Fortum Oyj

Tapio Kuula – President and Chief Executive Officer Timo Karttinen – Chief Financial Officer

Patrick Hummel – UBS Benjamin Leyre – Exane BNP Paribas Anne Azola – Morgan Stanley Lueder Schumacher – Société Générale Emmanuel Turpin – Morgan Stanley Andreas Thielen – MainFirst Deborah Wilkens – Goldman Sachs Karri Rinta – SHB

Okay. Thank you and welcome to Fortum’s third quarter reporting here in Helsinki we are together with our CFO, Timo Karttinen and we do as, as normally, so that we will give short presentation in the beginning and then we are ready for answering your questions.

And I hope that you have material available and we will start from the Page 3. Some key figures from our third quarter results.

Overall, we can say that that we can be very satisfied with the third quarter both operationally and financially. As you can see from this paper, our comparable operating profit went up from €167 million to €183 million, up by 10%.

That means also that earnings per share during the third quarter is up to €0.10 and the last 12 months we have been able to deliver €3.4 per share. Net cash from operating activities were strong again close to €300 million and during the last 12 months it has been €1.77 billion.

And as you have seen from figures actually from the beginning this year, we have been able to reduce our debt because good cash flow as well as because divestments by €3 billion. I think that is reasonably good achievement.

Then if we move to Page 4, there are some highlights from the third quarter, we can say that this is quite good results in these circumstances clearly lower electricity market prices than last year still able to improve our results. And of course, our flexible portfolio especially hydro portfolio and made it possible to compensate low electricity prices, I think that’s achieved fall of price more than €44 per megawatt hour.

So, also very satisfactory, very put in these circumstances. As said, strong cash flow from operations and the big project divestment project of Swedish electricity distribution network that is ongoing and as planned, we don’t have the exact time table for that for us, it’s more important that we do the process prudently and obviously that we will get as good price as possible.

We have also done well with our efficiency improvement program, I am confident that we will achieve all targets which we booked through that program and we also finalize estimate that we will complete that well before the end of this year. Obviously, we will continue this kind of efficiency improvement work even after this program even if we probably don’t establish a new specific program of our efficiency improvement.

If we then move to Page number 5, it is about market conditions during the third quarter. The power electricity consumption that was quite flattish.

No big changes as compared to last year. Hydro reservoirs they are now about 10 terawatt hours lower than the statistical long-term average but they are at the same level as last year just to get feeling about how important this 10 terawatt hour is.

It’s good to remember that in Nordic area the hydro power production and the total hydro power production is about 200 terawatt hours. As said, really, really, market prices were clearly lower than last year both the spot price and area prices both in Finland and in Sweden.

There is also a debate about energy and about climate change CO2 et cetera in many different places in Brussels, in Sweden, there is the new minority government and also energy issues are quite higher on the agenda. Renewables also nuclear power et cetera.

In Brussels, I think they are discussing about new target setting today and tomorrow. In Russia, the consumption was also pretty exactly on the same level as last year in all relevant market area.

Spot price increased slightly in rubles about 2% in practice on the same level than last year, in euros; of course the price went down. You can see the Nordic water reservoir and their development on Page 6 and there you can also identify the current deficit about 10 terawatt hours.

NordPool spot price is described on the next page. Nothing special, it seems to be that we are living according to forward prices pretty tough times during coming nearest years than there is positive outlook after some years most likely the price development will be more volatile if you look at the history, but this is the way how all the markets sees that.

On Page 8, you see fuel and CO2 allowance, prices what is probably most important in this page or in this picture this is the oil price development as we know that the oil prices come down quite significantly. Now we are roughly on the level of 80, 85USD per barrel which is clearly lower than there has been during the last recent years.

With coal price and CO2 price and gas prices, there is not significant surprises on this. Then important picture which indicates well our market conditions as well as our operational achievement, we see that really NordPool spot price went down significantly by more than 10% down to €31.8 per megawatt hour and as said, we achieved €44.2 per megawatt hour which is down 7% from last year.

But this is of course Short summary about the whole Q3 results, here we can see that power and technology segment and Russia were able to improve their results. Of course, when we look at absolute figures we have to remember the seasonality of our business so that during the third quarter, we are not able to do in absolute terms so big results both third and second quarter of course much weak in energy business than first and fourth quarters.

