Offshore wind giant Ørsted has issued its interim report for the first
quarter of 2021 noting that it 'continued stable operations' despite the
company's operating profit (EBITDA) for the first quarter of the year amounted
to DKK 4.9 billion, a DKK 1.9 billion decrease compared to the same period
last year. It attributed the decrease to high earnings from the construction
agreement related to the Hornsea
assets in Q1 2020 not being repeated in Q1 2021, very strong wind speeds
in Q1 2020 and the divested distribution, residential customer, and city
light businesses last year.
Net profit amounted to DKK 1.6
return on capital
employed (ROCE) came in at
Q1 2021 was impacted by a DKK 0.8 billion warranty provision related to
cable protection system issues at some of its offshore wind farms. Ørsted
discovered an array cable issue on several offshore wind farms across the
UK and Continental Europe. The issue, which could concern up to 10 wind
farms, occurs when the cable protection system (CPS) moves across the scour
protection (i.e. rocks placed on the seabed around the foundations to avoid
seabed erosion), abrading the CPS and in the worst-case scenario causing
the cables to fail.
also reiterated its current full-year gross investment expectation of DKK
32-34 billion. However, once the Brookfield Renewable Ireland acquisition
closes, the purchase price will be added to the current guidance.
In its offshore business, revenue increased by 67 % to DKK 13.3 billion.
Revenue from construction agreements increased by DKK 4.5 billion, primarily
due to the divestment of the offshore transmission assets at Hornsea 1
in Q1 2021. Revenue from offshore wind farms in operation amounted to DKK
5.7 billion, in line with the same period last year due to the ramp-up
from Borssele 1&2 which was offset by lower wind speeds.
EBITDA decreased by 30 % relative to Q1 2020 and amounted to DKK 3.9 billion.
Gross investments amounted to DKK 4.6 billion and was mainly related to
Changhua 1 & 2a,
2, and its
Nipper, Group President and CEO of Ørsted,
says in a comment
to the interim report for the first quarter of 2021: “Ørsted’s
performance was good during Q1 2021 and slightly exceeded our expectations,
and we’ve reached multiple strategic milestones. In our Offshore business,
the Polish Baltica 2 & 3 projects
with a total
capacity of up to 2.5 GW were awarded contracts for difference and we’ve
entered a new partnership in
States. We also signed an agreement to farm down 50 % of Borssele 1 &
2. In our Onshore business, we’ve made a strategic acquisition in Ireland
and the UK, which provides us with a platform for future growth in the
European onshore renewables market. We’re looking forward to presenting
an update of our strategy and long-term targets at our Capital Markets
Day on 2 June.”