TIDMORSTED
EBITDA for 2020
Based on our preliminary and unaudited reporting, we expect an operating
profit (EBITDA) of DKK 18.0 billion for 2020, which is above our latest
guidance of DKK 16-17 billion.
The increase in earnings is primarily of temporary nature, but we have
also seen strong operational performance throughout the Group in the
last months of the year. We achieved higher than expected earnings from
our operating assets and trading related to hedging of our power
exposures, and we saw positive temporary effects in our gas portfolio
business due to higher gas prices at year-end. In addition, fixed costs
came in lower than expected throughout the Group, and we had lower than
expected project development costs in the US, mainly due to timing.
Financial outlook 2021
Group EBITDA guidance
Operating profit (EBITDA) excluding new partnership agreements is
expected to be DKK 15-16 billion in 2021.
2020 realised 2021
Outlook 2021, DKKbn 2020 realised(1) excl. RBC(1,2) guidance(3)
EBITDA 18.0 17.1 15-16
Offshore 14.8 14.8 Lower
Onshore 1.1 1.1 Higher
Markets & Bioenergy 2.1 1.2 Lower
(1) Business performance principle
(2) Without the Danish power distribution, residential
customer, and city light businesses (RBC)
(3) Without new partnerships; relative to 2020 excl.
RBC
As in previous years, our EBITDA guidance does not include earnings from
new partnership agreements as it is difficult to predict the exact
timing of potential farm-downs as well as the distribution of income
between years if the partnership includes a construction agreement.
In terms of new partnerships in 2021, we expect to close the 50 %
farm-down of Greater Changhua 1 following the agreement announced in
December 2020. Furthermore, we plan to farm-down a 50 % share of
Borssele 1 & 2 around summer. Finally, we will explore the possibility
of a farm-down of our solar PV portfolio following the commissioning of
Muscle Shoals in Q3. While we have not included any gains from these
farm-downs in our guidance, we have assumed a derived reduction in site
earnings.
We had no earnings from new partnership agreements in 2020, while EBITDA
from existing partnerships is expected to amount to DKK 1.6 billion. In
2021, EBITDA from existing partnerships is expected to be close to zero.
In 2020, we divested our Danish power distribution, residential customer,
and city light businesses. These contributed with DKK 0.9 billion to our
EBITDA in 2020.
2020 realised & 2021 guidance DKKbn
2020 realised 18.0
Danish power distribution, residential customer and
city light business -0.9
Existing offshore partnerships -1.6
2020 comparable 15.5
Offshore(1) Lower
Onshore(1) Higher
Markets & Bioenergy(1) Lower
IFRS 9 one-off effects 1.0
2021 guidance 15.0-16.0
(1) Excl. IFRS 9 one-off effects
Directional business unit guidance
Earnings in Offshore (excluding new partnership agreements) are expected
to be lower than in 2020. Earnings are also expected to be lower than in
2020 adjusted for the non-repetition of earnings from existing
partnerships in 2020 (approx. DKK 1.6 billion) and the positive effect
(approx. DKK 1 billion) of ceasing to report according to the business
performance principle in 2021 (see below). The positive impact on
operational earnings driven by the last 400 MW of Hornsea 1 receiving
CfDs from April and full-year effects from Borssele 1 & 2 net of the
reduction in site earnings from the assumed farm-down will be more than
offset by a number of adverse effects. In 2021, we expect an increase in
expensed project development costs, O&M costs related to Greater
Changhua 1 & 2a and Hornsea 2 before they commence generation in 2022,
higher TNUoS charges, and lower earnings from Horns Rev 2 which came out
of subsidy period in October 2020. Finally, 2020 had higher than normal
wind speeds, which constitutes the largest negative impact year on year.
Earnings in Onshore are expected to be higher than in 2020 driven by
increased earnings from new wind and solar farms coming online, net of
the assumed reduction in site earnings from the possible farm-down of
our solar PV portfolio. The increased operational earnings will be
partly offset by higher costs related to the strategic expansion of the
business and an adverse year-on-year impact from recognition of
derivatives.
Earnings in Markets & Bioenergy (excluding the divested Danish power
distribution, residential customer, and city light businesses), are
expected to be lower than in 2020. The positive effects from revaluation
of gas at storage caused by the increasing gas prices, especially during
Q4 2020, is expected to partly reverse in 2021.
Cease to report on business performance principle from 2021
From 2021, we will cease using our supplementary business performance
principles and only report our financials based on IFRS. This will
simplify our reporting and comply with future reporting requirements.
The transition entails that the market value of our business performance
hedges (related to commodities and related FX) deferred to a future
period at the end of 2020 will cease to exist as it has already been
recognised in the income statement according to IFRS.
For 2021, EBITDA according to IFRS is expected to be approx. DKK 1
billion higher than what we would have expected if we had continued to
report based on the business performance principle. The majority of this
is related to Offshore site earnings.
Ørsted will publish its annual report for 2020 on 3 February 2021.
For further information, please contact:
Media Relations
Martin Barlebo
+45 99 55 95 52
Investor Relations
Allan Bødskov Andersen
+45 99 55 79 96
Ørsted's vision is to create a world that runs entirely on green
energy. Ørsted develops, constructs, and operates offshore and
onshore wind farms, solar farms, energy storage facilities, and
bioenergy plants, and provides energy products to its customers.
Ørsted ranks #1 in Corporate Knights' 2020 index of the Global 100
most sustainable corporations in the world and is recognised on the CDP
Climate Change A List as a global leader on climate action.
Headquartered in Denmark, Ørsted employs 6,120 people.
Ørsted's shares are listed on Nasdaq Copenhagen (Orsted). In 2019,
the company generated revenue of DKK 67.8 billion (EUR 9.1 billion). For
more information on Ørsted, visit orsted.com or follow us on
Facebook, LinkedIn, Instagram and Twitter.
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