.3.2020 - 100 MW DK Amagerværket 3 250 MW coal replaced by 150 MW biomass during 2020 + 1100 MW DE Datteln 4 Uniper’s coal condensing unit; targeted commissioning mid-2020. -10000 31.12.2020 - 856 MW SE3 Ringhals 1 Decommissioning 31.12.2021 - 4060 MW DE Nuclear Decommissioning Brokdorf, Grohnde, -12000 Gundremmingen C Nordic Germany German coal commission 31.12.2022 - 4040 MW DE Nuclear Decommissioning Isar 2, Emsland, -14000 Neckarwestheim 2 2017 2018 2019 2020 2021 2022 By end of - 7000 MW DE Coal German Coal Commission proposes 7 GW 2022 commission additional reduction of lignite/hard coal

Estimated capacity changes based on publically announced information from various stakeholders

29 Wholesale electricity price too low to attract investments

EUR/MWh EUR/MWh

110 110 Average levelised costs of new electricity generation 100 100 90 90 80 80 70 70 60 60 Futures 50 29 January 2019 50 40 40 30 30 20 20 10 10 0 0 1995 2019 2029 Solar PV Onshore Gas Large Coal Nuclear Offshore in Spain wind condensing hydro condensing wind

Source: Nord Pool, Nasdaq Commodities Commodity prices are forward prices as of April 2018, extended with inflation

NOTE: The presented figures are calculated based on data from recent public reports and do not represent Fortum’s view. Average achieved price (€/MWh) for the production type depends on availability and flexibility. There are large variations in the cost of hydro, wind and solar depending on location and conditions.

30 Fortum’s nuclear fleet

LOVIISA OLKILUOTO OSKARSHAMN FORSMARK Commercial Unit 1: 1977 Unit 1: 1978 Unit 1: 1972* Unit 1: 1980 operation started Unit 2: 1981 Unit 2: 1980 Unit 2: 1974* Unit 2: 1981 Unit 3: (Under construction) Unit 3: 1985 Unit 3: 1985 Generation Capacity Unit 1: 507 MW Unit 1: 890 MW Unit 1: 473 MW* Unit 1: 984 MW Unit 2: 507 MW Unit 2: 890 MW Unit 2: 638 MW* Unit 2: 1,116 MW Total: 1,014 MW (Unit 3: 1,600 MW) Unit 3: 1,400 MW Unit 3: 1,159 MW Total: 1,780 MW (3,380 MW) Total: 1,400 MW Total: 3,259 MW Fortum’s share 100% 1,014 MW 27% 473 MW 43% 602 MW 22% 724 MW Yearly production 8 TWh 14 TWh 11 TWh 25 TWh Fortum’s share of production 8 TWh 4 TWh 5 TWh 6 TWh Share of Fortum’s Nordic 19% 9% 11% 13% production Majority owner Fortum Pohjolan Voima Uniper Vattenfall Fortum’s share 26.6% 43.4% 22.2% Operated by Fortum Teollisuuden Voima (TVO) OKG Aktiebolag Forsmarks Kraftgrupp *Out of operation; on decommissioning phase RESPONSIBILITIES Loviisa: Fortum is the owner, licensee and operator with all the responsibilities specified in the Nuclear Energy Act, Nuclear Liability Act, and other relevant nuclear legislation Other units: Fortum is solely an owner with none of the responsibilities assigned to the licensee in the nuclear legislation. Other responsibilities are specified in the Companies Act and the Articles of Association and are mostly financial.

31 Fortum's nuclear power in the Nordics

LOAD 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 FACTOR (%) Oskarshamn 1* 80 51 63 85 68 77 72 1 12 74 60 81 82 0 Oskarshamn 2* 90 78 76 86 75 90 77 81 33 0 0 0 0 0 Oskarshamn 3 85 95 88 70 17 31 68 69 77 75 79 83 77 87 Forsmark 1 85 76 81 88 88 93 79 88 87 94 79 95 88 94 Forsmark 2 94 72 85 79 64 38 94 82 89 89 91 75 82 87 Olkiluoto Forsmark 3 95 92 88 69 86 81 85 93 88 83 58 82 86 81 Forsmark

