Orsted

Orsted Q3 2024 $ORSTED (-1.39%)

Financial performance

• Revenue: Total revenue in the first nine months of 2024 amounted to DKK 49,957 million, compared to DKK 57,725 million in the same period in 2023, indicating a decline.
• EBITDA: EBITDA increased to DKK 23,606 million compared to DKK 19,403 million, an increase of 22%.

Balance sheet overview

• Total assets: As of September 30, 2024, total assets amounted to DKK 290,341 million.
• Equity: Equity stood at DKK 91,127 million, an increase from DKK 77,791 million at the end of 2023.
• Net interest-bearing debt: This increased to DKK 62,817 million, up from DKK 47,379 million at the end of 2023.

Income overview

• Operating profit (EBIT): EBIT amounted to DKK 12,516 million, a significant improvement compared to a loss of DKK 16,448 million in the first nine months of 2023.
• Net profit: Profit for the period was DKK 6,100 million compared to a loss of DKK 19,026 million in the previous year.

Cash flow overview

• Cash flow from operating activities: This amounted to DKK 8,050 million, compared to DKK 22,362 million in the first nine months of 2023.
• Free cash flow: A negative free cash flow of DKK 15,281 million was recorded, compared to a negative cash flow of DKK 3,427 million in 9M 2023.

Key figures and profitability ratios

• Return on capital employed (ROCE): Improved to 8.1% from -13.7%.
• FFO/Adjusted net debt: This fell to 12.6% from 20.9%.

Segment information

• Offshore: EBITDA in the Offshore segment amounted to DKK 19,831 million, an increase of 21% compared to 9M 2023.
• Onshore: EBITDA amounted to DKK 2,802 million, compared to DKK 2,445 million.
• Bioenergy & Other: EBITDA increased to DKK 213 million, a significant increase compared to DKK 89 million.

Competitive position

Ørsted remains a leader in renewable energy with significant investments in offshore and onshore wind projects, consolidating its strong market position.

Forecasts and management commentary

• Strategic ambitions: Target to reach 35-38 GW of installed renewable capacity offshore and 11-13 GW onshore by 2030.
• Financial outlook for 2024: EBITDA, excluding new partnerships and cancellation fees, is expected to be between DKK 24-26 billion.

Risks and opportunities

• Market risks: Exposure to market, credit and liquidity risks, with a focus on stabilizing key rating metrics.
• Opportunities: Continued investments in renewable energy projects and strategic divestments to optimize the portfolio.

Summary of the findings

Ørsted has shown a strong financial performance in the first nine months of 2024, with significant improvements in EBITDA and EBIT. The company continues to invest heavily in renewable energy projects, securing a competitive advantage in the industry. Nevertheless, there are challenges in managing cash flows and net debt. The strategic focus on expanding renewable capacity by 2030 is in line with global sustainability targets and offers both opportunities and risks in terms of implementation.

Positive aspects

• EBITDA growth: Ørsted's EBITDA increased by 22% to DKK 23,606 million in the first nine months of 2024, compared to DKK 19,403 million in the same period in 2023, indicating strong operational performance and effective cost management.
• Performance in the offshore segment: The Offshore segment reported EBITDA of DKK 19,831 million, an increase of 21% compared to the previous year. This growth resulted from higher revenues from CfD contracts, ROCs and green certificates.
• Reduction in Scope 1 greenhouse gas emissions: A significant 47% reduction in Scope 1 emissions was achieved, mainly due to a 53% decrease in coal consumption in power plants.
• Strategic capacity expansion: Ørsted has set ambitious targets to expand renewable capacity to 35-38 GW offshore and 11-13 GW onshore by 2030, which is in line with global sustainability targets.
• Improved return on capital employed (ROCE): ROCE improved to 8.1% from -13.7%, indicating better capital utilization and improved profitability.

Negative aspects

• Decline in sales: Total revenue decreased to DKK 49,957 million compared to DKK 57,725 million in the same period in 2023, indicating challenges in maintaining revenue growth.
• Increase in net interest-bearing debt: Net interest bearing debt increased to DKK 62,817 million, from DKK 47,379 million at the end of 2023, which could affect financial flexibility.
• Negative free cash flow: The company recorded a negative free cash flow of DKK 15,281 million, compared to a negative cash flow of DKK 3,427 million in 9M 2023, indicating challenges in cash flow management.
• Lower availability in the offshore wind segment: Availability in the offshore segment amounted to 89%, a decrease of 4 percentage points year-on-year, due to planned maintenance work on Hornsea 1 and 2.
• Increase in Scope 3 emissions: Scope 3 greenhouse gas emissions increased by 63% due to emissions from capital goods related to the commissioning of new turbines.

Hello everyone,

it's time for some feedback again!

Briefly about the long-term strategy. I currently save monthly $IWDA (+0.99%)
$EIMI (+0.35%) and $WSML (+1.42%) . I definitely want to increase the ETF share over the next few years. I definitely invested too little here at the beginning.

