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.

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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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