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Nordex Defies Cost Increases With New International Orders

Hamburg, Germany - Supply bottlenecks and rising raw material prices are currently presenting the industry with challenges that were not foreseeable in this way. The resulting braking effects are also evident at wind turbine manufacturer Nordex, which has adjusted its forecast for the current year.

Nevertheless, a high order backlog and new orders are putting investors in a good mood. Following last week's major order from Ireland, the Nordex Group yesterday (Nov. 16, 2021) reports an order for just under 70 megawatts (MW) from Turkey. The share price is climbing.

Nordex Group confirms preliminary figures

Nordex Group has confirmed the preliminary figures published last week (08.11.2021). The wind turbine manufacturer generated consolidated revenues to almost EUR 4.0 billion in the first nine months of 2021 (9M/2020: EUR 3.2 billion). Earnings before interest, taxes, depreciation and amortization (EBITDA) increased to EUR 100.7 million (9M/2020: EUR 70.8 million), corresponding to an EBITDA margin of 2.5 percent (9M/2020: 2.2 percent).

In the first three quarters of 2021, the Nordex Group increased its order intake in the Projects segment (excluding Service) from 3.8 GW to 4.6 GW; this corresponds to a value of EUR 3,219 million (9M/2020: EUR 2,642 million). As of the end of September 2021, the Nordex Group had an order backlog of EUR 8.0 billion (9M/2020: EUR 7.9 billion). Of this, EUR 5.0 billion (9M/2020: EUR 5.1 billion) is attributable to the Projects segment and EUR 3.0 billion (9M/2020: EUR 2.8 billion) to the Service segment.

Due to the macro environment characterized by rising raw material and freight costs as well as temporary supply chain disruptions, Nordex also revised its guidance for 2021. Accordingly, Nordex now expects an EBITDA margin of around 1 percent for 2021 (previously 4.0 – 5.5 percent). However, Nordex expects to overcome the current challenges and continues to aim for the strategic target of an 8 percent EBITDA margin in the medium term. The basis for this is that external markets have overall stabilized and the period of cost and sales pricing adjustments is over, Nordex said.

"We continue to see strong demand for our product portfolio, while the ambitious climate targets announced by politicians in many countries mean the outlook remains highly promising for our industry. Our main priority now is to push ahead efficiently with our production and installation activities and manage the extremely high raw material and logistics costs, as this volatile environment might stay with us for a while yet," said Nordex CEO José Luis Blanco.

Nordex receives orders from Turkey and Ireland

Nordex also scored with new orders in November. From Turkey, the wind turbine manufacturer has received an order from Enerjisa Ureti, Turkey's largest independent power plant operator, for 12 N163/5.X turbines for the 68.4 MW "Erciyes" wind farm. In addition to the supply and installation of the turbines, the order also includes a long-term service and maintenance contract. The order is Nordex's first in Turkey for a wind farm with turbines in the 5 MW class. Nordex will install the turbines of the Delta4000 series in the 5.7 MW operating mode. The wind farm is located in the province of Kayseri in the region of Central Anatolia.

Nordex also reported a major order from Ireland last week (Nov. 10, 2021). Nordex will supply 15 N149/4.X turbines and a further 7 N149/5.X machines for the Ardderroo wind farm. The order also includes a 20-year premium service contract. The wind farm, with a total capacity of 101 MW, is located in County Galway on the west coast of Ireland.

Share climbs

Yesterday, Nordex stock gained a substantial 4.5 percent to a price of EUR 15.2 (11/16/2021, closing price, Stuttgart stock exchange). In today's trading, the stock is currently up 1.1 percent at EUR 15.41 (11/17/2021, 3:45 p.m., Suttgart Stock Exchange). Compared with the turn of the year, the share is therefore currently down by around 30 percent.

Source: IWR Online, 17 Nov 2021