Danish Offshore Wind Project Termination Not Detrimental to Cadeler's Long-Term Financial Performance, CEO Affirms

Tuesday, November 14, 2023

Danish offshore wind installation services firm Cadeler said Monday evening it had received notice of termination of the Aflandshage offshore wind project in Øresund, Denmark, which in turn led to the cancellation of its turbine installation contract.

"Cadeler regrets the cancellation of the project – however, the cancellation will not impact Cadeler’s long-term financial performance, but will have a positive impact on the guidance provided for the financial year 2023," Cadeler said.

The contract awarded to Cadeler by Siemens Gamesa for the transportation and installation of 26 11MW wind turbines, set to begin in 2026, has been cancelled. The contract was originally announced by Cadeler in April 2023. 

"As Cadeler has replacement projects lined up and in general operates with mutual termination fees when entering into contracts with partners, the decision will not change Cadeler’s long-term financial performance and will not have a material negative impact on Cadeler’s backlog, but it will impact the guidance provided for the financial year 2023 positively," Cadeler said.

In the 2023 Interim Financial Report published on August 29, 2023, Cadeler provided guidance for the financial year ending December 31, 2023, stating that revenue was expected to be in the range between EUR 95 to 103 million while adjusted EBITDA was expected to be in the range EUR 41 to 49 million. 

Cadeler now increased the revenue guidance for the financial year 2023, which is expected to be between EUR 100 to 105 million. Due to the business combination agreement with Eneti Inc. the company is also providing guidance for adjusted EBITDA, which excludes transactional costs as defined in the 2023 Interim Financial Report, and is expected to be within the range of EUR 47 to 52 million.  

EBITDA guidance has also been narrowed and is now expected to be within the range of EUR 40 to 45 million after transactional costs.  

The company estimates that approximately EUR 7 million of transaction costs will be incurred in 2023 in relation to the execution of the contemplated combination with Eneti Inc., which is still expected to be completed in Q4-2023. 

Cadeler A/S and Eneti last week announced the start of a share exchange offer for all the outstanding shares of common stock of Eneti.

The company estimates that EUR 5 million in costs related to the issuance of shares connected to the exchange offer will be reflected in equity.  

Commenting on the contract termination, CEO Mikkel Gleerup, Cadeler, says: “We naturally regret the decision to cancel Aflandshage, a Danish project we had looked forward to supporting with all our expertise. However, the decision to cancel Aflandshage will not affect our long-term financial performance, as we see a strong demand in the market for our services. We expect back-to-back utilization of vessels on other projects”.

Categories: Energy Renewable Energy Industry News Activity Offshore Wind

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