British Energy chief replaced by non-executive director

1 April 2005

Troubled UK nuclear generator British Energy has announced that Mike Alexander has stepped down as chief executive and resigned as a director of the company to be replaced by Bill Coley, previously a non-executive director.

Despite comments by Adrian Montague, as chairman of BE, that Alexander “decided to seek a new challenge elsewhere” widespread industry speculation suggests Alexander was effectively dismissed after failing to turn the nuclear generator’s finances around in the wake of its government bail out and stock market relisting. Furthermore, unlike Cole, Alexander who has a background in the oil and gas sector, lacked direct experience in nuclear generation, a key issue for the company which is under pressure to improve performance at its eight generation plants.

Operating unit costs for the third quarter 2005 increased by £4.3/MWh to £21.5/MWh (€31.1/MWh), largely due to lower output, depreciation and announced incremental investment in people and plant while operating loss before exceptional items was £8 million (€11.6/MWh) for the quarter.

Coley, a former senior executive with Duke Energy, was appointed as a non-executive director at BE in June 2003 and is chairman of the company's nuclear performance review committee.

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