AREVA, Business & strategy overview - Appendix 1 - November 2009

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AREVA, Business & strategy overview - Appendix 1 - November 2009

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AREVA, Business & strategy overview - Appendix 1 - November 2009

  1. 1. AREVA Business & Strategy overview Appendices November, 2009
  2. 2. Notice ► Forward-looking statements This document contains forward-looking statements and information. These statements include financial forecasts and estimates as well as the assumptions on which they are based, statements related to projects, objectives and expectations concerning future operations, products and services or future performance. Although AREVA’s management believes that these forward-looking statements are reasonable, AREVA’s investors and investment certificate holders are hereby advised that these forward-looking statements are subject to numerous risks and uncertainties that are difficult to foresee and generally beyond AREVA’s control, which my mean that the expected results and developments differ significantly from those expressed, induced or forecast in the forward-looking statements and information. These risks include those developed or identified in the public documents filed by AREVA with the AMF, including those listed in the “Risk Factors” section of the Reference Document registered with the AMF on April 15, 2009 (which may be read online on AREVA’s website, www.areva.com). AREVA makes no commitment to update the forward-looking statements and information, except as required by applicable laws and regulations. AREVA Overview – November 2009 p.3
  3. 3. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.4
  4. 4. Key data for 2008 In millions of euros 2007 2008 ∆ 08/07 Backlog 39,834 48,246 +21.1% Revenue 11,923 13,160 +10.4% Operating income before OL3 1,043 1,166 +11.8% % of revenue 8.7% 8.9% +0.2 pts Additional provision for OL3 (292) (749) Operating income 751 417 -44.5% % of revenue 6.3% 3.2% - 3.1 pts Net income attributable to equity holders of 743 589 -20.7% the parent €20.95 €16.62 -20.7% Earnings per share Free operating cash flow* (1,985) (921) +€1.064Bn 12/31/08 6/30/09 Net debt (**) 4,003 5,499 + 37.4% * EBITDA +/- change in Operating WCR – Capex net of disposals ** Siemens’ put option at its 2007 value, i.e. €2.049B AREVA Overview – November 2009 p.5
  5. 5. First half 2009 revenue compared with first half 2008 H1 2009 H1 2008 Reported Comparable Exchange Consolida- Harmonization Reported In millions of euros revenue* revenue rate tion scope of accounting revenue impact impact methods Front End 1,556 1,547 60 0 0 1,488 Reactors and Services 1,506 1,535 44 25 0 1,466 division Back End 843 938 9 0 0 930 division Nuclear 3,906 4,021 112 25 0 3,883 Operations T&D 2,614 2,325 (20) 61 0 2,284 Corporate 2 1 0 0 0 1 Group total 6,522 6,346 92 86 0 6,168 * Contribution to revenue AREVA Overview – November 2009 p.6
  6. 6. Non-operating items In millions of euros H1 2008 H1 2009 ∆ H109/H108 Operating income 539 16 (523) Net financial income 213 212 (1) Share in net income of equity 121 (163) (284) associates Income tax (74) (58) +16 Effective tax rate 9.8% 25.3% + 15.5 pts Minority interests 38 (154) (192) Net income attributable to 760 161 (599) equity holders of the parent AREVA Overview – November 2009 p.7
  7. 7. Net financial income In millions of euros H1 2008 H1 2009 ∆ 09/08 End-of-life-cycle operations 1 29 28 including: Income from portfolio earmarked for end-of-life-cycle 62 47 (15) operations 66 76 10 Income from receivables related to dismantling and from discount reversal on earmarked assets (127) (95) 32 Discounting reversal expenses Cost of net debt (net of discounts and premiums) (55) (59) (4) Discounts and premiums on financial instruments (21) 1 22 Income from disposals of securities 354 244 (110) Discount reversal on retirement and benefits (35) (45) (10) Other income and expenses (31) 43 74 Net financial income 213 212 (1) AREVA Overview – November 2009 p.8
  8. 8. Share in net income of associates In millions of euros H1 2008 H1 2009 ∆ 09/08 STMicroelectronics (3) (124) (121) Eramet Group 116 (39) (155) Other 8 0 (8) Total 121 (163) (284) AREVA Overview – November 2009 p.9
  9. 9. Minority interests In millions of euros H1 2008 H1 2009 ∆ 09/08 Siemens’ 34% share of AREVA NP (44) (166) (122) Minority interests’ 40% of Eurodif 37 14 (23) Other 45 (2) (47) Total 38 (154) (192) AREVA Overview – November 2009 p.10
