Bloomberg News

EDF Quarterly Sales Rise on Higher Cold Snap Power Volumes

May 10, 2012

Electricite de France SA, Europe’s biggest power generator, reported first-quarter sales rose 6.3 percent after the utility sold more power to French homes during a February cold snap.

Revenue rose to 20.8 billion euros ($27 billion) from 19.6 billion euros a year earlier, the Paris-based operator of France’s 58 nuclear reactors said today in a statement. The utility confirmed 2012 financial and nuclear output targets.

The cold wave in February led to higher sales by volume although it reduced the profit margin by almost 100 million euros, EDF said. First quarter revenue also benefited from a 2011 French power rate increase.

EDF is raising spending on nuclear reactors because of stricter safety measures after the Fukushima disaster in Japan and a program to keep existing plants running for as long as 60 years. France’s state auditor has estimated the utility will have to invest 55 billion euros through 2025. EDF’s reactors in France provide about three quarters of the country’s power output while the utility also operates eight atomic generators in the U.K.

The utility is facing uncertainty about a works plan at its Fessenheim plant after the May 6 election of Socialist Francois Hollande as president. He pledged during the campaign to halt the reactors within five years as well as lower the country’s dependence on atomic power by around 2025.

Hydropower Rises

French hydropower production increased by 1 terawatt hour in the first quarter compared with the previous year while reserve levels “should be built back up” from Alpine snow and April rainfall, EDF said. Dam output fell last year amid a dry spell.

EDF is targeting average annual growth in earnings before interest, tax, depreciation and amortization of 4 percent to 6 percent between 2011 and 2015. The 2012 payout will be “at least stable” compared with last year.

The utility, which is building a 1,650-megawatt European pressurized reactor in France, expects French nuclear-power production to be 420 terawatt-hours to 425 terawatt-hours this year. It also forecasts higher atomic output in the U.K. First quarter production in the U.K. dropped by 1 terawatt hour due to unplanned outages at the Dungeness and Sizewell plants.

The utility said the availability of its domestic reactor fleet last year was 80.7 percent, compared with 78.2 percent in 2010. EDF declined to confirm in February a previous target of making 85 percent of the country’s reactors available for electricity production by 2015 because of “uncertainty” about major works at reactors for safety and new equipment.

EDF has programmed six planned reactor outages due to 10- year safety inspections this year and steam-generator replacements on two reactors, according to a February earnings presentation. EDF has said replacing steam generators halts a reactor for 50 extra days.

There may also be “potential consequences” on planned nuclear reactor outages due to post-Fukushima safety inspections.

To contact the reporter on this story: Tara Patel in Paris at tpatel2@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net


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