Fingrid rating affirmation reflects capex-driven leverage outlook

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Fingrid rating and leverage outlook

Highlights

Fitch affirmed Fingrid Oyj’s ‘A’ rating with Stable Outlook, citing strong business profile, robust cash flow, and a supportive regulatory framework.
Fitch forecasts Fingrid’s EUR2.9 billion capex for 2026–2030 will drive average annual negative free cash flow of EUR250 million, largely funded by new debt and congestion income.
Fitch expects funds from operations net leverage to rise from 5.0x in 2025 to 5.6x by 2029, with execution risks due to uncommitted capex and uncertain future demand.

Fitch rationale and financial outlook

As reported by Fitch Ratings, Fingrid Oyj's Issuer Default Rating is affirmed at 'A' with a Stable Outlook, supported by the company's strong business profile, supportive regulatory framework and solid operating cash flow generation.

Fitch says the rating also factors in Fingrid's sizeable capex plan, which is largely intended to meet higher electricity consumption and expand cross-border interconnections. The agency expects operating cash flow to remain robust, helped by a rising allowed weighted average cost of capital and a growing regulatory asset base, despite limited inflation indexation for that asset base.

Funds from operations net leverage rose to 5.0x in 2025 from 4.4x in 2024, but remained below Fitch's earlier expectation of 5.6x because of stronger EBITDA and net cash generation. In 2026, Fitch expects that metric to ease to 4.6x, before gradually increasing through 2029 to 5.6x, while net debt to regulatory asset base rises to 51% from 46% in 2025.

Investment programme shapes sector impact

Fitch expects Fingrid to carry out about EUR2.9 billion of capex over 2026 to 2030, leading to average annual negative free cash flow of nearly EUR250 million. The agency assumes EUR0.6 billion of funding will come from congestion income, with the rest financed mainly through new debt and operating cash flow.

The investment programme is mainly expansionary and is aimed at accommodating expected demand growth, which could strengthen Finland's electricity network and cross-border transmission links over time. Fitch also says the sustained spending should materially increase Fingrid's regulatory asset base by 2030.

At the same time, execution risk remains linked to the later stages of the plan because only about 20% of the total capex for 2026 to 2030 is currently committed. Fitch says the timing and scale of future investments depend on the pace of new customer connections and overall demand, which could push part of the programme beyond the current rating horizon.

Earlier, we discussed U.S. power demand as utility executives kept firm load-growth expectations despite data center scrutiny.

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