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Written by Martin Lynch, European News Editor for Industrial Info (Galway, Ireland)--Europe's largest nuclear engineering firm, AREVA S.A. (EPA:AREVA) (Paris, France), has warned that it expects to report heavy losses of 1.2 billion euro ($1.3 billion) for 2015.
This represents the fifth straight year of annual net losses for AREVA, but the amount is less than the company's previous prediction of 1.7 billion euro ($1.84 billion).
"Net income will show a heavy loss, impacted by the provision for restructuring announced on July 30 and by a supplemental provision for losses at completion in the Reactors & Services operations and for wind and solar projects," the company's board of directors said in a statement.
In May, AREVA announced that 6,000 jobs would have to go. Crippling delays with its European Pressurized Reactor (EPR) nuclear projects at Olkiluoto in Finland and Flamanville in France have cost the company billions of euros in overruns.
French state-owned company Electricite de France (EDF) (EPA:EDF) (Paris) proposed a rescue plan for the company earlier this year. In August Industrial Info reported that EDF would purchase a controlling stake in the nuclear reactor business of AREVA for 2.7 billion euro ($2.96 billion). For additional information, see August 4, 2015, article - EDF to Take AREVA's Nuclear Business in $2.96 Billion Deal.
EDF, which owns and operates all of France's 58 nuclear reactors, will control 75% of the AREVA NP reactor business division, which is responsible for equipment and fuel manufacturing, as well as the servicing of reactors.
U.S. engineering firm Westinghouse Electric Company LLC (Cranberry Township, Pennsylvania) has also expressed an interest in purchasing AREVA assets. Speaking recently to the Wall Street Journal, Chief Executive Officer Danny Roderick said: "I am always interested in good acquisitions. There are parts of AREVA I am interested in."
The deal with EDF was expected to close before the end of the year, but it is believed that the proposed purchase price remains a sticking point. In its statement, AREVA stated: "Negotiations with EDF pertaining to the sale of a majority share of AREVA NP are making progress, with a view to a conclusion in the early part of next year."
Despite its financial troubles, the company continues to win numerous nuclear contracts. In September, the company was contracted by Germany's largest utility, E.ON (XETRA:EOAN) (Düsseldorf, Germany), to service the Isar 2, Brokdorf and Grohnde nuclear power plants. For additional information, see September 29, 2015, article - AREVA Wins Three German Nuclear Contracts.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to europe@industrialinfo.eu or visit us online at Industrial Info Europe.
This represents the fifth straight year of annual net losses for AREVA, but the amount is less than the company's previous prediction of 1.7 billion euro ($1.84 billion).
"Net income will show a heavy loss, impacted by the provision for restructuring announced on July 30 and by a supplemental provision for losses at completion in the Reactors & Services operations and for wind and solar projects," the company's board of directors said in a statement.
In May, AREVA announced that 6,000 jobs would have to go. Crippling delays with its European Pressurized Reactor (EPR) nuclear projects at Olkiluoto in Finland and Flamanville in France have cost the company billions of euros in overruns.
French state-owned company Electricite de France (EDF) (EPA:EDF) (Paris) proposed a rescue plan for the company earlier this year. In August Industrial Info reported that EDF would purchase a controlling stake in the nuclear reactor business of AREVA for 2.7 billion euro ($2.96 billion). For additional information, see August 4, 2015, article - EDF to Take AREVA's Nuclear Business in $2.96 Billion Deal.
EDF, which owns and operates all of France's 58 nuclear reactors, will control 75% of the AREVA NP reactor business division, which is responsible for equipment and fuel manufacturing, as well as the servicing of reactors.
U.S. engineering firm Westinghouse Electric Company LLC (Cranberry Township, Pennsylvania) has also expressed an interest in purchasing AREVA assets. Speaking recently to the Wall Street Journal, Chief Executive Officer Danny Roderick said: "I am always interested in good acquisitions. There are parts of AREVA I am interested in."
The deal with EDF was expected to close before the end of the year, but it is believed that the proposed purchase price remains a sticking point. In its statement, AREVA stated: "Negotiations with EDF pertaining to the sale of a majority share of AREVA NP are making progress, with a view to a conclusion in the early part of next year."
Despite its financial troubles, the company continues to win numerous nuclear contracts. In September, the company was contracted by Germany's largest utility, E.ON (XETRA:EOAN) (Düsseldorf, Germany), to service the Isar 2, Brokdorf and Grohnde nuclear power plants. For additional information, see September 29, 2015, article - AREVA Wins Three German Nuclear Contracts.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Our European headquarters are located in Galway, Ireland. Follow IIR Europe on: Facebook - Twitter - LinkedIn For more information on our European coverage send inquiries to europe@industrialinfo.eu or visit us online at Industrial Info Europe.
