Ørsted 1st Quarter Profits Slightly Down Despite Wind Earnings Growth
Danish energy group Ørsted published its first quarter earnings on May 1, announcing profits slightly down compared to the same quarter a year earlier, but was reassured by continued increase from its offshore and onshore wind energy assets.
Ørsted revealed it had recorded an operating profit for the first quarter of DKK 5.1 billion, down 7% compared to the first quarter of 2018. As the company explained in its announcement, the decrease in operating profit “was expected and was mainly due to a positive one-off compensation awarded following the completion of an arbitration case in Q1 2018 as well as cyclically lower earnings from our gas portfolio in Customer Solutions.”
Further, the decrease was partially offset by a 13% increase in earnings from offshore wind farms in operation and from the company’s new onshore wind farms. This also helped the company increase its green share of generation from 68% to 80%.
“We delivered strong results in line with expectations,” said CEO and President Henrik Poulsen. “During the first quarter we have continued to strengthen our portfolio within both Offshore and Onshore.”
Poulsen also went on to highlight several of the first quarter accomplishments which included Final Investment Decision on two offshore wind farms and the acquisition of
“In April, we took final investment decision on our 900 MW Taiwanese Greater Changhua 1 & 2a offshore wind project following the achievement of an establishment permit, approval of the supply chain plan and signing of the power purchase agreement with Taipower,” explained Poulsen. “We have submitted bids for offshore wind projects in France, the Netherlands and the US. We expect an outcome from all five tenders and auctions over the coming three months.
“In April, we took final investment decision on the 338MW US onshore wind farm Sage Draw with expected commercial operation date (COD) in Q1 2020.
“Furthermore, we have entered into an agreement to acquire a subsidiary of US-based Coronal Energy. The subsidiary is a nationwide solar and storage developer with a significant pipeline of solar and storage projects expanding our capability platform and exposure to new attractive regional markets.
“We remain very pleased with the operational and financial performance of the company as we continue to expand our position as a global leader in green energy.”
Looking forward, Ørsted’s guidance for 2019 remains unchanged from its 2018 annual report at an operating profit (EBITDA) in the range of DKK15.5 to DKK16.5 billion compared with DKK15 billion in 2018 (excluding new partnership agreements) representing an increase of between 4% to 10%.
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