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Dong Energy Reports First Quarter 2017 with Ebitda-Decrease

Fredericia, Denmark

Operating profit (Ebitda) from continuing operations totalled DKK 3.3 billion compared with DKK 7.1 billion in Q1 2016. The decrease was in line with expectations and was driven primarily by a positive impact in Q1 2016 from one-off payments from the renegotiation of gas purchase contracts, as well as the divestment of our gas distribution network to Energinet.dk in Q3 2016. These non-recurring items totalled DKK 3.0 billion in Q1 2016.

Underlying Ebitda declined as a result of a very strong Q1 2016 in Wind Power, which included a gain of DKK 0.6 billion on the divestment of 50 percent of Burbo Bank Extension and high activity related to the construction of the German wind farms Gode Wind 1 and 2. In 2017, partnership income in Wind Power is expected to materialise later in the year in connection with the expected divestment of 50 percent of Walney Extension and the construction of, among others, the Race Bank wind farm.

Return on capital employed (ROCE) for the last 12 months increased from 15 percent in Q1 2016 to 17 percent in Q1 2017. Gross investments totalled DKK 2.5 billion, of which approximately 80 percent was invested in the continued expansion of offshore wind. From the beginning of the year until the end of Q1 2017, net debt increased by DKK 3.1 billion to DKK 6.5 billion.

Henrik Poulsen, CEO and President, says: "Q1 Ebitda in line with expectations gives us a good start to 2017. We maintain our financial guidance for 2017, with Ebitda expected to amount to DKK 15-17 billion, which is equal to a growth of 4-18% in the underlying operating profit, and gross investments expected to total DKK 18-20 billion for the year.Operations in Wind Power were in line with expectations in Q1. Following a January with weak winds, both February and March were close to a normal wind year. In addition, wind farm availability was satisfactory. Overall, earnings from commissioned wind farms were up by 21 percent compared to Q1 2016.



Source: IWR Online, 28 Apr 2017