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Thursday, 6 February 2020
Vestas Wind - Full Year Results
Vestas is one of the world's leading players in wind turbines - it designs, makes, installs and services both onshore and offshore turbines and holds the record of providing more turbines throughout 80 countries than any other company. The core of the business is providing sustainable, clean and affordable energy to people all around the world.
They are the global leader in onshore wind - over 100 GW installed and also onshore servicing. They are #2 in offshore wind (behind Orsted) with 5 GW installed and plans to double this by 2022. It's market cap. is currently 143bn DKK (approx £16bn).
The shares were added to my ISA portfolio last October at the price of 535 DKK.
The company have this week released results for the full year to end December 2019 (link via Company website).
Orders have increased by 25% to a record 17.9MW. Revenues increased to 12.15bn EUR (10.13bn in 2018) with the bulk of this provided by their Power Solutions sector - 10.3bn and a further 1.9bn from servicing.
They propose a 6.6% hike in the dividend to 7.93 DKK which equates to just over 1.1% at current share price.
Commenting on the results, group CEO, Henrik Andersen said :
“Wind energy manifested its position as a leading global energy source in 2019, driving Vestas’ order intake to a record 17.9 GW, 20 percent growth in revenue and expected high activity levels in the coming years. In an extraordinarily busy year, Vestas extended its industry leadership, met its guidance on all parameters and scaled the company to deliver on our highest-ever order backlog of EUR 34bn.
Once again, our Service business delivered year-on-year growth and improved profitability, underlining its strategic importance in a tough market. In 2019, the industry thus faced challenges from trade wars and tariffs, causing execution costs to increase, which we expect to continue in an even busier 2020.
Together with our customers and partners, everyone at Vestas worked vigorously to create the momentum to finish 2019 strongly, and we must continue this momentum to achieve our goals for 2020. As we continue to lead the transition towards a world powered by sustainable energy, we remain focused on executing our strategy and pushing the industry to higher levels on technology, profitability and sustainability,”
The results have been well received with the share price rising 5% to 721 DKK on Wednesday.
The company expects strong growth in the renewables sector over the coming decade. They forecast that global renewable capacity for electricity will increase from 10% to 35% by 2035 with annual investment in wind power to double to $200bn during this time frame.
Vestas has launched a seriously ambitious sustainablity drive throughout their own business and entire value chain. The company aims to become carbon neutral by 2030 and produce zero-waste turbines by 2040.
As with Orsted, I am more than happy with my acquisition and may look for an opportunity to top up my holding over the coming few months.
As ever, this article is merely a record of my personal investment decisions and should not be regarded as an endorsement or recommendation. Holding individual shares always carries more risk than collective investments - always DYOR!