Loviisa 1 95 93 94 86 96 93 94 84 92 92 93 88 93 91 Loviisa Loviisa 2 95 88 96 93 95 89 94 91 93 89 92 93 93 85 *O1 was shut down for decommissioning earlier as originally announced, starting 17.6.2017. Source: Fortum Olkiluoto 1 98 94 97 94 97 92 95 90 97 94 96 91 93 87 Oskarshamn Olkiluoto 2 94 97 94 97 95 95 91 96 93 97 89 94 81 94

Source: Fortum *) Out of operation; on decommissioning phase Finnish units world class in availability Overview of production and consumption: www.fortum.com/investors - energy related links

32 Variety of technologies and ages

UNIT MWE (NET) SHARE (%) SHARE COMMERCIAL AGE TYPE/ SUPPLIER (MWE) OPERATION GENERATION 1)

Loviisa 1 507 100,0 507 1977-05-09 41 PWR / 1 AEE (Atomenergoexport) Loviisa 2 507 100,0 507 1981-01-05 37 PWR / 1 AEE (Atomenergoexport) Olkiluoto 1 890 26,6 234 1979-10-10 39 BWR / 3 Asea-Atom / Stal-Laval Olkiluoto 2 890 26,6 237 1982-07-10 36 BWR / 3 Asea-Atom / Stal-Laval Olkiluoto 3 (1,600) 25,0 (400) (Jan 2020) PWR / 3 Areva / Siemens Oskarshamn 1 473 43,4 205 1972-02-06 46 BWR / 1 Asea-Atom / Stal-Laval Oskarshamn 2 638 43,4 277 1975-01-01 43 BWR / 2 Asea-Atom / Stal-Laval Oskarshamn 3 1,400 43,4 607 1985-08-15 33 BWR / 4 Asea-Atom / Stal-Laval Forsmark 1 984 23,4 230 1980-12-10 38 BWR / 3 Asea-Atom / Stal-Laval Forsmark 2 1,116 23,4 261 1981-07-07 37 BWR / 3 Asea-Atom / Stal-Laval Forsmark 3 1,159 20,1 233 1985-08-18 33 BWR / 4 Asea-Atom / Stal-Laval

1) Generation refers to technical resemblence based on KSU classification and not to reactor design generations. All reactors are of Generation II except Olkiluoto-3 (EPR) which is of Generation III.

PWR = (Pressurized Water Reactor) The most common reactor type in the world (e.g. all French units, most US units). Also the Loviisa units are PWRs, but based on Russian design. High pressure prevents water from boiling in the reactor. The steam rotating the turbine is generated in separate steam generators. BWR = (Boiling Water Reactor) Similar to the PWR in many ways, but the steam is generated directly in the reactor. Popular reactor type e.g. in Sweden, the US and Japan. Planned capacity increase: • Forsmark 1, potential capacity increase of total ~110 MW in 2019-2021. Closing of the units: • OKG AB's Extraordinary shareholders' meeting decided on 14 October 2015 on the closure of Oskarshamn nuclear power plant units 1 and 2 in Sweden. • Unit 1 was taken out of operation on June 17, 2017. Unit 2 has been out of operation since June 2013 due to an extensive safety modernisation, and it will not be put back into operation. The closing process for both units is estimated to take several years.

33 Third party nuclear liability in case of severe accident

Law approved by Parliament In force since 1 January 2012 in 2010, requires separate decision from Government to come into force. Unlimited company responsibility Convention parties Company responsibility State responsibility requires 3rd party insurance 300 M€ 300 M€ Responsibility of company 145 M€ coverage. (insurance or guarantee)

500 M€ 500 M€

1200 M€ 145 M€ Requires ratification by 2/3 of member states to come into force. In Finland approved by Parliament in 2005 700 M€ 700 M€ 145 M€ 700 M€ Liability in Paris convention will have additional conditions. 240 M€ 200 M€

Old, Current, Sweden Finland, New Paris Finland Sweden (new, not temporary convention From 1/1-2019 in force) legislation

