Dong records 7% rise in Q3 op profit, confirms oil and gas exit
Image by Dong Energy (dongenergy.com)
Danish energy company Dong Energy A/S (CPH:DENERG) today reported a 7% year-on-year increase in third-quarter operating profit, aided by a 19% rise in Wind Power as it confirmed a decision to exit oil and gas.
The company's operating profit, or earnings before interest, tax, depreciation and amortisation (EBITDA), grew to DKK 4.76 billion (USD 707m/EUR 640m) in the third quarter of 2016. Net profit rose sharply to DKK 3.3 billion from DKK 458 million in the same quarter of 2015, reflecting the higher EBITDA, lower depreciation and a DKK-1.3-billion gain from the divestment of the gas distribution grid to Energinet.dk.
Dong said it has decided to start a process with the aim of exiting its oil and gas business. "This should be seen in the context of DONG Energy’s strategic transformation towards becoming a global leader in renewables and a wish to ensure the best possible long-term development opportunities for our oil and gas business," said chief executive and president Henrik Poulsen.
The company currently has seven large offshore wind farms under construction totalling 4.4 GW and continues to shape its offshore wind pipeline for the period beyond 2020, the CEO noted.
Dong also maintained its full-year outlook for EBITDA of DKK 20 billion-23 billion and gross investments of DKK 18 billion-21 billion. In the first nine months of the year, EBITDA rose 16% to DKK 17.2 billion. Net profit increased by DKK 6.5 billion to DKK 9.7 billion.
The table below gives more details about the results of the Wind Power division.