Distribution is quite significantly down compared to last year, but of course the main reason is that, this third quarter doesn’t include any more Finnish and Norwegian distribution business which we are partnered distribution in the last year. Also in Swedish distribution business there are some one-time like items which made some delta between this year and last year.

Timo might come back to those afterwards. Then if we take next page, Page 11 and the whole nine months period, here we can see that of course the price – low price can be seen in power and technology results that is down from last year about €50 million and in distribution of course the main reason for that is the structural changes as well as, as warm weather affected, especially in the beginning of this year.

Russia has done quite nicely. This is according to our expectations and obviously also the fact that Nyagan 2 unit is in practice.

Ready and ready to get capacity supply agreement payments from the beginning of next year, that is promising more in further. So, now I let the floor to Timo, Timo will continue with finance.

Thank you, Tapio, and good afternoon everybody. Timo Karttinen speaking.

Let me first, once again remind everybody that from the start of this year. We are no longer consolidating Fortum Environment 100% into our – into Fortum numbers and Fortum Environment being the district heating and combined heat and power or CHP operation in Stockholm and Greater Stockholm area where we have a 50-50 joint venture with the City of Stockholm.

So we take our 50% share of the results in the share of profits from associates and joint ventures line. And then also 2013 numbers have been revised accordingly.

Also what Tapio already mentioned, so, 2013 numbers obviously for all quarters contain also Finnish and Norwegian distribution, but now for this year, this third quarter and then the fourth quarter also in the future. So, they contain only this Swedish distribution.

So that is the reason so for some drop in the comparison numbers. Then let’s move on to Page 13 and look at the differences between comparable and reported operating profits.

There is nothing really special at this time here in the difference. All in all, our comparable operating profit was €34 million higher than the reported one and the biggest difference there is really the €40 coming from this IAS 39 derivatives bookings that relate to those derivatives that we use towards our future electricity production and sales price and cash flow.

And as you may remember so, some of – bulk of those get to hedge accounting treatment, but some of those hedges do not and those that do not we then book here and they are different. Then turning the page to power and technology, the comparable operating profit here was €28 million, better than last year same period at €167 million.

Last year, this quarter, we had the €29 million write-down booking for the closure of the Inkoo coal-fired power plant here in Finland. But even this discounting that so this is an improvement quarter-to-quarter despite the lower prices that Tapio already mentioned.

So a good achievement. And of course, this is then partly due to the higher hydro amount 0.2 terawatt hours more hydro, also higher nuclear amount, 0.3 terawatt hours and then also we had the – here in the Nordic area, 0.2 terawatt hours higher thermal production than same time last year.

Also good to note that for the planned nuclear maintenance outages are now being completed, except for this Oskarshamn 2 unit which has been out whole of the year and will be out in the long-term maintenance well into next year. As said already, so the price trend has continued throughout the year, both spot prices and then also the relevant area prices for us being Swedish prices and Finnish prices.

They have been lower than corresponding prices last year. On the other hand, hydro production has been higher.

One can say that all in all we have come back to normal levels from the low levels of hydro production last year and then the availability highly good. However, the cumulative production during this year in our nuclear fleet is somewhat lower than last year and that is due to the unavailability of Oskarshamn 2 and then also partly due to the – with that we had some a bit longer plant outages during this year than last year.

Then turning the page to Heat Electricity Sales and Solutions. That segment has our heat business, heat distribution, combined heat and power generation and then also the end-customer refill electricity sales.

Outside Russia where then of course the heating business is part of other segment. This is of course typically seasonal and especially where heat business is seasonal as the temperatures are higher in quarter two and quarter three, so the heat demand is lower and consequently also the volumes and both the margins are lower.

And this also visible now during this quarter. The comparable operating profit being at minus 4 compared to minus 3 last year.

On top of this normal seasonalities you will so – it has been a bit warmer than last year one to decrease depending a bit on the month and the locations. So this is also visible in the volumes on top of the divestment.

As we have been divesting non-core activities also in this heat business during last year and this year. Warm weather has been visible throughout the whole year in this business.

