areva, business & strategy overview - april 2009 - appendix1

Appendix 1Nuclear: a critical part of the solution

> Overview – April 20093

Worldwide demand for electricityto double by 2030

Sources: World Energy Association (March 2009), IEA-World Energy Outlook (2008)

� Capex in the Power sector expected to reach $13.8 trillion 2007

� $6.8 trillion in T&D

� $6.8 trillion in generating capacity

� 2008 – Worldwide distribution of electric power mix

Oil10%

Nuclear16%

Coal39%

Hydro.19%

� Worldwide electric power generation (in TWh)

X 2

2005 2010 2015 2020 2025 2030

15 000

30 000

Hydro19%

Covering both Generation and T&D markets, AREVA has 2 reasons to benefit from

electricity sector investments


Nuclear power: a critical part of the solutionfor power generation

Nuclear power generation does not release greenhouse gas:life cycle greenhouse gas emissions very low

1.

2.

3.

4.

Low price of generationalmost immune to uranium price fluctuations

Fossil resources are limitedand uranium conventional resources are 200 times 2008 demand

Energy security of supplyuranium is present in stable countries


CO2 emission cost (25€/t CO2 )Average MWh cost for new plants

Nuclear power cost competitiveness

* Based on UBS Estimates for Europe (Global Nuclear Power - January 2009).Main technology-specific assumptions include:

- an economic life of 50 years for nuclear power plants, 40 years for coal power plants, and 30 years for combined gas power plant,

- size of 1,500 MW for nuclear power plant, 750 MW for coal plant and 425 MW for combined gas plant, and a CO2 price of €25/t

126

100109

Combined Gas Coal Nuclear

Nuclear € 50 - € 65 NS zzz

Combined cycle gas

Coal

Sources: Enel (July 2008), E.On (April 2008), UBS (January 2009)

€ 65 - € 82

€ 55 - € 75

€ 5 - € 10

€ 15

Full Cost of Generation Including CO2 Costs*(Rebased on nuclear)

CO2 Cost

Cost Comparison for Europe


Nuclear power cost of generation: limited dependency on fuel price evolution

70%

10%

Fixed operating costs

Fuel & Other variable costs

Capital cost

Sources: Based on E.On estimates for Europe (January 2009) , with Carbon at 20 €/t

20%

Nuclear MWh cost split

70%

2%



Capital cost

15%

Carbon

12%

Combined Cycle GasTurbine (CCGT) MWh cost split

35%

6%



Capital cost

33%

Carbon

25%

Hard CoalMWh cost split


Nuclear power: a critical part of the solution in the UK

� “ The Government’s conclusion is that nuclear power i s:

� Low-carbon – helping to minimise damaging climate change

�Affordable – nuclear is currently one of the cheapest low-carbonelectricity generation technologies, so could help us deliver our goals cost effectively

�Dependable – a proven technology with modern reactors capable of producing electricity reliably

�Safe – backed up by a highly effective regulatory framework

�Capable of increasing diversity and reducing our de pendence on any one technology or country for our energy or fue l supplies .”

UK Government White Paper (2007)

Appendix 2Situation regarding nuclear in the various regions


�

The nuclear market place : 436 nuclear reactors in 2009 and more to come from the East

2

130

Western Europe

In service Under construction

28

109

Southern & Eastern Asia

10

67

CIS & Eastern Europe

02

Africa & Middle East

North America

2

126

South America

14

Source: WNA (January 2009)


Installed capacity in main countries

2008 2007 2008 2007

France* 65.9 65.9 438.6 439.1Germany 21.5 21.4 148.7 140.5Russia 23.2 23.2 162.3 158.3United Kingdom** 12.5 11.9 39.4 58.6Ukraine 13.8 13.8 89.8 92.7Sweden 9.6 9.4 66.9 66.9Spain 7.7 7.7 60.0 55.0Belgium 6.1 6.1 45.8 48.2Finland 2.8 3.0 23.0 23.4Other 17.7 17.4 135.4 125.9

TOTAL 180.8 179.8 1,209.9 1,208.6

* Excluding Phoenix, considered a research reactor. ** Data incomplete for Britain (only Jan-Sep 2008 total available for British Energy Portion)Source: Nucleonics Week, restated by AREVA

Gross capacity(GWe)

Gross generation(TWh)

2008 2007 2008 2007

Canada 15.4 15.0 94.0 94.0United States 107 105.8 842.4 843.0Mexico 1.4 1.4 9.8 10.4Brazil 2.0 2.0 14.0 12.4Argentina 1.0 1.0 7.4 7.2

TOTAL 126.8 125.2 967.6 967.0

Source: Nucleonics Week, March 2008, restated by AREVA.

Gross capacity(GWe)


2008 2007 2008 2007

Japan 49.6 49.9 251.7 278.7China 9.0 9.1 42.6 62.9India 4.1 4.1 15.5 17.8South Korea 18.4 18.4 151.0 142.9Taiwan 5.1 5.1 40.8 40.6Pakistan 0.5 0.5 1.9 2.5

TOTAL 86.8 87.1 503.5 545.4

Source: Nucleonics Week, March 2008, restated by AREVA.

Gross capacity(GWe)


Appendix 3Front End business details


New mines will be necessary to meetUranium demand

World Uranium Supply and Demand

0

10000

20000

30000

40000

50000

60000

70000

80000

90000

100000

199

5

199

7

199

9

200

1

200

3

200

5

200

7

200

9

201

1

201

3

201

5

201

7

201

9

tU

Production from existing mines Recycling (Mox, RepU, off-spec)

Russian HEU (existing agreement) Inventory reduction/adjustment

Demand to be covered by new projects Consumption (WNA Upper Scenario 07)

source: WNA 2007


Conventional fissile resources representmore than 200 years of 2009 world demand

General total of conventional resources: 16,009,100 tWorld demand in 2009*: less than 66,000 t

Resources: > 200 times 2009 demand

10.545.47General total

Subtotal

> 130

80 to 130

40 to 80

< 40

15 to 25

7.77

2.97

4.80

SpeculativeResources

2.77

?

