Friday, May 20, 2011

Japan's Tepco posts $15 bln loss on nuclear crisis costs

TOKYO: Tokyo Electric Power Co recorded a 1.25 trillion yen ($15.3 billion) loss for the past financial year, the biggest ever by a non-financial Japanese firm, hit by costs to cope with the world's worst nuclear crisis since Chernobyl, Reuters reported on Friday, May 20.

Tokyo Electric, commonly known as Tepco, is struggling to bring its Fukushima Daiichi nuclear plant in northern Japan under control after damage from the March 11 earthquake and tsunami crippled reactors and triggered radiation leaks.

The company, Asia's largest utility, posted a net loss of 1.25 trillion yen for the year ended in March, compared with a profit of 133.8 billion yen a year earlier. It was the biggest loss by a non-financial firm in Japan, exceeding the 835 billion yen loss by Nippon Telegraph and Telephone in 2002.

The massive loss was flagged by media. The Nikkei newspaper had predicted a net loss of about 1 trillion yen, while the Yomiuri forecast a loss of 1.5 trillion yen.

The loss, the biggest in Tepco's 60-year history, reflects costs to scrap damaged nuclear reactors at Fukushima Daiichi and a write-off of deferred tax assets with compensation payouts likely to depress profits for many years.

Tokyo Electric did not offer guidance for the current year to March 2012 given uncertainty over how much of its profit will go toward paying the people forced to evacuate the areas surrounding the crippled plant and others due compensation.

The government last week agreed to set up a fund using taxpayers' money to help Tepco cope with compensation. Tepco can draw on the fund to make upfront payments and repay the fund from its annual profits over several years.

Tepco has not made an estimate for the likely cost of compensating all victims. Analyst forecasts have ranged from around $25 billion up to $130 billion if the crisis at the nuclear complex drags on. - Reuters


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