Global Wind Firm Vestas’ Revenue Plunges 5.2% YoY Amid ‘Geopolitical Volatility’

Global Wind Firm Vestas' Revenue Plunges 5.2% YoY Amid 'Geopolitical Volatility'

Global Wind Energy company Vestas has released its Q1 figures as it generated revenue of EUR 2,681million witnessing a decrease of 5.2 percent compared to the year-earlier period.

Vestas also outlined that continued geopolitical volatility is expected to cause uncertainty in 2024 and that profitability should also continue to improve gradually but will still be held back by the execution and completion of low-margin projects from the backlog.

According to the figures released by Vestas, EBIT before special items amounted to EUR (68)m, resulting in an EBIT margin before special items of (2.5) percent. The underlying EBIT margin increased by 1.5 percentage points compared to the first quarter of 2023, when disregarding the effects of the sale of the converters and controls business in the comparison quarter.

Vestas also said that the adjusted free cash flow amounted to EUR (997)m compared to EUR (1,280)m in the first quarter of 2023. The quarterly intake of firm and unconditional wind turbine orders amounted to 2,300 MW, a 30 percent decrease from the first quarter of 2023. The value of the wind turbine order backlog was EUR 26.6bn as of 31st March.

In addition to the wind turbine order backlog, at the end of the quarter, Vestas had service agreements with expected contractual future revenue of EUR 34.4bn. Thus, the value of the combined backlog of wind turbine orders and service agreements stood at EUR 61.0bn – an increase of EUR 10.3bn compared to the year-earlier period.

Group President & CEO Henrik Andersen said, “Vestas’ underlying performance continued to improve in the first quarter of 2024, and our financial results were in line with expectations. Our revenue was EUR 2.7bn with an EBIT margin of minus 2.5 percent, which represents a 30 percent increase in gross profit driven by higher project profitability and service growth, but lower project deliveries. Following a very strong finish to 2023, we secured 2.3 GW of orders, while maintaining a strong commercial discipline. As we ramp up to deliver on our growing backlog and deliver across both onshore and offshore, we continue to lead the industry and focus on achieving our financial goals. We maintain our guidance for 2024 and want to thank our customers, partners, and shareholders for their ongoing support, and our more than 30,000 colleagues for their dedication to both Vestas and the energy transition.”