0.82

1.95

PrognosticatedResources

2

2.13

-

0.27

0.65

1.20

InferredResources

1

3.34

-

0.74

0.83

1.77

ReasonablyAssured

Resources

Cost of recovery$/kgU

Unconventional

Conventional

CATEGORY of Uranium resources (million tons = Mt)

*WNA estimate for 2009 Source: Nuclear Energy Agency "Uranium 2007: Resources, Production and Demand"

+ With Gen IV Fast Breeder Reactor, resources are v irtually unlimited

1 Based on direct geologicalevidence

2 Based on indirect geologicalevidence

3 Extrapolated values

3

Identified (deposits) Undiscovered


�

Uranium (2008 Data) Oil (2007 Data)Gas (2007 Data)

Improved security of supply with Uranium

� Developed countries and China depend largely on oil & gas supplied from unstable areas

Sources: AREVA, IEA

North America

24%

11%

24%

Russia

8%12%

22%

Venezuela 3%

Mexico 4%

Alegria3%

Niger7%

20%

Uzbekistan 5%

Australia

20%

Indonesia

3%

China

4%

4%

28%

38%

Other

Kazakhstan

70% of oil reserves and 40% of gas

reserves

Namibia

10%

Middle East

28%

5%

Key areas of production (in % of global production)

2%3%

3%

1%

1%

2%

1%

1%


Mining: solid fundamentals in a more volatile environment

AREVA performance � AREVA reserves and resources in 2008

� Replacement of mined reserves

� AREVA reserves/resources constitute 10%

of the world’s identified resources

� 31% increase in exploration expenses, to €56M

� 4% increase in production, to 6,303 MTU

� Increase in production costs of around 15%, comparable to the averagefor the industry

� Stable average AREVA sales prices

$36.90*$36*

20082007

$23*

2006

* per lb U3O80

50

100

150

� Solid fundamentals:

� Utilities want to secure supplies and future

expansion of nuclear fleet

� Price drops in 2008

� Spot: average of $62/lb in 2008 vs. $99/lb

in 2007

Volatility due primarily to investment fund

sales

� Long-term: average of $83/lb in 2008

vs. $91/lb in 2007

Prices stable for the past 5 months at $70/lb

Market trend

LT & spot Ux prices, 2001- 2008

Spot

Long-term Peak – July 07: Spot $138/lbLT $95/lb

Current - Feb. 09Spot $47/lbLT $70/lb


Enrichment services requirementsshould rise

GBII plant - France

60

80

100

120

140

160

2000 2001 2002 2003 2004 2005 2006 2007 2008

Spot restrictedSource: Ux / TradeTech

Rise in spot SWU prices to $160 as of 12/31/2008 (vs. $143 early 2008)SWU rates ($)

� Capacity of 7.5M SWU

� First SWU productionin 2009

� Cost and schedule on track

Full use of current capacities

10

20

30

40

50

60

70

80

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

MS

WU

MS

WU

WNA 2007 scenario - Reference

WNA 2007 scenario - Upper Cumulative capacitiesof global players


135 out of 305* PWR and BWRreactors in operation worldwide are fueled by AREVA

USA(18P/69, 11B/35)

BRAZIL(2P/2) **

SOUTH AFRICA(2P/2)

TAIWAN(0P/2, 4B/4)

JAPAN(2P/21, 2B/32)

CHINA(6P/7) **

FRANCE(~53P/58)

GB(1P/1)

BELGIUM(5P/7)

SWEDEN(3P/3, 4B/7)

FINLAND(0B/2)

GERMANY(11P/11, ~4B/6)

SPAIN(1P/6,1B/2)

* Map (283) + Mexico (2B), Slovenia (1P), South Korea (16P), India (2B) and Pakistan (1P) : sources AIEA,

WNA as of October 2007** Local fuel makers using Framatome ANP technology

NL(1P/1)

SWITZERLAND(3P/3, 1B/2)

AREVA provides fuel for 92% of its installed basis and 21% for its competitors’ installed basis


PW

R

1,800 T/y 1,434 T/y 874 T/y

BW

R

Europe

327 T/y

USA

823 T/y 609 T/y

Asia

82%

22%

12%18%

78% 84%

2,127 T/y 2,257 T/y 1,483 T/y

AREVA Westinghouse + Enusa GNF Genusa Others

11%

72%

17%29%10%61%

41%32%

27%

Source : Nuclear Assurance Corporation (Fuel Trac édition 10/2008); Average value over 2008 +/- 1 year

AREVA covers more than 40% of fuel global needs for BWR and PWR (excluding VVER)

4%

Appendix 4Reactors & Services business details


Maintenance, repare,spare parts replacement, recurring engineering and upgrade

USA: around $10-11Bn of nuclear O&M recurring expen ses in 2007for a production in the range of 843 Bn kWh / y *

O&M recurring expensesshould remain relatively stable and high

~0,4€ cents/kWh

Maintenance

40%

60%

~0,6€ cents/kWh

* NEI, Nucleonics Week (March 2009)

O&M expenses are expected to trend upward in coming years

Europe: Operating & Maintenance expenses per kWh

OperatingTraining

Logisitcs...


