Half-year 2015 results
July 30, 2015
In accordance with IFRS 5, the statement of income and the statement of cash flows for the first half of 2014 were restated to present pro forma information using a consolidation scope comparable to that of the first half of 2015; net income from operations which are the subject of requests for proposals or whose sale is under negotiation is presented on a separate line, “net income from discontinued operations”.
The following operations meet the criteria of IFRS 5 for classification as “discontinued operations” at June 30, 2015:
- AREVA NP
- Nuclear Measurements
- Solar Energy
- Wind Energy: Adwen’s results are recognized using the equity method as from March 9, 2015. The results from January 1 to March 8, 2015 and income from deconsolidation are presented in “net income from discontinued operations”.
It should be noted that the level of activity of the different Business Groups and their contribution to the group’s results may vary significantly from one half year to the next in the nuclear operations. Accordingly, half-year data should not be viewed as a reliable indicator of annual trends.
Half-year 2015 results
• Key figures:
- Backlog: €32.3bn (stable vs. H1 2014)
- Revenue: €1.930bn (+6.3% LFL)
- EBITDA: €306m (+€63m vs. H1 2014)
- Operating income: €7m (+€219m vs. H1 2014)
- Operating cash flow: €460m (+€517m vs. H1 2014)
- Net cash flow from company operations: -€211m (+€55m vs. H1 2014)
-Consolidated net income: -€206m (+€488m vs. H1 2014)
• Highlights of the period
- Deployment of the transformation plan
- Olkiluoto 3 (OL3): substantial improvements observed at the site concerning project execution
- Flamanville 3 (FA3): with EDF’s agreement, AREVA submitted a test program to the regulators designed to demonstrate equipment compliance with the new safety requirements. Review of this program is underway.
- Agreements to increase Franco-Chinese cooperation on civilian nuclear energy (CNNC, CGN and EDF)
- Agreement on transportation and nuclear logistics in China (CNNC)
- Final agreements with Gamesa for the creation of the Adwen joint venture
- Start of the process to dispose of Canberra
• Performance plan
- Progress on the competitiveness plan (2017 target of €1bn in operating gains compared with 2014, including €500m net of inflation for the New AREVA consolidation scope): about 85% of the actions identified
- Job reduction objective of 5,000 to 6,000 jobs across the group (including 3,000 to 4,000 in France) by the end of 2017
- Social dialogue: start of “book II” process in October
- Advances made on commercial agreements with EDF (natural uranium, conversion, enrichment, treatment and recycling)
- Strengthened management of large projects
• Strategic roadmap
- Directions set by the President of the French Republic on June 3, 2015 taken into account
- Redefinition of the partnership with EDF:
- Definition of the terms of the strategic partnership
- Plan to sell at least 75% of the AREVA NP entity to EDF
- Plan to create a joint entity for the design, project management and marketing of new reactors
• Financing plan
- Financing of the company for the 2015-2017 period:
- Financing requirements: approximately €7bn after incorporating the benefits of two levers:
- Deployment of the competitiveness plan
- Strong selectivity in capital expenditure
- Sources of liquidity for the 2015-2017 period:
- Equity financing of approximately €1.2bn:
• Optimization of the minimum cash pooling threshold
• Optimized cash management (factoring, monetization of tax receivables, weekly forecasts)
• Continued efforts to raise financing for industrial assets
- Asset sale program of approximately €2.4bn:
• Plan to sell at least 75% of the AREVA NP entity to EDF for the indicative amount of 2.0 billion euros at the date of the operation completion
• Sales of other assets: target of approximately 0.4 billion euros
- Additional measures studies for the reinforcement level of liquidity and capital
- Significant capital increase to give AREVA, in addition to the measures of the financing plan, a financial profile enabling it to refinance all of the company’s needs in the mid-term.
• Financial outlook (1) :
- Confirmation of the outlook for net cash flow from company operations
(1) Data at constant consolidation scope and foreign exchange, excluding the impacts of asset sales, equity-based transactions and refinancing.
Paris, July 30, 2015
The Board of Directors of AREVA, meeting yesterday under the chairmanship of Philippe Varin, approved the financial statements for the period ended June 30, 2015. Chief Executive Officer Philippe Knoche offered the following statement concerning the results:
“We are targeting a clear objective for 2017: to transform AREVA into a competitive company refocused on its core business, the nuclear fuel cycle, where it has unique human and industrial capital in the world.
During the first half, AREVA made determining decisions in that direction. The group has announced an ambitious competitiveness plan, is engaged in strong social dialogue with its social partners, and has worked to improve the management of its large projects, which up to now have weighed heavily on its financial trajectory. It pursued its strategic roadmap for its refocusing and the redefinition of the partnership with EDF. The agreements found with EDF represent very significant progress. The group also worked on its financing plan whose aim is to allow AREVA to refinance its mid-term needs on the markets.
Next months will be key to continued success in the execution of this transformation plan, by keeping safety, the customer and social dialogue at the center of our action. One of the priorities will be to draw the organization of two companies, different and linked by a strategic partnership at the same time. The arrival of Bernard Fontana, coming from the industry and internationally recognized, at the head of AREVA NP, is for those whole actions, very good news for the group.
Lastly, we must make the transition from a time of crisis management to a time for the longer term, one in which a vision and a development strategy are defined for the new AREVA. Philippe Varin and I have every intention of using that time to build a project for reconquering the future, with everyone's support.”