Eon warns it could cut 11,000 jobs as nuclear plants shut

 
Kasmira Jefford
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EON AG, Germany’s biggest energy group, said it made a loss in the first half of the year in the wake of the government’s decision to shut down all nuclear power plants, and warned that it may cut 11,000 jobs.

The energy supplier made a loss of €1.58bn (£1.39bn) in the three months to June, compared with a profit of €1.63bn in the second quarter of 2010. Overall net income in the first half fell 71 per cent to €900m.

The group said it faced “major challenges” and recorded a “decrease for all key earnings indicators”, blaming Germany’s plans in the aftermath of the Fukushima disaster to mothball all nuclear reactors by 2022.

Chief executive Johannes Teyssen said the group was “not immune to negative changes in our markets” and would have to reduce costs from approximately €11bn to around €9.5bn per year, by imposing cuts equal to 10 per cent of its workforce.

Eon also said its original guidance for a dividend of €1.30 per share would be cut to €1.

Shares slumped 11 per cent, closing at €13.82 yesterday.