Ørsted A/S (CPH:ORSTED) today reported strong results for the first quarter (Q1) of 2020 and reaffirmed its most recent EBITDA guidance as it sees no indication that the COVID-19 crisis will significantly impact its earnings this year.
The Danish pure-play renewables company posted a 33% year-on-year jump in operating profit, or earnings before interest, tax, depreciation and amortisation (EBITDA), with a 25% increase in earnings from offshore and onshore wind farms in operation thanks to the ramp-up of power production from Hornsea 1, Lockett and Sage Draw, along with high wind speeds in Europe during the period.
The company’s net profit rose by 11% on the year.
The exact figures are available in the following table.
| Figures in DKK million |
Q1 2020 |
Q1 2019 |
| EBITDA |
6,805 |
5,130 |
| Profit (loss) for the period from cont. operations |
3,346 |
2,639 |
| Profit (loss) for the period from discont. operations |
(28) |
(43) |
| Profit (loss) for the period |
3,318 |
2,596 |
| Cash flows from operating activities |
(428) |
(118) |
| Gross investments |
(5,308) |
(3,899) |
| Divestments |
7 |
2,678 |
| Free cash flow |
(5,729) |
(1,339) |
| Net interest-bearing debt |
27,084 |
9,111 |
| FFO/adjusted net debt |
21% |
46% |
| ROCE |
11% |
28% |
“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,” Ørsted’s president and CEO, Henrik Poulsen, said.
He noted that the company’s asset base has been fully operational over the last couple of months. In turn, projects under construction all remain on track, but Ørsted recognises an increased risk of component and service delays from suppliers impacted by the coronavirus crisis.
“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,” Poulsen added.
In March, Ørsted revised upwards its 2020 forecast for EBITDA from a range of DKK 15 billion-16 billion to DKK 16 billion-17 billion because of updated assumptions regarding the divestment of the transmission asset for Hornsea 1. Later that month it reiterated its guidance despite the increasing uncertainty that came with the COVID-19 situation and now did the same. In addition, it reaffirmed its expectation of annual gross investments of DKK 30 billion-32 billion.
(DKK 1.0 = USD 0.146/EUR 0.134)
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Offshore wind park. Image by: Ørsted A/S.
