STOCKHOLM (Reuters) - Sweden’s Vattenfall reported on Tuesday a swing to a deep loss in the second quarter, hit by falls in the price of electricity and Germany’s plans to phase out coal, and said Chief Executive Magnus Hall had decided to leave the group.
The state-owned utility booked impairment losses of 10.6 billion crowns (941.77 million pounds in the quarter, leading to an operating loss of 7.03 billion crowns compared with a year-ago profit of 2.87 billion.
It wrote down the value of Moorburg, its coal-fired plant in Hamburg, by 9.1 billion crowns due to low margins and Germany’s passing of a bill this month for it to exit coal as a power source by 2038 to meet climate targets.
It also wrote down the value of wind farms in Sweden and Denmark by 1.5 billion crowns due to falling prices.
“We are seeing strained market conditions in many respects, especially for fossil-fired power generation. While this is not surprising, it is now resulting in large write-downs,” Hall said in a statement.
Vattenfall said its turnover fell to 31.3 billion crowns from 34.7 billion, due mainly to lower electricity prices and lower sales volumes in the Nordic countries and the Netherlands. Vattenfall said its board would now begin the process of finding a successor to Hall, who joined the group as CEO in 2014, adding that Hall would leave no later than Jan. 31, 2021.
“It’s a personal decision and after six intense and fun years, with many changes and a clear direction for Vattenfall I feel it’s time to wind down and focus more on other things,” he told Reuters on his resignation.
“I will remain fully committed until my successor is in place,” he said in the statement.
Reporting by Anna Ringstrom; editing by Edwina Gibbs and Mark Potter