A significant share of O&M expensesare outsourced by the utilities

Source: Nuclear Engineering International – december 2004 / AREVA

0

100

200

300

400

500

600

700

800

900

EDF US (Navigant Consult.) US (Duke estimate)

FTE Internal FTE External

Full Time Equivalent workforce internal + external for 1,000 MWe installed

The trend should amplifyin the coming years


Main componentsof PWR coolant system

5

4

1

2

3

1 Reactor vessel

2 Control rod drive mechanisms

3 Steam generator

4 Reactor coolant pump

5 Pressurizer

22


PWR steam generator

Heat transfer surface:

4,700 to 7,000 square meters

� mechanical effects of the circulating P and S flows

� chemical effects of the P and S fluids� nominal and transient temperatures

and pressures on P and S sides

DUTY

� nickel-based alloy (tubes),low internal alloy carbon steel (structures) with a stainless steel layer the water chamber (P side)

MATERIALS

� height: 20 to 22 meters� diameter: 3.5 to 5 meters� weight (empty): 300 to 420 metric tons

DIMENSIONS & WEIGHT:

FUNCTIONS

� to transfer heat and ensure leak-tightness between the primary (P) and secondary (S) circuits

Design Commissioning

23


Thermal Power

Electrical Power

Thermal Efficiency

Limitation of severe accidents consequences

Number of fuel assemblies

Average burnup of reloads

Redundancy factor

Service lifetime

MW

MW

%

GWd/t

years

* Maximum burnup rate currently allowed by the French safety authority

4500

1650

36.8

++

241

>60

4

60

EPRTM

The EPRTM: increased power and safety - extended life expectancy over the most recently built reacto rs

4250

1450

34

+

205

45*

2

40

N4


NUCLEAR ISLAND: 55-60 %AREVA

CONVENTIONAL ISLAND15-20 %

Alstom, Siemens

CIVIL WORKS10-20 %

BOP5-15 %

Customer

Typical cost breakdown of a Nuclear Power Plantof the EPR TM type


50% of WW nuclear fleet is over 25 years old129 reactors out of 439 are over 30 years old

Source: IEAE International Status & Prospects of Nuclear Power (February 2009) – Data as of January 2008

Pyramid of ages – 439 nuclear plants – WW nuclear fle et (Data as of January 2008)

A need for re-investmentsin the existing fleet

3 24 5

2

6

3

64 4 3

64 5

9

64

1011

14

2224

3233

21

18

2220

7

141416

11

23

15

1012

57

1 1

0

5

10

15

20

25

30

35

1 6 11 16 21 26 31 36 41Age (in years)

Num

ber

of R

eact

ors


EDF nuclear power plant lifespan

� EDF objective: bring lifespan of French nuclear fle et significantly beyond 40 years

� 18 nuclear units will reach a lifetime of 40 years between 2015 and 2020

� Shutdown of such units would imply a major investme nt programme in new nuclear units

� Investment necessary to allow a significant extensi on of lifespan beyond 40 years include

� Investment in asset maintenance to be carried out e very year, including replacement of major components

� Ten-year inspection: with significant programmes to improve safety

� Total investment associated

� EDF estimates: c. €08 400 M per unit spread out sev eral years (900 MW unit)

� International benchmark: c. US$ 500/kW (from 40 to 60 years), ie c. US$ 450 M for a 900 MW unit

Source: EDF (January 2009)


EDF 5 Years Nuclear Capital Expenditures Plan

� EDF recurring nuclear capital expenditures are expe cted to rise in the coming years with increasing nuclear reactors maintenance & life extension spending

EDF 5 years nuclear capital expenditures in France*

Recurring share of nuclear capital expenditures

*Excludes Penly EPRTM Project

Source: EDF, January 2009


Generation 3 +

Generation 4

Current NuclearFleet with 40-year service life

Life extension past 40 years

0

10,000

20,000

30,000

40,000

50,000

60,000

70,000

1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060

EDF nuclear plant scenario starting in 2020

Generation 3+: EPR TM

Source: EDF

MWe installed

Renewal over 30 years (2020-2050)Construction of about 2,000 MW/year

Years

Average plant life: 48 years

29

Appendix 5Back End business details


Recycling is a competitive solution compared to direct disposal

� A 1994 OECD study shows that the overall costs of recycling and direct disposal are more or less identical

� A study conducted by BCG (Boston Consulting Group) in the US in 2006 shows the costs of recycling and direct disposal to be comparable

⊳Interim Storage

⊳Recycling

⊳Transports

⊳Waste disposal

� Interim Storage

� Transports

� Packaging

� Waste Disposal

DIRECT DISPOSALRECYCLING

Recycling Competitiveness

� Recycling reduces the risks associated with the uncertainty surrounding disposal costs

UNCERTAIN COSTS

UNCERTAIN COSTS

DIRECT DISPOSAL

Controlled costs

Strong uncertainty surrounding

costs

CONTROLLED COSTS

CONTROLLED COSTS

RECYCLING

Uncertainty Reduction

Source: International Benchmark AREVASource: BCG, AREVA

Plutonium & Uranium Credits

Total costs Total costs


Effective reprocessing capacity for lightwater reactors spent fuel

AREVACOGEMA - La Hague

BnFL /Sellafield

Minatom /Chelyabinsk

Japon /Rokkasho Mura(starting 2006)

1,700 mt / y

900 mt / y

Max. 400 mt / y

800 mt / y

Technology transfer

Source: AREVA, World Nuclear Association

In Back End, AREVA is the specialist of spent fuel management

� Considerable barriers to entry for recycling:� Technical and technological know-how� Regulations� Capital requirements

� AREVA is Nr 1 worldwide in terms of effective producti on

AREVA BnFL Minatom JNFL

~24,540 mt

4,010 mt 4,200 mt

420 mt

Up today, AREVA reprocessed c.75% of the spent fuel worldwide,i.e 24,500 mt out of 33,200 mt

Cumulative effective production,as of dec. 2008


AREVA Logistics Activities� TN International (France), TRANSNUCLEAR Inc. (USA) and TRANSNUCLEAR Ltd.

(Japan)� Design & licensing of dry storage and transport cas ks

� Manufacturing of dry storage casks

� Organization of Transports

� Cask maintenance operations on site

� LMC (France)� Road transport of radioactive materials

� Operations on railway and maritime facilities

� Maintenance of safety vehicles

� MAINCO (France)� Management of site supply chain

� Specific handling operations

� MECAGEST (France)� Manufacturing of mechanical and welded components (cas k baskets, vitrified and

compacted waste containers, etc.)

