French nuclear power and technology giant Areva said Monday that it could post a net loss of $5.6 billion in 2014, up from $566 million in 2013.
The losses look to be substantially more than Areva's market capitalization, which stands at about $4.19 billion, The New York Times reported Monday
The news has triggered speculation that the company, which is 87 percent owned by the state, is soon to be restructured or absorbed in part by French utility giant Eletricite de France or EDF.
The company cited construction delays and the waning value of assets as primary causes for the losses. In addition, renewable energy contracts have not proved to be profitable, the company said.
Delays at Unit 3 of the Olkiluoto Nuclear Power Plant in Finland have pushed costs up almost three times the original estimates. The original price tag for the unit was $3.3 billion. That has escalated to about $9.6 billion.
Bloomberg said Monday that Areva has about $7.9 billion in gross debt.
Job cuts in France may be in the offing, the company said, but details of a new business plan will be released March 4. “The group is working on developing a competitiveness plan and a strategic and financial road map,” Areva said.
Anonymous comments will be moderated. Join for free and post now!