Fortum Corporation is an energy company focusing on the Nordic and Baltic countries, Poland, Russia and India. The company operates power plants, including combined heat and power plants, and generates and sells electricity and heat. In addition, Fortum provides waste services such as recycling, re-utilisation, final disposal solutions and soil remediation and environmental construction services.
The Fortum´s segments are: Generation; City Solutions; Russia; and Other, under which M&A, Solar & Wind Development, and Technology and New Ventures are reported.
Generation is responsible for Nordic power production. The segment comprises nuclear, hydro and thermal power production, trading and industrial intelligence, as well as nuclear services globally.
The City Solutions segment comprises heating and cooling, waste-to-energy, biomass and other circular economy solutions as well as electricity sales and services. The business operations are located in the Nordics, the Baltic countries and Poland. The segment includes Fortum’s 50% holding in the Fortum Värme joint venture.
The Russia segment comprises power and heat generation and sales in Russia and includes Fortum´s over 29% holding in the TGC-1 associated company.
2016 was a challenging year in many respects, driven mostly by increased commodity market volatility, especially by very low coal and oil prices. The industry’s power demand was too weak and commodity prices were too low and volatile to support a material increase in electricity prices.
A positive development in 2016 was the Swedish government’s budget proposal in September for lowering the real-estate tax on hydro assets and for phasing out the nuclear capacity tax over the coming years.
The total sales turnover of the company in 2016 increased slightly to EUR 3 632 million or by 5% compared to EUR 3 459 million in 2015. The sales turnover in 2014 amounted EUR 4 088 million.
Among the group the performance of two segments was indicated by an increase in turnover of 20% (City Solution) and 6% (Others), the Russian turnover remained unchanged and the Generation segment showed a small drop of 4% in turnover, compared to 2015.
The Comparable operational EBITDA fell by 8% from EUR 1 102 million in 2015 to EUR 1 015 million in 2016 after a drop of 24% from EUR 1 457 million in 2014 to EUR 1 102 million in 2015.The comparable operating EBITDA performance among the segments in 2016 was indicated by a decrease of 23% (Generation) and 15% (Others) and by an increase of 14% (City Solution) and 17% (Russia), compared to 2015.
According annual report in 2016 the Comparable operating profit of the company amounted to EUR 644 million and represented a drop of 20% compared to 2015 (EUR 808 million) and 25% compared to 2014 (EUR 1 085 million).
However, the reported operating profit totalled EUR 633 in 2016 compared to EUR -150 million in 2015, which represented an increase of 522% from 2015 to 2016 and was impacted by items affecting comparability, including sales gains, Ekokem  transaction costs and derivatives mainly used for hedging Fortum´s power production, as well as nuclear fund adjustments for continuing operations. The year 2015 included a EUR -794 million impact from the early closure of two nuclear units in Sweden.
The 130% increase in goodwill from EUR 152 in 2015 to EUR 353 million in 2016 came from the acquisition of the Ekokem Corporation and Grupa DUON S.A. in the City Solutions segment during 2016. Total goodwill also includes the goodwill from the acquisition of OAO Fortum in the Russia segment.
 In 2016 Fortum acquired Grupa DUON S.A, an electricity and gas sales company in Poland, and the Ekokem Corporation, a leading Nordic circular economy company specialising in material and waste recycling, final disposal solutions, soil remediation and environmental construction, as well as making wind power investments in Sweden, Norway and Russia.