Denmark’s wind turbine giant Vestas came out of 2008 on a high wave, with a Q4 result that was its best ever.
Revenues shot up by 24 percent to some DKK 45 billion and pre-tax profit was at DKK 5.3 billion compared with some DKK 2.1 billion in 2007. While management expects progress to continue in 2009, it will, however, slow somewhat.
“Vestas expects that the installed wind power capacity on average will experience an annual growth rate of about 20 per cent in the coming ten years mainly due to the fact that wind power neither uses water nor emits CO2 when generating electricity. At the same time, modern energy creates local jobs and reduces the dependence on fossil fuels which is often imported. Vestas expects that wind power will account for at least 10 per cent of the world’s electricity consumption by 2020,” Vestas says in its accounts release.
Fewer new jobs
The financial crisis has meant that many other wind power producers and suppliers have had to lay off employees, but Vestas has not been part of that trend.
Nonetheless, Vestas says in its report that the financial crisis will also affect new Vestas employment.
“Due to the financial crisis, a number of employments have been deferred, and the recent years’ massive intake in the number of employees is not expected to continue in 2009,” Vestas says.
In its outlook for 2009, Vestas said revenue is forecast to rise to EUR 7.2 billion with its EBIT margin expected to increase to 11-13 percent. Investment are forecast to amount o EUR 1.2 billion at the end of 2009, with net working capital not exceeding 10 percent of revenue.
“The above expectations for investments are subject to Vestas experiencing an improvement in the order intake up till the reporting for the first quarter of 2009 on 28 April. If this does not materialise, the investment programme will be adjusted, and the general cost level will also be further reduced,” Vestas says adding that to date, Vestas has not experienced cancellations or postponements in its order backlog.
In its operations abroad, Vestas says it is expanding its production capacity in its principal markets, doubling its blade capacity to 4,000 blades in 2010 from its Colorado plant adding that “as a parallel to the establishment of the world’s largest tower factory in Colorado, Vestas is establishing its first nacelle factory in the USA – also in Colorado.”
The company says that In China, where Vestas is building a new foundry, the new factory in Hohhot in Inner Mongolia, will deliver its first kW turbines in the second quarter of 2009.
“In the longer term, the expansion outside the euro zone will contribute to ensuring improved currency equilibrium between Vestas’ income and expenses,” the company says.