ENERGYSOLUTIONS REPORTS NET LOSS, BUT PREDICTS GROWTH

By ExchangeMonitor

After a schedule and cost analysis of its long-term decommissioning project at the Zion nuclear power plant revealed the project would cost more than the company originally planned, EnergySolutions reported a tax-adjusted net loss of $196.2 million, but revenue of $1.8 billion, for the year 2011 in its filings with the Securities and Exchange Commission. Before the impact of the financial adjustments—a year-end goodwill impairment, an asset retirement obligation (ARO), and deferred tax asset accounting adjustments—the company reported it would have had a net income of $102.2 million. Amid lower overall commercial disposal at its Clive, Utah facility and failed bids for major government cleanup contracts, EnergySolutions’ announcement of a contract to treat contaminated water at the Fukushima plant in Japan and other international work was pointed to as indicators of company growth in the future. “Our successes in 2011 have positioned the company for profitable growth in both the short and the long term,” Val Christensen, president of EnergySolutions, said during an earnings call with investors yesterday. “With new business wins in Japan, Canada and here in the U.S., we are winning new business through our partnering strategy and intense focus on customer needs.”

The same financial adjustments came into play for the earnings reported from the fourth quarter of 2011, with EnergySolutions saying yesterday it earned $468.5 million in revenue during that period, but experienced a net loss of $202.8 million. During 2011, EnergySolutions closed its contract at the Department of Energy’s Uranium Disposition Services conversion facility, and lost the bid to keep its Moab, Utah cleanup contract. The company also spent more than it expected in its failed bid for the UK-based Dounreay cleanup project. However, “We’re expecting very good progress from Zion in 2012, and we’re getting traction on commercial work here in the U.S. We think waste volumes are coming back around,” Christensen said. EnergySolutions hopes to turn the Fukushima contract into continued work during the cleanup of that site, and Christensen mentioned plans to work with German companies as they begin to decommission their fleet of reactors. “We’re extremely happy to be relevant in Germany, Japan, Canada, China, and elsewhere in the world,” Christensen said.

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