May 10, 2021
We are living in strange times: the COVID-19 crisis has and will continue to extensively affect our working environment.
Despite all the uncertainty, Finnfund had an active start for the year 2021. During the Q1, we made 11 new investment decisions, worth of 105 million euros. We also managed to make a great number of disbursements and our portfolio grew by 20 million, 3,3%, reaching 628 million euros.
In addition, we launched a new key sector to support our strategic goals: Digital Infrastructure and Solutions. As our Economist Minna Kuusisto writes in her recent blog post, access to internet plays a crucial part in fostering equality and inclusivity. Yet a vast majority of the world’s population lives in countries, where less than half of the people have access to internet.
Finnfund is the first Development Finance Institution (DFI) to put special emphasis on this sector. We are proud of this new initiative, and I strongly believe that it strengthens our position as one of the forerunners among the European development financiers and impact investors.
Our financial performance in Q1 was satisfactory. Our net financial income increased 34% (EUR3.8m vs. EUR2.8m). Operational expenses remained under control being 7% higher compared to previous year but 5% lower compared to the budget. The profit was 598,000 euros (€-1.7m).
The outlook for financial year 2021 remains the same as previously expected. Although the beginning of the year was good, origination of new investments will be increasingly challenging if the global travel restrictions are kept in place.
We are seeing an increasing amount of COVID-19 infections in our target countries, and unfortunately vaccinations are only starting to take off in many of them. It is still unclear if we can travel this year, and that obviously puts pressure to our origination team as well to the portfolio management.
To sum up, we have had a great start for the year, and despite the fact that the future remains unclear, I am hopeful. We at Finnfund are at the frontline of the global effort to build back better.
Chief Financial Officer
P.S. This blog post marks the beginning of quarterly blog posts aiming to provide a better insight into our investment operations for our financiers, investors and other stakeholders. We have also started to publish a quarterly newsletter – you can read the first edition & join our subscribers here.