Danish pure-play renewables company Ørsted A/S (CPH:ORSTED) today reported a DKK-3.3-billion (USD 521m/EUR 444m) rise in first-half (H1) operating profit because of a significant gain from the farm-down of an offshore wind asset.
Specifically, the sale of a 50% stake in the 752-MW Borssele 1 & 2 offshore wind farm earlier in the year has led to a 34% year-on-year increase in Ørsted’s January-June 2021 earnings before interest, tax, depreciation and amortisation (EBITDA) to DKK 13.1 billion. The exact gain from the particular sale amounts to DKK 5.4 billion.
Meanwhile, earnings from the company’s offshore and onshore wind farms in operation went down by DKK 0.3 billion as significantly lower wind speeds across the portfolio more than offset the increased generation capacity from new wind farms in operation, Ørsted explained. Other negative effects came with higher TNUoS tariffs, lower earnings from Horns Rev 2 due to the end of the subsidy period in October 2020, and lower ROC recycle prices.
The table below gives more information about the company’s financial performance in both the second quarter and first half of 2021.
| Figures in DKK million |
Q2 2021 |
Q2 2020 |
H1 2021 |
H1 2020 |
| EBITDA |
8,196 |
2,956 |
13,059 |
9,761 |
| Profit (loss) for the period |
5,544 |
(825) |
7,142 |
2,493 |
| Cash flows from operating activities |
3,147 |
8,197 |
11,234 |
7,769 |
| Gross investments |
(12,133) |
(3,757) |
(18,798) |
(9,065) |
Ørsted reiterated its full-year EBITDA forecast of DKK 15 billion-16 billion but noted it now expects the actual result to be in the low end of the guided range due to the significantly lower than normal wind speeds across its entire offshore wind portfolio and a warranty provision towards the company’s partners in relation to cable protection system issues at some of its wind farms. Ørsted pointed out that these projections exclude the gain from the Borssele 1 & 2 farm-down.
At the same time, the company is increasing its full-year gross investment guidance from DKK 32 billion-34 billion to DKK 39 billion-41 billion because of the recently closed acquisition of Brookfield Renewable Ireland and the pending acquisition of the 302-MW Lincoln Land onshore wind project in the US.
(DKK 1.0 = USD 0.158/EUR 0.134)
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The Horns Rev 2 Offshore Wind Farm. Source: Ørsted A/S
