Vattenfall atom profits slump

Electricity provider Vattenfall's net profit fell by almost a quarter last year, as lower electricity prices and production reduced earnings to 10.4 billion kronor (1.56 billion euros; $1.57 billion) compared to 13.1 billion kronor in 2010.

Sales also declined considerably to 181 billion kronor, which was 15 percent less year-on-year, the company announced Thursday.

Vattenfall CEO Oystein Loseth noted, however, that fourth-quarter net profit doubled year-on-year, reaching 5.1 billion kronor.

Loseth described 2011 as a "tough year in many respects for the entire energy sector."

Nuclear phase-out burdens

Vattenfall earnings were hit hard by the German government's decision to phase out nuclear energy production by 2022.

After last year's nuclear catastrophe in Fukushima, Japan, the government decided to speed up the phase-out, ordering the immediate shutdown of the country's six oldest reactors. Among them were Vattenfall's reactors at the Krümmel and Brunsbüttel power plants.

Loseth said the decision resulted in an "earnings charge of 10.5 billion kronor."

In November 2011, the Swedish state-owned company announced it would file a lawsuit against Germany in a US court, seeking compensation to the tune of several billion dollars.

In view of slumping profits, Vattenfall CEO Loseth said the company would continue to cut costs. He described a current program, aimed at reducing costs by 6 billion by the end of 2013 as "proceeding better than planned" as the group's 2011 costs were already 4 billion kronor lower than in the previous year.

Author: Uwe Hessler (dpa, AFP)
Editor: Michael Lawton