  10. 10. Cash flow and net debt In millions of euros H1 08 H1 09 Operating EBITDA 863 459 % of revenue 14.0% 7.0% Net gain on disposals of non-current operating assets (190) (173) Change in operating WCR (739) (783) Net operating Capex (455) (618) Free operating cash flow before tax (521) (1,115) End-of-life-cycle obligations (20) (33) Dividends paid (319) (313) Other (net financial investments, income tax, 428 546 non-operating WCR, etc.) Increase (decrease) in net cash (432) (915) Net debt (6/30) 4,459 6,414 AREVA Overview – November 2009 p.11
  11. 11. Simplified balance sheet at 6/30/09 In billions of euros Goodwill 5 Total equity 6.7 PPE and intangible assets 8.6 5.7 Provisions for end-of-life-cycle operations 3.7 Other provisions Assets earmarked for end of 5.2 life cycle operations 0.6 Other balance sheet items Equity associates 1.6 6.4 Net debt*: €(6.414)B Non-current financial assets 1.2 1.5 Operating WCR Secteurs refroidis Simplified assets creuset par du Simplified liabilities & Simplified = 23.1 = Simplified liabilities assets circulation d’eau equity & equity * Net debt including Siemens’ put option at its 2007 value, i.e. 2.049 billion euros AREVA Overview – November 2009 p.12
  12. 12. Balance Sheet (1/2) ASSETS (in millions of euros) June 30, 2009 December 31, 2008 Non-current assets 22,557 22,841 Goodwill on consolidated companies 5,016 4,803 Intangible assets 3,317 3,089 Property, plant and equipment 5,294 4,913 End-of-life-cycle assets (third party share) 277 270 Assets earmarked to finance end-of-life-cycle operations 4,986 4,954 Equity associates 1,571 1,757 Other non-current financial assets 1,174 2,152 Pension fund assets 2 1 Deferred tax assets 921 900 Current assets 12,534 11,804 Inventories and work-in-process 3,820 3,403 Trade accounts receivable and related accounts 4,857 4,486 Other operating receivables 2,747 2,434 Current tax assets 95 164 Other non-operating receivables 181 154 Cash and cash equivalents 622 1,050 Other current financial assets 212 113 Assets of operations held for sale - - Total assets 35,091 34,644 AREVA Overview – November 2009 p.13
  13. 13. Balance Sheet (2/2) Liabilities and Equity (in millions of euros) June 30, 2009 December 31, 2008 Equity and minority interests 6,693 7,292 Share capital 1,347 1,347 Consolidated premiums and reserves 4,734 4,455 Deferred unrealized gains (losses) on financial instruments (129) 287 Currency translation reserves (190) (131) Net income attributable to equity holders of the parent 161 589 Minority interests 769 745 Non-current liabilities 12,025 11,795 Employee benefits 1,283 1,268 Provisions for end-of-life-cycle operations 5,696 5,674 Other non-current provisions 121 123 Long-term borrowings 4,218 3,969 Deferred tax liabilities 707 760 Current liabilities 16,374 15,558 Current provisions 2,251 2,081 Short-term borrowings 3,031 2,693 Advances and prepayments received 4,975 4,752 Trade accounts payable and related accounts 2,939 2,991 Other operating liabilities 3,042 2,884 Current tax liabilities 57 104 Other non-operating liabilities 80 53 Liabilities of operations held for sale - - Total liabilities and equity 35,091 34,644 AREVA Overview – November 2009 p.14
  14. 14. Income Statement In millions of euros June 30, 2009* June 30, 2008* December 31, 2008* Revenue 6,522 6,168 13,160 Other income from operations 41 18 32 Cost of sales (5,674) (4,905) (10,906) Gross margin 889 1,281 2,286 Research and development expenses (249) (205) (453) Marketing and sales expenses (320) (287) (607) General and administrative expenses (487) (468) (980) Other operating income and expenses 183 219 171 Operating income 16 539 417 Income from cash and cash equivalents 5 13 38 Gross borrowing costs (63) (89) (148) Net borrowing costs (59) (76) (111) Other financial income and expenses 271 289 81 Net financial income 212 213 (29) Income tax (58) (74) (46) Net income of consolidated businesses 171 678 343 Share in net income of equity associates (163) 121 156 Net income from continuing operations 7 799 498 Net income from discontinued operations -- -- -- Net income for the period 7 799 498 of which minority interests (154) 38 (91) Net income attributable to equity holders of the 161 760 589 parent * The discount/premium is classified in Other financial expenses as from 12/31/2008. It was classified in gross borrowing costs in H1 2008 AREVA Overview – November 2009 p.15
