Pandemic hits Nordex's H1 op profits while revenues double

2.4-MW Nordex turbines. Source: Nordex SE

German wind turbine maker Nordex (ETR:NDX1) today posted doubled sales for the first half of 2020 but said its earnings in the period were hit by the coronavirus crisis, pushing it to an EBITDA loss.

The manufacturer reported a consolidated loss of EUR 180 million (USD 212.8m), expanding from EUR 55.4 million in annual terms and a loss before interest, taxes, depreciation and amortisation of EUR 70.8 million, against a year-ago profit of EUR 17.1 million. Thanks to the high activity level, however, sales and gross revenue, which also includes changes in inventories, improved.

CEO Jose Luis Blanco explained that the COVID-19 health and financial crisis had a major blow on the company’s business in the second quarter and put continuing uncertainty on the market. The company recently secured EUR 350 million in federal government debt to protect it against the effects of the pandemic, which, according to the CEO, ensure that Nordex “remains on its growth trajectory even under these circumstances." Those expansion plans will be additionally supported by EUR 402.5 million in cash from the sale of a 2.7-GW onshore wind and solar project development pipeline to German energy major RWE AG (ETR:RWE) that was agreed at end-July.

More details about Nordex’s financial results in January-June can be seen in the following table.

Figures in EUR million, unless otherwise noted	H1 2020	H1 2019
Sales	2,047.9	990.8
Total revenue	1,990.0	1,603.6
EBITDA (loss)	(70.8)	17.1
EBITDA margin (neg)	(3.5%)	1.7%
EBIT (loss)	(146.4)	(50.2)
Consolidate profit (loss)	(180)	(55.4)
Free cash flow	(137.1)	(161.3)

During the reporting period, Nordex's order intake in the Projects segment, excluding services, declined to 2,531.9 MW from 3,038.4 MW and reached a value of EUR 1.81 billion. European orders were responsible for 80% of the total, while Latin America accounted for the remaining 20%. Order intake at the Projects and Service segments stood at EUR 5.4 billion and EUR 2.7 billion, respectively.

In the first half, wind turbine production declined to 1,735 MW from 2,948 MW a year back. Total installed capacity in the six months rose to 2,287.1 MW from 778.1 MW.

In view of the overall uncertainty caused by the pandemic and the inability to predict the potential consequences to the supply chain, Nordex said it still cannot make a realistic and reliable estimate on its future performance. The German firm withdrew its 2020 guidance in May.

(EUR 1.0 = USD 1.182)

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