Ørsted achieved an all-time-high operating profit in 2018, which was 33% higher than 2017, with earnings from offshore windfarms up 29%.
The company’s operating profit (EBITDA) was Dkr30.0Bn (US$4.6Bn). EBITDA without new partnerships increased by 18% to Dkr15.0Bn, thus significantly exceeding the company’s expectations at the beginning of the year and most recent guidance.
Earnings from offshore windfarms in operation increased primarily due to ramp-up at Walney Extension, Race Bank and Borkum Riffgrund 2. The company also completed a farm-down of Hornsea 1, one of the largest renewable energy M&A transactions ever.
Return on capital employed increased to 32% compared to 25% in 2017. Net profit amounted to Dkr19.5Bn, the company’s best result ever. This was an increase of Dkr6.2Bn compared to 2017.
Ørsted chief executive and president Henrik Poulsen said, “2018 was a great year for Ørsted. We delivered our best financial result ever and continued our deployment of green energy, reaching 75% green energy in our heat and power generation. On a global scale, renewable energy will grow rapidly in the years to come. We are well positioned to take part in this significant growth.
“In 2018, we reached significant milestones in our ambitious green strategy. In the UK, we commissioned Race Bank in January and Walney Extension, the world’s largest offshore windfarm, in May, and in Germany, we commissioned Borkum Riffgrund 2 in December. All were commissioned ahead of schedule, underpinning the strength of our construction capability.
“By 2030 it is our strategic ambition to reach an installed capacity of more than 30 GW renewable energy, provided that the build-out creates value for our shareholders. Contributing to this ambition, we raised our 2025 ambition for offshore wind from 11-12 GW to 15 GW.”
He reiterated the company’s willingness to work with the Taiwanese authorities and local stakeholders to reach key outstanding project milestones for offshore wind in Taiwan. “Once we have clarity on the outcome of supply contract renegotiations and have achieved all key project milestones, Ørsted’s board of directors will review and decide on the final investment case,” he said.
In a conference call about the company's results, Mr Poulsen said the company stood by its commitment to develop a supply chain in Taiwan. “The Taiwanese Government needs green energy at a price it can afford, and wants to drive economic growth through a local supply chain, but as a company we need a balance of risk and return that is acceptable to us.”
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