With very small sums I invest in stocks like $ASML (+3.19%)
$AAPL (+0.52%)
$MCD (-0.18%)
$MC (-1.36%)
$MSFT (+0.08%)
$AMZN (-1.7%) and co. There I have split the execution to 2x per month. If it drops significantly, I buy in tranches.

So that the dividend doesn't come up short, I still have stocks like $O (+1.58%)
$KO (+1.89%)
$DGE (-0.51%) and my overweight $BAT . I don't work with savings plans for dividend stocks. Here I only buy in tranches if the share falls significantly. Provided I am still convinced of the investment. I try to focus exclusively on established quality companies.

I only see these candidates here as a trade. I will definitely part with them if the prices are attractive $BNTX (+6.37%)
$FXPO (-0.8%)
$ORSTED (-1.39%)
$PYPL (+0.64%)
$YSN (+3.55%)
$SIX2 (-1.06%) .

Conclusion

-Increase ETF share

-Increase the investment amount of the individual positions

-Reduce overall portfolio positions

I look forward to any constructive criticism!

08.10.2024

Nordex Group receives orders for 500 MW from Canada + Oil and gas producer Equinor acquires stake in wind power company Orsted + Order intake in Germany calls for caution + China's economy remains weak

The Nordex Group
$NDX1 (-3.17%) received orders for 74 N163 turbines totaling 500 MW from Canada at the end of September. The orders also include the Premium Service for maintaining the turbines for between 15 and 30 years.

The Norwegian oil and gas producer Equinor $EQNR (+2.2%) has acquired a minority stake in the Danish wind power company Orsted $ORSTED (-1.39%) making it the second largest shareholder. Equinor bought almost 41.2 million shares, the company announced in Stavanger on Monday. This corresponds to a stake of 9.8 percent. This has a market value of 2.5 billion US dollars (just under 2.3 billion euros), based on the closing price on Friday. The largest shareholder is the Danish state. According to Orsted, the country held a good half of the shares at the end of the year. Following the announcement of the news, Orsted shares rose by a good four percent to 434 Danish kroner. Equinor emphasized that it supports Orsted's strategy and board of directors. In addition, the Norwegians did not intend to take a seat on the management board. Without specifying a time horizon, the Norwegians announced their intention to increase their stake to ten percent. There are currently no plans to increase the stake beyond this. The company described its commitment as "long-term".

As was to be feared following the recent weak sentiment indicators, the German incoming orders in August fell significantly. Even if the 5.8 percent drop compared to the previous month is partly due to a lower number of large orders, today's data confirms to Commerzbank economists that demand for industrial goods from Germany has weakened further. This suggests that the German economy will stagnate at best in the second half of the year. An upturn is not expected until next year, and even this is likely to be very modest.

Tuesday: Stock market dates, economic data, quarterly figures

ex-dividend of individual stocks

BBVA EUR 0.29

Quarterly figures / company dates USA / Asia

02:00 Samsung Electronics quarterly figures

12:00 Pepsico quarterly figures

17:00 Boeing deliveries 9/24

Untimed: General Motors Capital Markets Day | Procter & Gamble AGM

Quarterly figures / Company dates Europe

07:30 OMV Trading Update 3Q

Untimed: Deutz Capital Markets Day | BNP Paribas Extraordinary General Meeting

Economic data

• 08:00 DE: Production in the manufacturing sector August seasonally adjusted FORECAST: +0.8% yoy previous: -2.4% yoy
• 14:30 US: Trade Balance August FORECAST: -70.80 bn USD previous: -78.79 bn USD
• 18:45 US: Atlanta Fed President Bostic, speech at Atlanta Consular Corps luncheon
• 19:00 DE: ECB Governing Council member Nagel, speech at the German Bundesbank's Capital City Reception

The US government gave the green light on Tuesday for the Sunrise Wind offshore wind project from Orsted ($ORSTED (-1.39%) ) and Eversource ($ES (+3.43%) ), which is expected to supply more than 320k households in New York with electricity.

Sunrise Wind will be the seventh offshore wind project authorized by President Biden's Department of the Interior offshore wind project that is part of his climate change agenda.

The project is expected to generate 924 megawatts and create hundreds of jobs during the construction and operation phase. The permit stipulates that fewer wind turbines than planned in order to minimize environmental impact.

Sunrise Wind will be about 16 nautical miles south of Martha's Vineyard, Massachusetts and 27 nautical miles east of Montauk, New York.

Orsted is now negotiating the final terms of the agreement and plans to acquire Eversource's interest in the project.