As you may remember that the first quarter was especially warm which then depressed most of the volumes and the margins then. And then it’s also good to note that Fortum Environment which is also heat business – heating business combined heat and power production that’s not visible in these numbers, but Fortum Environment has contributed all in all €42 million in our associate result line during the first three quarters of the year.

Then turning the page to Russia. Russian business for us is also seasonal.

We have their CHP Combined Heat and Power production on top of the electricity only production as well. Now on the other hand, as we are increasing the new capacity, we have now this summer, we had the second Nyagan unit also up and running.

So we are receiving more and more capacity payments and that for its part is also stabilizing the quarterly income and also increase in the summary income which is also visible in these numbers as the comparable operating profit is now on the level of plus 1 compared to minus 15 last year. And the increase in the comparable operating profit is due to on top of these capacity payments, also a better electricity and heat spreads.

So partly, market conditions and partly of course our continuous stride to manage and reduce our cost where possible. Then also this old capacity that participate this year, it is a year so competitive capacity selection, auction and that auction is always held during the autumn and has now also being held for next year.

So, like in prior years, majority of our old capacity has been selected and is participating there for next year. So, no realistic differences there compared to earlier.

Nyagan 3, as already mentioned by Tapio has passed these certifications and also this 72 hour running test and we are preparing the unit to be in the normal operational and in the CSA system from the 1st of January next year as planned. Overall, the Russian results during the three quarters of this year, they have in euro terms, they have been impacted negatively by roughly €16 million due to the lowering exchange rate both ruble compared to euro.

And then this comparable EBITDA, last 12 months is currently in this segment on the level of 332 million. Turning the page to distribution, and once again a reminder as these quarterly comparison numbers have been dropping from last year, so last year it didn’t include Finnish and Norwegian distribution also to the third quarter and this is of course purely Swedish distribution then.

Swedish – all in all, the volumes have been on last year’s levels. But the slightly warmer weather has impacted also here in the Swedish distribution side and they are not on top of that we have at some higher plant maintenance and then also we had during the late summer, a bit more thunder storms than last year.

So we had a bit more storm costs and storm repair costs there as well compared to last year. And as already Tapio mentioned, so we continue to evaluate and prepare for the possible divestment of the Swedish distribution business exactly as planned and as told before.

Turning to Page 17 and income statement starting from our sales. Sales is down €84 million to the level of €976, then it’s good to note in the interim report, note pages there are this segment sales numbers and there you can see that the distribution segment sales was down by €87 million year-by-year.

So really the structural changes in the distribution segment will explain the drop in the sales compared in these quarters. Comparable operating profit, €16 million higher than last year and we had less negative items affecting comparability than last year, so that means that our reported operating profit was €53 million higher than last year on the level of €149 million.

The share of profits of associates typically this quarter is low, now it was €1 million, financial expenses continue to go down as they should as we are reducing our net debt and that then leaves us with a net profit for the period at 84 million compared to €30 million last year and the EPS as mentioned already €0.10 this quarter compared to €0.04 than quarter last year. All in three quarters this year, the EPS runs at €2.91 per share, also which €2.11 is coming from this items affecting comparability mainly outsourced from the sales gains of the Finnish distribution grid.

Okay, sorry I just got to note that I have wrong page number here, but nevertheless now turning to the cash flow statement. So, our operating profit before EPS €11 million higher than last year.

We have positive but smaller positive effects from both these non-cash flow items and financial items and foreign exchange gains and losses than last year. Taxes are on the same levels than last year and this all leads them to that times from operations is €51 million lower than last year on the set level of €273 million.

The change in working capital is positive, but a smaller positive than last year. So all in all cash from operating activity is €113 million lower than last year, but still on a good level of €288 million.

Our capital expenditure is somewhat lower and then this other investing activities is significantly more positive than last year and this is including the effect that we are getting from the basis of the shareholder loans, the money that we are receiving from Fortum Environment as they pay down the debt that they owe to us and then all in all the cash flow before financing activities €107 million more than last year at €259 million. And then, once again, good to note that during the first three quarters cash flow before financing activities all in all almost €4 billion, once again major part of that coming from the divesting activities and especially from the cash flow from the sales of the Finnish distribution.

