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Denmark

Denmark

Vestas share buy-back as prices reach eight-year high

DENMARK: A "better than expected" first half of 2016 for Vestas, with a 60% increase in gross profit and the highest share price in eight years, has resulted in the manufacturer setting aside €400 million to buy back shares.

A strong Q2 has led to Vestas increasing its forecast for 2016
A strong Q2 has led to Vestas increasing its forecast for 2016

Company CEO Anders Runevad said the second quarter was "strong" as revenue increased 46% to DKK2.56 billion (€344 million) and turbine orders amounted to 1.79GW.

The results have caused Vestas to increase the guidance for 2016, with revenue now expected to reach a minimum of €9.5 billion, up €0.5 billion on the previous guidance.

Vestas is also issuing a share buy-back programme for up to DKK 2.98 billion (€400 million) of shares to be bought between 18 August and 30 December 2016.

"We are upgrading the full-year guidance on revenue ... and as a result of the strong performance we are delivering tangible shareholder value through the 2016 share buy-back programme that we are launching now," Runevad said.

"The purpose of the share buy-back programme is to adjust Vestas' capital structure and to meet obligations arising from share-based incentive programmes to employees of Vestas.

"At Vestas' annual general meeting in 2017, a resolution will be proposed that shares acquired, which are not used for hedging purposes of share-based incentive programmes, will be cancelled," Vestas said.

Vestas' share price bounced 10% this morning (18 August) on the news of strong results and the share buy-back.

The current level of just over DKK530 (€70) per share is the company's highest share price since the financial collapse in 2008 and has steadily climbed since its low of DKK 25.11 in July 2012.

Vestas has awarded dividends to shareholders in its previous two annual results.

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