Danish wind turbine maker Vestas on Wednesday reported third-quarter operating profits and revenue above expectations, reflecting an easing of supply chain disruptions and higher prices for turbines, boosting its shares 9% in early trade.
The world's leading turbine maker has since the pandemic faced supply chain issues and higher raw material prices, which have hurt its profits and its ability to deliver a backlog of projects.
"Vestas' positive momentum increased in the third quarter of 2023, and we continued the gradual improvement in our execution and profitability," CEO Henrik Andersen said in a statement.
"Despite continued market design and permitting challenges, we saw strong commercial activity," he said.
The positive signals from Vestas come as rival Siemens Energy is struggling with far-reaching quality issues at its onshore wind turbine division, while developers of offshore wind farms have taken big losses on projects due to higher costs.
The higher value of delivered projects and stable volumes helped Vestas increase third-quarter revenue by 11% to 4.4 billion euros ($4.7 billion), above the 4.1 billion forecast by analysts in a poll shared by the company.
Earnings before interest, tax (EBIT) and items affecting comparability stood at 70 million euros against a 127 million euro loss last year, above the average 31 million euro forecast from analysts.
Vestas now expects full-year revenue between 14.5 billion and 15.5 billion euros compared with an earlier range of 14 billion-15.5 billion.
Adjusted EBIT margin is now expected at 0-2% compared with its previous guidance of between minus 2% and plus 3%.
($1 = 0.9361 euros)
(Reuters - Reporting by Jacob Gronholt-Pedersen / Editing by Terje Solsvik and Mark Potter)