226 transports organized and 88 casks manufactured in 2008


AREVA key objectives in logistics business

� Develop our internal resources to anticipate our needs

People

� Maintain Research & Development efforts to offer innovative solutions for our customers in both back-end and front-end

Innovation and marketing

Operations performance

� Develop new fleets while securizingprocurements and sea transportation capacities

Market development

� Develop logistics activities consistently with the back-end sector priorities


� In compliance with IAEA 2005

� Burn-up: 70 000 MWd/t

� Enrichment: 5%

� Compatible with EPR TM

Used fuel: towards new packagings

TN 1, 1969

MARK II, 1980s-2000s(IAEA 1985)

TN12/2

TN13/2

TN17/2

TN 112, 2008(IAEA 2005)TN G3, 2015-2018

TN 12/1, 1980s


Nuclear Site Value Development

� AREVA considers nuclear site value development as a fully-fledged industrial activity

� Dedicated entity created in 2008: the Nuclear site Value Development Business Unit

� Role of the entity:

�Promote AREVA’s 20 years experience and expertise in this field

�Within AREVA, develop steer project progress and st andardized methods and techniques

� Key figures

�1,400 employees working on 6 sites

�4 major projects underway for both AREVA and the French Atomic Commission (CEA)

Cadarache: A first for MOX plant dismantling


Focus on radioactive waste management Framework French Law of June 28, 2006 (1/3)

� Program law:�Provides a framework for the

management of all radioactive waste

�Sets the schedule for management of this waste

� Institutes the principle of a National Management P lan

�Principle: One waste category = One disposal method

�� Key milestones:⇒ Opening of the geologic repository in 2025

⇒ Parliamentary debate and vote in 2015 (retrievabili ty)


►A definition that reinforces the use of used fuel t reatment:

� “The reduction of the quantity and harmfulness of

radioactive waste is sought, particularly through used fuel

treatment and the processing and packaging of

radioactive waste”

►An obligation to “clean up the past”:

“Owners of long-lived medium-level

waste produced before 2015 must

package it no later than 2030”

►Effective framework for foreign fuel treatment

►A standard solution: decision to dispose of long-li ved medium- and high-level waste packages beginning 2025



� Obligation to create a long-term management fund an d related management rules � Fund localized in companies

� Concerns the dismantling and disposal of long-lived medium- and high-level waste

� No transfer to the State (responsibility, fund)

� Very strict framework (amount, exposure, oversight by special commission)

� Note: Evaluation of disposal costs by an ad hoc wor king group led by the administration

One of the world’s most comprehensive law in this field :

Stabilizes the future and controls the fundamentals



Radioactive waste French classification

Waste category

VLL

(very low level)

A

(low level -LL)

B

(medium level - ML)

C

(high level -HL)

Short-lived(half-life < 30 years)

Long-lived(half-life > 30 years)

Morvilliers Disposal Center, in operation since 2003

Sub-surface storage center, opening slated for 2013

La Manche Disposal Center, full, closed (1969-1994), in 300-year monitoring period

Deep disposal center, decided by the law of June 28 , 2006 (opening slated for 2025)

Underground Laboratory in Bure (Meuse – Haute Marne)

Soulaines Disposal Center,in operation since 1992

Appendix 6T&D business details


T&D investments will outpace GDP growth in the near future

Source: AREVA

Economyglobalization+

� More networks inter-dependency to copewith potential shortages

� More economical exchanges of electricity

� More interconnections of networks withdifferent phases or frequency

� Increased needs in Automation

Past investmentconsequences+

� Old equipments in Western countries� Under-investments following privatization

leading to recent black-outs (Italy, US, …)� Lower grid / generation spare margin

� Need for refurbishment investments� Needs in Automation

Increase in T&Dintensive sourcesof electricity

+� Integration of renewables

� Need to connect distributed energysystems to the grids

� Expected strong growth of Wind with highT&D investments requirements

Growthof electricity in global energymix

+� Urbanization fostering need of safer /

cleaner energy� Long term shortage in Oil& Gas primary

sources of energy� Global warming leading to CO 2 emission

reduction objectives

GDP growth


AREVA T&D commercial achievements & strategy of selective acquisition and partnerships in 2008

� Major commercial achievements�Significant contracts with Dubai Electricity (UAE), StatoilHydro (UK),

UTE (Melo - Uruguay), National Grid/RTE (IFA2000 - UK/France), etc.

�N°1 in India�New leadership position in HVDC (excl. China)

� Major strategic moves�Acquisitions to increase our products portfolio: Waltec (Brazil), RB

Watkins (USA) and Nokian Capacitors (Finland)

�Strategic partnerships with GE (India) and Shanghai Electric (China)

� Production capacity increases to support growth�12 Greenfields in China, India, Poland and Turkey�Extension of key units in France, Switzerland and Germany, etc.


�

RB Watkins

Waltec

T&D India/GE India

PTR/Shanghai Electric Group

DSC/Sino American

PDS-GIS/Huadian

DSC-PDS/Leekeen

DSC/Hengchi

GIS/Jinxin

Key Strategic Moves in 2008

€290m full-year sales impact

Acquisitions

Partnerships

Joint-Ventures

Nxtphase

Nokian


New leadership positions established

� EMS

� Disconnectors

� GIS

� SPS Aluminum

� Instrument Transformers

� HVDC*

*Excluding China

Gas-Insulated Substation

Energy Management Systems

High Voltage Direct Current

Special Products Suppliers


Enlarged products portfolio

PACiS 4.5

GIS F35-5 bay

PIX High for Nuclear Segment

100% Vegetable oil Power Transformer

Top core Current Transformer

MaxSine SVC

Power transformer

MS 3000 Monitoring


AREVA’s smart grid vision

CO2 free energy sources

integration

CO2 free energy sources

integration

• Nuclear• Centralized /

Decentralized Renewable• Micro–renewable• Energy storage

Transmission optimization

Transmission optimization

• Infrastructure (incl. long distance, both energy & communication)