  15. 15. Key data by division (1/2) H1 09 Reactors In millions of euros and Back Group (excluding employees) Front End Services End T&D Corporate total Contribution to revenue 1,556 1,506 843 2,614 2 6,522 Results Operating income 348 (608) 150 186 (61) 16 % of revenue 22.4% - 40.3% 17.8% 7.1% - 0.2% EBITDA (excluding end-of-life- cycle costs) 438 (333) 198 211 (55) 459 % of contribution to revenue 28.1% - 22.1% 23.5% 8.1% - 7.0% Cash Net Capex (235) (163) (50) (149) (20) (618) position Change in operating WCR (212) (97) (88) (370) (17) (783) Free operating cash flow (179) (595) 60 (310) (92) (1,115) Other Employees 14,950 20,287 10,993 30,816 884 77,929 AREVA Overview – November 2009 p.16
  16. 16. Key data by division (2/2) H1 08 In million of euros Reactors (excluding and Back Group employees) Front End Services End T&D Corporate total Contribution to revenue 1,488 1,466 930 2,284 1 6,168 Results Operating income 400 (258) 175 253 (32) 539 % of revenue 26.9% - 17.6% 18.8% 11.1% - 8.7% EBITDA (excluding end-of-life- cycle costs) 533 (98) 205 255 (31) 863 % of contribution to revenue 35.8% - 6.7% 22.0% 11.2% - 14.0% Cash Net Capex (125) (178) (44) (99) (9) (455) position Change in operating WCR (264) (130) (87) (198) (59) (739) Free operating cash flow (46) (407) 73 (45) (96) (521) Other Employees 13,618 18,490 10,773 27,431 715 71,026 AREVA Overview – November 2009 p.17
  17. 17. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.18
  18. 18. Numerous countries have nuclear power plant projects CANADA UK NETHERLANDS Target: new reactors ► Target*: 10 GWe by 2020 ► 1 new reactor by 2018** by 2018 ► EPR selected by EDF & E.ON FINLAND ► Olkiluoto 3 (EPR) under construction Up to 3 new reactors to be built by 2020 FRANCE CZECH REPUBLIC CHINA Flamanville 3 (EPR) ► 1 bid for 2 reactors 18 reactors under construction under construction o/w 2 EPR Penly: 2nd EPR by 2017 JORDAN Target*: 70 GWe by 2020 Possible 3rd EPR ► Target 2 plants (opportunity for EPR and Gen 2 reactors) US EPR selected by 6 utilities ITALY (8 units) Target*: 8 to 10 new large reactors by 2030 EMIRATES INDIA EDF-Enel JV to build ►Preparation of an EPR 6 reactors under construction at least 4 EPR project for several reactors Target*: 50 GWe by 2050 # of reactors MoU with NPCIL for up to 6 EPR under construction in the world 44 45 34 28 30 SOUTH-AFRICA ►Nuclear program on hold 2005 2006 2007 2008 2009 30 countries operating 43 countries considering starting 25 countries having nuclear power plants a civil nuclear program expressed interest (*): Nuclear generation capacity announced by countries / (**) :Delta announcement (June 2009). No technology specified AREVA Overview – November 2009 p.19
  19. 19. The nuclear market place : 436 nuclear reactors in 2009 and more to come from the East 67 126 130 10 2 CIS & Eastern Europe 2 North America Western Europe 109 28 Southern & Eastern Asia 2 0 4 Africa & Middle East 1 South America Source: WNA (January 2009) In service Under construction AREVA Overview – November 2009 p.20
  20. 20. Installed capacity in main countries Gross capacity Gross generation Gross capacity Gross generation (GWe) (TWh) (GWe) (TWh) EUROPE 2008 2007 2008 2007 AMERICAS 2008 2007 2008 2007 France* 65.9 65.9 438.6 439.1 Canada 15.4 15.0 94.0 94.0 Germany 21.5 21.4 148.7 140.5 United States 107 105.8 842.4 843.0 Russia 23.2 23.2 162.3 158.3 Mexico 1.4 1.4 9.8 10.4 United Kingdom** 12.5 11.9 39.4 58.6 Brazil 2.0 2.0 14.0 12.4 Ukraine 13.8 13.8 89.8 92.7 Argentina 1.0 1.0 7.4 7.2 Sweden 9.6 9.4 66.9 66.9 Spain 7.7 7.7 60.0 55.0 TOTAL 126.8 125.2 967.6 967.0 Belgium 6.1 6.1 45.8 48.2 Finland 2.8 3.0 23.0 23.4 Other 17.7 17.4 135.4 125.9 ASIA 2008 2007 2008 2007 TOTAL 180.8 179.8 1,209.9 1,208.6 Japan 49.6 49.9 251.7 278.7 * Excluding Phoenix, considered a research reactor. China 9.0 9.1 42.6 62.9 ** Data incomplete for Britain (only Jan-Sep 2008 total available for British India 4.1 4.1 15.5 17.8 Energy Portion) South Korea 18.4 18.4 151.0 142.9 Source: Nucleonics Week, restated by AREVA Taiwan 5.1 5.1 40.8 40.6 Pakistan 0.5 0.5 1.9 2.5 TOTAL 86.8 87.1 503.5 545.4 Source: Nucleonics Week, March 2008, restated by AREVA. AREVA Overview – November 2009 p.21
  21. 21. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.22
