Dong Energy A/S (CPH:DENERG) today reported DKK 3.29 billion (USD 484m/EUR 443.5m) in first-quarter EBITDA from continuing operations, a drop of 54% from a year ago, but in line with expectations.
Earnings before interest, tax, depreciation and amortisation (EBITDA) in the year-ago quarter included DKK 3 billion in non-recurring items, the Danish utility and major offshore wind developer pointed out. The decrease in underlying EBITDA was 19%. Dong confirmed its full-year forecast.
The company said it expects partnership income in Wind Power to materialise later in the year with the expected divestment of 50% of Walney Extension and the construction of the Race Bank offshore wind farm. Dong said partnership income is seen to exceed the level in 2016.
| All in DKK million |
Q1 2017 |
Q1 2016 |
| Revenue |
16,497 |
17,408 |
| - of which Wind Power |
4,678 |
5,761 |
| EBITDA |
3,288 |
7,085 |
| - of which Wind Power |
2,139 |
2,900 |
| Underlying EBITDA |
2,139 |
4,065 |
| EBIT |
1,993 |
5,909 |
| - of which Wind Power |
1,233 |
2,094 |
| Profit from continuing ops |
1,214 |
4,980 |
| Profit for the period |
2,640 |
5,216 |
Dong Energy has 3.6 GW of installed offshore wind capacity and 7.4 GW of projects with a final investment decision (FID). Its Wind Power division produced 2.1 TWh in the first quarter of 2017, up by 24% in annual terms, thanks mainly to new capacity. The company also has bioenergy and thermal power plants. In 2016 it completed the coal-to-biomass conversion of the Studstrup and Avedoere power plants.
The process of divesting its oil and gas business in progressing according to plan, with the transaction still seen to be closed in the current year.
Dong still expects 2017 EBITDA of between DKK 15 billion and DKK 17 billion, and gross investments of DKK 18 billion-20 billion for the year.
| All in DKK billion |
2017 guidance |
2016 result |
| EBITDA (continuing ops) |
15-17 |
19.1 |
| - of which Wind Power |
Higher |
11.9 |
- of which Bioenergy &
Thermal Power |
Higher |
0.1 |
- of which Distribution &
Customer Solutions |
Significantly lower |
7.1 |
| Gross investments |
18-20 |
15 |
In the first quarter, gross investments reached DKK 2.5 billion, of which roughly 80% went to offshore wind. Return on capital employed (ROCE) for the last 12 months was up to 17% from 15% in the same quarter of 2016.
The full report is available at http://assets.dongenergy.com/DONGEnergyDocuments/com/Investor/Interim/2017/Q1/Interim_Report_Q1_2017_EN.pdf
(DKK 10 = USD 1.47/EUR 1.35)
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Image by Dong Energy (dongenergy.com)
