Orsted has partly blamed overhedging and “ineffective” hedges across its offshore wind portfolio as well as later than expected commissioning of Hornsea 2 for a year-on-year decline in operating profit in the second quarter of 2022.
The Danish energy giant posted an operating profit of DKK 3.6bn (€485m) in its interim results compared to DKK 8.2bn (€1.1bn) for the same period last year.
However, Orsted has said this is largely down to the sale of a 50% stake in its Borssele 1&2 offshore wind farm in the same period last year and that, excluding new partnerships, its EBITDA was actually DKK 800m (€107.52m) higher than in 2Q21.
Overall, Orsted posted an interim profit for the quarter of DKK 269m (€36.1m), a DKK 5.3bn (€710m) drop on the same period in 2021.
The developer has meanwhile said it will raise its full-year EBITDA outlook by DKK 1bn to DKK 20-22bn (€2.7bn – €2.9bn), driven largely by higher earnings in its bioenergy & other and onshore wind businesses.
EBITDA from the developer’s CHP plants almost doubled relative to the same period last year due to higher power prices.
Orsted also “optimised” its northwest European gas activities where it was able to “lock in gains” from the offtake flexibility in its sourcing contracts and at gas storages.
Onshore wind earnings have been “higher than expected” in the first half of 2022, mainly due to an increase in power prices in the US and Europe.
The developer said its acquisition of European wind platform Ostwind and Ford County Wind in the US would likely contribute to higher site earnings in the last part of the year.
Ostwind holds 152MW of wind in operation and under-construction, as well as 526MW of advanced development projects Orsted expects to build by 2026.
The increased EBITDA guidance excludes new offshore wind partnerships in 2022, which comprises its 50% farm-down of Borkum Riffgrund 3 in Germany in the first quarter and upcoming 50% stake sale in Hornsea 2.
Mads Nipper, Group President and CEO of Ørsted (pictured), said: “I’m very pleased with the first half of the year. In addition to a strong set of results for the period, including an increase of our full-year EBITDA guidance, we’ve achieved significant strategic milestones.
“We were awarded a contract for the world’s single biggest offshore wind farm, Hornsea 3 in the UK, with a capacity of 2,852 MW. With this significant win and maturation of other offshore projects, we’re well on track to achieve our target of 30 GW offshore wind by 2030.
“In our Onshore business, we also made strong progress with our entry into the Spanish onshore market and the agreement to acquire Ostwind, a developer, owner, and operator of onshore wind Germany and France.
“In general, we’ve seen positive market development during the first half of 2022. Both the EU and the US have presented very ambitious plans to accelerate the build-out of renewable energy, which ensures a strong platform for continued growth within the development of renewable energy.”