Annual Report 2014 | Suomeksi |

4 Capital risk management

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Fortum wants to have a prudent and efficient capital structure which at the same time allows the implementation of its strategy. Maintaining a strong balance sheet and the flexibility of the capital structure is a priority. The Group monitors the capital structure based on Comparable net debt to EBITDA ratio. Net debt is calculated as interest‑bearing liabilities less cash and cash equivalents. EBITDA is calculated by adding back depreciation, amortisation and impairment charges to operating profit, whereas Comparable EBITDA is calculated by deducting items affecting comparability and net release of CSA provision from EBITDA. Fortum's net debt to EBITDA target is around 3.
Dividend policy ensures that shareholders receive a fair remuneration for their entrusted capital, supported by the company’s long‑term strategy that aims at increasing earnings per share and thereby the dividend. When proposing the dividend, the Board of Directors looks at a range of factors, including the macro environment, balance sheet strength as well as future investment plans. Fortum Corporation’s target is to pay a stable, sustainable and over time increasing dividend, in the range of 50‑80% of earnings per share, excluding one‑off items.
Fortum Corporation's long‑term credit rating with both S&P and Fitch remained unchanged during year 2014 and is A‑ (negative outlook).
Net debt/EBITDA ratios
EUR million Note 2014 2013
Interest‑bearing liabilities 1) 28 6,983 9,058
Less: Liquid funds 1) 25 2,766 1,265
Net debt 4,217 7,793
Net debt without Värme financing 3,664 6,658
Operating profit 3,428 1,508
Add: Depreciation, amortisation and impairment charges 526 621
EBITDA 3,954 2,129
Less: Items affecting comparability 2,077 106
Less: Net release of CSA provision 4 48
Comparable EBITDA 1,873 1,975
Net debt/EBITDA 1.1 3.7
Comparable net debt/EBITDA 2.3 3.9
Comparable net debt/EBITDA without Värme financing 2.0 3.4
1) Including interest‑bearing debt of EUR 0 million (2013: 20) and cash balances of EUR 0 million (2013: 15) classified as assets held for sale in balance sheet.

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