  22. 22. A long standing effort and global exploration portfolio is key… Major deposits discovered by / with AREVA 1957 1960 1965 1968 1976 1981 1985 1997 2003 2008 Gabon Bakouma Arlit Cominak Imouraren Cigar Lake McArthur Shea creek Dulaan Tamgak Cluff Lake Uul Deep Exploration budget 60 (M€) 56 AREVA exploration portfolio 50 42 40 30 27 EUROPE 20 15 Since 1947 Canada 10 Russia 0 Quebec Kazakhstan Mongolia 2005 2006 2007 2008 ASIA Ouzbekistan Since 1995 Exploration Staff Jordanie (# FTE) AMERICA 400 360 Since 1964 SenegalNiger CAR 300 Gabon OCEANIA 220 200 AFRICA Since 1969 130 Since 1950 100 80 Namibie Australia 0 2005 2006 2007 2008 AREVA Overview – November 2009 p.23
  23. 23. … to reach a level of resources ensuring production sustainability and offering clients long term visibility AREVA resources Canada France Our Resources ►11,590 MTU Kazakhstan and Reserves ►169,095 MTU ►46,927 MTU level allow Niger production USA ►228,282 MTU Mongolia sustainability for more than 20 ►12,563 MTU ►6,922 MTU CAR years given our ►8,709 MTU production targets Namibia ►45,443 MTU Australia This long term South Africa visibility is a key ►7,585 MTU ►5,722 MTU commercial advantage as AREVA resources (1) 1/1/2009 (MTU) clients tend to Proven + probable reserves (2) 237,533 anticipate their Measured + indicated resources 91,210 fuel supply Inf 156,274 Other measured + indicated resources 51,896 Other Inf 5,923 TOTAL 542,836 Note: (1) Accessible AREVA share, (2) mine and plant yields included AREVA Overview – November 2009 p.24
  24. 24. AREVA handles various mining projects at different development stages… PROSPECTION SHOWING PREFEASIBILITY FEASIBILITY Mc Clean Mc Arthur Somaïr Cominak French Mines Muyunkum Tortkuduk Comuf (Gabon) Cluff Lake (Canada) Heap leaching Somaïr Trekkopje Imouraren Cigar Lake Mongolia Bakouma Australia Midwest Jordan Ryst Kuil Canada RESERVES Kiggavik Kazakhstan Shea Creek Millenium New productions Niger Dawn Lake between 2009 Namibia… RESOURCES and 2013 ~ 15 years ~ 5 years GRASS ROOT DETAILED RECONNAISSANCE DELINEATION DEVELOPMENT PRODUCTION REMEDIATION EXPLORATION EXPLORATION DRILLING DRILLING Exploration Licence Mining Lease Process AREVA Overview – November 2009 p.25
  25. 25. … with a project launch sequence optimizing capital spending thanks to our diverse portfolio Estimated possible production start up (*) 2017-20 2013-14 2009-2012 Midwest, Kiggavik, Imouraren : +5,000 tU Shea Creek Katco : +2,500 tU (successful ramp-up) Cigar Lake : +2,600 tU 2015-16 Somaïr: +1,200 tU Bakouma : +2,000 tU Trekkopje : 3,000 tU Ryst Kuil Sainshand * Production figures: 100% except Midwest & Cigar AREVA share 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 More than 10 major production projects are on track 4 of them will come progressively online by 2012 to reach our objective of doubling production The diversity of our projects portfolio allows us to optimize capital allocation and adapt to market conditions AREVA Overview – November 2009 p.26
  26. 26. That impacted directly the spot price from 1971 until now Mining output below demand End of inventories Tension on mining Mining output slow down production Increase of secondary supplies: Nuclear revival Inventory draw out Inventory build up inventory, military material, recycling Speculation 120 110 100 90 Spot Price Evolution -Ux Yearly Average 80 70 60 50 40 30 Faillite du trader 20 NUEXCO 10 0 1971 1972 1973 1974 1975 1976 1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 USD/lb 1 2 3 4 5 Oil Three Mile Island (US) Material from ex- Stabilisition Tension shock incident: nuclear power USSR on the market phase phase Source: Indicateur Trade Tech, Nuexco Exchange Value AREVA Overview – November 2009 p.27
  27. 27. Since June 2007 peak at 136 $/lb, spot price decreased to 40 $/lb, but has started recovering above 50 $/lb Ux price, spot and long term, 2007-2009 160 140 - 62% 120 100 80 60 40 Ux spot 20 Ux LT 0 7 7 7 7 7 7 7 7 7 7 7 7 8 8 8 8 8 8 8 8 8 8 8 8 9 9 9 9 9 9 9 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 /0 01 02 03 04 05 06 07 08 09 10 11 12 01 02 03 04 05 06 07 08 09 10 11 12 01 02 03 04 05 06 07 ► Spot price was depressed due to: Large amounts of U being sold by Nukem and funds Market recovery limited by financial stress resulting in utilities inventory management ► Current spot increase is supported by supply constraints: Closure of mines (Denison US mines, Dominion) Projects delayed / postponed (Midwest, Cigar Lake, Olympic Dam) Spot price low of 40$/lb was below the marginal mine cost ► The spot market is volatile and not necessarily representative: Volumes traded < 15% of the market, calculated average is not weighted and is based on volunteered information Long term price much more stable, really represents the bulk of volumes as long term contracts tend to develop AREVA Overview – November 2009 p.28
