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UPDATE 1-EDF extends nuclear fleet depreciation period, shares up 8 pct
July 29, 2016 / 7:31 AM / a year ago

UPDATE 1-EDF extends nuclear fleet depreciation period, shares up 8 pct

* Shares up 8 pct as EDF extends depreciation of reactors

* EDF sells half of its power unit RTE to CDC

* Board approves Hinkley Point, UK reviews position (adds shares, details)

PARIS, July 29 (Reuters) - EDF has extended the depreciation period of part of its French nuclear fleet to 50 years from 40, which will boost its bottom-line profit, the French state-controlled utility said.

EDF said the longer depreciation of its 900 megawatt series reactors - excluding one in Fessenheim which the government wants to close - boosted first-half net income excluding non-recurring items by 300 million euros and would boost full-year net by 600 million euros.

An EDF spokeswoman said the extension concerns 32 of EDF’s 58 reactors.

“Extending the depreciation period of our reactors allows us to align our accounting practices with our industrial strategy,” EDF chief financial officer Xavier Girre said on an earnings call.

EDF said it was going ahead with its new accounting policy even though nuclear safety authority ASN has not yet given a generic approval to extend the lifespan of French reactors, and which will review each reactor individually.

EDF shares rose more than 8 percent in opening trade on Friday, outperforming the broader index, up 0.3 percent.

On Thursday evening EDF also said its board had given the go-ahead for its 18 billion pound project to build two nuclear plants in Britain, although the new British government said hours later that it would review the contract.

EDF also announced it had made a deal with state bank CDC to sell half of its stake its its grid unit RTE.

EDF said first-half core earnings before interest, tax, depreciation and amortisation (EBITDA) were nearly stable at 8.9 billion euros. Net income fell 17.2 percent to 2.1 billion euros due to asset impairments.

The group maintained its 2016 earnings guidance for the EBITDA earnings measure at between 16.3 billion and 16.8 billion euros. (Reporting by Geert De Clercq; Editing by Andrew Callus)

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