Energy giant EDF sees profits surge

EDF billFrench utility firm EDF has reported its profits nearly trebled last year compared with 2010 when sluggish demand in the wake of the global recession forced it to set aside billions of euro.

The state-controlled utility's bottom line of 3 billion euro (£2.5 billion) was also helped by an increase in its nuclear output in France and Britain where energy produced rose by 3% and 15% respectively.
The nuclear output offset a drop in hydropower and exceeded the company's targets for both countries.

But sales were stagnant at 65.3 billion euro (£54.1 billion) amid what CEO Henri Proglio called a "troubled environment" that includes Europe's raging debt crisis and the possibility of a new recession.

A mild early winter in Europe particularly hit energy sales there.

Demand for energy tends to dip during economic turmoil and can be slow to return as people form new habits.

In 2010 EDF was forced to set aside billions in provisions when energy prices did not rise as quickly as it hoped in the wake of the 2008 global recession. That contingency hammered its 2010 profits, magnifying the rebound in 2011.

Amid broader concerns about the state of the economy however, EDF's shares opened 2% lower on the Paris exchange on Thursday.

After a tsunami in Japan caused several reactor meltdowns at a nuclear plant there, many companies like EDF, whose primary business is nuclear, worried about its future. Germany, for instance, has decided to pull out of nuclear all together by 2020.

However, EDF said it would be able to implement the suggestions made during French and British reviews prompted by the Japanese disaster. It added that it expected 5-10% growth in net income this year.

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