34 Fortum - a major player in Russia

PAO Fortum (former TGC-10) • Operates in the heart of Russia’s oil and gas producing region, fleet mainly gas-fired CHP capacity TGC-1 • 26 TWh power generation, 20 TWh heat production in 2017 Investment programme to add 85%, almost 2,200 MW to power generation capacity St. Petersburg TGC-1 • 29.5% of territorial generating company TGC-1 operating in north-west Russia PAO Nyagan Fortum • ~7,000 MW electricity production capacity (more than 40% hydro), ~27 TWh electricity, ~29 TWh heat in 2017 Moscow • In December 2014, Fortum and Gazprom Energoholding signed a protocol to start a restructuring process of TGC-1. Currently Gazprom Energoholding owns 51.8% of the TGC-1 shares and Fortum 29.5%. As part of the restructuring, Fortum will establish a joint venture together with Rosatom to own Tyumen the hydro assets of TGC-1, while Gazprom Energoholding continues with the heat and thermal power Chelyabinsk businesses of TGC-1. By utilising its present stake in TGC-1, Fortum would obtain a 75-plus-percent ownership in the new hydro power company, and Rosatom a 25-minus-percent minority holding. • In October 2015, Fortum announced that the discussions related to the potential restructuring of TGC-1 will continue, and it is not possible to estimate the time schedule or outcome of the discussions.

35 Day ahead wholesale market prices in Russia

Key electricity, capacity and gas prices in the PAO Fortum area IV/18 IV/17 2018 2017 Electricity spot price (market price), Urals hub, RUB/MWh 1,099 1,038 1,043 1,041 Average regulated gas price, Urals region, RUB 1000 m3 3,883 3,755 3,801 3,685 Average capacity price for CCS, tRUB/MW/month 158 157 148 148 Average capacity price for CSA, tRUB/MW/month 1,196 983 1,075 899 Average capacity price, tRUB/MW/month 682 577 609 535 Achieved power price for Fortum in Russia, RUB/MWh 1,982 1,845 1,888 1,813 Achieved power price for Fortum in Russia, EUR/MWh 26.0 27.0 25.6 27.5

Day ahead 40 1 400 power market prices 35 1 200 30 for Urals 1 000 25 800 20

/ / MWh 600

€ 15 RUB MWh/ RUB 400 10

5 200 Source: ATS In addition to the power price generators 0 0 receive a capacity payment. 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

36 Thermal power generation capacity in Russia at 31.12.2017

YEAR SUPPLY POWER FUEL CCS CSA PRODUCTION TOTAL STARTS PLANT TYPE CAPACITY CAPACITY TYPE CAPACITY < 2011 Tyumen CHP-2 Gas 755 CHP/Condensing 755 Chelyabinsk CHP-2 Gas, coal 320 CHP/Condensing 320 Argayash CHP Gas, coal 195 CHP/Condensing 195 Chelyabinsk CHP-1 Gas, coal 134 CHP/Condensing 134 2011 Feb/2011 Tyumen CHP-1 Gas 450 210 CHP/Condensing 660 Jun/2011 Chelyabinsk CHP-3 Gas 360 233 CHP/Condensing 593 Oct/2011 Tobolsk CHP* Gas 452 213 CHP/Condensing 665* 2013 Apr/2013 Nyagan 1 GRES Gas 453 Condensing 453 Dec/2013 Nyagan 2 GRES Gas 453 Condensing 453 2015 Jan/2015 Nyagan 3 GRES Gas 455 Condensing 455 Dec/2015 Chelyabinsk GRES Gas 247 CHP/Condensing 247 2016 Mar/2016 Chelyabinsk GRES Gas 248 CHP/Condensing 248 2017 Dec/2017 Chelyabinsk GRES Gas 248 CHP/CCGT 248 2,462 MW 2,298 MW 4,760 MW

*) Tobolsk power plant was sold in Q1/2016

37 Hedging improves stability and predictability - principles based on risk mitigation

38 2009 onwards thermal and import from Russia excluded Financial Statements 2018

Fortum Corporation 1 February 2019 2018 Highlights

• Strategy updated – financial targets and dividend policy unchanged • Uniper as an associated company – Year-end ownership 49.99% • Higher Nordic power price in 2018 • Low hydro inflows and reservoir levels

• Volatile commodity and CO2 prices

– CO2 price tripled during the year • Comparable EBITDA at EUR 1,523 million, +19% • Comparable operating profit at EUR 987 million, +22% • EPS at EUR 0.95 (0.98) – Items affecting comparability EUR 0.15 (0.38) • Balance sheet discipline with focus on cash flow continues

• The Board of Directors proposes dividend for 2018 unchanged at EUR 1.10 per share

