Areva has posted its 2007 results, boasting an order book of almost €40 billion. France's consolidated nuclear giant, and the biggest nuclear company in the world, said it is benefiting from surging demand for nuclear power worldwide.
|Areva's Paris headquarters
The company's backlog reached €39.8 billion ($60.2 billion), up 55% on last year's figure. Sales revenue was up 9.8% to €11.9 billion ($18.0 billion) while operating income also increased a little: up 2.6% to €751 million ($1.1 billion).
Anne Lauvergeon, the company's CEO and chair of its executive board, said the company had met its targets for the year, and outlined next year's goals, which amounted to more of the same: increases in sales and backlog, increased operating income and a continuation of capital investment.
Net debt at the company increased to over €1.9 billion, but this was put down to the acquisition of South African uranium miner UraMin, which was financed by a large bank loan.
Leading the 55% increase in backlog were the Front End, Reactors & Services, and Transmission & Distribution divisions.
The Front End section - dealing with the delivery of nuclear fuel from the uranium mining stage to the point it is used to generate power in a reactor - was led by its uranium enrichment units. A "non-recurring volume effect" in enrichment caused a sharp rise in revenue which was enough to offset extra costs in the uranium mining business unit.
The Transmission & Distribution division grew in new areas, as exemplified by a large contract for gas-cooled substations in Qatar where Areva said they were not even present a few years ago. Other large contracts which have buoyed Areva over the year have been the deal for two EPR nuclear islands for China, that for another EPR at home in France, a large nuclear fuel contract with Korea Hydro and Nuclear Power, a reprocessing (back end) contract with Italy's Sogin.
In Reactors & Services, recognizing another "additional provision" for costs of the problematic Olkiluoto 3 new-build project was the main factor in a change from 2006's loss of €420 million ($635 million) and 2007's €178 million ($269 million) loss. The project continues to limp along well behind schedule, and Areva bosses indicated some certain displeasure with the methods of customers Teollisuuden Voima Oyj (TVO) and Finnish regulators, Stuk. TVO's project manager for the new reactor, Martin Landtman, hit back with comments to YLE Uutiset: "At the moment, Areva has submitted half of the plans to us. Nuclear reactors are not built without plans, at least not in Finland."
Despite current build troubles, Areva looked ahead to series production of its reactors and presented their view of the nuclear power industry in 2030, forecasting a total installed generation capacity of 635 GWe - up from 372 GWe now. Some 344 GWe would come from new reactors, the company said, and it intended to build one third of the ones built in "accessible markets". The definition of that term is likely to exclude China, where imported nuclear technology is to be reproduced largely by state companies and India which remains excluded from international trade.
The scenario of global capacity of 635 GWe was optimistic - above the 525 GWe supposed by the International Energy Agency's World Energy Outlook alternative scenario, and also above the World Nuclear Association (WNA) reference level of 529 GWe. It remained below the International Atomic Energy Agency's high level of 691 GWe and the WNA upper scenario of 731 GWe.