LONDON — Vestas Wind Systems upgraded its forecast for full-year sales and profit margins after earnings beat analyst estimates in the third quarter. The shares jumped.
Profit was $126 million in the three months through Sept. 30, rebounding from a $107.8 million loss a year earlier, the Aarhus, Denmark-based wind-turbine manufacturer said Friday in a statement. The average forecast of nine analysts compiled by Bloomberg was for a $87.9 million profit.
Vestas now expects sales for the year of as much as $8.7 billion, $1.24 billion more than it previously predicted. The company upgraded its forecast for the operating margin for a second successive quarter and now expects it to be as much as 8 percent.
“The main reason we’re lifting our outlook is we have increased visibility on the fourth quarter and which projects will go ahead,” CEO Anders Runevad said Friday in a phone interview. “We also see the operational results and the cost-down program coming through.”
In Colorado, Vestas operates blade plants in Windsor and Brighton, a nacelles plant in Brighton, and a tower factory in Pueblo.
While orders fell by almost a quarter in the period to 1,170 megawatts, the order book for the first nine months of the year has risen by 12 percent, Vestas said.
Wind-turbine makers are waiting to see whether the U.S. will renew a tax credit to the industry that expired at the end of 2013. Runevad said it’s still too early to tell how last week’s midterm elections, which saw the Republicans take control of the Senate, will affect that decision.
The criteria for the benefit, known as the production tax credit, or PTC, meant that any project that started development last year can still claim the benefit as long as it finishes construction by the end of 2015. That has meant that orders have held up, with Vestas taking 1.6 gigawatts of U.S. orders in the first nine months, more than 40 percent of its total.
“The U.S. is a big market, and definitely it would have an impact (if the credit isn’t renewed),” Runevad said. “I would definitely prefer for it to be renewed.” He said he doesn’t expect a decision until next month at the earliest.
Runevad took charge Sept. 1, 2013, during a period of nine straight quarterly losses. The company snapped that run in the last three months of 2013 after cutting almost a third of its workforce along with 12 factories over two years in a bid to slash fixed costs.
The manufacturer is now on course for its first annual profit since 2010 after racking up net income of almost $247.7 million in the first three quarters.
