Rolls-Royce said today the long-term outlook for its nuclear business was positive with renewed activities in the civilian market. There are "encouraging opportunities" in the UK and China in particular, alongside its nuclear submarine activities, the company said on the release of its 2016 financial results.
The British engineering company recorded a loss of £4.6 billion ($5.7 billion), but revenue in the group's nuclear business rose 11% year on year to £777 million. This was led by submarine programs, including refuelling projects and decommissioning activities, though civil instrumentation and control programs in France and Finland were also strong, Chief Financial Officer David Smith said. These included the first phase of upgrade work at the Loviisa nuclear power plant in Finland and maintenance programs across the French nuclear power fleet.
Lower gross margin in its nuclear business reflected the dominance of government-led submarine programs, Smith said, and was further offset by additional costs including R&D to support the initial design phase for small modular reactors (SMRs). Underlying profits for the nuclear business were £37 million before financing.
Rolls-Royce last year outlined plans to develop through a consortium a fleet of 7 GWe SMRs in response the UK government's competition to identify the best value SMR design for the country.
"We continue to invest in new designs for new opportunities … SMRs represent those opportunities," CEO Warren East said.
Other 2016 highlights for Rolls-Royce's nuclear business include the government's final approval of the Hinkley Point C nuclear power plant, for which it was awarded preferred bidder status for waste treatment system, heat exchanger and diesel generator contracts. It has also announced closer strategic collaboration with China National Nuclear Corporation, including engineering and training services. "The Chinese market is expected to sustain strong growth and we are well-positioned with relevant technology," it said.
The long-term outlook for its nuclear business remains positive, it said, with the UK government's confirmation of ongoing investment in the Dreadnought class of submarines.
Researched and written
by World Nuclear News