EDF Group results for 2014
EDF Energy will provide a detailed breakdown of how each part of its business has performed when it publishes its annual segmented accounts later this year.
The key points relating to EDF Energy’s performance are:
- Operating Profit (EBIT) for EDF Energy in 2014 was £649m. This is 25% lower than in 2013 (£863m) and reflects challenging market conditions. The figure includes a one-off charge of £136m relating to the reduction in value of gas generating and storage assets, meaning underlying profitability was 10% lower1
- This figure was impacted by the precautionary decision in August 2014 to shut down Heysham 1 and Hartlepool nuclear power stations to allow a detailed programme of boiler inspections to take place. These stations have now been safely returned to service
- Performance of the rest of the nuclear stations was very strong, in particular:
o Heysham 2 achieved over 10.4TWh output, a record for any advanced gas cooled reactor power station in a single year
o Hinkley Point B generated its highest output in 10 years with no unplanned stoppages in 2014
o Excellent safety performance with the lowest ever number of “lost-time incidents” recorded in the nuclear stations’ operational history
- In 2014, EDF Energy officially opened a new gas power station at West Burton in Nottinghamshire, and its first offshore windfarm at Teesside
- Further progress has been made on plans to build a new nuclear power station at Hinkley Point in Somerset with the approval of agreements between the UK Government and EDF by the European Commission
- EDF and the UK Government are working hard to finalise all agreements on Hinkley Point C and are making significant progress in all areas with the shared objective of finalising documents in the coming weeks. This will allow a final investment decision to be possible in the next few months. EDF is also making progress in discussions with future investment partners in the project. In particular, progress is being made with Chinese partners on all aspects of their nuclear industrial co-operation in the UK, which is part of the wider partnership between EDF and Chinese companies
- EDF Energy’s residential customer business has taken steps to reduce operating costs through increased efficiency and is now close to breaking even. It had on average 194,000 more customer accounts during 2014 than during 2013 and now has an industry-leading 40% of customers on fixed tariffs with no exit fees
- Investment in digital means that 42% of our customers now deal with their accounts online
- As part of our commitment to openness and education, we have welcomed 90,000 people to our nuclear visitor centres
- Progress on sustainability with all the nuclear power stations now holding the Wildlife Trust Biodiversity Benchmark for management of the biodiversity on nuclear sites
- In 2014, 83% of EDF Energy employees said they strongly believe in the company’s ambitions, which include leading the decarbonisation of the UK electricity sector and being the best and most-trusted energy company
What we do with our profits
- The company reinvested all of its operational profit and more back into the business, with more than £1.2bn being spent on its existing nuclear and coal stations, its new nuclear project and its customers business. For example, this investment enabled EDF Energy to announce that it has extended the expected life of Dungeness B nuclear power station in Kent by ten years to 2028. The company has invested £3.7bn in the UK over the last three years
- In 2014, EDF Energy paid £250m in interest payments on its loans. It expects to pay around £110m in corporation tax in respect of its 2014 profits
EDF Energy Chief Executive Vincent De Rivaz said: “Despite challenging market conditions, EDF Energy increased its investment in the UK. Customers will benefit from this long term approach with more low carbon electricity for the future. Our spending on research and development has underpinned our ability to safely extend the lives of our nuclear power stations. At the same time customers are seeing very competitive prices, with an increasing number benefitting from our fixed tariffs.”
For further information the UK results, please contact Louis Blake in the EDF Energy press office on 0207 752 2248.
1EDF Energy’s financial performance as measured by earnings before interest, tax, depreciation and amortization (EBITDA) was £1,555m. EBITDA in 2013 was £1,689m. This means EBITDA was 8% lower in 2014.
Glossary of terms
Earnings before interest and tax (EBIT) / Operating profit
This is a company’s ‘operating’ profits before payments for tax and interest payments are included. The charge for depreciation and amortization is included in the operating profit figure.
Earnings before interest, tax, depreciation and amortisation (EBITDA)
This is effectively the company’s net income from selling energy minus its operating expenses, but it excludes the significant costs involved in repaying loans, paying tax and the declining value of the assets it owns (e.g. buildings, power stations and equipment).
It also does not factor in the amount a company must invest to maintain existing assets or build new power stations.
Reflects the value of non-physical assets owned by the company such as copyright or patents.
For more information contact:EDF Energy Media
Media Relations Team
EDF Energy is one of the UK’s largest energy companies and the largest producer of low-carbon electricity, producing around one-fifth of the nation's electricity from its nuclear power stations, wind farms, coal and gas power stations and combined heat and power plants. The company supplies gas and electricity to 6 million business and residential customer accounts and is the biggest supplier of electricity by volume in Great Britain.
EDF Energy’s safe and secure operation of its eight existing nuclear power stations at sites across the country makes it the UK’s largest generator of low carbon electricity. EDF Energy is also leading the UK's nuclear renaissance and has published plans to build four new nuclear plants, subject to the right investment framework.
These new plants could generate enough low carbon electricity for about 40% of Britain’s homes. They would make an important contribution to the UK’s future needs for clean, secure and affordable energy. The project is already creating business and job opportunities for British companies and workers.
Through Our Better Energy Ambitions, EDF Energy has developed one of the biggest environmental and social programmes of any British energy company.
In 2014 EDF Energy received seven ‘Big Ticks’ in the Business in the Community (BITC) Responsible Business Awards. In 2013 EDF Energy received the Environmental Leadership for Behavioural Change Award in the national Environment and Energy Awards and was highly commended in the first ever pan European Corporate Social Responsibility Awards scheme for its Sustainable Schools programme – the Pod.
EDF Energy is part of EDF Group, one of Europe’s largest power companies. The company employs around 15,000 people at locations across the UK.
To find out more about the UK's energy challenges look at www.edfenergy.com/energyfuture/