EDF, the French nuclear power group, has reined in capital spending and launched a €1bn cost-cutting programme as it warned again that it would only build new atomic power stations in the UK if profits were guaranteed.

The company’s net debt has soared over the past year from €33.3bn at the end of 2011 to €39.2bn in December, putting extra pressure on its management to keep investments under control.

EDF – the world’s biggest supplier of nuclear-powered electricity by production – was planning to increase capital spending to €13bn this year. But it said on Thursday that 2013 spending would be kept flat at €12bn, while plans to increase capital outlay to €14bn in 2014 and €15bn in 2015 were under review.

With most of that spending allocated to maintaining and supporting EDF’s fleet of 58 nuclear reactors in France, analysts have said that this leaves less money for international investments such as the UK.

Henri Proglio, EDF’s chief executive, said negotiations with the British government over the multibillion-pound nuclear power station at Hinkley Point in Somerset were “intense”. But he added that “we expect to come to a conclusion by the end of the first quarter” in talks aimed at setting a fixed price for power generated by the plant.

“We will not move on without a formal guarantee on the profitability of our investments,” he added.

EDF is also in talks with the UK Treasury about a government guarantee on some of the building costs. Thomas Piquemal, EDF finance director, said: “Once we finalise the contract in terms of the price [for the power], we can look at the financing structure, bringing in partners and the infrastructure debt and guarantee that may be part of the UK contract.”

The comments were made as EDF reported a 5 per cent rise in net income to €3.3bn in 2012 compared with the prior year, despite slowing European demand for electricity. Earnings before interest, tax, depreciation and amortisation were €16.1bn, up 7.7 per cent on 2011.

The company, 84 per cent-owned by the French state, raised its 2012 dividend by 10 cents to €1.25.

The shares closed up 5 per cent at €14.95 in Paris yesterday.

Despite the big increase in debt, Mr Proglio said he was not under pressure to sell assets, although EDF’s 25 per cent stake in Alpiq of Switzerland was probably not a long-term investment.

“We felt we would be comfortable with [a limit of] net debt around 2.5 times earnings before interest, tax, depreciation and amortisation,” he said.

Mr Proglio has been subject to speculation about whether he will be removed from his post by the French government. But EDF still signalled it was ready to challenge ministers over French tariffs restricting what it can charge electricity consumers.

Mr Piquemal said spending on maintaining nuclear reactors rose from €2.2bn in 2010 to €3.3bn in 2012, but the “tariff structure in France is not commensurate with the increasing investments”.

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