40 Q4 2018 – Higher achieved price and nuclear volumes partly offset by lower hydro volumes

• Nordic power price up +56% in Q4 Y/Y • Low hydro inflows and reservoir levels

• Volatile commodity and CO2 prices • Comparable EBITDA at EUR 473 million, +12% • Comparable operating profit at EUR 333 million, +13% • EPS at EUR 0.22 (0.28) – Items affecting comparability EUR -0.02 (0.01) • Cash flow from operating activities totalled EUR 38 (295) million – Mainly due to change in working capital (including change of settlements for futures)

41 Ånstadblåheia Q4 2018 Highlights Strategy Fortum and Lidl updated - signed Financial agreement to targets utilise excess unchanged heat

50 MW wind Operation of Decision to Valo commissioned 50 MW wind at install Nordic’s Ventures with in Ulyanovsk site biggest battery Google Capital Ånstadblåheia, (JV in Russia) (5 MW) co-founder - Norway started EUR 150 million

Construction of Uniper’s result Modernisation 250 & 100 MW as an of Loviisa NPP wind in associated automation Russian JV company from successfully started Q4 2018 completed onwards

Ånstadblåheia Nordic water reservoirs in Q4 below reference and 2017 levels – some improvement since the historically low levels in Q3

Reservoir content (TWh) Q4 2018 by country • Year 2018 was characterised by 120 very dry first half and high precipitation during the fall 100 • Earlier and more rapid than normal spring flood increased reservoirs temporarily above 80 normal levels

• Record rains in Norway in 60 August-September increased Norway the water reservoir levels closer 40 to the normal level rapidly • November-December were again dry, thus reservoir 20 Sweden declined versus the normal and 2000 2003 2017 2018 2019 normal ended 9 TWh below the normal 0 Finland and 12 TWh below last year Nord Q1Pool median 2000 Q2 2003 2017 Q3 2018 2019 Q4

43 Source: Nord Pool Volatile coal and gas prices

USD / t Coal price (ICE Rotterdam) 250 The global coal market was supported by continued strong demand growth in China in the first half of the year, requiring strong import volumes from the 200 international market 150 • However, China’s macroeconomic outlook began to weaken towards the end of the year, which put the coal market into a wait-and-see mode 100 • The wider financial market sell-off lowered prices in the coal market in October, 50 • In 2018, Chinese power generation from coal rose by some 6%, still indicating strong demand growth, but domestic production has also showed signs of 0 rebound towards the end of the year, with official data suggesting a 5.2% Y/Y 2008 2010 2012 2014 2016 2018 2020 production increase in 2018 overall

GBp / therm Gas price (ICE NBP) 100 The European gas market was very bullish in 2018 despite a decrease in overall gas consumption 80 • Internal: low storage levels due to cold end of winter led to high storage 60 injection demand during the summer 40 • Northwest Europe decreased summer gas-for-power demand in order to make room for the injections, as supplies were tight 20 • External: the strong EUA market supported the gas price, signalling more power sector demand for the fuel, leading to a circle where EUAs and gas chased 0 2008 2010 2012 2014 2016 2018 2020 each other upward

Source: ICE, Thomson Reuters 44 Market prices 29 January 2019; 2019-2020 future quotations CO2 price tripled in 2018

EUR / tCO2 CO2 price (ICE EUA) 35 The EU ETS experienced a major upheaval as the market digested the effects of the Market Stability Reserve, started in 2019 to virtually eliminate the surplus of 28 allowances by 2023 21 • The EUA price tripled during 2018 anchored in the European coal-to-gas 14 switching range, connecting the EUA price onto the wider fuel complex • Part of the EUA strength was triggered by the rising gas prices, which made 7 the needed fuel-switching more expensive

0 2008 2010 2012 2014 2016 2018 2020

USD / bbl Crude oil price (ICE Brent) 150 Crude oil markets were characterised by demand growth well above long-term averages in 2018, which made the OPEC+ production cuts very effective in 120 increasing prices 90 • Oil prices strengthed until October despite continued strong gains in US crude 60 oil production, with an overall Y/Y increase reaching 20% • In October, the sentiment in the financial markets radically shifted and oil 30 declined sharply on the back of weaker demand and inflation expectations

