British Energy earnings fall 49.7 percent

Source: Reuters

Date :18/11/2008 10:55:26

Nuclear power station operator British Energy posted a 49.7 percent fall in first-half earnings on Tuesday due to power station shutdowns and lower electricity output, but said it hoped for a better second half.

British Energy, which has agreed to be taken over by French power group EDF , also expressed confidence about its ability to extend the lives of its existing nuclear power stations and, with the help of EDF, to build new reactors.

The group's pretax earnings before interest, depreciation and amortisation in the six months to Sept 28 fell to 257 million pounds from 511 million pounds a year ago, above broker Deutsche Bank's forecast of 238 million pounds.

The company, which has eight nuclear power stations and the Eggborough coal-fired station in northern England, said its nuclear output was lower than the same period a year ago, mainly due to maintenance and repairs at its Hartlepool and Heysham 1 reactors. Total output was 22.7 terrawatt hours (TWh), against 30.7 TWh previously.

Chief Executive Bill Coley said the company expected to return five reactors to service, at its Heysham, Dungeness, Hinkley Point and Hartlepool stations, before the end of next month, and another two in the early part of 2009.

The group said there was potential to improve its output and performance in the second six months of 2008/9.

"We're looking forward to a good second half," Coley told journalists in a conference call.

British Energy said it was continuing to carry out work related to potential new nuclear power plants on sites at its Hinkley Point, Sizewell, Bradwell and Dungeness stations.

Asked whether he thought the credit crunch would affect plans by British Energy and EDF for new nuclear plants, Coley said EDF had a good balance sheet and financing capability.

"I feel confident these plants can be built," he said.

The company was studying the feasibility and economics of extending the working lives of all its nuclear power stations, Coley said.

"I think they're in the best condition they've been in since construction," he said.

"I'm very optimistic about our ability to life-extend these stations and we continue to work on plans to do so."

At 9:15 a.m., shares in British Energy were 0.3 percent, or 2 pence, ahead at 752 pence.

(Reporting by Philip Waller; Editing by Rupert Winchester)

LONDON (Reuters)