Energy group Vattenfall's Q1 net profit up 90 per cent

May 5, 2011, 12:05 GMT

Stockholm - Swedish state-owned energy group Vattenfall on Thursday said its first quarter net profit almost doubled, even as net sales declined due to the effect of the sale of its German transmission business and a stronger Swedish currency.

Net profit in the quarter was 7.2 billion kronor (1.2 billion dollars), compared to 3.7 billion kronor year-on-year.

Net sales during the period dropped 26 per cent to 51.8 billion kronor, mainly due to the sale a year ago of the group's German transmission business, 50Hertz Transmission GmbH, the group said.

Vattenfall said electricity production increased 4.6 per cent in the quarter, with increases from nuclear power and wind power. Production from hydropower and fossil fuels dropped.

The 37-per-cent increase in nuclear power production was linked to the utility's Swedish plants. In Germany, the Brunsbuettel and Kruemmel nuclear plants remained offline. Vattenfall owns 50 per cent of Kruemmel.

Brunsbuettel was one of seven plants affected by the German government's decision to shut down reactors built before 1980 after the massive earthquake in Japan which caused a crisis at the Fukushima nuclear plant.

Chief executive Oysten Loseth later told analysts that it was uncertain what effects the German government's moratorium would have.

'We will definitely know more after the moratorium has ended, and the German government has decided what they will do when it comes to the nuclear strategy for Germany,' he said.

He added that Vattenfall and 'other players in the German market are in discussions with government officials.'

Vattenfall was still studying a possible plan to let rival E.ON take over operations of Brunsbuettel and Kruemmel, he said.

Asked if the public debate on nuclear energy had possibly affected its customer base in Germany, Loseth said he could not say, noting that 'many of our competitors also have nuclear power in their portfolio.'

The group has operations in the Nordic region, Germany, Poland, Belgium and Netherlands. At the end of March it employed some 37,800 people, down 3 per cent compared to the same period in 2010.

Read more about Energy

Read more about Sweden Business