Tohoku Electric expects lower costs, higher prices to power record annual profit

Tohoku Electric Power, Incorporated

31/07/2023 12:32

TOKYO, July 31 (Reuters) - Japan's Tohoku Electric Power
 9506.T  on Monday booked a record first quarter profit and also
forecast a record annual profit as cheaper fuel and higher
electricity prices spurred the utility's rebound from a loss
last year. 
    Most Japanese utilities are recovering from last year's
crisis when their results were hit by the disruption of energy
supplies caused by the Ukraine war.
    Fossil fuels such as liquefied natural gas (LNG) and thermal
coal have fallen more than 60% and 70% respectively so far this
year.
    Tohoku's net profit for the April-June quarter was 79.17
billion yen ($556 million), against a loss of 31.24 billion yen
a year earlier.
    The company, which did not give full-year outlook in April,
predicted net profit of 140 billion yen for the year to March
31, 2024, compared with a loss of 127.5 billion yen last year.
    Tohoku raised power prices for business clients last
November and for some retail customers from June 1.
    Japan is gradually returning nuclear power to its energy mix
for reasons of energy security and to try to lower carbon
dioxide emissions in line with climate goals. 
    Tohoku's forecast includes a small benefit from the planned
restart of No.2 reactor of Onagawa nuclear power plant in
northern Japan in February 2024, said Tamotsu Kikuchi, deputy
general manager of Tohoku's accounting division.
    Peer Kyushu Electric Power  9508.T  also reported on Monday
a record net profit of 71.46 billion yen for the last quarter,
against a loss of 34.81 billion yen a year earlier, driven by
sliding fuel prices and an increase in utilisation ratio at its
nuclear power plants to 86% from 36%.  
    The utility left its April forecast of annual profit of 90
billion yen unchanged, citing uncertainty over future trends in
fuel prices. It also stuck to the targeted nuclear power
utilisation ratio of 90.5% for the current year.
    ($1 = 142.2800 yen)

 (Reporting by Yuka Obayashi; editing by Barbara Lewis)
 ((Yuka.Obayashi@thomsonreuters.com; +813-4520-1265;))