Annual Report 2013 | Suomeksi |

9 Assets held for sale

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Accounting policies + -
Non-current assets (or disposal groups) classified as held for sale are valued at the lower of their carrying amount and fair value less costs to sell if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. These classification criteria do not include non-current assets to be abandoned or those that have been temporarily taken out of use. An impairment loss (or subsequent gain) reduces (or increases) the carrying amount of the non-current assets or disposal groups. The assets are not depreciated or amortised. Interest or other expenses related to these assets are recognised as before the classification as held for sale.
Discontinued operations represent a separate major line of business that either has been disposed of or is classified as held for sale. Assets and liabilities attributable to the discontinued operations must be clearly distinguishable from the other consolidated entities in terms of their operations and cash flows. In addition, the reporting entity must not have any significant continuing involvement in the operations classified as a discontinued operation.
The assets and liabilities relating to Finnish distribution business have been classified as assets held for sale in the balance sheet as of 31 December 2013. Fortum signed in December 2013 an agreement to sell its electricity distribution business in Finland to Suomi Power Networks Oy, which is owned by a consortium of Finnish pension funds Keva (12.5%) and Local Tapiola Pension (7.5%) together with international infrastructure investors First State Investments (40%) and Borealis Infrastructure (40%).
The total consideration is EUR 2.55 billion on a debt- and cash-free basis. Fortum expects to complete the divestment process during the first quarter of 2014 subject to the necessary regulatory approvals as well as customary closing conditions. Fortum expects to book a one-time sales gain of EUR 1.8-1.9 billion (depending on the timing of the closing) corresponding to approximately EUR 2.0 per share in its Distribution segment’s first quarter 2014 results.
As of 31 December 2012 there were no Assets held for sale.
Assets held for sale 1)
EUR million 2013 2012
Intangible assets and property, plant and equipment 1,116 -
Other assets 42 -
Cash and cash equivalents 15 -
Total 1,173 -
Liabilities related to assets held for sale 1)
EUR million 2013 2012
Interest-bearing liabilities 20 -
Deferred tax liabilities 141 -
Connection fees 306 -
Other liabilities 73 -
Total 540 -
1) Amounts are presented net of internal balances with other Fortum subsidiaries, such as internal financing amounting to EUR 61 million (2012: 0).
Impact on Distribution segment information
The Finnish distribution operations are included in the segment information presented in Note 5. The impact of Finnish distribution business to Distribution segment's comparable operating profit for 2013 was EUR 73 million. Additional information of the impact to segment information is presented in the table below:
EUR million Distribution segment 2013 Distribution segment 2013 without Finnish operations Impact 1)
Comparable EBITDA 550 410 -140
Comparable operating profit 331 258 -73
Operating profit 348 271 -77
Share of profits in associates and joint ventures 5 7 2
Depreciation and amortisation 219 152 -67
Capital expenditure 260 134 -126
Assets (at period end) 4,301 3,145 -1,156
Liabilities (at period end) 531 195 -336
Net assets (at period end) 3,770 2,950 -820
Comparable return on net assets, % 8.8 8.7 -0.1
Return on net assets, % 9.2 9.1 -0.1
Number of employees (at period end) 852 515 -337
Volume of distributed electricity, TWh 26.1 16.6 -9.5
Number of electricity distribution customers, thousands 1,648 1,006 -642
1) Impact as consolidated to Fortum Group figures for 2013.
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