Financing

Pohjolan Voima Group's financial position is strong and liquidity is good.

Pohjolan Voima has a long-term equity ratio of approximately 38 % – 40 %. The Group’s equity ratio on 30 June 2022 was 42.4% (on 30 June 2021: 41.0%).

At the end of June 2022, the Group’s interest-bearing debts totalled €1,179 (1,218) million, and cash and cash equivalents totalled €43 (54) million. Furthermore, the Group had €350 (329) million of unused committed credit facility agreements and €238 (238) million of unused shareholder loan commiments.

On 29 June 2022, Pohjolan Voima Oyj signed a new €350 million revolving credit facility to refinance previous facilities totalling €329 milllion. The new facility has a maturity of five years, and it also includes two one-year extension options. For the first time, the margin of the revolving credit facility is linked to the achievment of the company’s key sustinability targets of carbon neutrality in electricity and heat production.

For short-term funding, the Group had a domestic commercial paper programme of €300 (300) million, of which €90 (91) million was used.

The Group companies’ loan agreements do not include any financing covenants.

In June 2018, Pohjolan Voima Oyj issued an unsecured bond of €125 million. The bond will mature on 8 June 2023 and a fixed annual interest of 1.75 percent will be paid on it. The bond was listed on the Nasdaq Helsinki stock exchange list.

On 18 November 2019, Pohjolan Voima Oyj issued an unsecured bond of €150 million. The bond will mature on 20 January 2025, and a fixed annual interest of 1.25 percent will be paid on it. The bond was listed on the Nasdaq Helsinki stock exchange list.

Japan Credit Rating Agency (JCR) has announced a rating of A+ , outlook negative, for Pohjolan Voima Oyj in its report, published on 10 December 2021.

Key risks are connected to the OL3 EPR project

Risk management is carried out in line with the Group’s risk management policy. The Group applies a decentralised risk management model. Risks that may compromise the achievement of the objectives are estimated, and measures for their management are defined. The significance of the risks is estimated as the sum of their likelihood of occurrence and impact.

All Pohjolan Voima companies are covered for risks of damage through measures related to maintenance, occupational health and safety, adequate training provided to the personnel and other necessary measures, as well as through insurance in line with the Group’s insurance policy.

The key risks and uncertainty factors involved in Pohjolan Voima’s operations are presented in the 2021 report of the Board of Directors. The Group’s most significant risks are related to the schedule of TVO’s OL3 EPR project, the consortium company Areva’s sufficient financial capacity to fulfil its responsibilities until the end of the guarantee period and the profit-yielding capacity of the OL3 project.

See also