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Exclusive-EDF warns of 1 billion euro loss due to French strikes, reviews hiring - sources

Published 04/13/2023, 07:59 AM
Updated 04/13/2023, 08:06 AM
© Reuters. FILE PHOTO: The company logo for Electricite de France (EDF) is seen in Paris, France, March 2, 2021. REUTERS/Benoit Tessier
EDF
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By Benjamin Mallet

PARIS (Reuters) -French utility EDF (EPA:EDF) has warned drawn-out strikes at its nuclear reactors and hydro-electricity plants have cost it 1 billion euros ($1.10 billion) in lost output and that it is reviewing hiring plans for the year, three sources said.

Two of the sources, who are union members and were briefed by two EDF executives in separate conversations last week, told Reuters they were informed that EDF management had asked all divisions to see which hires could be postponed to next year.

An EDF spokesperson told Reuters that a moratorium had been imposed on hirings. The spokesperson did not elaborate on the reason and declined to comment on the strikes' financial impact on the group, which is in the process of being fully nationalised.

The financial hit incurred from the industrial action, confirmed to Reuters by a third source inside the company, follows a record loss in 2022 when the utility was bedevilled by reactor outages.

It comes as EDF's new chief executive draws up a plan to ramp up nuclear production and lighten the group's heavy debt load.

The French economy ministry declined to comment.

The group had originally planned to hire between 3,000 and 3,500 people in 2023, mostly in nuclear production and sales, one of the sources said.

The same source said that disruption to nuclear reactor maintenance and repair works caused by more than a month of strikes against a deeply unpopular pension reform could result in delays of between 18 to 24 months to the maintenance schedule.

That in turn could jeopardise EDF's nuclear production forecasts for the year at a time when the utility was hoping to rebound from a 34-year output low in 2022, when it was hammered by an unprecedented number of outages at its reactors.

The financial hit will complicate matters for new EDF boss Luc Remont, tasked with putting the group back on track after it slumped to a record net loss of 17.9 billion euros ($19 billion) last year.

Lower output from the company's nuclear plants forced EDF to buy electricity on the market to supply its customers just as Russia's invasion of Ukraine pushed power prices sharply higher across Europe.

Its earnings were also hit by government measures to cap the increase in electricity bills for French households and protect them from rising inflation.

© Reuters. FILE PHOTO: The company logo for Electricite de France (EDF) is seen in Paris, France, March 2, 2021. REUTERS/Benoit Tessier

The group's net debt rose to 64.5 billion euros in 2022, up from 43 billion a year earlier.

($1 = 0.9072 euros)

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