Six-month results released today by UK nuclear power producer, British Energy, show a reduced loss before tax of £17m ($24.9m), despite a 10 per cent decline in UK electricity prices. The company has benefited from profits from its US activities but will not see the same pattern during the rest of the year due to planned outages.
British Energy said it was on track to deliver its targets, though competition both in the UK and US remained tough. The results were in line with analyst’s expectations.
The loss for the half year of £17m compares with £56m for the same period last year on a turnover down from £1.1bn to £929m.
The recent fall in UK electricity prices were cushioned by contracted arrangements and UK generation sales were down since the introduction of Neta.
“Conditions in the UK remain challenging, with expected achieved prices for the full year in the region of 10 per cent below last year,” Executive Chairman Robin Jeffrey said in the results statement.
Shares in British Energy, which have outperformed the UK electricity sector by more than 20 per cent so far this year, ended at 274 pence on Tuesday, valuing the group at about £1.75bn.
In May the group completed a lease arrangement to operate the Canadian Bruce Power nuclear plants until 2018 with an option to extend this until 2043. The six reactors are scheduled to contribute £20m per year by 2003/4.
British Energy said it had made its submission to the UK Energy Review calling for the maintenance of nuclear power generation in the country’s energy mix. A “nuclear for nuclear” replacement programme was required, according to the company, so that the UK can continue to source 25 per cent of its electricity from nuclear generation. It also called for responsibility for the costs of managing spent fuel arising prior to privatization to rest with the government and not British Energy shareholders.
British Energy, which aims to be one of the world’s leading nuclear energy companies and is focusing on partnerships both in North America and Europe, proposed an unchanged interim dividend of 2.7 pence per share.