Turning to key ratios page, comparable EBITDA at €1.86 billion, interest-bearing net debt €4.8 billion, down €3 billion during the year and comparable net debt to EBITDA which is a key ratio that we use to measure our balance sheet strength. It is currently 2.6 and if we exclude the remaining part of the debt that Fortum Environment is owing to us and that Fortum Environment is according to agreement that we have made with the City of Stockholm going to pay back to us during this year and next year.

So if we exclude that from our net debt, then this ratio would be at 2.2. And as you may remember our target there is to be around 3 which really means that we have a good strong balance sheet and we have good position to look at the marketplace even if the marketplace would be challenging at times.

The return on capital employed on a very good level 19%, but that has the return on equity as well obviously impacted by the sales gains mainly once again coming from the divestment of the Finnish distribution grid. Liquid funds at the end of the reporting period €2.2 billion and then also committed lines more than €2 billion, so we have really also a good cash position currently.

Our debt maturity profile, we have very little outstanding debt that is maturing this year and then we have roughly €1 billion debt maturing next year. If you look at what has been happening during this year, so we have been paying down the debt as we go and as the debt matures and we have – really added new debt as we have a good cash position and – well of course, that would be something that one would assume us continue to as we go forward.

The average interest rate in our debt portfolio is currently 3.9% and the portion of floating to fixed debt is fairly close to even at 47 to 53 currently. Last, but not least, our efficiency program that we started in the beginning of the last quarter 2012, for 2013 and 2014 and then we really put ourselves one overriding goal of improving the cash flow by €1 billion during this period by reducing CapEx, reducing working capital, diverting non-core assets other than distribution activities that we account for separately and then reducing fixed costs.

The plan all in all the efficiency program has been running according to plan. We are now when we count in also the effect from the divestment of the Grainsmouth power plant in Scotland.

So we have divested non-core assets approximately by €500 million and also in the other areas we have been proceeding. We are close to completion and we estimate that we will be able to successfully finalize the efficiency program during this year.

But then of course, I can assure you that even if and when we close the efficiency program, so the mindset and the focus on the efficiency and the continuous improvement of our activities, so that will continue also in the future. And with this, it’s good to turn back to Tapio for the outlook.

Okay, thank you Timo and we go to the outlook page, Page number 24, probably not that big changes for you rest. Before we estimate that there is modest electricity demand for the Nordic area probably about 0.5% and the nearly during coming years.

Electricity expected to gain electric consumption and as mentioned a couple of areas where we clearly see electricity demand expanding, one area is datacenters which are and have been established in Finland and in Sweden especially and then the other area is that there is certainly more electric vehicles in Russia. You remember that we changed the target setting in Russia to rubles and really reason being that that is very difficult to estimate the ruble exchange rate and we kept the ruble target on the same level as seen from the very beginning €18.2 billion and we are confident that we will reach that level run rate wise 2015.

Key drivers and risks of our business they are same as they have been of course, power price, electricity and volumes they are the key elements key parameters and there are some criteria or items affecting that demand supply situation, hydro electrical situation and of course CO2 and fuel prices and then of course, plant availability which is very much then custom to our operational deployments. Annual CapEx, if we continue to the next page, it’s very much as we have said before, so we assume that, that is roughly about €1 billion and then, hedging we can say that we can be very satisfied with the hedging situation for the rest of 2014.

Volume-wise 30% 70% and price-wise €43 per megawatt, that was quite significantly higher than the current forward prices. 2015, the figures are 40%, volumes about – €41 per megawatt hour.

2016 volume is 10% and price 39% and here I remind that there is as we see quite a lot time before 2016. Efficiency programs, Timo already explained and the tax situation is as we have said before, that’s roughly about effective tax rate roughly about 20% and what is also known that the Finnish government has revocated so-called wind farm tax.

So we don’t assume that to be a relevant in Finland. So this was really briefly I’ll report and now we are ready and willing to answer your questions.

So please go ahead.

Yes, thanks. Good afternoon, thanks for taking my question.

Three if I may. First one regarding your hedging 2016 those 10% at the €39 per megawatt hour.

Is that, are these hedges that have happened during the third quarter and if so, I am surprised by the price level bearing in mind where the forward curve was during the third quarter. So, any explanation will be helpful.