  28. 28. Conventional fissile resources represent more than 200 years of 2009 world demand CATEGORY of Uranium resources (million tons = Mt) Conventional Identified (deposits) Undiscovered Reasonably Speculative 1 Based on direct Cost of recovery Inferred Prognosticated Assured geological $/kgU Resources Resources Resources evidence Resources 2 1 3 2 Based on indirect geological < 40 1.77 1.20 evidence 1.95 3 Extrapolated 40 to 80 0.83 0.65 4.80 values 80 to 130 0.74 0.27 0.82 > 130 - - ? 2.97 Unconventional Subtotal 3.34 2.13 2.77 7.77 General total 5.47 10.54 15 to 25 General total of conventional resources: 16,009,100 t World demand in 2009*: less than 66,000 t Resources: > 200 times 2009 demand + With Gen IV Fast Breeder Reactor, resources are virtually unlimited *WNA estimate for 2009 Source: Nuclear Energy Agency "Uranium 2007: Resources, Production and Demand" AREVA Overview – November 2009 p.29
  29. 29. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.30
  30. 30. Two main enrichment processes; Centrifugation is the new state-of-the-art Gaseous Diffusion Gaseous Centrifugation ►Using gaseous diffusion technology, Georges ►Centrifuge technology is now considered Besse has been offering the best in terms of by all players as the most efficient safety, security and flexibility for 30 years. enrichment technology ►No disruption of supply since production ►Used in Georges Besse II and EREF, the launch in 1979 TC12 centrifuge has been a proven technology since 1992 ►High flexibility with regard to levels of enrichment ►This design of centrifuge offers the best levels of cost efficiency, energy savings, ►The current plant will serve as a bridge until technical reliability and environmental new centrifuge plants are online impact ►Modular conception that allows extension AREVA Overview – November 2009 p.31
  31. 31. AREVA supplies fuel assemblies and associated services and products A fuel assembly is a bundle of zirconium rods containing the enriched uranium Overview of AREVA Fuel activities ►UO2 assemblies for various reactor designs of the installed Fuel base and for AREVA new builds assemblies ►MOX/ERU assemblies ►Field work: handling, inspection Fuel- and repair of fuel assemblies related ►Engineering work: services services linked to fuel optimization and plant uprates ►Enriched uranium pellets are loaded into ►Zirconium products (tubes, flat zirconium rods products, etc) Secondary ►Tubes are bundled together in an ►Other products (components, products uranium powder, etc) assembly with grids AREVA Overview – November 2009 p.32
  32. 32. AREVA covers more than 40% of global needs for BWR and PWR fuel Europe USA Asia 2,127 T/y 2,257 T/y 1,483 T/y 18% 22% 12% 4% PWR AREVA 78% 84% 82% Westinghouse/ Enusa 1,800 T/y 1,434 T/y 874 T/y GNF Enusa 11% 29% Others 27% 17% 41% 61% 10% 32% BWR 72% 327 T/y 823 T/y 609 T/y Source : Nuclear Assurance Corporation (Fuel Trac édition 10/2008); Average value over 2008 +/- 1 year AREVA Overview – November 2009 p.33
  33. 33. 135 reactors worldwide are fuelled by AREVA NL GB (1P/1) SWEDEN (1P/1) (3P/3, 4B/7) AREVA BELGIUM FINLAND (5P/7) (0B/2) provides fuel for 92% of its FRANCE GERMANY reactor (~53P/58) (11P/11, ~4B/6) installed base SPAIN JAPAN (2P/21, 2B/32) and for 21% of (1P/6,1B/2) its competitors’ installed base USA (18P/69, 11B/35) SWITZERLAND CHINA (3P/3, 1B/2) (6P/7) * TAIWAN (0P/2, 4B/4) BRAZIL (2P/2) * SOUTH AFRICA (2P/2) In addition to map: Mexico (2B), Slovenia (1P), South Source: IAEA, WNA as of October 2007 Korea (16P), India (2B) and Note: *Local Fuel makers using AREVA NP Technology Pakistan (1P) AREVA Overview – November 2009 p.34
  34. 34. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.35
  35. 35. The new build business focuses on the “Nuclear island”: 50~60% of the total EPR price Conventional island* NSSS+BNI: 50~60% 15~20% AREVA Ex.: Alstom, Siemens,.. Balance of plant 5~10% Various suppliers Civil works** 15~25% Ex.: Bouygues,.. Note: Actual price of an EPR reactor and price proportions varies according to customer, country and project specificities * Steam turbine, power generator, cooling systems, grid interface ** Civil works costs includes nuclear island, conventional island and balance of plant civil works costs AREVA Overview – November 2009 p.36