0 2008 2010 2012 2014 2016 2018 2020

Source: ICE, Thomson Reuters 45 Market prices 29 January 2019; 2019-2020 future quotations The MSR introduces tightness to carbon market – in 2018 coal-to-gas switching was modest due to high gas price

Linear reduction factor (LRF) tightens the market Market stability reserve restores scarcity Abatement from coal to gas switching by reducing future auction volumes depends on coal and gas prices, together MtCO2 represented by a switching range 2500 Eur/t Need for abatement 40 24% of cumulative surplus Switch range 2000 CO2eq.) of or inventory reduction 35 CO price 30 2 1500 Mton 25

1000 Cap (excl aviation) capof57% 20 15 500 EU ETS emissions (incl call 10 on EUAs from aviation)

0 5

Illustrative volumes ( volumesIllustrative 43% of capof43%

Free Auction MSR Auction Deficit Emissions 0

2012 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2034 2036 2038 2040 2042 2044 2046 2048 2050 2010 allocation pre- effect post- 2017 2018 2019 MSR MSR • CO2 price has more than tripled since November • Linear reduction factor (LRF) is the percentage of • When TNAC2 > 833 Mt, MSR deducts 24% of the 2016, when the final decision was reached on the baseline supply1 by which the annual supply of TNAC from the auction volume each year placing future EU ETS rules, including the intake rate of allowances (cap) is reduced every year. LRF is them into the reserve during 2019-2023 the Market Stability Reserve, which became set at • MSR rate is 12% during 2024-2030 operational in January 2019 • 1.74% for 2013-2020 (equals to a • When TNAC < 400 Mt, MSR releases 100 million • The EUA market is in a process of finding the reduction of 38 MtCO /year) EUAs annually from the reserve adding them to 2 appropriate price at which enough fuel-switching • 2.2% for 2021-2030 (equals to a future auctions occurs in order to balance supply and demand reduction of 48 MtCO /year) • 900 million backloaded allowances from 2014-2016 2 • This price is heavily dependent on the • In total, emissions are set to decrease by 43% by will be transferred into the MSR in 2019-2020 prices of gas and coal, illustrated by the 2030 vs. 2005 • As from 2023, allowances in MSR above the total coal-to-gas switching channel • Next LRF review is scheduled for 2024 number of allowances auctioned during the • In practice, then, the gas/coal price relationship • 3.03% LRF from 2030 onwards would previous year will be cancelled has become a major price anchor for the EUA deliver net zero emissions by 2050 • Next MSR review is scheduled in 2021

2 TNAC = total number of allowances in circulation = Efficiency assumptions in switching range; 1 46 Average annual total quantity of allowances released in 2008-2012. supply – (demand + allowances in the MSR). According to the latest at low-end: gas 52% and coal 34%; publication May 15, 2018 the TNAC corresponds to 1655 million at high-end: gas 49% and coal 36%. O&M allowances. cost assumptions apply. Regulatory update

• COP24 agreed on the operational rules for the Paris Agreement – Rules on market mechanisms and global carbon markets still pending • The EU 2050 climate strategy sets the long-term framework – Targets and policy measures for 2030-2050 to follow • The German Coal Commission report published – Closing both nuclear and coal underlines the importance of gas during the transition phase – Detailed rules still to be developed - for company-specific assessment • Sustainable financing rules affect the entire EU financing sector – Technology neutral and market-based taxonomy system required • Brexit – The impact of no-deal Brexit on the EU energy market not expected to be significant – Hard Brexit would lead to a sudden UK exit from the EU ETS

47 German Coal Commission hands over its proposal to the government - Coal to be phased out in 2038 at the latest

• Holistic and responsible approach to phasing out coal- fired generation – government now to enforce ”We welcome the Coal Commission’s proposal and hope that the • Roadmap for capacity closures agreed government will swiftly address the – 12.5 GW by 2022 (compared to 42.5 GW in 2017) details necessary for the – Additional 13 GW by 2030 implementation. – Latest 2038 all remaining capacity • Affected companies and regions to be compensated The proposal highlights the – Level of compensation to power plant operators remains importance of gas during the open transition towards a fully – Coal regions would receive EUR 40 billion during the next decarbonised energy system and 20 years to mitigate negative structural changes underlines the need for every utility to – EUR 2 billion annual compensation to customers in lower have a solid decarbonisation grid fees and/or taxes proposed to reduce impact of expected hike in power price strategy.”

