Fortum (FORTUM) Investor Day 2025 summary

Strategic priorities and growth vision

• Focus on value creation through core Nordic operations, leveraging hydro and nuclear assets, and expanding an 8 GW renewables development portfolio for future growth.

• Nordic market demand is projected to rise from 400 TWh to 550 TWh by 2030 and up to 975 TWh by 2050, driven by data centers, electrification, and industrial decarbonization.

• Shift from wholesale commodity market to bilateral contracts with industrial customers, aiming to increase long-term PPAs and stabilize revenue streams.

• New strategic targets include a 14% RONA, maintaining at least a BBB credit rating, and a dividend payout ratio of 60%-90% of comparable EPS.

• Sustainability targets include net zero emissions by 2040, coal exit by 2027, and updated biodiversity goals.

Financial guidance and capital allocation

• Targeting a €330 million improvement in comparable operating profit by 2030, driven by normalization of hydro and nuclear volumes, efficiency gains, and growth in consumer solutions.

• Committed capital expenditure of €2 billion for 2026-2030, with flexibility for an additional €2.5 billion in growth opportunities, subject to strict investment criteria (WACC + 150-400 bps hurdle rate).

• Growth capex of €750 million and maintenance capex of €1.25 billion planned for 2026-2030.

• Updated hedging target: at least 25% of rolling 10-year Nordic generation hedged by end of 2028, with 18% hedged at end of 2024.

• Dividend policy remains at 60-90% of comparable EPS, with a strong track record of annual cash dividends since 1998.

Business development and new opportunities

• Ready-to-build renewables target of 1.2 GW by 2028, with 8 GW in permitting phase; new investments only with linked PPAs.

• Flexibility solutions pipeline of 2.5 GW by 2028, including 2 GW from customer services and 0.5 GW from own assets.

• Active engagement with data centers and industrial customers, leveraging a land bank of 12 industrial sites (5 GW grid capacity) to accelerate large-scale projects.

• Consumer solutions business targets €40 million profit improvement by 2030, focusing on organic growth, digital services, and operational efficiency.

• M&A remains a strategic option, with focus on synergetic bolt-on acquisitions in renewables, district heating, and consumer solutions.