British Energy profits up on rising prices

17-11-2006

British Energy profits up on rising prices
British Energy has more than doubled its first-half core earnings, with higher energy prices helping to boost its performance despite its nuclear output falling below expectations.

The nuclear power company said that adjusted earnings before interest, tax, depreciation and amortisation for the six months to October 1st were £481 million, up from £212 million for the same period in the previous year.

Half year revenues rose by 35 per cent, up from £1 billion to £1.4 billion, British Energy said.

The energy provider said that its results for the period reflected higher electricity prices, with realised power prices up 43 per cent during the first half to £35.7 per megawatt hour (mwh), up from £10.7 mwh in the comparable period.

But a reported fall in nuclear output follows the company's recent announcement that it had discovered pipe cracks affecting two of its power stations.

British Energy confirmed that it was continuing to undertake work to resolve boiler issues at Hinkley Point B in Somerset and at its Hunterston plant in Scotland, but said the problems were "expected to have a significant impact on output for the financial year".

Commenting on the results, British Energy chief executive, Bill Coley, said: "While output has been disappointing in the year to date, the first six months of the year 2006/07 have shown an improvement in financial performance compared to the first half last year largely due to higher achieved electricity prices.

"We remain focused on our strategy to improve the long term reliability and output of our power stations and are encouraged with certain areas of performance improvement," he added.

Mr Coley also indicated that he had "shortened the reporting lines" within the company by appointing three nuclear officers to report directly to him.

The decision to appoint the three new officers follows the announcement that British Energy's chief nuclear officer, Roy Anderson, is standing down from his role from today.


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