EDF

Strengthens

  • Strong competitive position in Europe, especially in France.
  • Energy needs are enormous since in 10 years one billion people will have the access to electricity on the world.
  • In the first term, EDF declared solid results. Particularly, thanks to international activities and integration of British Energy which contributed to 936 million euro to EBITDA of the group.
  • Even though the French market is open to competition since 2007, the leadership of EDF remains unchallenged for the moment due to its competitive prices thanks to its nuclear facilities.
  • By acquiring British Energy, EDF has become the principal actor of nuclear relaunch in the U.K. This also matches EDF’s goal to be the first player in this realm.
  • Despite the decrease of the net results per share in 2008 (1,87 euro against 3,08 in 2007), the dividend has been maintained 1,28 per share.
  • The authorization given by the Nuclear Safety Authority (ASN) to extend the operating life of power of 900 MW group from thirty to forty years should favor of the advancement of that achivement. This increase should also be ensured by investments underway in France and abroad which should increase performance of the group, the plan to improve operational efficiency, and the integration of British Energy, which should generate additional synergies.

Weaknesses

  • The cost of strikes in the first term, which has affected its distribution subsidiary ERDF, is estimated at 270 million (450 million and the whole of 2009);
  • The EDF's financial structure has been weakened by the acquisition of British Energy: net debt reached 36.8 billion euros at June 30, 2009, to only 27.7 billion of equity;
  • Debt reduction is even more crucial for the group that should pursue investments in Britain in the nuclear
  • Maintaining the regulated rates (determined by the state), that only EDF can implement so far, could be threatened after the government handed over the Champsaur report. He advocates expanding these rates to all electricity suppliers;
  • The announcement by EDF Energy to lower electricity prices by 8.8% on average in the United Kingdom as of March 31, 2009 could occur elsewhere in Europe;
  • The decline in oil prices could limit the benefits of nuclear power, which is the driving fore of group’s development.

Financial Events

In early 2009, EDF has completed the acquisition of British Energy worth roughly 12 billion pounds (13.6 billion euros). It is the largest acquisition in company’s history. This should enable it to play a leading role in the nuclear revival in the United Kingdom.
The resumption of nuclear activities U.S. Constellation Energy (4.5 billion dollars) is delayed by a court decision. The group hopes to conclude by the first quarter of 2010 the sale of its distribution network of electricity in the United Kingdom for approximately 4 billion pounds (4.7 billions euros).

Source: TF1 News,

As of July, 2008, all major assets are located outside of Russia, in 14adjacent countries:

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