Crisis-hit Tepco books $7.4 bln quarterly loss | business | Hindustan Times
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Crisis-hit Tepco books $7.4 bln quarterly loss

business Updated: Aug 09, 2011 12:20 IST

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Tokyo Electric Power , the operator of Japan's crippled nuclear plant, reported a $7.4 billion quarterly loss due to a massive provision to compensate victims of the nuclear disaster, soaring fuel costs and a dive in sales.

The March meltdown at the Fukushima complex in northeast Japan spawned the world's worst nuclear crisis since Chernobyl and put the very existence of Asia's largest utility, commonly known as Tepco, in doubt.

Tepco's chances of survival improved after Japan's parliament last week passed a bailout scheme backed by taxpayer funds and contributions from other utilities to help shoulder a compensation bill analysts estimate could climb as high as $130 billion.

For the April-June quarter Tepco reported a net loss of 571.8 billion yen ($7.4 billion), against a loss of 5.5 billion yen in the same period last year. Sales fell 7% to 1.13 trillion yen.

Tepco said it booked a 400 billion yen charge to compensate victims of the crisis, which include some 80,000 people evacuated from areas surrounding the Fukushima plant.

It booked another 105 billion yen in costs for restoring facilities damaged in the March 11 earthquake and tsunami.

Government guidelines on compensation were issued last week and Tepco has said it aims to start accepting claims in September and making payments in October.

Shares of Tepco, which have lost more than 80% since the disaster, closed flat ahead of the results. The stock had tumbled as much as 14% in morning trade following media reports it would book a massive quarterly loss.

Following the earthquake, worries over the safety of nuclear power have forced Tokyo Electric and other plant operators to keep reactors idle, driving up fuel costs.

Utilities are now operating 15 out of 54 reactors that had been available before the March 11 earthquake and all of those could be shut down by next May if safety concerns continue to stall restarts.