• Network management

Distribution optimizationDistribution optimization

• Infrastructure ( to enable bi-directional power flows, communication)

• Network management

New consumption modes integration and management

New consumption modes integration and management

• Electric cars• µ-production and µ-grid• Deregulated environment• Smart appliances &

buildings

Energy policies / Regulatory push

New technologies capabilities

EnablersBlackout

preventionBlackout

prevention

• Defense plan• React in real-time• Online Stability• Closed Loop Control

Market efficiency

Environmental concerns

Energy efficiency

+

Customers needs

Reliability and Quality

Stability

Appendix 7Outlook China


� Electricity consumption 1995-2020

Source: China Electricity Council (CEC) , Market Study, Financial Crisis Impact Study

China: strong growth in power consumption despite slow down in 2008


China: the energy challenges

� Secure economic growth

� Minimize energy dependency

� Ensure sustainable development

�Ensure social stability by reducing disparities: electricity for all at

an affordable price

�Take action on environmental issues , both for existing pollution

and global warming

�Expand the interconnection market (HVDC) for electricity

transmission to densely populated, developed areas

80% of hydraulic resources

70% of coal reserves

Better developed Regions

Nuclear power and advanced T&D technologieshave a major role to play


China: overview of the energy sector

� Per capita consumption is still low and very dispar ate

� Insufficient installed capacity

� 792 GW installed as of the end of 2008, with a target of 1500 GW by 20201

� A promising market

� China’s capital spending on new generating capacity and in the transmission

and distribution sector is expected to rise to 50 billion dollars per year from 2006

to 2010.

� China’s electricity transmission and distribution market represents 25% of the

world market

� Renewable energies law is effective since 2006 to e ncourage renewable energy resources

� Renewable energy is expected to reach 10-12% of total installed power

capacity by 2020

� China is to become the first market in Renewable Energy from 2010

1 Source: China Electricity Council and World Nuclear Association


China: AREVA’s positions

� More than 2,900 employees, of which 2,800 employees for T&D

� More than 735 million euros sales in 2008

T&D

Reactors &Services

Front-End

24%

47%29%

AREVA’s Sales split

T&D


China: AREVA T&D’soperations in China

*Sales by destination in 2008 (not including products manufactured in China and exported overseas)

� China’s T&D market 2008 represents 25% of the worl d market and is expected to keep growing despite of current fina ncial crisis

� Substantial capital expenditure is required in ligh t of the country’s rising energy demand at above 10% CAGR 2006-2010

� More than 365 million euros in sales in 2008 *

� Breakdown of the Chinese T&D market in 2008:

Local players = 70% of the market

ShenGao1% PingGao

4%

TWBB2%

TBEA5%

Nari 3%

XJ Group2%

Japanese/Korean3%

Other MNCs3%

XD Group8%

Others44%

ABB15%

SIEMENS7%

AREVA3%


China: T&D Market Growth

� T&D Market Drivers

�Fast industrialization (2008 Industrial production growth: +13%)

�Urbanization and improved living standards

� Need for infrastructures and appliances

�Need to efficiently connect distant power generatio n and main consumption centers over long distance (UHV and HVD C opportunities)

�2008 annual capacity increase = 90 GW (~ UK install ed capacity)

40,5%41,8%

43%44%

45%47%

48%

50,0% 50,4% 51,0%

40%

42%

44%

46%

48%

50%

52%

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Urbanization rate


China: nuclear power’s share is expectedto quadruple by 2020

� Total installed capacity in 2008: 792 GW, mostly the rmal

� Nuclear power’s share is still limited in China: 9 G W, corresponding to 1.5% of 2008 total installed genera ting capacity in China

� Objective: 5% by 2020, i.e. 70 GW

Source: China Electricity Council

77%

1.5%

20%

1.7%

Nuclear

Hydro

Wind

Fossil Fuel (gas, coal, oil)

China Installed Generating Capacity (2008)


China: nuclear civilian sites11 reactors in operation – 18 under construction


China: AREVA role in the developmentof the nuclear fleet

Daya Bay - 1994

Qinshan I - 1991

Qinshan II phase 1 – 2002; 2004

Qinshan III – 2002; 2003

Ling Ao I – 2003

Tianwan – 2007

Ling Ao II – 2010; 2011

Qinshan II phase 2 – 2011; 2012

Other project Gen 2 & 3

Built by AREVA

Significant Participation (Supply, assistance, …)

Projects to come

A wide offerof services, equipments

and fuelfor the whole fleet

A strong presence in the newly built plants

200x Commissioning date

2015201020001990

Hongyanhe – 2012; 2013

Taishan – 2013; 2014


China: the largest contractever signed

in the nuclear business

Material and Servicesfor 15 years of operation

Constructionof 2 EPRTM

nuclear islands

Discussions to start on cooperation for

treatment and recycling

€8 Bn


China: renewable energies outlooks

� AREVA Bioenergy

�600 to 900 MW to be installed yearly to reach 20 00 0 MW installed

capacity by 2020

�Annual market turnover related to boiler island exp ected

to exceed 200 M€ by 2012

�No market saturation foreseen before 2012.