Second, I was wondering if you can share a bit more color or your thinking about the situation, Sweden with the new government and the new energy policy, how that could affect your assets on the one hand in terms of higher taxation and on the other hand also in terms of the nuclear residual life or potentially nuclear CapEx that may have to be increased to keep the plants up and running? And the third question is regarding cost-cutting.

The current program expires end of 2014, is it fair to assume that in the upcoming Capital Markets Day you are going to give us an outlook as far as efficiency targets and then cost-cutting are a concern beyond 2014 or all the low hanging fruit already harvested with that current program?

Okay, if I start and if Timo then feel something to be adding to. So, we don’t normally tell when we have done hedging.

This is the first time when we report 2016. So this is the reason why this is available with exact figures for 2016 now.

But obviously this means that, that we do a lot small volumes with hedging and try with those right standing at the other indexing prices as high as possible. But this, I think as we indicate that we have done reasonably well for 2016 as well.

Volumes are low, but as I said, that there is a lot of time to increase those at appropriate time. As I said and as you repeated there is new government in Sweden which seems to be quite active in energy sector as well.

Now we have heard that they are planning to increase nuclear tax by 17% and if that goes through that is in magnitude about the €15 million for Fortum, but as I said, this is just a proposal. Then it’s much more difficult to estimate about what will be the outcome about the discussion life time different nuclear plants, we are certainly following that but it’s very, very difficult to give any comment at this point in time.

And as Timo already indicated that that despite that efficiency improvement program will be completed that certainly doesn’t mean that we wouldn’t pay attention to efficiency improvement potentials. One indication of that is of course our new organizational set up with the COO model which one really idea behind is that we feel that there is still things to be done internally for example opportunities and efficiency improvements between different businesses as well as between businesses and staff functions and we are actively working with those items.

Can I just follow-up on that last point? Is there, I mean, will that result in a top down number for overall efficiency measures as a follow-up program?

Or is it then really down to the business units and it’s basically an accumulation of smaller things which will not be measured against a big company-wide benchmark number?

Yes, I think it’s of course natural uncertain that we look at the cost both top down and Fortum up and as obviously also we are – as we speak so, we are preparing next year’s plan and the plan is going forward. So that’s the cost questions and issues are well integrated there.

So, definitely we will look at those internally both ways as we have done and we will continue to do but most necessarily in the form as Tapio said earlier, so that that we would starting a new externally communicated separate efficiency program.

Okay, thank you very much.

Yes, thank you and good afternoon. Two questions for me please.

The first one is on Swedish distribution, I wonder if you could share with us an estimate of your RAB in Sweden and are there any definition for having the Swedish government’s decision in early September? Thank you.

And the second question will be related to heat in Russia. As you mentioned in your reports and the good progress made and with the roadmap, I wonder if this is now enough for you to consider significant investments in Russia and the heat – or the heat opportunities or the prospects or the sector profitability are scale too distant?

Thank you.

Okay, if Timo takes the Swedish distribution question.

Yes, as you know and of course most of you listening have heard and know that there has been a decision regarding the capital ordinance for the new regulatory period for Swedish distribution activities and that new regulatory period starts 2016. And there will be some changes from the current model into the new model and this is then about how the regulated asset base is defined.

This is a new decision and obviously we are internally looking at that, but also I think that fairly obviously we are not commenting those numbers externally right now especially also in the situation as we have told publicly that we are evaluating and preparing for a possible divestment of that business.

Yes, and about Russian heat business and heat reform has set Russian government has decided the roadmap for heat reform and that is certainly very positive for us. We haven’t disclosed any roadmap for investments et cetera, but obviously this heat reform is positive intensive for investment as well.

But when the time is right, we will come back to that.

Thank you.

Good afternoon. Thank you for taking my question.

Basically, I would be interested in having your take; you could give more in detail on the carbon reform. You are very active in lobbying at the European level for a reform and I would like to have your opinion on the feasibility of implementing reserve.

And more specifically, do you believe that you could have members state agreeing on both on early implementation of the strategic reserve in 2017 or 2018 and on allocating the back loaded volumes into the reserve?

Okay, thank you. First of all I have think that really important issue is that the European Union can agree that CO2 reduction target for 2030 will be 40% compared to 1990 and I am quite hopeful and confident that that will go through.

