Vestas Earnings Beat Expectations on Strong Service Business and Pricing

By Dominic Chopping

Vestas Wind Systems on Wednesday posted a larger-than-expected third-quarter net profit and narrowed full-year guidance after seeing strong growth in its service business and higher sales prices.

The Danish wind-turbine maker said it saw a gradual improvement in project profitability, achieving a higher value for turbine deliveries, stable volumes, easing supply chain disruptions as well as increased activity in its service business.

Vestas swung to a net profit of 29 million euros ($31 million) from a loss of EUR147 million a year earlier, as revenue rose 11% to EUR4.35 billion.

A company-compiled consensus had expected a net profit of EUR7 million on revenue of EUR4.09 billion.

Wind turbine orders more than doubled on the year, driven by offshore and higher activity in North America and Europe.

Order intake rose to EUR4.9 billion from EUR2.0 billion, while the turbine order backlog rose to EUR21.6 billion from EUR18.1 billion and the service order backlog rose to EUR32.4 billion from EUR29.9 billion.

"Despite continued market design and permitting challenges, we saw strong commercial activity," Chief Executive Henrik Andersen said.

The company now sees full-year revenue at EUR14.5 billion-EUR15.5 billion from EUR14.0 billion-EUR15.5 billion, and a pre-items earnings before interest and tax margin of 0% to 2% from minus 2% to 3%.

Write to Dominic Chopping at dominic.chopping@wsj.com

(END) Dow Jones Newswires

November 08, 2023 02:45 ET (07:45 GMT)

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