EDF boss vows to put company back on track after record $19 billion loss

By Benjamin Mallet

PARIS (Reuters) -EDF boss Luc Remont vowed to put the French power producer back on track on Friday after it slumped to a record net loss of 17.9 billion euros ($19 billion) in 2022, hammered by an unprecedented number of outages at its reactors.

Output from the company's nuclear plants fell to a 34-year low, forcing EDF to buy electricity on the market to supply its customers just as Russia's invasion of Ukraine pushed power prices sharply higher across Europe.

EDF's earnings were also hit by government measures to cap the increase in electricity bills for French households and protect them from rising inflation.

The group, which is in the process of being fully nationalised, recorded negative yearly core earnings or EBITDA of 5 billion euros and its net debt rose to 64.5 billion euros, up from 43 billion a year earlier.

"Today, our priority is to put EDF back on track," Chief Executive Luc Remont, appointed by the government in November to turn the group around, told reporters.

He said he targeted nuclear output in France of between 300 and 330 terawatt-hours (TWh) in 2023, up from 279 TWh last year - which was the lowest since 1988 and turned France into a net importer of electricity for the first time since 1980.

Core earnings for this year are expected to be "significantly higher" than the 18 billion euros booked in 2021, Remont said, and the group targets net debt at 3 times EBITDA or less in 2023.

STRATEGIC PLAN

The group however must fund big investments of 33 billion euros through 2028 on its existing reactors, while a plan announced by President Emmanuel Macron to build six new reactors by 2050 is expected to cost 52 billion euros.

It also faces a multi-billion euros bill for the construction of the planned Sizewell C plant in Britain.

The French government has given Remont six months to come up with a strategic plan for the utility, which generates the lion's share of the country's electricity and has been dogged by delays and cost overruns on existing projects.

Its planned Flamanville reactor is more than a decade behind schedule and its estimated cost has more than quadrupled to 13.2 billion euros.

EDF said on Friday that 43 of its 56 reactors, which were hit by delayed maintenance and checks for corrosion issues that first emerged in late 2021, were currently operational.

Corrosion problems have been or are being treated at 10 of the most sensitive reactors and pipes will be replaced at seven more by the end of 2023, it said.

The government's plan to gain full control of the company and delist it from the stock market - it already had an 84% stake - is on hold pending a court ruling on an appeal by minority shareholders. The ruling is expected in the first half of 2023, EDF said.

($1 = 0.9406 euros)

(Additional reporting by America Hernandez; Writing by Silvia Aloisi; Editing by Ingrid Melander and David Holmes)