Vestas losses hit share price hard

DENMARK: Vestas recorded the biggest first-half net loss of all the companies in the sector, prompting it to unexpectedly cut its 2010 outlook as customers delayed orders in the wake of the credit crisis.

The company's announcement of a Q2 2010 EUR119 million loss sent panic across the markets and sliced 25% off its stock price in one day (August 18). Vestas' net loss H1 2010 was EUR201 million, compared to a EUR99 million net profit in H1 2009.

The loss came on the back of a 24% slump in the company's revenues, from EUR2.3 billion in H1 2009 to EUR1.76 billion in H1 2010. In the second quarter of 2010 it shipped 54% fewer wind turbines and 50% fewer wind power systems than in the second quarter of 2009.

Announcing the figures, Vestas said it expected a 2010 operating profit margin of 5-6% and revenue of EUR6 billion, down from its previous forecast of 10-11% and EUR7 billion respectively. It blamed delays in orders in the US, Spain and Germany for the downgrade.

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