• Respective amount of CO2 allowances to be cancelled - Fortum in the EU Emission Trading Scheme (ETS)

48 Nordic power price recovery continued

EUR/MWh Nordic spot and forward prices 90 • In 2018, the average system spot price in the Nord Pool System Price 80 Nord Pool was 44.0 EUR/MWh (29.4), the Futures average area price in Finland was 46.8 EUR/MWh 70 (33.2) and in Sweden (SE3, Stockholm) 44.5 EUR/MWh (31.2) 60 • In Q4 2018, the average system price in the Nord 50 Pool was 47.6 EUR/MWh (30.6), the average area price in Finland was 49.6 EUR/MWh (33.0) and in 40 Sweden (SE3, Stockholm) 48.2 EUR/MWh (31.1)

30 • The main reasons for the increasing spot price, both for the full year and Q4 2018, compared to 20 year 2017, were clearly higher cost of coal condense and drier hydrology 10

0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

29 January 2019 Source: Nord Pool, Nasdaq Commodities 49 German – Nordic price spread

SPOT PRICE EUR/MWh Nordic and German daily spot prices in Jan 2018 – Jan 2019 • In 2018, the spread was 0.5 EUR/MWh with the Nordic system price 100 at 44.0 EUR/MWh and German price at 44.5 EUR/MWh 80

• During 2012-2018, the average realised German-Nordic spot spread 60 was 4.6 EUR/MWh, varying in the range of -1-15 EUR/MWh on an 40 annual level 20 • Realised German-Nordic spread is influenced by realised supply and demand fundamentals in the Continental Europe and Nordic areas 0 Q1 Q2 Q3 Q4 FORWARD PRICE Nordic Germany

• During 2018, the spread for 2020 delivery traded in the range EUR/MWh Nordic and German year 2020 forwards in Jan 2018 – Jan 2019 60 6.8-19.3 EUR/MWh, avg. 11.4 EUR/MWh. 50 • Expected supply/demand balance in the Nordic area and in 40 Continental Europe has an effect on the spread: investments in new interconnector capacity, growth of demand and new renewables as 30 well as amount of exiting nuclear and coal capacity all play a role 20 10 • The spread has increased as at the same time both price levels have 0 increased Q1 Q2 Q3 Q4 Nordic Germany

29 January 2019 Source: Nord Pool, Bloomberg 50 Nordic power prices on a rising trend in 2018 – Fortum price up 16% on Q4, price in Russia impacted by weaker rouble

+56% +6%

+16% -4%

Changes refer to year-on-year difference (Q4 2018 versus Q4 2017) NOTE: Achieved power price (includes capacity payments) in roubles increased by 7%

51 Generation

• Higher comparable operating profit in Q4, +18% – Higher nuclear, but lower hydro generation – Higher achieved power prices and lower taxes in Sweden • Higher comparable operating profit in 2018, +32% – Higher achieved power prices and lower taxes in Sweden partly offset by lower hydro and nuclear volumes • Loviisa automation project finalised; focus to maintain cost efficiency and benchmark performance, drive flexible clean energy

MEUR Q4 2018 Q4 2017 2018 2017 Sales 555 433 1,837 1,677 Comparable EBITDA 224 191 762 603 Comparable operating profit 189 160 631 478 Comparable net assets 6,295 5,672 Comparable RONA % 11.2 8.4 Gross investments 71 55 194 264

52 City Solutions

• Higher comparable operating profit in Q4, +11% – Higher power sales volumes and price, positive impact of change to seasonal heat pricing in Finland – Partly offset by the weaker result in recycling and waste business • Improved comparable operating profit in 2018 +15% – Positive impact of EUR 37 (15) from Fortum Oslo Varme partly offset by the weaker result in the recycling and waste business • Hafslund integration, development and expansion of recycling and waste business MEUR Q4 2018 Q4 2017 2018 2017 Sales 358 340 1,094 1,015 Comparable EBITDA 113 110 284 262 Comparable operating profit 68 61 113 98 Comparable net assets 3,743 3,728 Comparable RONA % 5.0 5.5 Gross investments 79 69 222 556

53 Consumer Solutions

• Higher sales in Q4 driven by higher spot prices – Continued tough competition and customer churn in the Nordics • Marginally lower comparable operating profit in Q4 • Increased comparable operating profit in 2018, +29% – Hafslund positive contribution of EUR 18 million – Profitability burdened by lower sales margins and the amended service agreements for the divested electricity distribution companies • Hafslund restructuring, integration and development of product offerings

