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HELSINKI, May 12 (Reuters) - Finnish energy company Fortum reported first-quarter operating profit slightly above forecasts on Wednesday helped by its German holding Uniper and high power prices.
Underlying operating profit rose to 1.17 billion euros ($1.42 billion) from 393 million a year earlier and topped the 1.1 billion mean estimate in a poll provided by the company here.
“Nordic power prices increased significantly from last year, despite the persistently high hydro reservoir levels,” CEO Markus Rauramo said in a statement.
Generation’s Nordic achieved power price rose to 37.2 euros from 34 euros a year earlier, and slightly above analysts’ expectation of 37.1 euros.
“The performance of our newest segment, Uniper, was very strong in the first quarter, even compared to the very good results in the first quarter of 2020,” Rauramo said.
Consolidation of Uniper, in which Fortum raised its stake to more than 50% last year, boosted its first-quarter operating profit by 711 million euros.
Fortum held a 76.1% stake in Uniper at the end of last year. A spokesman declined to comment on the current shareholding.
Fortum said it has hedged some 80% of its remaining 2021 Nordic power sales at a price of 32 euros/MWh, and 55% at 31 euros/MWh for 2022. Analysts expect Fortum to achieve a power price of 36.0 euros/MWh this year and 34.4 euros/MWh next year.
Fortum’s share price was 1.2% higher in midday trading.
Describing the results as “relatively strong, Citi analysts said cold weather had worked in Fortum’s favour, but weather would be a volatile factor in future.
“Encouraging is the pace of balance sheet deleveraging,” they said in a note.
Fortum said its financial net debt declined to 6.4 billion euros by end-March from 7 billion three months earlier.
$1 = 0.8250 euros Reporting by Essi Lehto and Tarmo Virki, editing by Louise Heavens & Simon Cameron-Moore