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The reasons given by the company on Tuesday were the costs of realigning the production of the rotor blades, the lower installation performance and the increase in the costs of raw materials and logistics. The Hamburg-based company joins a whole host of wind turbine manufacturers who are groaning with inflation. Nordex also had to postpone the presentation of quarterly results due to a cybersecurity incident.
The stock, which only had to leave the SDAX small-cap segment on Monday due to late data submission, fell 7% at the start of trading and has therefore reached its lowest level since July 2020. The stock has now lost. more than a third of its value since the beginning of the year. Jefferies analyst Constantin Hesse described the numbers as weak. However, he sees a ray of hope: the average price per megawatt hour for orders received in the first quarter is the highest since the beginning of 2019.
Nordex significantly increased losses in the first quarter of the year. The end result was a deficit of nearly 151 million euros, as announced by the company in Hamburg. In the same period of the previous year, Nordex had already registered a less than almost 55 million euros. EBIT adjusted before realignment costs (EBITDA) slipped to the red to € 52 million after a profit of € 10.4 million the previous year.
At the end of January, Nordex announced that it would stop producing rotor blades at its German site in Rostock at the end of June. The company justifies this with a tough competitive environment and a shift in demand for larger rotor blades that could not be manufactured in Rostock. According to the latest information, around 600 employees are affected.
Switching production to other rotor blades and lower installation performance due to weather conditions led to a good quarter sales decline to € 933 million. Incoming orders without the service activity amounted to 903 million euros and are therefore slightly lower than the previous year’s value.
Nordex is sticking to its forecast for 2022, which it had already lowered in late May. The company also confirmed the medium-term objective of achieving an operating margin (Ebitda) of 8%. For 2022, the wind turbine manufacturer assumes minus four to zero percent for this key figure.
“The start of 2022 was difficult and it certainly went differently than everyone expected,” commented CEO Jos Luis Blanco of the numbers. The cost situation remains unstable, there are “significant interruptions in the supply chain”. With the expected medium-term recovery of margins, the CEO is also aiming for price increases.
In recent weeks, several wind turbine manufacturers such as Vestas and Siemens Gamesa have lowered their annual forecasts due to rising costs and supply chain disruptions. The war in Ukraine aggravated the situation. Higher costs cannot be passed on to customers to the same extent. This is especially true for onshore wind turbines. The high competitive pressure and the consequent price war that has raged for years has led to the wind energy crisis, considered a key sector for the energy transition.
Nordex stock fluctuates heavily after weak key quarterly data
Nordex shares, which are no longer listed in any major DAX family index, are on a rollercoaster Tuesday. Poor key data for the first quarter with a reported slippage to the operating loss area troubled investors particularly in a generally weak industrial environment and, as a result, balance sheet concerns also emerged. At times, the price has dropped 13 percent via XETRA to its lowest level since May 2020. But more and more investors thought about a bargain, the least fell to 3.42 percent at midday from 9.03 EUR.
Costs for realigning rotor blade production, lower installation production, and rising raw material and logistics costs impacted Nordex’s first quarter. Net loss increased and adjusted operating profit (Ebitda) returned to the red. According to Goldman Sachs expert Ajay Patel, the focus is on the wind turbine manufacturer’s balance sheet. It is questionable whether the funds are sufficient to dominate the current situation without further measures. He recalled a corporate bond maturing in 2023.
HAMBURG / FRANKFURT (dpa-AFX)
The leverage must be between 2 and 20
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