MOSCOW (Pakistan Point News / Sputnik - 03rd May, 2022) Finnish energy company Fortum said on Tuesday that it would write off 2.1 billion Euros ($2.2 billion) of assets related to the company's activities in Russia due to uncertainties and risks associated with the Russian military operation in Ukraine.
In early March, the company decided to abandon new investment projects in Russia, but pledged to continue its activities in the country as usual and fulfill its obligations to customers.
"Following Russia's attack and the war in Ukraine and the consequential geopolitical tensions, uncertainties and risks, Fortum will record pre-tax impairments of approximately EUR 2.1 billion related to the company's Russian operations in its first quarter 2022 results," the company said in a statement.
The value of the company's net assets in Russia after the impairments will amount to 3.3 billion euros, Fortum stressed.
The impairments will include about 0.3 billion euro related to main funds and business reputation of Fortum's Russian segment and around 0.6 billion euro associated with fixed assets of Unipro, the Russian segment subsidiary of Uniper, whose largest shareholder is Fortum.
In addition, the impairments of approximately 0.2 billion euro related to Fortum's share in Russia's Territorial Generating Company Number 1 (TGC-1) and renewable energy joint enterprises will be reflected in the value of profits from associated companies and joint ventures.
Fortum is a Finnish state-owned energy company. In addition to Finland, the company carries out activities in Germany, Central Europe, the United Kingdom, Scandinavian countries and Russia. Fortum operates power plants, produces and sells electricity and heat. The company also offers waste managements services.
Fortum is engaged in the production and sale of electricity and heat in Russia. Its structure includes eight thermal power plants in the Urals and Western Siberia. According to Russian Accounting Standards, in 2021, the net profit of the Finnish energy firm increased by 1.1 times year-on-year and amounted to 18.644 billion rubles ($277 million).