So that means that fairly the CO2 is the key driver for climate mitigation. Then your question about the market stability reserve, we feel that is important element to stabilize the market and to reduce the big volatility and increase the predictability of CO2 to prices.

It’s difficult to say much more about that because that process is in early, early stage and as you said that obviously we would like to – that to happen as early as possible, we feel that that would be right signal to the market, but with the current or at this very moment, I think it’s fairly early, to estimate the exact time.

And do you have an opinion on the possibility to have the back loaded volumes allocated back into the reserve or do you believe it will be a difficult agreement to reach?

Yes, of course, this is again; if you are aware, different countries have different opinions et cetera. So, I don’t really feel that I would be in a position that I would guess what will be the outcome.

Thank you.

Yes, good afternoon. Two very quick questions.

One is, can you just confirm the impact of the increase in the nuclear tax in Sweden, I am not sure if I got the number, was it €15 million?

Yes, 15, yes.

15, thank you, that’s so easy. On capacity payments in Russia, my understanding is that the 2015 capacity payments on average coming down for old capacity about 24%, is that also a number that would apply to your assets or would you be above or below that?

We haven’t published that figure and when we start to reporting next year, then you will get that figure and during the first quarter, you will see the results from the first quarter.

Okay.

Thank you. Good afternoon everybody.

I’ve got a question on the comments that you make on Page 5 of your interim report. Tapio, this is in the essentially the paragraphs on where you said on your view and I was quite interested by what seems to be a new wording on the button paragraph where you say that it is important to be prepared for possible industrial restructuring opportunities in today’s market and that comes after the fact that you are evaluating the possible divestment of Swedish distribution.

So, and for sure, the tough market conditions in the past two years has mean that a lot of utilities have been paused to sell assets. It looks like most of the utilities now are getting towards the end of their disposal programs.

Is your comment referring to more disposals from your peers in Europe or is it more referring to actually what we’ve seen relatively little of which is disposal by municipal companies or state companies? Where do you think there is more opportunity and one related question although further away geographically speaking is India, we’ve had a new government put in place.

So which has sent quite positive signals toward the industry and infrastructure world and is it comforting your interest in the country? Could that be a region to accelerate your development there?

Thank you

First of all, this is, I would say general statement. As we have said before that we will – that we have opportunities to invest money with better returns in energy production especially compared to electricity.

Distribution and I would say that our priorities as we have said to look at different opportunities including restructuring including mergers and acquisitions and then also of course to some degree also from an Greenfield projects. India, India’s new government, I think that will be industry-friendly.

But I don’t think that that will make any major difference what we are planning to do in India. We will take – carefully consider our steps and as you have been able to read from our strategy, India is really platform for future growth so that is the long-term investment.

I don’t see that there will be that kind of significant investments in India in near future. But that is important to long-term wise for Fortum.

Thank you very much.

Yes, good afternoon. Coming back on one thing Russia or actually two small things.

Firstly, would you be ready to give the actual capacity which has been accepted for the old capacity markets and secondly, can you give the timetable for the two remaining units in Chelyabinsk when they will come on stream next year? Thank you

Yes, if I remember correctly about 3.7% our old capacity which is not that significant overall were not accepted. So, nearly all the old capacity were accepted.

So that the auction totally 195 megawatts. That is on the Page 26 in our report.

And then, timing for those two units, last units in Chelyabinsk, the target is that they will be completed by summer next year.

Okay, great. Thank you.

Yes, thank you for taking my question. First of all, could you just help with the breakdown of the remaining €500 million in CapEx you plan to spend this year?

And then could you also help provide us with your view as to what’s driving that significant premium in the Finnish prices over the Nordic price and what the main drivers are there? And then finally, received increased in place in Russia could you may be help us understand that trend?

Yes, about the CapEx, so what we say about the Russia investment program, so we say that roughly €300 million worth of investment is still outstanding at the end of the reporting quarter. So that is obviously something that is coming partly this year and partly next year and that is obviously part of our rest of the year CapEx as well.

And then of course we have a broad range of other investments ongoing and as you have seen from the sort of accumulation of our CapEx during the year. So, it has been a bit slow, but that also fairly typical quite often.

