Vestas bonds sink to "junk" after 2011 guidance cut - report

Jan 6, 2012 - After Danish wind-turbine maker Vestas Wind Systems A/S (CPH:VWS) downgraded its 2011 guidance once more earlier this week, its eurobonds have slid to junk level, local daily Morgenavisen Jyllands-Posten reported today.

The bonds' price has now dropped 15% from 2010, to their lowest level ever, the daily said.

Confidence in the company has subsided and the risk premium on the bonds is growing. However, Vestas is not threatened by insolvency, according to Bo Andersen from Jyske Bank.

Vestas said on Tuesday that its 2011 operating profit is seen at zero, against previously expected EUR 255 million (USD 325.9m). The outlook for operating margin was cut to 0% from around 4%. Full-year revenue, foreseen at EUR 6.4 billion, landed at around EUR 6 billion, while expenses were EUR 125 million higher than projected.

(EUR 1.0 = USD 1.281)

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