AREVA’s technology, based on its operating feedback ,

is an asset in the stiff competition with local boi ler manufacturers

�AREVA aims at:

� Developing boiler engineering competences, combinin g AREVA mastered technology and low cost manufacturing

� Low cost sourcing for oversea projects

Appendix 8Outlook India


India: massive growth of nuclear generated power is expected over the next 40 years

4 GWe

50 GWe

Nuclear installed capacity should multiply by more

than 10 by 2050

66 GWe**

Francein 2008

2008 2050

Source: Indian Office of the Minister of State for Commerce & Power (February 2009), Nucleonics Week

15%

68%

4%3%

10%

Nuclear percentage should rise from 3% in 2008 to 25%of the power mix in 2050

75%

25%

Coal

Other Renewable

Hydraulic

Nuclear

2007

20502020

20 GWe

� Population growth (x 1.5 from 2000 to 2050)

� GDP growth (7.5% per year in 2008, and c.6% expecte d in 2009*)

� Increase in electricity access (44% of Indian house holds have no access to electricity in 2008)

Key drivers

Oil

* Economist Intelligence Unit, February 2009** Nucleonics Week, March 2009

Others


India: Important T&D investments to continue

�T&D Indian 11 th Five Years Plan (2008-2012)Fresh capacity addition is considered to be the mai n driver for future demand for Electrical Equipments in the T&D segment

(Rs Bn)

(GW)

(GVA)

CapacityFunds Required

Transmission

Central Sector

State Sector

750

650

Distribution

Sub-Station787

Augmentation of S/S

793

43

16

292 *

198

* 292 GVA to be added + 500,000 Nos. of Industrial installations (HT)

Source: JM Financial, Planning commission working group report on power sector


� T&D India Market share 2008

India: AREVA T&D has a strong competitive position

� Major land marks:

� 70% market share in the EMS segment for Transmission networks

� Supplied and commissioned India’s first 765 kV substation in 2007 for NTPC Sipat plant

� 20% of HVDC inter-regional linkages

� Largest number of GIS referencesin India

� Network Consultancy contract for Reliance Energy’s Delhi & Mumbai networks ; 1 st of its kind in India

� Modernization of Bhutan’s electrical network for 2 cities

Source: AREVA. Market share calculation based on 2008 orders

AREVA

16.9%

Siemens

8.8%

BHEL

5.2%CGL

4.9 %

Others

38.8%

ABB

15.6%

L&T

2.1%

Chinese – Koreans

7.7%


India: AREVA benefits from an historical presence in India since 1950s’

� 8 manufacturing sites

� 3 new manufacturing sites

� 4,200 employees

� 22 sales offices

Full fledge local player covering UHV, HV, MV, Systems and Automation

Dehli, Noida

Naini

Kolkata

BangaloreChennai

Pondicherry

Baroda

NAINI

CHENNAI

BANGALORE

KOLKATA

NOIDA, DELHI

CHENNAI

PONDY

KOLKATA

Map as of end of 2008

Hosur

Padappai New factories


India: the country has developed a strong nuclear industry

� India has developed a strong domestic nuclear indus try, drawing on the benefits of earlier cooperation with Canada, France, the United States, Russia…

� NPCIL is the specialized nuclear utility in India, architect-engineer and operator of 17 reactors (+ 6 under construction )

� Operating reactors are derivatives of Candu (14) and BWRs (2), but are rather small (160 to 500 MW range)

� India is developing fast neutron reactors, proof of its technological capability and forward-looking approach

� Nuclear supply chain in India is dominated by sever al large public and private industrial groups, like BHEL, Larsen & Toubro, Tata,etc.

� India now aims to supply 25% of electricity from nuclear p ower by 2050, from 3% in 2008


India: 17 reactors in operation and 6 under construction

PHWR (3.760 MW)BWR (320 MW)

PHWR (660 MW)VVER (2.000 MW)

RAWATBHATA 1, 2, 3 & 4740 MW

440 MW (5 & 6)

KAKRAPAR 1&2440 MW

TARAPUR 1, 2, 3 & 41400 MW

KAIGA 1, 2 & 3620 MW220 MW

Plants in operation

Plants under construction

NARORA 1&2440 MW

KALPAKKAM 1&2440 MW500 MW (Fast breeder reactor)

KUDANKULAM 1&22000 MW

FBR (500 MW)fast breeder reactor


India: recent evolution of the specific country situation relating to non-proliferation commitments

� India did not sign the Nuclear Non-Proliferation Tr eaty (NPT)and conducted its first nuclear test in 1974

� From that time, on-going cooperation between India and other countries was interrupted, and supplier states put in place the N SG (Nuclear Suppliers Group, 45 countries today) to regulate nuclear expo rts

� Since adoption of Full-Scope Safeguards in 1992, NS G member states do not allow themselves to export nuclear technology, equi pmentand fissile material to any country not complying w ith Full-Scope Safeguards

� Between 2005 and 2008, discussions between India an d several NSG member states took place, for an agreement on safeguarding civilian nuclear facilities and fissile material paving the way for a new conse nsus within NSG

� Summer 2008: India obtained a green light from AEIA and the NSG validated an exceptional arrangement to permit its members to deal with. Some countries had already signed MOU with India to put in place framework agreement of cooperation

� February 2009: India signed a safeguard agreement w ith the AIEA, allowing individual countries to further trade with India in civilian nuclear field


� V. Poutine visit: February 2007

India: success of the discussions with NSG members

� India/USA statement: July 2005

� G. Bush visit: March 2006

� Bilateral cooperation:India / Canada (PHWR)India / France (FBR)India / USA (BWR)

1974 2006 20072005

� 1st Indian nuclear test

AREVA

Feasibility report for 6 GW

AREVA

Feasibilityreport for EPR TM

February 2006: President

Chirac visit

July 2006: AREVA visit

� India / France statement: September 2005

July 2008: AEIA

green light

2008

� American Congress vote: December 2006

2009

January 2009: AREVA

– Bharat Forge JV**

February 2009: AREVA

– NPCIL MoU for up to 6

EPRTM Reactors***

December 2008: AREVA – NPCIL 300 tU

Supply Contract*

February 2009: Nuclear safeguards agreement between India and the IAEA

� Nuclear cooperation agreements with France

* First of its kind MoU between India and a foreign nation** Joint Venture with Bharat Forge for the production of heavy components of nuclear reactors (to start in 2012)*** Memorandum of Understanding to supply 2 to 6 EPRTM reactors

September 2008:

End of 34 years Ban

from Nuclear

Suppliers Group

� Nuclear cooperation agreements with US


India: key challenges for AREVA� For Nuclear:

� Successfully license the EPR TM with the Indian nuclear regulatory authority

� Sign final contract with NPCIL for the construction of the 2 first EPR TMs at Jaitapur

