Safety checks cut profits at British Nuclear Fuels
The comments came as BNFL revealed after-tax losses of pounds 88m for last year, after making a one-off provision of pounds 356m to pay for future tax bills on long-term reprocessing contracts. Excluding this charge, pre- tax profits rose by 46 per cent, to pounds 316m.
But despite the provisions BNFL more than doubled the dividend it pays to the Government, from pounds 45m to pounds 93m. The chairman, John Guinness, said the decision was "entirely a matter for the board", and there had been no political pressure to increase the amount the company adds to Treasury coffers.
Mr Guinness declined to say how much lower the current year's profits would be compared with last year's pre-exceptional earnings. "This year's number will begin with a figure 2, rather than a 3," he explained.
BNFL reprocesses waste from British Energy and was boosted last year by higher output from the UK nuclear power stations. But shortly after the troubled flotation in July, British Energy temporarily shut down Hinckley Point and Hunterston after discovering suspected cracks in pipe wells.
Another drain on profits this year will be a planned 30-week shutdown of facilities which reprocess fuel from some older Magnox stations, whose operational lives have been extended.
The recently appointed chief executive, John Taylor, forecast another round of staff reductions in an on-going drive to improve efficiency. Mr Taylor, who joined BNFL from the chemicals industry, said he was looking to flatten the tiers of management as part of a strategic review of operations.
The first stage of the strategic review, announced yesterday, has been to reorganise the company into four divisions, ending a traditional split between national and international operations.
BNFL is half-way through a plan to cut 2,000 jobs, though Mr Taylor said there was space for further savings. He said there was no target for staffing levels at BNFL, which employs 13,500. "We are looking for cost reductions. We've got areas where we need to improve efficiency and effectiveness."
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