Let’s go step-by-step. --- **1. Nature of the business** Fortum is a Finnish utility company with a mix of regulated and unregulated power and gas activities. It operates in generation (hydro, nuclear, renewables), trading, and retail. The business profile leans toward *utility/infrastructure-like*, but significant exposure to merchant power and commodities adds volatility. --- **2. Financial profile and credit metrics** - **Revenue** grew in 2022, but comparable and reported operating profit declined. - **Net income** was deeply negative mainly due to discontinued operations (the German Uniper exposure was a huge drag). - S&P-adjusted **Net Debt/EBITDA = 1.84x** and **FFO/Net Debt ≈ 0.46** — both suggestive of solid investment-grade metrics at first glance. - However, reported **equity collapsed** from ~€13.7bn to ~€7.7bn, mostly due to Uniper losses. - The huge loss in discontinued operations, impairments, and derivative-related losses signal elevated risk. --- **3. Hybrid issuance history** The facts clearly state: - No hybrid bonds issued in 2021 or 2022. - First year of issuance: never. This alone, based on guidance, is a **strong signal** the company is at most *Marginally Suitable* and more likely *Not Suitable*. --- **4. Market conditions and rationale** - Interest rates increased sharply in 2022, making hybrid debt more expensive. - No clear, pressing refinancing or capex rationale stated. - Hybrid issuance would be a first-time event, with no demonstrated investor appetite at Fortum. --- **5. Suitability assessment** - The business is in a volatile sector with exposure to commodity risk and political intervention risk (as seen with Uniper). - While partly regulated, the unregulated exposure is large. - Equity cushion weakened significantly in 2022. - No prior hybrid issuance track record. - Rating metrics improved but under exceptional circumstances; future stability is uncertain. - All factors point toward *Not Suitable*. --- **Final conclusion:** Not Suitable