Danish wind turbine manufacturer Vestas Wind Systems A/S reported a lackluster second quarter financial earnings this week, with revenue, earnings, and free cash flow all declining compared to a year ago, and 2017 guidance remaining in place, causing shares to tumble in early trading.
Vestas reported a net profit for the second quarter of only €186 million, up slightly on the €160M in the first quarter but down significantly on the €278 taken in during the second quarter of 2016, and analyst expectations of €238 million. Revenue for the second quarter was €2,206 million, up from the €1,885 million taken in during the first quarter, but down 14% from the €2,557 million taken in during the same quarter a year earlier.
Wind turbine order intake for the quarter amounted to 2,667 MW (megawatts), up from 2,049 MW in the first quarter and well up on the 1,790 MW taken in during the second quarter of 2016. Vestas’ wind turbine order backlog is currently valued at €9.1 billion as of 30 June, and Vestas also boasts service agreements worth approximately €11.1 billion.
“In a changing market, Vestas delivered another solid quarter with healthy earnings and maintained our leadership position,” said Group President & CEO Anders Runevad. “Our second quarter results showed improved order intake across all regions, increased order backlog, strong performance in service, and half-year revenue on par with 2016. Looking ahead, we need to continue to put all of our focus on effectively executing on our strategy.”
As of this writing, with full-year guidance remaining unchanged, Vestas’ shares have dropped 8% since trading opened this morning (Nasdaq Copenhagen). Vestas also announced a share buy-back program of up to DKK 4,460 million (approximately €600 million) that will run from 17 August 2017 to 29 December 2017. This would increase the company’s share buy-backs in 2017 up to a total of €700 million.