  36. 36. Main components of PWR coolant system 5 1 Reactor vessel 2 Control rod drive mechanisms 3 3 Steam generator 2 4 Reactor coolant pump 4 5 Pressurizer 1 AREVA Overview – November 2009 p.37
  37. 37. PWR steam generator Design Commissioning FUNCTIONS to transfer heat and ensure leak-tightness between the primary (P) and secondary (S) circuits DUTY mechanical effects of the circulating P and S flows chemical effects of the P and S fluids nominal and transient temperatures and pressures on P and S sides MATERIALS nickel-based alloy (tubes), low internal alloy carbon steel (structures) with a stainless steel layer the water chamber (P side) DIMENSIONS & WEIGHT: height: 20 to 22 meters Heat transfer surface: diameter: 3.5 to 5 meters 4,700 to 7,000 square meters weight (empty): 300 to 420 metric tons AREVA Overview – November 2009 p.38
  38. 38. 50% of WW nuclear fleet is over 25 years old 129 reactors out of 439 are over 30 years old Pyramid of ages – 439 nuclear plants – WW nuclear fleet (Data as of January 2008) 35 3233 30 24 23 25 Number of Reactors 22 21 22 20 20 18 16 15 14 1414 15 12 1011 11 10 9 10 7 7 5 6 6 6 5 6 5 5 3 2 4 2 3 4 4 3 4 4 1 1 0 1 6 11 16 21 26 31 36 41 Age (in years) A need for re-investments in the existing fleet Source: IEAE International Status & Prospects of Nuclear Power (February 2009) – Data as of January 2008 AREVA Overview – November 2009 p.39
  39. 39. Competitive overview Japan ► Reactor & Services market mostly evenly shared among three United States strong domestic players: ► NPP Installed base*: Toshiba, Hitachi-GE & MHI Westinghouse: ~2/3 and GE: ~1/3 ► AREVA forged several ► Services: AREVA, growing Europe partnerships (ATMEA, marketshare now at ~25-30% MNF…) with MHI ►NPP Installed base*: ► Projects*: AREVA, ~1/3 of new projects AREVA: 60%+, W and AEP: 10%+ each Strong player with competitive offer: ► Services: AREVA is the leader with more taking market shares away from than 33% marketshare, historic domestic incumbents W and AEP both have 10-20% ► Projects*: While most projects have not selected a technology yet, AREVA’s prospective marketshare is already at 40%+ * NPP market shares based on power output Robust position on a steadily growing market AREVA Overview – November 2009 p.40
  40. 40. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.41
  41. 41. Overview of recycling process Nuclear reactor Recycled fuel MOX Reprocessed uranium fuel Used Fuel Long-term Vitrified Waste storage and Compacted Waste disposal AREVA Overview – November 2009 p.42
  42. 42. Recycling offers key benefits ► Natural resources savings Used fuel contains 96% of reusable materials Up to 25% natural uranium savings ► Improved ultimate waste management Volume of ultimate waste divided by 5 Waste toxicity divided by 10 Standard, durable, specifically designed waste forms and containers ► Reinforced economic interest of recycling Demonstrated competitiveness vs. once-through strategy Ability to control overall back-end costs based on proven 40-year industrial track record ► While ensuring Health, Safety and Environmental protection AREVA Overview – November 2009 p.43
  43. 43. Recycling strengthens non-proliferation ► Recycling restricted to a few regional centers under strict international safeguards Offering recycling services to a wide range of customers Avoiding the accumulation of used fuel in multiple storage sites worldwide Returning to customers final waste not subject to AIEA safeguards ► Plutonium recycled in MOX fuel Consumes roughly one third of the plutonium Significantly degrades the isotopic composition of the remaining plutonium and thus the potential attractiveness for non-peaceful usage ► Recycling facilities such as La Hague and Melox have a perfect track record with respect to fissile materials safeguards ► Recycling contributes to international non-proliferation initiatives Weapon-grade plutonium disposition (MFFF project) Securing « gap material » (DOE) AREVA Overview – November 2009 p.44
  44. 44. Recycled fuels performance in reactors ► MOX & Reprocessed Uranium fuels can accommodate all Light Water Reactors (80% of worldwide nuclear capacity) ► For utilities, recycled fuels have outstanding performance Excellent reliability track record Equal energy performance compared to natural uranium MOX in-core behavior similar to Uranium fuel under normal and accidental conditions ► EPR designed to accommodate up to 100% of its fuel as MOX AREVA Overview – November 2009 p.45
