Ørsted’s Operating Profit Hits Record in 2018

Ørsted has reported a record operating profit of DKK 30 billion (some EUR 4 billion) in 2018, which is 33% more than the year before.

The news comes as the company’s Board of Directors approved the all-time-high EBITDA today, on 30 January, as part of the approval process for the annual report for 2018.

Ørsted said that the EBITDA without new partnerships increased by 18% to DKK 15 billion, thus exceeding the company’s expectations at the beginning of the year, as well as its most recent guidance of DKK 13-14 billion.

The increase is said to be mainly due to higher achieved Renewable Obligation Certificate (ROC) recycle values, lower than expected costs, and better than expected progress on the Borkum Riffgrund 2 offshore wind project, resulting in higher partnership gains and faster ramp-up of generation.

Earnings from offshore wind farms in operation increased by 29% to DKK 11.0 billion in 2018, primarily due to ramp-up at Walney Extension, Race Bank and Borkum Riffgrund 2.

Net profit amounted to DKK 19.5 billion, an increase of DKK 6.2 billion compared to 2017 and the company’s best result ever.

The share of renewable energy in the company’s generation mix increased from 64% to 75% in 2018. This was driven by ramp-up and commissioning of new offshore wind farms in the UK and Germany, the acquisition of Lincoln Clean Energy (LCE) and increased generation based on biomass at the Avedøre and Skærbæk power stations. This puts Ørsted well on track to meet the objective of reaching 99% green generation by 2025.

EBITDA is expected to be DKK 15.5-16.5 billion in 2019 compared with DKK 15 billion in 2018 (excluding new partnership agreements), corresponding to an increase of 4-10%.

Gross investments for 2019 are expected to amount to DKK 21-23 billion, reflecting a high level of activity related to offshore and onshore wind farm projects, the company said.

NOTE: The article was updated on 8.20 AM CET Thursday, 31 January.