TIDM44ZX
Orsted A/S
29 April 2020
Interim report for the first quarter 2020
Strong Q1 results
Today, Ørsted's Board of Directors approved the interim report
for the first quarter of 2020. Our operating profit (EBITDA)
amounted to DKK 6.8 billion, a 33% increase compared to the same
period last year.
Earnings from offshore and onshore wind farms in operation
increased by 25% to DKK 5.2 billion driven by ramp-up of generation
from Hornsea 1, Lockett, and Sage Draw. Furthermore, we had high
wind speeds in Europe throughout Q1 2020.
Net profit amounted to DKK 3.3 billion and r eturn on capital
employed (ROCE) came in at 11%.
The green share of our heat and power generation increased from
80% to a new high of 90%.
On 4 March 2020, we increased our EBITDA (business performance)
guidance from DKK 15-16 billion to DKK 16-17 billion due to updated
assumptions regarding the divestment of the transmission asset for
Hornsea 1.
At this point in time, we have no indication that the COVID-19
situation will significantly impact our earnings for the year, and
thus we re-iterate our most recent EBITDA guidance of DKK 16-17
billion in 2020. We also re-iterate our expectation of gross
investments of DKK 30-32 billion in 2020.
Henrik Poulsen, CEO and President of Ørsted, says:
"Despite the COVID-19 crisis and its profound impact on
societies around the world, we have had a very good start to the
year with strong financial results and solid operational
performance across the entire business.
We activated our Corporate Crisis Management Organisation in
early March to steer Ørsted through the global COVID-19 crisis. Our
focus has been on the health and well-being of our employees and
their families and the communities we are part of.
During the last couple of months, our asset base has been fully
operational with availability rates for our wind farms and power
stations within the normal range.
In March, we commissioned the 338MW onshore wind farm Sage Draw
in the US.
Our construction projects all remain on track. However, across
our projects, we see an increased risk of component and service
delays from suppliers impacted by COVID-19. We collaborate closely
together with our partners to mitigate these situations as best
possible and without compromising health and safety standards.
Based on our current outlook, we believe the COVID-19 related
impact on our construction projects will be limited both in terms
of timing and economics.
Our offshore development projects in the US are moving forward,
although at a slower pace than originally expected due to a
combination of the Bureau of Ocean Energy Management's (BOEM)
prolonged analysis of the cumulative impacts from the build-out of
US offshore wind projects, and now also COVID-19 effects. The two
earliest projects in our pipeline; the 120MW Skipjack project in
Maryland and the 130MW South Fork project in New York, are most
exposed to the risk of delays. For Skipjack it is no longer
realistic to receive the 'Notice of Intent' from BOEM in due time
to meet commissioning date in late 2022. Therefore, we now expect
to commission the wind farm approx one year later. For the South
Fork project, which was also planned for a 2022 commissioning date,
we have received the 'Notice of Intent', but have not received a
confirmed permit schedule from the federal government outlining
when the 'Construction and Operations Plan' (COP) will be received.
This combined with impacts from the COVID-19 related shutdowns in
New York, will also very likely delay South Fork to beyond
2022.
For our largest awarded US development projects - Revolution
Wind, Ocean Wind, and Sunrise Wind - with expected commissioning in
2023 and 2024, we also see increased risk of delays. We have
submitted our COP applications for Ocean Wind and Revolution Wind
and are awaiting BOEM to issue their 'Notices of Intent', outlining
the timeline for COP approval. For Sunrise Wind in New York, we are
currently unable to progress our offshore site surveys due to
COVID-19 restrictions, which adversely impacts our COP application
process. So, for these three projects, we need more visibility on
the path to COP approval before concluding whether commissioning in
2023-24 remains realistic. We expect to have more clarity after
summer.
Ørsted is a strong company with a resilient business model, and
we are in a much less vulnerable position than many other sectors
that are deeply impacted by the crisis. However, the impact of
COVID-19 will have material ripple effects throughout all economies
and sectors, and we cannot be complacent about its potential impact
on us. Thus, we remain vigilant about the unfolding crisis and have
identified a number of risks that potentially can impact our
activities, including the ones listed in our company announcement
on 25 March.
I would like to extend a special and heartfelt thank you to all
Ørsted employees and our partners for doing an exceptional job in
maintaining a strong focus on health and safety during these
challenging times, while also maintaining business continuity
across Ørsted's critical operations and projects."
Financial key figures for Q1 2020:
DKK million Q1 2020 Q1 2019 %
============================== ======== ======== =======
EBITDA 6,805 5,130 33%
Profit (loss) for the period
from cont. operations 3,346 2,639 27%
Profit (loss) for the period
from discont. Operations (28) (43) (35%)
Profit (loss) for the period 3,318 2,596 28%
Cash flows from operating
activities (428) (118) 263%
Gross investments (5,308) (3,899) 36%
Divestments 7 2,678 n.a.
Free cash flow (5,729) (1,339) 328%
Net interest-bearing debt 27,084 9,111 197%
FFO/adjusted net debt 21% 46% (25%p)
ROCE 11% 28% (17%p)
============================== ======== ======== =======
For further information, please contact:
Media Relations Investor Relations
Martin Barlebo Allan Bødskov Andersen
+45 99 55 95 52 +45 99 55 79 96
Conference call
In connection with the presentation of the interim report, a
conference call for investors and analysts will be held on
Wednesday, 29 April 2020 at 14:00 CEST.
Denmark: + 45 32 71 49 98
UK: + 44 800 408 7373
US: + 1 877 890 2416
Room number: 233127
Participant PIN: 8564
The conference call can be followed live at:
https://edge.media-server.com/mmc/p/tugmuzb3
Presentation slides will be available prior to the conference
call at:
https://orsted.com/en/investors/ir-material/financial-reports-and-presentations#0
The interim report is available for download at:
https://orsted.com/en/investors/ir-material/financial-reports-and-presentations#0
Attachments to this company announcement:
Interim financial report Q1 2020 (pdf)
Company announcement (pdf)
Investor presentation (pdf)
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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