MEUR Q4 2018 Q4 2017 2018 2017 Sales 555 453 1,759 1,097 Comparable EBITDA *) 31 25 110 57 Comparable operating profit 17 18 53 41 Comparable net assets 648 638 Customer base, million 2.47 2.49 Gross investments 14 3 47 493

*) 54 Implementation of IFRS 15 positive effect due to capitalisation of sales commissions in 2018: Q4 2018 EUR 9 million and 2018 EUR 32 million Russia • Increased comparable operating profit in Q4, +6% – Positive impact from higher CSA payments (Nyagan 1&2), contribution from new production units and compensation for the relocation of heat pipeline in Tyumen – Offset by weaker rouble EUR -10 million and bad debt provisions • Lower comparable operating profit in 2018, -8% – New units and higher CSA payments offset by negative impact from weakened rouble EUR -32 million, bad debt provisions and lower electricity margins • Growth in solar and wind

MEUR Q4 2018 Q4 2017 2018 2017 Sales 305 314 1,069 1,101 Comparable EBITDA 127 121 417 438 Comparable operating profit 89 84 271 296 Comparable net assets 2,789 3,161 Comparable RONA % 10.3 10.1 Gross investments 66 167 117 277

55 Q4 2018 – Higher achieved power price in Generation

Comparable operating profit EUR million

• Increased power sales • Higher CSA payments volumes and price • New production units • Seasonal heat pricing • Compensation for the • 0.8 TWh lower hydro in Finland relocation of the heat volumes • Weaker result in pipeline in Tyumen • 5.2 EUR/MWh higher recycling and waste • Lower profit due to achieved price business bad-debt provisions • Lower taxes • FX- effect MEUR -10

56 Year 2018 – Clear improvement in the Generation segment

Comparable operating profit EUR million

• Consolidation of • FX- effect MEUR -32 • Profit from • Consolidation of Hafslund • Lower electricity selling a Fortum Oslo • Lower sales margin 54% share Varme margin • Negative impact from of Fortum’s • Weaker result in • Negative impact bad-debt provisions Indian • 2.8 EUR/MWh recycling and from amended • New production units solar higher achieved waste business service • Higher CSA power price agreements for payments plants • Lower taxes the divested • Contribution from • 1.6 TWh lower electricity renewable generation hydro volumes distribution • Positive spot market • 0.2 TW lower companies nuclear volumes correction • 2017 was positively affected by improved bad-debt collections

57 Key financials

MEUR Q4 Q4 2018 2017 • Higher comparable operating 2018 2017 profit due to higher power prices and acquisitions Sales 1,599 1,432 5,242 4,520 • Share of profits from associates Comparable EBITDA 473 424 1,523 1,275 impacted by co-owned nuclear- Comparable operating profit 333 295 987 811 related adjustments and divestments Operating profit 309 315 1,138 1,158 • EPS for Q4 2018 negatively Share of profits of associates and joint ventures -44 34 38 148 impacted by items affecting comparability and share of profits Profit before income taxes 261 300 1,040 1,111 from associates (full year 2017 Swedish tax case -0.14 EUR) Earnings per share, EUR 0.22 0.28 0.95 0.98

Net cash from operating activities 38 295 804 993 • More cash tied to the daily cash settled futures reflecting higher power prices

58 Income statement

Q4 Q4 2018 2017 MEUR 2018 2017 • Sales and comparable operating profit increased due to higher power prices Sales 1,599 1,432 5,242 4,520 and Hafslund acquisition Other income 41 29 130 55 Materials and services -870 -747 -2,795 -2,301 • Share of profits from associates Employee benefits -119 -122 -459 -423 impacted by co-owned nuclear-related Depreciations and amortisation -139 -128 -536 -464 adjustments and divestments Other expenses -178 -168 -594 -576 Comparable operating profit 333 295 987 811 • Finance costs positively impacted by Items affecting comparability -24 20 151 347 nuclear-related adjustments and lower Operating profit 309 315 1,138 1,158 interest costs Share of profits/loss of associates and -44 34 38 148 joint ventures • Income taxes for 2017 negatively Finance costs - net -4 -49 -136 -195 impacted by Swedish tax case Profit before income tax 261 300 1,040 1,111 Income tax expense -64 -43 -181 -229 • Net profit impact from nuclear-related Profit for the period 197 257 858 882 adjustments was close to zero