� Set up the announced joint venture with Bharat Forg es in order to start the production of

heavy forging components for the EPR in 2012

� For T&D: grasp market growth

� Increase capacity: Greenfield, lean manufacturing

� Cover all market segments by localization of techno logy and specific developments to

address market needs

� Overall, leverage India to support AREVA strategy w orldwide

� Recruit and retain talents

� Manufacturing base for other units

� Engineering resources and R&D centers of excellence

� Strong supplier base

Appendix 9Financials


Change in revenue 2008/2007 like-for-like

In millions of euros

2008 2007

RevenueRevenue like-

for-likeExchange

rateimpact

Consolidationscope impact

Change in valuation method

Reportedrevenue

Front End division 3,363 3,136 (53) 46 4 3,140

Reactors & Servicesdivision 3,037 2,739 (47) 19 49 2,717

Back End division 1,692 1,735 (4) 0 0 1,738

Nuclear 8,092 7,610 (103) 65 53 7,595

T&D division 5,065 4,375 (121) 169 0 4,327

Corporate and Other 3 1 0 0 0 1

Consolidated 13,160 11,985 (224) 233 53 11,923


Non-operating items

ChangeIn millions of euros 2007 2008 08/07

Operating income 751 417 (334)

Net financial income (expense) 64 (29) (93)

Share in net income of associates 148 156 8

Income tax (81) (46) 35Effective tax rate 9.9% 11.8% +1.9 pts

Minority interests (139) 91 230

Net inc. attributable to equity holders of parent 743 589 (154)


Net financial income


End-of-life-cycle operations 107 (57) (164)Including:Income from earmarked portfolio and interest on receivables 175 87 (88)Non-portfolio income 113 182 69Discount reversal on end-of-life-cycle portfolio and schedule revisions (181) (327) (146)

Net borrowing costs (excl. discount/premium) (53) (11 1) (58)

Discount/Premium (20) (16) 4

Income from disposal of securities 3 370 367

Discount reversals on retirement/benefits provision (55) (72) (17)

Other financial income and expenses 82 (143) (225)

Net financial income (expense) 64 (29) (93)


Share in net income of associates

� The negative results of ST Microelectronics (-84% c ompared with 2007) are offset in part by Eramet's positive perfor mance


STMicroelectronics (25) (46) (21)

Eramet group 153 187 34

Other 20 15 (5)

TOTAL 148 156 8


Minority interests in subsidiaries' earnings


AREVA NP (17) (186) (169)

AREVA NC 129 76 (53)

AREVA T&D 23 32 9

AREVA TA 3 4 1

Other 1 (17) (18)

TOTAL 139 (91) (230)


Cash flow and net debt

In millions of euros 2007 2008

Ebitda (excluding end-of-life-cycle costs)* 1,335 1,181% of revenue 11.2% 9.0%

Gain (loss) on disposal of operating assets 1 (197)

Change in operating WCR (432) (451)

Net operating Capex (2,889) (1,454)

Free operating tax flow before tax (1,985) (921)

End-of-life-cycle obligations 171 (115)

Net financial Capex (131) (462)

Dividends paid (345) (326)

Revaluation of minority put options (liability) (932) (19)

Other (income tax, non-operating WCR, etc.) 85 (577)

Change in net cash position (3,137) (1,496)

Net debt (12/31) (4,003) (5,499)


2,25,5

0,15,2 3,3

8,0

4,87,3

1.8

5,7

Assets (simplified) Liabilities & equity(simplified)

Simplified balance sheet at 12/31/09

Goodwill

PP&E and intangible assets

Assets earmarked for end-of-life-cycle operations

Non-current financial assets

Equity

Provisions for end-of-life-cycle operations

Other provisions**

WCRInvestments in associates

= 21.9 =

* Net debt excluding unexercised put options = borrowings including interest-bearing prepayments – cash – marketable securities – non-trade current account assets

** Including net deferred taxes

Net debt*

In billions of euros


End-of-life-cycle operations

4 9545 404

1 964

270

270

2 991

Assets Breakdown ofAREVA assets

Provisions

AREVA Third party share

End-of-life-cycle operationsat December 31, 2008

In millions of euros

Earmarked portfolio

Receivables

� The law of June 28, 2006 on the sustainable management of radioactive materials and waste requires a 100% reserve ratio by June 28, 2011 for end-of-life-cycle provisions using dedicated assets

� Since 2002, AREVA’s reserve ratio has ranged from 90% to 110%

� At December 31, 2008, in an environment of severe crisis in financial markets, it was 92%


In millions of euros 2007 2008* 2007 2008 2007 2008*

Nuclear 3,172 5,005 429 37 13.5% 0.7%

T&D 761 1,086 265 402 34.8% 37.0%

Other 331 2,250 (111) (111) - -

Consolidated 4,264 8,341 583 328 13.7% 3.9%

ROACE (1/2)

Average Capital Employed

Net Operating Income ROACE

* Unadjusted for goodwill linked to the Siemens put option


2007 2008unadjusted for

In millions of euros Siemens’ put option

Net operating income 583 328

Net intangible assets 2,729 3,089

Goodwill used in ROACE calculation 2,520 4,748*

Property, plant and equipment 4,204 4,914

Customer prepayments on assets (907) (941)

Operating WCR 368 656

Provisions for contingencies and losses (3,088) (3,430)

Capital employed 5,826 9,036

Average capital employed 4,264 8,341

ROACE 13.7% 3.9%

ROACE (2/2)

CONSOLIDATED

* Unadjusted for goodwill related to Siemens’ put option


Balance Sheet (1/2)

-1Pension assets

34,644

-

113

1,050

154

164

2,434

4,486

3,403

11,804

900

2,152

1,757

4,954

270

189

4,913

3,089

4,803

22,841

December 31, 2008

-Assets of operations held for sale

30,676Total assets

279Other current financial assets

634Cash and cash equivalents

141Other non-operating receivables

94Current tax assets

1,402Other operating receivables

3,884Trade accounts receivable and related accounts

2,817Inventories and work-in-process

9,251Current assets

604Deferred tax assets

2,588Other non-current financial assets

1,558Investments in associates

2,873Assets earmarked for end-of-life-cycle operations

2,491End-of-life-cycle assets (third party share)

