MHI Vestas set 'to break even' after losses

DENMARK: Expanding its V164 platform has squeezed its earnings despite its revenue and profit increasing in the last financial year, the joint venture said.

MHI Vestas unveiled its V164-9.5MW turbine in June
MHI Vestas unveiled its V164-9.5MW turbine in June

The manufacturer’s revenue was up 77% year-on-year from €531.24 million to €942.15 million, while its operating loss decreased from €119.45 million to €98.56 million.

Its overall loss for the financial year was also down, from €120.52 million in 2016/17 to €98.28 million a year later.

However, it described 2018/19 as a "watershed year" for the company, in which it expected its earnings before interest and taxation (EBIT) to break even.

The company stated its short-term earnings are still being affected by the cost of expanding its turbine platform.

MHI Vestas unveiled its V164-9.5MW turbine in June 2017, having first introduced the V164 as a 7MW machine — though always intended as an 8MW platform — seven years earlier.

In the last financial year, the manufacturer received a firm order to install it at the 252MW Deutsche Bucht wind farm, a conditional order to supply it for the 224MW Northwester 2, and has been named the preferred supplier for the 860MW Triton Knoll and 950MW Moray East projects.

It also signed a preferred supplier agreement for Taiwanese projects with a combined capacity of 1.5GW.

MHI Vestas' main priorities for the 2018/19 financial year are to "continue to set the industry standard for safety", drive competition in the market, and build on its parent company footprints in emerging markets, it said in its annual report.

The end of the 2017/18 financial year completes the first four-year cycle of the merged company, the company stated. In January 2018, MHI and Vestas made a change to the company’s executive management, in accordance with the terms of the joint venture.

Former Adwen chairman Phillippe Kavafyan replaced outgoing CEO Jens Tommerup from 1 April, supported by new co-CEO Lars Bondo Krogsgaard, previously CEO at Nordex.

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