British Energy said yesterday it is completing repair work on one reactor at the Hunterston power station in Scotland and hopes to get it up and running soon, as it announced that first-quarter profits fell by nearly 50% to £129m because of nuclear power station outages.

British Energy said yesterday it is completing repair work on one reactor at the Hunterston power station in Scotland and hopes to get it up and running soon, as it announced that first-quarter profits fell by nearly 50% to £129m because of nuclear power station outages.

The group, whose shareholders rejected a £12bn takeover bid by the French utility EDF this month, said first-quarter adjusted earnings before interest, tax, depreciation and amortisation (Ebitda) tumbled to £129m. Its reactors produced 27% less power in the quarter compared with the year-earlier period.

"We have continued to make good progress towards resolving the plant issues that have significantly impacted our performance in the year to date," chief executive Bill Coley said.

Hunterston B Reactor 3 is running at 70%, a company spokeswoman told The Herald, but repair work is continuing on the Ayrshire's plant's B Reactor 4 and the East Kilbride-based group hopes to get it back into service "in a few days". The reactor has been out of action since June 30, she stated.

She said it was company policy to operate both reactors at 70% of their full capacity.

When asked in a conference call if there are any clearer plans to raise output above 70% at Hunterston B and Hinkley Point B in England, Coley replied: "We've achieved the goal we set of 70% and we're assessing the strategies to increase the load further beyond 70%. I can't give any schedule yet, but can confirm that we do hope to take load beyond 70% at some point."

British Energy's other Scottish-based power station, Torness, is running at full capcity, the spokeswoman added. Coley said the Hartlepool and Heysham 1 stations in England were on track to return to service in the group's third quarter, although he would not put a return date on units at Dungeness B in south-east England.

Shares in the company, which is 35% owned by the British Government, closed 1.5p higher at 706.5p - a gain on the day of 0.2% - in London trading.

The results were a lot better than some analysts expected.

Deutsche Bank said in a preview note that it was forecasting adjusted Ebitda of £55m, with performance to improve as high wholesale power prices feed into the numbers.

British Energy said it is continuing discussions "in respect of a potential transaction" despite the collapse of the all-cash EDF offer nearly two weeks ago, but refused to comment on the specific details of the talks.

"We have many shareholders and many shares in issue and I would be hard pressed to try and characterise the general sentiment of those shareholders," Coley said.

He added that the company remained committed to new nuclear build - given the green light by the government in January - and was currently assessing which of its sites were suitable.

EDF has not formally given up on agreeing a takeover, while British Gas owner Centrica is said by sources to have revived earlier attempts at a merger - either all-share or cash-and-shares.

The government is known to want to cash in its holding and has said it preferred the all-cash route offered by EDF, which has the experience in new nuclear build deemed important as Britain prepares to construct new power stations.

The UK's largest independent energy consultancy, McKinnon & Clarke, said that the fall in British Energy's profits will strengthen its resolve to press ahead with finding a suitable purchaser.

McKinnon & Clarke's energy analyst David Hunter said British Energy is still likely to be sold to state-controlled Electricité de France because of strong political will for a deal, and energy security remaining a huge political issue.

"EDF has the expertise of running and building nuclear stations and is the world's largest nuclear generator. The UK Government's overriding objective is to get the new nuclear build process under way as soon as possible and they believe this is best achieved by sale to EDF," Hunter stated.

However, McKinnon & Clarke said that rushing to sell to EDF is short-sighted, and further consolidation in the market would seriously damage price competition - not only at the customer level, but also at the level of power station ownership.

"The government should look at alternative purchasers outwith the big six' operators to protect competition," Hunter said. "Vattenfall, the fourth largest electricity provider in Europe, has nuclear expertise and has expressed interest in breaking into the UK market."