Swedish energy group Vattenfall reports billions in losses

GMT 05:50 2015 Wednesday ,22 July

Arab Today, arab today Swedish energy group Vattenfall reports billions in losses

Swedish energy group Vattenfall
Stockholm - XINHUA

State-owned energy group Vattenfall reported hefty losses on Tuesday as the company suffered from sluggish demand in Europe.

Vattenfall reported second-quarter operating losses of 38 billion SEK (4.41 billion U.S. dollars), weighed down by write-downs to the tune of 36.3 billion SEK (4.21 billion U.S. dollars), its earnings report said.

"The low electricity prices are having an ever-greater impact on Vattenfall's earnings, as our forward contracts entered into in previous years at higher prices are gradually expiring," CEO Magnus Hall said in a statement.

Vattenfall said it had been hit by falling electricity demand in Europe since the financial crisis, causing prices to drop, as well as competition from solar and wind producers.

The Swedish government's recent decision to close two reactors at the Ringhals power plant, where Vattenfall owns a majority stake, also contributed to the write-downs, the company said.

Hall refused to rule out future job cuts on Tuesday, having already announced in April that 1,000 full-time jobs would go.

The energy group reported net second-quarter sales of 36.1 billion SEK (4.19 billion U.S. dollars), a marginal decrease on the same period last year.

Vattenfall, which employs more than 30,000 people in six European countries, has sought 5.1 billion U.S. dollars in damages from the German state for its decision to pull out of the nuclear power sector by 2022. (1 U.S. dollar = 8.63 SEK)

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