Areva Net Profit Rises On Gains and Payouts

By ADAM MITCHELLAugust 30, 2008;

PARIS -- French nuclear group Areva SA said its first-half net profit more than doubled, helped by one-time gains and stronger payouts from its stakes in other companies.
The state-controlled nuclear group, which is promoting its European pressurized-water reactor in the U.K. along with Électricité de France SA, said net profit rose to €760 million ($1.12 billion) in the six months to June 30, compared with €295 million the same period a year earlier.
Areva said net profit was helped by a €95 million increase in net financial income, including a gain from the sale of a stake in wind-turbine manufacturer REpower Systems AG.
The contribution to profit from Areva's stakes in other companies, meanwhile, rose to €121 million from €34 million a year earlier, helped by strong income growth at mining and metals company Eramet SA.
"As usual there are a lot of one-offs," Alex Barnett, a Paris-based analyst at Jefferies, said. There are so many items, he said, that it's "hard to read anything in the numbers."
Operating income more than doubled, to €539 million, the company said. Areva also said it had booked an additional provision on its reactor-building contract in Finland. The company didn't specify the size of the provision.
Last month, Areva reported that first-half revenue rose 15% to €6.17 billion, as sales in its reactors and services division surged.
Areva's share price has fallen more than 15% in the past three months to close at €688.36 Friday, as oil prices slipped, taking the edge off investors' enthusiasm for all things nuclear.
There has also been speculation that the French state might push for a tie-up between Areva and heavy-engineering company Alstom SA, in which French conglomerate Bouygues SA holds a 30% stake. Friday, Bouygues's chairman and chief executive, Martin Bouygues, said there has been no movement on this, and the issue doesn't seem to be a priority for the French government.
--David Pearson contributed to this report.
Write to Adam Mitchell at adam.mitchell@dowjones.com