  45. 45. AREVA: N° worldwide in treatment 1 of nuclear fuel Treatment capacity for light Cumulative production, water reactors fuel (tons/year) as of dec. 2008 (tons) 1 800 25 000 ~24,500 1,700 1 600 1 400 20 000 1 200 15 000 1 000 900 800 800 10 000 600 Max. 400 400 5 000 4,000 4,200 200 400 0 0 AREVA Sellafield Ltd. Rosatom JNFL / AREVA Sellafield Ltd. Rosatom JNFL La Hague Rokkasho Mura As of today, AREVA treated ~75% of the fuel worldwide, i.e 24 500 tons out of 33 200 tons Source: AREVA, World Nuclear Association AREVA Overview – November 2009 p.46
  46. 46. AREVA: N° worldwide in MOX fuel 1 fabrication MOX fuel production capacity Cumulative production, as of dec. 2008 (tons of MOX / year) (tons of MOX) 200 195 1.400 1,300 1.200 150 130 1.000 120 800 100 e 600 as ph n 400 50 s ig De 200 » 10 0 0 AREVA Melox SMP J-MOX AREVA Melox SMP J-MOX AREVA Overview – November 2009 p.47
  47. 47. AREVA logistics activities Casks supply ► Design & licensing of dry storage and transport casks ► Manufacturing of casks Transport and fleet management ► Road transport of radioactive materials ► Operations of railway and maritime facilities ► Organization of transports incl. real-time monitoring ► Cask and safety vehicle maintenance on site ► Maintenance of safety vehicles ► Management of site supply chain ► Risk assessment and crisis management AREVA Overview – November 2009 p.48
  48. 48. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.49
  49. 49. Throughout the world, governments are supporting the development of renewable France energies Targets by 2020: »> 20% of renewable energies in the energy mix by 2020 Incentives: »Off shore: stimulation to favor national champions »Biomass: feed-in tariffs (between 49€/MWh and 113€/MWh) Targets by 2020: Targets by 2020: Targets by 2020: »14-15% reduction of GHG below 2005 »E.U. targets: renewables = 15% of »Renewable energy consumption =10 % levels by 2020 (proposal in renewable in energy consumption mix of the total energy cons°by 2010 and Copenhagen) (i.e. 40% of electricity production) 15% by 2020 (30GW of wind power & 24GW of Biomass) Incentives: Incentives: »Over $60 billion in clean energy »Off Shore: stimulation policies (e.g. UK : Incentives: investments (American Recovery and Reinvestment Act) : loan guarantees, in 2008 site pre- selection + subsidiaries »Central government financial authority’s for investment + tax exemption) renewable energy fund to support tax incentives and public investment) »Biomass: attractive basic purchasing renewable energy development USA rate (e.g. up to 267€/MWh in Germany) »Biomass: (e.g. subsidy of 0.25 yuan (US $0.03) per kilowatt-hour for biomass) Europe (excl. France) China AREVA Overview – November 2009 p.50
  50. 50. Renewable Energies Business Segments Overview WIND POWER Off-shore wind turbine designer and manufacturer Vertically integrated in blades PRODUCTS Specialized engineering company (EPC) for turnkey delivery of biomass fired power plants BIOENERGIES Ownership of range of critical technologies (combustion, gasification, etc.) Energy storage solutions ENERGY CARRIER AND STORAGE Stationary back-up solutions (fuel cells) Equipment for production of hydrogen (electrolyzers) Renewable BU is looking for opportunities to leverage its EPC know-how into solar thermal AREVA Overview – November 2009 p.51
  51. 51. Geographical footprint aligned with market opportunities Germany USA France ►Wind off-shore manufacturing ►Bioenergy JV ADAGE ►Headquarter ►Windpower Research and development ►Bioenergy EPC ►Research and development ►Blade set manufacturing ►Hydrogen R&D and Manufacturing (fuel cells) ►Bioenergy EPC China ►Business development team India ►Bioenergy EPC Brasil ►Bioenergy EPC AREVA Overview – November 2009 p.52
  52. 52. Continuous excellence in the Wind Power business segment 6 M5000 turbines installed in North Sea (Alpha Ventus project) Recent development Global Tech project - binding MoU signed for 80 WTGs (March 2009) Borkum West II project - binding MoU signed for 40 WTGs (September 2009) ► Multibrid moving from being in upstart stage to being a world-class operating entity Generic Certification of WT Securing & optimizing the supply chain Design to cost Prepare for plant duplication On-going ► Enter New Markets development Expand off-shore presence in the UK, China and North America ► Strategic Differentiators Make the industry profitable through better mitigation of the overall risk profile: tighter integration with installation and management companies Leverage the “design for off-shore” advantages to deliver next generation high capacity turbines Develop & deliver ‘Floating Turbines’ AREVA Overview – November 2009 p.53
