EDF records UK profit of £903m

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EDFEnergy giant EDF recorded a £903 million UK profits haul in the first half of the year as Britons were charged more to crank up the heating.

The French-owned supplier said underlying earnings rose 2.8%, helped by greater gas demand from households during the coldest spring in 50 years and by selling power at higher prices on the wholesale markets.

The UK's biggest electricity generator, which supplies gas and electricity to about 3.7 million homes in the UK, hiked bills by 10.8% on average late last year. However, it insisted its UK retail arm continues to lose money.

EDF earned the bulk of its profits through its power generation arm, which has a fleet of eight nuclear power stations in the UK, plus two coal plants and one gas power station. It said UK revenues rose 7.3% to 4.99 billion euro (£4.33 billion) during the first six months of the year.
The group also said negotiations with the Government over building new nuclear power stations in Somerset and Suffolk continue, and it will make a decision on the project by the end of the year.

EDF said UK profits rose due to "good control of operating expenses and favourable wholesale prices" and were also "underpinned by higher gas sales to retail customers due to the cold weather in the first half".

Rising profits are likely to infuriate customers, who were forced to spend more to stay warm during the winter, and come ahead of British Gas owner Centrica's first half results due out on Wednesday. EDF did not quantify how much more power customers used. British Gas hiked prices by an average of 6% in November, but in May pledged to hold back further price rises for the time being.

An EDF spokesman said its UK retail arm was "likely" to have remained loss-making during the first half, without giving details, after recording underlying losses of £92 million in 2012 and £124 million in 2011.

The group insisted its customers benefited from the cheapest standard variable prices of any major supplier during 26 of the 28 weeks during the period.

Higher wholesale power prices helped offset the impact of maintenance cutting output from its UK nuclear plants by one terawatt hour.