174Including: End-of-life-cycle assets (AREVA share)

4,204Property, plant and equipment

2,729Other intangible assets

4,377Goodwill on consolidated companies

21,425Non-current assets

December 31, 2007

ASSETS(in millions of euros)


Balance Sheet (2/2)

LIABILITIES AND EQUITY(in millions of euros)

34,644

-

53

104

2,884

2,991

4,752

2,693

2,081

15,558

760

3,969

123

5,674

1,268

11,795

745

589

(131)

287

4,455

1,347

7,292

December 31,2008

1,175Employee benefits

11,951Non-current liabilities

30,676Total liabilities and equity

-Liabilities of operations held for sale

41Other non-operating liabilities

127Current tax liabilities

1,921Other operating liabilities

2,565Trade accounts payable and related accounts

4,172Advances and prepayments received

613Current borrowings

1,823Current provisions

11,261Current liabilities

1,277Deferred tax liabilities

4,302Non-current borrowings

121Other non-current provisions

5,075Provisions for end-of-life-cycle operations

470Minority interests

743Net income attributable to equity holders of the parent

(138)Currency translation reserves

1,117Deferred unrealized gains and losses

3,925Consolidated premiums and reserves

1,347Share capital

7,464Equity and minority interests

December 31,2007


Income Statement

16.6216.62

35,442,701

589

91

--

498

156

343

(46)

(29)

81

(111)

(148)

38

(43)

417

214

460

(980)

(607)

(453)

2,286

(10,906)

3213,160

2008

-Net income from discontinued operations

20.95Diluted earnings per share*20.95Basic earnings per share

35,442,701Average number of shares outstanding

743Net income attributable to equity holders of the pa rent

(139)Les minority interests

882Net income from continuing operations

148Share in net income of associates

734Net income of consolidated businesses

(81)Income tax

64Net financial income

138Other financial income and expenses

(73)Net borrowing costs

(110)Gross borrowing costs

37Income from cash and cash equivalents

(57)

751

Restructuring and early retirement costs

Operating income

(123)

808

Other operating income and expenses

Operating income before restructuring expenses

(881)General and administrative expenses

(529)Marketing and sales expenses

(421)Research and development expenses

2 762Gross margin

(9,183)Cost of sales

21Other income from operations11,923 Revenue

2007In millions of euros

* Adjusted for net income from discontinued operations


Consolidated

Segment reporting (1/2)

% of revenue

Operating income

Contribution to consolidated revenue

Income items

In millions of euros(except number of employees)

Free operating cash flow

Change in operating WCR

Net Capex

% of consolidated revenue

Ebitda (excl. end-of-life-cycle)

Cash flow items

Number of employees

Capital employed*

PP&E and intangible assets .

Other

� 2008

Corporate, Other and

EliminationsT&DBack End

Reactors and Services

Front End

3,363

453

13.5%

780

23.2%

(664)

(533)

(609)

5,595

6,091

14,240

* Capital employed at the end of the period

3,037

(687)

-22.6%

(349)

-11.5%

(365)

124

(591)

1,436

159

19,477

1,692

261

15.4%

320

18.9%

(88)

190

422

1,947

(906)

10,906

5,065

560

11.1%

587

11.6%

(324)

(276)

(20)

1,308

1,356

29,966

3

(170)

-

(158)

-

(13)

44

(124)

2,520

2 336

825

13,160

417

3.2%

1 181

9.0%

(1,454)

(451)

(921)

12,806

9 036

75,414


Consolidated

6.3%

751

11,923

(1,985)

(432)

(2,889)

11.2%

1,335

65,583

5,826

11,310

Segment reporting (2/2)

% of revenue

Operating income

Contribution to consolidated revenue

Income items

In millions of euros(except number of employees)

Free operating cash flow

Change in operating WCR

Net Capex

% of consolidated revenue

Ebitda (excl. end-of-life-cycle)

Cash flow items

Number of employees

Capital employed*

PP&E and intangible assets

Other

� 2007

Corporate, Other and

Eliminations

-

(166)

1

(190)

(20)

(33)

-

(137)

620

345

2,325

T&D

9.2%

397

4,327

233

(5)

(193)

9.8%

426

25,248

816

1,053

Back End

11.7%

203

1,738

172

(186)

(81)

25.3%

440

10,638

(644)

1,897


- 6.6%

(179)

2,717

(528)

(81)

(322)

- 4.6%

(125)

16,500

178

1,141

Front End

15.8%

496

3,140

(1,673)

(140)

(2,260)

23.3%

731

12,577

5,135

4,894

* Capital employed at the end of the period


2008 sales revenue by BU (1/2)

Front End division

Mining23%

Chemistry8%

Enrichment32%

Fuel37%


Back End division

Logistics14%

Cleanup6% Engineering

3%

Treatment -Recycling

63%

Transmission & Distribution

Products53%

Systems31%

Automation10%

Services6%

Nuclear services26%

Plants39%

Nuclear measurement

6%

Equipment9%

AREVA TA12%

Consulting/Information Systems5%

Renewable energies

5%

Nuclear Site Value Development

14%


2007 sales revenue by BU (2/2)

Front End division

Mining23%

Chemistry8%

Enrichment34%

Fuel36%


Back End division

Logistics13%

Cleanup6% Engineering

3%

Treatment -Recycling

81%

Transmission & Distribution

Products49%

Systems32%

Automation11%

Services8%

Nuclear services29%

Plants39%

Nuclear measurement

6%

Equipment8%

AREVA TA11%

Consulting/Information Systems6%

Renewable energies

1%

areva, business & strategy overview - april 2009 - appendix1

Economy & Finance