  53. 53. AREVA: a unique offshore turbine Multibrid turbines M5000 The most powerful offshore turbine on the market (5 MW) A leading edge position on a market favourable to high power turbines 3.6 MW 5 MW A wind turbine designed specifically for harsh sea conditions A light-weight structure, providing customer with A facilitated installation and maintenance The best weight / power ratio available on the market Offshore wind activities covering Design, manufacturing, assembly, and commissioning of the off-shore turbines Maintenance services Source: New Energy Finance 11/04/2008, Companies AREVA Overview – November 2009 p.54
  54. 54. Bioenergies: a presence covering the wide range of biomass types and geographies China: 429M tons USA: 340M tons Europe: 381M tons » 30 GWe wood potential India: 153M tons » 17 GWe biomass potential ASEAN: 351M tons BRAZIL: 387M tons » Thailand: 3,3 GWe » 11 GWe (retrofit potential) » Philippines: 2,3 GWe » 15 GWe (additional straw) » 2 GWe Biogaz Rice Palm Cereals Wood Sugarcane AREVA Overview – November 2009 p.55
  55. 55. Bionergies: Main references around the world Germany 2 biogas + 5 mine gas Thailand USA power plants for 57 MWe 2 12 biomass Biomass power plants for power plants for 600 MWe 20 MWe in project Brazil 83 biomass India power plants for 3 biomass 2,296 MWe + 2 waste heat power plants for Chile 47 MWe 1 biomass power plants for 98 Power plants 2,430 MWe 10 MWe under operation or construction total installed capacity AREVA Overview – November 2009 p.56
  56. 56. Appendices ► Financials p5 ► Nuclear: a critical part of the solution p 19 ► Mining business details p 23 ► Conversion/ Enrichment/ Fuel business details p 31 ► Reactors & Services business details p 36 ► Back-End business details p 42 ► Renewable business details p 50 ► Outlook China p 58 ► Outlook India p 70 AREVA Overview – November 2009 p.57
  57. 57. China: strong growth in power consumption despite slow down in 2008 ►Electricity consumption 1995-2020 17.0% 6,000 14.9% 14.4% 14.4% 12.9% 3,922 11.6% 3,632 3,427 3,246 8.6% 2,825 2,470 8.6% 2,187 1,911 8.0% 1,633 1,347 1,463 5.6% 6.0% 1,002 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009E 2010E 2020E Annual consumption (in TWh) Annual growth Source: China Electricity Council (CEC) , Market Study, Financial Crisis Impact Study AREVA Overview – November 2009 p.58
  58. 58. China: the energy challenges ►Secure economic growth ►Minimize energy dependency 70% of coal reserves Better ►Ensure sustainable development 80% of hydraulic developed Regions resources Ensure social stability by reducing disparities: electricity for all at an affordable price Take action on environmental issues, both for existing pollution and global warming Expand the interconnection market (HVDC) for electricity transmission to densely populated, developed areas Nuclear power and advanced T&D technologies have a major role to play AREVA Overview – November 2009 p.59
  59. 59. China: overview of the energy sector ►Per capita consumption is still low and very disparate ►Insufficient installed capacity 792 GW installed as of the end of 2008, with a target of 1500 GW by 20201 ►A promising market China’s capital spending on new generating capacity and in the transmission and distribution sector is expected to rise to 50 billion dollars per year from 2006 to 2010. China’s electricity transmission and distribution market represents 25% of the world market ►Renewable energies law is effective since 2006 to encourage renewable energy resources Renewable energy is expected to reach 10-12% of total installed power capacity by 2020 China is to become the first market in Renewable Energy from 2010 Source: China Electricity Council and World Nuclear Association AREVA Overview – November 2009 p.60
  60. 60. China: AREVA’s positions ► More than 2,900 employees, of which 2,800 employees for T&D ► More than 735 million euros sales in 2008 Reactors & Services T&D Front-End AREVA’s Sales split AREVA Overview – November 2009 p.61

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