Vestas raises guidance as headwinds subside
AFP/The Local - [email protected]
Published: 20 Aug, 2014 CET.
Updated: Wed 20 Aug 2014 13:29 CET
Wind turbine maker posted strong quarterly earnings on Wednesday as it continued to emerge from a crisis in which it shed thousands of jobs.
Vestas Wind Systems raised its profits guidance on Wednesday on the strength of its quarterly earnings. The Aarhus-based company said it believes this year's margin on earnings before interest and taxes, before special items, would be at least six percent, instead of five percent forecast previously. The upgrade was based on "the improved cost base and the expected delivery plan for the second half of 2014," it said. The company, the world's biggest wind turbine maker, reported its last annual profit in 2010, falling into the red after an ill-timed expansion plan and tough competition forced it to slash its workforce by almost a third. "With another solid quarter showing improvements in most areas, we remain focused on executing on our strategy," chief executive Anders Runevad said in a statement. Vestas made a net profit of 702 million kroner (94 million euros, $125 million) in the second quarter compared with a 62 million euro loss in the same period a year ago, as revenue rose 13 percent to 1.341 billion euros. The group said the European market was "still characterised by low activity in southern Europe which is balanced by growth in some northern and eastern European markets," while activity in the US was high. "They have become better and more efficient at producing wind turbines," by lowering production costs while maintaining quality, Sydbank analyst Jacob Pedersen told Danish news agency Ritzau. Shares in Vestas were 1.2 percent lower in midday trading on the Copenhagen bourse, where the benchmark index was flat.
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Vestas Wind Systems raised its profits guidance on Wednesday on the strength of its quarterly earnings.
The Aarhus-based company said it believes this year's margin on earnings before interest and taxes, before special items, would be at least six percent, instead of five percent forecast previously.
The upgrade was based on "the improved cost base and the expected delivery plan for the second half of 2014," it said.
The company, the world's biggest wind turbine maker, reported its last annual profit in 2010, falling into the red after an ill-timed expansion plan and tough competition forced it to slash its workforce by almost a third.
"With another solid quarter showing improvements in most areas, we remain focused on executing on our strategy," chief executive Anders Runevad said in a statement.
Vestas made a net profit of 702 million kroner (94 million euros, $125 million) in the second quarter compared with a 62 million euro loss in the same period a year ago, as revenue rose 13 percent to 1.341 billion euros.
The group said the European market was "still characterised by low activity in southern Europe which is balanced by growth in some northern and eastern European markets," while activity in the US was high.
"They have become better and more efficient at producing wind turbines," by lowering production costs while maintaining quality, Sydbank analyst Jacob Pedersen told Danish news agency Ritzau.
Shares in Vestas were 1.2 percent lower in midday trading on the Copenhagen bourse, where the benchmark index was flat.
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