February 7 (Renewables Now) - Swedish state-owned utility Vattenfall AB today said operating profit for 2018 declined by 17% mainly due to pressured margins in the Heat segment and price hedges, and despite a significant improvement in the wind segment's contribution.
Vattenfall saw its full-year profit rise to SEK 12 billion (USD 1.3bn/EUR 1.14bn) from SEK 9.5 billion thanks to lower corporate taxes and a re-measurement of shares in the Swedish Nuclear Waste Fund at fair value. Net sales rose to SEK 156.8 million from SEK 135.1 million because of increased volumes in Germany, France and the UK, positive price effects in the Nordics and the Netherlands, and higher nuclear power generation.
While the Wind segment's underlying operating profit rose in 2018 to SEK 3.75 billion, compared to SEK 2.14 billion in 2017, this was not enough to offset lower earnings at the Heat and Power Generation divisions. As a result, Vattenfall’s underlying operating profit declined to SEK 19.9 billion from SEK 23.2 billion.
In Wind, net sales and the underlying operating profit went up due to positive price and currency effects, as well as additional capacity. More information about the wind segment is available in the table below.
|In SEK million, unless otherwise noted||2018||2017||Q4 2018||Q4 2017|
|Underlying operating profit||3,747||2,137||1,845||1,385|
|Electricity generation - wind power TWh||7.8||7.6||2.5||2.4|
|Sales of electricity (in TWh)||1.1||1.0||0.3||0.4|
In 2018, Vattenfall invested SEK 8.2 billion in wind, solar, biomass and waste, which is a year-on-year increase of 46% and also represents 33% of the group’s total capex of SEK 24.5 billion for the year. It plans to spend a further SEK 24 billion on new wind capacity in the period 2019-2020, corresponding to 75% of the group’s total budget for growth investments.
Late last year, Vattenfall took the final investment decision (FID) to build the 604.8-MW Kriegers Flak offshore wind farm in Danish waters.
The board of directors proposes a dividend of SEK 2 billion to Vattenfall’s owner, the Swedish state.
(SEK 1.0 = USD 1.080/EUR 0.954)