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Struggling French reactor maker Areva reported a €665m net loss for the full year on Wednesday, which was an improvement on the year before but still highlighted the scale of the problems facing the group.
The state-controlled company is being completely restructured and recapitalised in a government backed deal after years of losses wiped out its equity and brought it to the brink of collapse. The company lost €2bn in 2015 and €4.8bn in 2014.
Last year it was agreed that one half of Areva – the troubled reactor business, or OldCo – would be taken over by EDF, the larger French nuclear group, in a deal that values that part of the business at about €2.5bn. This is scheduled for the fourth quarter this year
Areva will be left as the NewCo, a uranium mining and nuclear fuel business, which will undertake a €5bn capital increase scheduled for June. Areva is 87 per cent government owned, so most of this money will come from the French state, although Japan’s Mitsubishi Heavy Industries and JNFL will also play a part.
The company has faced another problem over the last year, following manufacturing irregularities and document falsifications at its Creusot Forge foundry. The company booked a related charge of €121m, but said that there have been no claims from clients.
Several EDF reactors were halted and international regulators in the US, UK and China have started investigations after Areva discovered in 2016 that shortcuts in manufacturing had been covered up in tracking documents. The company is still investigating.
Areva for the first time presented separate pro-forma accounts for the parts of the group over which it will lose majority control, the OldCo. The unit reported a €440m operating profit, rebounding from a €100m loss in 2015 thanks to cost cutting, even as revenue fell slightly.
Areva also on Wednesday said it had booked a €316m write down on its uranium mines and a further €116m loss on the Olkiluoto 3 reactor under construction in Finland. Cumulative losses on it now stand at €5.6bn.
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