59 Cash flow statement

MEUR Q4 2018 Q4 2017 2018 2017 • Increased net cash from operating Comparable EBITDA 473 424 1,523 1,275 activities due to improved EBITDA Realised FX gains/losses 26 -12 231 -83 Paid net financial costs, income taxes and -55 -72 -280 -281 other • Positive impact of EUR 314 million from realised FX compared to 2017 Change in working capital -406 -45 -670 81 of which change of settlements for -226 17 -524 141 futures • More cash tied to the daily cash settled Net cash from operating activities 38 295 804 993 futures hedging power price Capital expenditures -185 -187 -579 -657 • Acquisition of shares, mainly Uniper Acquisitions of shares -175 -44 -4,088 -972 Divestments of shares 2 1 259 741 • Uniper PTO was financed with existing Change in cash collaterals and restricted 51 21 -36 -3 cash cash resources of EUR 1.95 billion and bridge loan financing of EUR 1.75 billion Other investing activities 15 14 46 85 Cash flow from investing activities -292 -195 -4,398 -807 • Dividends paid EUR 977 million Cash flow before financing activities -254 99 -3,594 187 Paid dividends -977 -977

60 Ongoing actions to deleverage with aim to optimise cash flow and maintain financial flexibility

2018 2017 TARGET Higher debt and lower cash due to payment of the Uniper investment in Comparable EBITDA, MEUR 1,523 1,275 Q2 2018 Interest-bearing net debt, MEUR 5,509 988 Liquid funds EUR 0.6 billion Comparable net debt/EBITDA ratio 3.6x 0.8x Around 2.5x Committed credit lines of EUR 1.8 Return on capital employed (ROCE), % 6.7 7.1* At least 10% billion

*) Includes capital gains of Hafslund transactions Deleveraging towards the target: 1. Prioritising capital expenditure 2. Improving business performance through operational excellence and increased flexibility 3. Optimising business portfolio

61 Outlook

Demand growth Hedging 2019 Estimated Targeted cost Taxation annual capital synergies of Hafslund Electricity demand in For 2019: ~75% hedged Effective tax rate for the Nordics is at EUR 31 per MWh expenditure, transaction 2019 for the Group including maintenance expected to grow by (Q3: 65% at EUR 30) EUR 15-20 million gradually 19-21% ~0.5% on average and excluding For 2020: ~45% hedged acquisitions materialising 2019-2020: In Sweden nuclear at EUR 29 per MWh capacity tax abolished EUR 600-650 million City Solutions: (Q3: 35% at EUR 28) EUR 5-10 million from 2018 and hydro assets’ real estate tax Consumer Solutions: rate to decrease over ~EUR 10 million a four-year period (2017-2020)

62 Annual General Meeting 2019 and dividend distribution proposal

• Fortum's Annual General Meeting 2019 will take place on 26 March 2019 at 11:00 am EET – At the Finlandia Hall in Helsinki • The Board of Directors proposes a dividend of EUR 1.10 per share, unchanged

• Dividend-related dates planned for 2019:

– Ex-dividend 27 March 2019 – Record date for dividend payment 28 March 2019 – Dividend payment date 4 April 2019

63 Debt portfolio and average interest rate December 31, 2018

Maturity profile

2 500 • Total interest-bearing debt 2 250 EUR 6,093 million 2 000 – Average interest 2.4% 1 750 (2017: 3.6%) 1 500 – Portfolio mainly in EUR and 1 250 SEK with average interest 1) 1 000 cost 1.7% (2017: 2.4%) 750 – EUR 686 million (2017: 773) 500 swapped to RUB, average interest cost including cost for 250 hedging 8.3% (2017: 9.5%) 0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029+

Bonds Financial institutions Other long-term debt CPs Other short-term debt

1) In addition Fortum has received EUR 75 million based on Credit Support Annex agreements with several counterparties. This amount has been booked as a short term liability.

64 Next events: The AGM on 26 March 2019 Q1/2019 results on 26 April 2019 Q2/2019 results on 19 July 2019 Q3/2019 results on 24 October 2019

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