June 23, 2010 / 8:18 PM / in 7 years

UPDATE 1-Areva takes 400 mln euros charge on Finnish plant

* Areva sees H1 operating loss due to Finnish provision

* Talks continue with EDF on G. Besse 1 shutdown terms

* Still sees significant growth in 2010 backlog, revenue

(Adds details from statement)

PARIS, June 23 (Reuters) - Areva SA CEPFi.PA expects to post an operating loss for the first half 2010 due to a new 400 million euros provision tied to delays in building a 1,600 megawatt nuclear reactor in Olkiluoto, Finland.

The state-owned company also reaffirmed its view there would be significant backlog and revenue growth this year, and a sharp increase in net income due to capital gains from the sale of its transmission and distribution business (T&D).

Areva also said negotiations were continuing with French power utility EDF (EDF.PA) on the terms for the shutdown of the Georges Besse 1 enrichment plant.

Excluding the additional provision for the Finnish plant and the possible impact of a shutdown of Georges Besse 1, the group’s operating margin for the first half should be around 4 percent of sales, it said.

Areva forecast first-half revenue should rise around 2 percent year-on-year and that its backlog at end-June should exceed 43 billion euros, a year-on-year rise of 1 billion.

Areva previously estimated its loss on the Finnish project at 2.3 billion euros.

The additional first-half provision “corresponds to the new schedule submitted by the Areva-Siemens consortium to its customer, VTO, as announced on June 7, which provides for the start up of the nuclear operation of the OL3 reactor at the end of 2012,” it said.

The construction of OL3, the first third-generation reactor to be built in Europe and originally scheduled to be in operation in 2009, has been plagued by delays and ballooning costs and both sides have taken a dispute over payments to the International Chamber of Commerce. [ID:nLDE62B228]

For full year 2010, Areva said operating income should grow before the provision, the dilution of capital gains and the possible impact of a shutdown of Georges Besse 1.

Net income for the first half will be up sharply year-on-year due to a capital gain of 1.3 billion euros from the T&D sale. (Reporting by Dominique Vidalon; editing by Andre Grenon)

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