So that the projects are getting ready and also invoicing them to happen more during the end of the year. So, that is something that we are expecting to happen this year as well.

Of course, there is always a general possibility that some things that we are planning and forecasting for this year will be going over the year end, but there is nothing specific there that we would be expecting and I said, when we are looking at internally, so we feel that that we will be in the guidance that we give. So that is really the extent of information that is available right now about the CapEx.

And the question about area, area prices, I think as there are several parameters which are affecting area prices, first of all they are really based on commercial situation and as you now that there are even different areas in Sweden today. But the hydro electrical situation of course affects then, affects what is the transmission capacity between different areas and I would say that most common is really the area price difference between Norway and Sweden.

Then obviously also technical difficulties or problems with the transmission effects goes, and a new thing is that, now there is stronger connection between Estonia and Finland. So that, Estonia also affects the demand in Finland and normally situation that there is a high demand in Estonia than there is supply.

So that, it’s quite typical that electricity is exported from Finland to Estonia. I didn’t get the third question, so that could you report?

Of course, that price, about price – about price development in Russia or what was that?

No, it was just asking with regard to the employee numbers which over the years have actually come down, now seem to start going up again in Russia. Just trying to understand that?

Okay, yes, they have come up a bit and really the main reason is that because the construction of existing projects and we have taken a bit stronger role to do some things more ourselves than we used to do in the past. But nothing exceptional in that respect.

Okay, thank you.

Yes, thank you. Two questions related to Sweden.

Firstly, if I am not mistaken, there is also a proposal to hike nuclear waste management fees starting next year. Can you comment if this is correct and if so, what would be the magnitude of that fee hike?

And then secondly, there was some news this week and the Swedish media suggesting that the Oskarshamn 1 reactor, that the owners or the owner – the main owner would leave in a decommissioning application already next year and would start a decommissioning process in 2017. Is this completely false or how would you comment this news?

Thank you.

There is some discussions ongoing about the waste fee, but that discussion is, really as I said, ongoing, so that it’s too early to comment about that. And then, about Oskarshamn 1 and possible statement about what they are preparing, of course, we don’t know about the timetable et cetera.

So that I think that it’s really, really an issue which should be then asked from them.

Okay, thank you.

Yes, just a quick follow-up question. In terms of your balance sheet capacity, once you sold these Swedish distribution business what do you think your balance sheet capacity is in terms of net debt-to-EBITDA?

Now, this clearly goes to CFO.

Yes, of course, as I said first, now we are in the base of preparing and evaluating. So, we normally, we take things one at a time, but then on the other hand of course, if that were to happen, we would then look at the balance sheet and see what is the right capital structure to go forward.

We have currently the target three net debt to EBITDA and that suits well for our current portfolio. Obviously, if the portfolio would then change, we would evaluate the situation whether that’s still is suitable or not understanding of course the fact that that distribution is regulated and stable and if that were to leave our portfolio, then that stable part would be going on.

Then on the other hand it’s also good to remember that key business also contains regulated entities depending on the country and it is more stable as it is more local and then also it’s good to remember that these capacity supply payment that we are receiving in Russia and that we continue to receive more as we are finalizing the rest of the capacity, they are also agreement based payments running 10 years. So that’s also a stable form of income and not nearly as volatile as the sort of merchant power plant income.

But those are all factors that we are looking at then and we will definitely take into consideration when we consider and look at first what happens and then what the impact might be.

So, that’s not something that was already in – of interest to the rating agencies. So, just happy to wait until the transaction actually takes place.

I would have thought you looked at this ahead of the transaction?

Yes, I am sorry, if I phrased incorrectly. We are definitely looking at those and looking at those issues as we speak and as we go forward but on the other hand also we take those one step at a time.

So we are currently the balance sheet what we are and the net debt to EBITDA target three suits that well and we have not – we have decided not to try to communicate anything else if – even if that were to change. So communicate anything else prior to some changes would happen in the balance sheet.

Okay, thank you.

Okay. Thank you, thank you for your interest and attention.

And now I would like to remind you and welcome you to Helsinki first of all 4th November to dinner and then the main happening 5th November on our Capital Markets Day. I hope that I can see and we can see most of you in Helsinki in the beginning of November.

Thank you.