• France's news in English

French nuclear giant Areva on the ropes

AFP · 20 Nov 2014, 08:33

Published: 20 Nov 2014 08:33 GMT+01:00

Facebook Twitter Google+ reddit

Areva's share price plunged on Wednesday after the struggling French nuclear giant abandoned its financial targets for the next two years.

The company's shares fell 16 percent to end the day at €10.13 while the CAC 40 index rose 0.26 percent to 4,273.35.

Trading in the shares of the company - 87-percent owned by the French state - was suspended on Tuesday after leaks, later confirmed by Areva, that it was throwing its financial forecasts out the window.

It said problems with cash flow, the timetable for restarting Japanese reactors, pushed-back plans for building new reactors, and lacklustre conditions in France were behind its decision.

According to the French business magazine Challenges, the government is considering injecting 2.0 billion euros ($2.5 billion) into the company.

It is also mulling the creation of an entity "to park and externalise ultra-losing activities," it said.

Shares long under pressure

Areva's stock, which is at its lowest since June 2012, had been under pressure for several months and has lost half its value since the beginning of the year. It already dropped 20 percent on August 1 when it announced a lower forecast for 2014.

Worldwide, interest in nuclear power has cooled since the March 2011 Fukushima catastrophe in Japan.

In October, Areva said it would cut investments and step up sales of non-strategic assets in a bid to shore up finances.

It also named chief operating officer Philippe Knoche as interim chief executive after CEO Luc Oursel stepped down citing health reasons.

A general meeting of shareholders is due on December 9.

In addition to financial and operational problems, Areva is overhauling its corporate governance.

Story continues below…

The dumping of Areva's forecasts came as energy group EDF confirmed that it would delay until 2017 the launch of a new-generation reactor designed by Areva that is under construction in the northern French town of Flamanville.

Areva said that because of operational delays some client payments could not be expected until next year.

"Areva is undertaking a review of its strategic outlook and mid-term funding plan, which will be examined in the framework of its governance," it said in a statement.

"Areva is suspending its financial outlook for 2015 and 2016," it said, noting delays in work on a new-generation, or EPR, reactor in Finland and in restarting nuclear plants in Japan.

Facebook Twitter Google+ reddit

Your comments about this article

Today's headlines
Is Marks & Spencer to close Champs-Elysées store?
Photo: AFP

Is it goodbye to crumpets, jam, and English biscuits?

After Calais, France faces growing migrant crisis in Paris
Photo: AFP

While all the focus has been on the closure of the Jungle in Calais, France must deal with the thousands of migrants sleeping rough in Paris. And their numbers are growing.

Restaurant boss suspected of kidnapping Cannes millionaire
The Nice residence of the president of Cannes' Grand Hotel, Jacqueline Veyrac. Photo: AFP

A restaurant owner 'harbouring a grudge', apparently.

Le Thought du Jour
Vive le pont - The best thing about French public holidays
Photo: AFP

The UK might have guaranteed public holidays, but France has "les ponts".

What's on in France: Top things to do in November
Don't miss the chocolate fashion show in Lyon. Photo: Salon du chocolat

The autumn is in full swing in France, and there's plenty to do.

What Paris 'squalor pit' Gare du Nord will look like in future
All photos: Wilmotte et Assoicés

IN PICTURES: The universally accepted 'squalor pit of Europe' is finally getting a facelift.

Halloween: The ten spookiest spots in Paris
Is there really a ghost on the first floor of the Eiffel Tower? Photo: AFP

Read at your own peril.

Halloween holiday in France: Traffic nightmares and sun!
Photo: AFP

But it's great news for the country's beleaguered tourism industry.

French MPs vote to make Airbnb 'professionals' pay tax
Photo: AFP

Do you make a lot of money through Airbnb in France? You'll have to pay a share to the taxman in future.

France and Britain accused of abandoning Calais minors
Photo: AFP

Scores of young migrants are forced to sleep rough for a second night.

Fifteen of the most bizarre laws in France
Sponsored Article
Last chance to vote absentee in the US elections
Medieval town in south of France upholds ban on UFOs
Mouth fun? French words you just can't translate literally
How France plans to help its stressed-out police force
Paris: 'Flying' water taxis to be tested on River Seine
Paris landlords still charging illegally high rents
Calais migrants given mixed reception in French towns
Lonely Planet says Bordeaux is world's best city to visit
What rights to a future in France for Calais migrants?
Myth busting: Half of French adults are now overweight
How speaking French can really mess up your English
The annoying questions only a half French, half Brit can answer
Forget Brangelina's chateau - here are nine others you've got to see
The must-see French films of the millennium - Part One
How life for expats in France has changed over the years
Why Toulouse is THE place to be in France right now
Video: New homage to Paris shows the 'real side' of city
The 'most dangerous' animals you can find in France
Swap London fogs for Paris frogs: France woos the Brits
Anger after presenter kisses woman's breasts on live TV
Is France finally set for a cold winter this year?
IN PICS: The story of the 'ghost Metro stations' of Paris
How to make France's 'most-loved' dish: Magret de Canard
jobs available