Vestas has downgraded its financial projections for the second half of 2021 to an overall EBIT margin before special items of 5-7%, down from 6-8%.
The change is due to a combination of supply chain constraints, cost inflation, and restrictions in key markets caused by COVID-19, and the impacts this is likely to continue to have in the second half of the year.
It now expects to generate revenue of €15.5-16.5bn (previously €16-17bn), including Service.
Total investments are now expected to be below €1,000m in 2021 (previously €1,000m).
The announcement came in its Q2 results, where EBIT before special items increased by €67m to €101m.
This resulted in an EBIT margin before special items of 2.9%, compared to 1% in the second quarter of 2020.
The quarterly intake of firm and unconditional wind turbine orders amounted to 5290MW.
The value of the wind turbine order backlog was €21.2bn as at 30 June 2021.
In addition to the wind turbine order backlog, at the end of June 2021, Vestas had service agreements with expected contractual future revenue of €26.9bn.
The value of the combined backlog of wind turbine orders and service agreements stood at €48.1bn – an increase of €13bn compared to the year-earlier period.
Group president and chief executive Henrik Andersen (pictured) said: “In the second quarter of 2021, Vestas underlined our market-leading position although the first half of the year has been slower than anticipated due to supply chain constraints in key markets.
“We achieved revenue of €3.5bn and an EBIT margin of 2.9%, which is an improvement of 1.9 percentage points year-over-year.
“This increase was primarily driven by underlying improved operations and execution, but hampered by the continued cost inflation impacting global industrials.
“In this environment, our Service business and wind turbine order intake grew 23% and 28% respectively year-over-year, which resulted in an all-time high order backlog of more than €48bn.
“Combined with an average selling price of €0.79/MW for onshore, new offshore orders and our first preferred supplier agreement for our V236-15.0 MW turbine, the quarter was commercially very strong.
“To reflect the challenges from cost inflation and the global environment we operate in, we have revised our guidance for 2021 and we remain focused on executing our priorities for the year, which enable us to deliver on our commitments, drive the energy transition, and strengthen our market leadership.”