$ORSTED (-1.39%) is struggling, excerpt from the report:

The aim is to reduce fixed costs by one billion Danish kroner by 2026, which includes cutting 600 to 800 jobs worldwide, Orsted announced on Wednesday. The Board of Directors also announced that it would scale back its investment and capacity plans, pay no dividends for the years 2023 to 2025 and sell assets worth around 115 billion kroner (15.4 billion euros) by 2030.

www.finanzen.net/amp/sparprogramm-orsted-aktie-verliert-orsted-setzt-bei-stellen-dividenden-und-investitionen-den-rotstift-an-13238626

Team $UKW (-0.33%)

That was my stock market year 2023.

Since I can call this year the first in which I was able to invest a large sum almost every month, my New Year's resolution is now to invest at least €1,000 every month. Thanks to a change of employer, I can now make this a reality.

I have now also looked beyond the German / European horizon and diversified my portfolio further this year. Non-equity stocks have also made it into my share portfolio. I would like to pick up on this again next year. Asian stocks are still missing here. Let's see what finds its way into my portfolio in 2024.

In addition, at least another €200 a month from my 'voluntary work' will flow into my portfolio. I would like to use this primarily to increase my position in cryptocurrencies $BTC (-0.05%) and $ETH (-1.61%) further expand.

My first share in 24 will actually be $SBUX (+2.42%) be. I had once said here on getquin that I would not invest. However, I changed my mind after I had a hot drink with my girlfriend in a Starbucks in Munich this year and used the time to observe who was actually getting an overpriced coffee here. I won't be getting any coffee here either, but I hope that others here will consume the black brew all the more.

On my hit list is $ORSTED (-1.39%) right at the top. After looking after a large solar project in the region this year, my view of renewable energies has changed a little, even if I think wind power will still do better than solar energy in Europe. I'll probably keep an eye on developments here until around April, but I might get out sooner.

Of course, the aim is still to achieve a return in order to make good provisions for the future. At the age of 25, I'm a bit proud to have saved a small sum. For most people, of course, this is a drop in the ocean, but we mustn't forget... Getquin is also a bubble somewhere (and I'm sure there are one or two fake portfolios here too).

As I now also enjoy the benefits of a company car with private use, I will sell my private car next year and reinvest the capital 'gained' from it in the stock market. This will add up to a nice little sum.

If you like, you can also take a look at my portfolio and give me some feedback. :)

I wish everyone a happy new year!

Small increase in the existing position - to bring in a breath of fresh air, so to speak $ORSTED (-1.39%) 🤑🤞🏽

Orsted $ORSTED (-1.39%)

Initial purchase after the crash with speculation on the turnaround

https://youtu.be/60G3nhhqNRE?feature=shared

Buy when the guns are thundering 🌿 I think the sector will benefit in the long term from the planned investments. However, individual stocks in the sector are too risky for me (see $ORSTED (-1.39%) ) 🤔

Orsted - a lot of wind and storm.

In the course of yesterday morning, the Danish energy supplier had a very $ORSTED (-1.39%) had a very special surprise in store for its investors.

It was announced that parts of the U.S. portfolio would have to be written down generously.

What does that mean now?

1. what is depreciation anyway?

There is scheduled and unscheduled depreciation in business administration. The names are self-explanatory. A write-down is usually a reduction in the value of business assets.

So much for that: Let's reflect on this now with an example with a little

back story:

Orsted has ambitious growth targets in new markets, including the US and Eastern Europe. So they need a lot of capital for this and take out loans. There, the respective tangible assets, in this case the wind turbines, are deposited as collateral. On the basis of this and, of course, other business factors, the lender calculates the interest rate for the loan.

Fortunately, since the "inflation reduction act" last year, renewable energies enjoy a tax reduction of about 30%. However, if this legal provision had not been agreed, the US market would probably have been abandoned yesterday.

And what next?

I hope I can keep it as comprehensible as possible: Specifically, we are talking about 3 wind projects that cannot be completed on time due to supplier problems. These projects account for about 50% of the assets in the USA. Total assets in the USA amount to just under €4 billion. The assets here comprise around €2.5 billion, or 62.5%. Depreciation comprises just under €730 million of this, i.e. just under 30%.

So you take more than half of your property that you financed with credit and realize, "Oh crap, I just lost 30% value."

What does the bank say about that?

"Since the terms were contracted on different terms, we need to revise them and submit new terms at higher interest rates."

Congratulations, so you are now getting even higher interest rates on top of your loan amount, which will massively reduce your profit and the longer the delay in realizing the projects lasts, the more money you will lose as a company.

But it gets worse:

Although you affirm that you can maintain the EBITDA margin, but honestly: How are they going to do that?

The margin will shrink and liabilities will continue to rise, free cash will shrink. On the stock market, this means that not only the growth fantasy is off the table, but also the serious danger of becoming unprofitable on a net basis.

It is alarming for the industry that Orsted is setting a negative example and demonstrating how unattractive wind power actually is, especially in the utility sector in the USA. In this role, one bears the producer risk and the operator risk at the same time.

And once again, there are calls for the state ... 😉