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Annual Report 2014 This Is Fortum

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Annual Report 2014 This Is Fortum Contents Contents This is Fortum .......................................................... 4 Support for society ....................................................................69 CEO’s review ................................................................................. 4 Generating economic value .....................................................70 Operations and market areas .................................................... 9 Distribution of added value 2014 ............................................70 Year 2014 in figures .................................................................11 Fortum as a tax payer ...............................................................73 Sales and production...............................................................11 Financials ................................................................ 77 Financial summary .................................................................17 Environmental summary .........................................................18 OPERATING AND FINANCIAL REVIEW ...................................77 Social summary ......................................................................19 Financial performance and position ......................................77 Market position .......................................................................20 Risk management .................................................................. 102 Strategy ........................................................................................23 Fortum share and shareholders .......................................... 111 Core areas of the strategy ........................................................23 Strategy realisation in 2014 ....................................................26 KEY FIGURES ..................................................................................118 Future energy system ...............................................................27 CONSOLIDATED FINANCIAL STATEMENTS .........................131 Sustainability embedded in the strategy ...................................28 Research and development ......................................................31 Consolidated income statement .......................................... 131 Operating environment and market development .............32 Consolidated statement of comprehensive income ......... 133 European market development ................................................32 Consolidated balance sheet .................................................. 134 Russian market development ...................................................35 Consolidated statement of changes in total equity ......... 135 Carbon market development ....................................................36 Consolidated cash flow statement....................................... 136 Notes to the consolidated financial statements ............... 139 Business .................................................................. 38 1 Accounting policies ............................................................139 Group Business structure ........................................................38 2. Critical accounting estimates and judgements ...................152 Our operations............................................................................41 3. Financial risk management ..............................................154 Hydropower .............................................................................41 4. Capital risk management ..................................................163 Nuclear power .........................................................................43 5. Segment reporting .............................................................164 CHP ........................................................................................46 6. Items affecting comparability ............................................174 Other production .....................................................................47 7. Fair value changes of derivatives and underlying items in Power and heat distribution .....................................................48 income statement ..............................................................175 Electricity and heat sales .........................................................50 8. Acquisitions and disposals ................................................176 Expert services ........................................................................51 9. Assets held for sale ...........................................................178 10. Other income and other expenses ....................................179 In Society ................................................................. 52 11. Materials and services ...................................................180 Stakeholders ...............................................................................52 12. Employee benefits ............................................................181 Stakeholder collaboration ........................................................52 13. Finance costs – net ..........................................................187 Main stakeholder groups .........................................................54 14. Income tax expense ........................................................189 Shareholders ...........................................................................58 15. Earnings and dividend per share .....................................191 Customers ...............................................................................58 16. Financial assets and liabilities by categories ....................192 Personnel ................................................................................59 17. Financial assets and liabilities by fair value hierarchy .....196 Suppliers of goods and services ...............................................62 18. Intangible assets .............................................................198 Authorities and energy industry organisations .........................66 19. Property, plant and equipment ........................................199 Media .....................................................................................67 20. Participations in associated companies and Non-governmental organisations .............................................67 joint ventures ..................................................................203 Local communities ..................................................................67 21. Other non-current assets ..................................................210 Contents 22. Long-term and short-term interest-bearing receivables ......210 GRI ......................................................................... 279 23. Inventories ......................................................................211 Standard disclosures .............................................................. 279 24. Trade and other receivables .............................................211 Report content .......................................................................280 25. Liquid funds....................................................................213 Material aspects ....................................................................281 26. Share capital ...................................................................213 Management approach .........................................................285 27. Non-controlling interests ..................................................214 Ethics and integrity ...............................................................295 28. Interest-bearing liabilities ................................................214 Assurance ................................................................................. 296 29. Deferred income taxes .....................................................216 Assurance statement .............................................................296 30. Nuclear related assets and liabilities ...............................218 GRI index .................................................................................. 298 31. Other provisions ..............................................................220 Economic responsibility ........................................................ 309 32. Pension obligations .........................................................221 Economic performance ..........................................................309 33. Other non-current liabilities .............................................226 Plant decommissioning .........................................................310 34. Trade and other payables ................................................226 System efficiency ...................................................................311 35. Pledged assets .................................................................227 Environmental responsibility .............................................. 312 36. Leasing ...........................................................................228 Materials ..............................................................................312 37. Capital commitments .......................................................229 Energy...................................................................................313 38. Contingent liabilities .......................................................229 Water ....................................................................................315 39.
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