Vestas Wind to sell shares as profitability improves
Copenhagen: The world`s second largest maker of wind turbines, Vestas Wind, reported a quarterly profit late Monday and said it would sell new shares to attract projects requiring more financial muscle.
Vestas made a 218 million euro ($295 million) net profit in the fourth quarter of last year compared with a 618 million loss in the same period a year ago, beating a Dow Jones Newswires analyst consensus of 182 million euros.
The quarterly profit was Vesta`s first in two and a half years.
"By successfully completing our turnaround plan, we have taken important steps in meeting these new challenges," chief executive Anders Runevad said in a statement unexpectedly released one day early.
The Danish company posted its third annual loss in a row, but narrowed to 82 million euros from 963 million in 2012.
The Aarhus-based group had plunged into the red after an ill-timed expansion plan forced it to implement draconian restructuring measures that have included cutting thousands of jobs.
A two-year turnaround plan, focused on cost reductions, appears to have borne fruit.
"I am encouraged by the progress Vestas has made in terms of improving profitability and cash flow generation," Runevad said.
"I do, however, also clearly see the challenges facing the company: Slow growth in electricity demand in key markets, tough competition and a challenging regulatory environment," he added.
In a separate statement Vestas said it would sell 20.4 million new shares, worth around 487.8 million euros at Monday`s close.
"Vestas intends to use the net proceeds of the placing to provide greater financing flexibility and to further enhance its financial stability, by strengthening its solvency ratio and obtaining more flexible banking arrangements," the company said.
"The board believes that this will facilitate the generation of additional business opportunities," it added.
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