Nordex has lowered its profit expectations for 2021 due to high raw materials, logistics and shipping costs.
It now expects an Ebitda margin of around 1% for the full year, down from 4.0-5.5% as previously forecast.
As it announced its preliminary results for the first nine months of 2021, the turbine manufacturer stated that rising inflationary pressures — especially the current instability in logistics — have been much greater than anticipated in the second half of the year.
Prices of raw materials and logistics, especially shipping costs, have continued to increase to unprecedented levels, it stated. Such pressures recently prompted Nordex to raise its turbine prices.
It added that it expects these pressures to continue in the fourth quarter of 2021 and into 2022.
Nordex cut its profit guidance despite its Ebitda for the first nine months of 2021 – €100.7 million – being up 42% from the same period last year. However, it stated that this figure was impacted by the volatility in the commodity and logistics markets.
Meanwhile, the manufacturer’s consolidated sales rose 25% to €4 billion in the first nine months of the year, mostly due to a “strong” performance in installations and production.
Nordex expects consolidated sales of €5.0-5.2 billion for the full year, narrowed upwards from a previous forecast of €4.7-5.2 billion due to high demand and strong performance in project execution, it explained.
At the end of the third quarter, the German company had an equity ratio of 28.5% – a figure it described as “strong” – and net cash position of €516 million.
Nordex has not changed its expectations for capital expenditure (approximately €180 million) and working capital ratio (minus 6%) for 2021.
Despite the ongoing cost pressures, Nordex continues to be optimistic about future business performance, it added. The firm believes future growth will be driven by the global momentum for renewable energy, the very low cost of energy of onshore wind and strong demand for its Delta4000 series of turbines.
“Sales have developed better than expected and initiatives to enhance operational excellence and further expand capacity have been very successful — but this has not been enough to fully offset the increasing costs of materials and logistics, particularly the surge in shipping costs during the third quarter”, said José Luis Blanco, CEO of the Nordex Group.
“These inflationary pressures are currently severe, but in the medium term we expect to benefit from the fundamentals shaping the industry and to return to a more positive business development.”
