Ørsted A/S (DNNGY) Q1 2025 Earnings Call Transcript

2025-05-07 11:47:53 ET

Ørsted A/S (DNNGY)

Q1 2025 Earnings Conference Call

May 07, 2025 08:00 AM ET

Company Participants

Rasmus Errboe - Group President & Chief Executive Officer

Trond Westlie - Chief Financial Officer

Conference Call Participants

Peter Bisztyga - Bank of America

Alberto Gandolfi - Goldman Sachs

Casper Blom - Danske Bank

Harry Wyburd - BNB Paribas

Ahmed Farman - Jefferies

Kristian Tornøe - SEB

Dominic Nash - Barclays

Lars Heindorff - Nordea

Jenny Ping - Citi

Olly Jeffery - Deutsche Bank

Rob Pulleyn - Morgan Stanley

Deepa Venkateswaran - Bernstein

Asne Holsen - ABG

Mark Freshney - UBS

Helene Brøndbo - DNB

David Paz - Wolfe Research

Presentation

Operator

Ladies and gentlemen, welcome to the Ørsted Q1 2025 Earnings Call. For the first part of this call, all participants will be listen-only mode and afterwards, there will be a question-and-answer session. Today's speakers are Group President and CEO, Rasmus Errboe; and CFO, Trond Westlie. Speakers, please begin.

Rasmus Errboe

Hello everyone and thank you for joining today's presentation. During the first quarter of the year, we have focused on execution of the business plan that we presented in February. As part of the updated plan, we established four key business priorities for Ørsted, which will be the core focus as we execute on our strategy.

First, it is the strengthening of our capital structure. Secondly, it is the delivery of more than 8 gigawatts offshore construction portfolio. And thirdly, it is a focused and disciplined approach towards capital allocation with value over volume. And finally, we will ensure that Ørsted is even more competitive in the future. We will continue to focus on progressing all four priorities to deliver on our plan.

With that said, the offshore wind industry continues to be challenged in the short-term with headwinds relating to supply chain, regulatory uncertainty, and macroeconomic developments. We follow the developments around further potential tariffs and other regulatory changes closely.

Despite the significant challenges across certain geographies, the long-term fundamental for offshore wind are strong, given the increase in global electricity demand, a strengthened focus on energy security and affordability through renewables, and improvements in framework conditions in several major markets.

With that, let me walk you through our progress on each of the four strategic priorities. During the first quarter, we have seen solid operational results with a reported group EBITDA increasing 18% compared to last year. In addition, we continue to deliver on our farm-down program as we closed two divestments since the start of the year.

In the U.S. we completed the 50% farm down of two of our solar farms. And just last week, we completed a divestment of a part of our West of Duddon Sands offshore wind farm in the U.K.

These transactions delivered total proceeds of around DKK7 billion and are supportive of our capital structure. We continue our relentless focus on the delivery of our offshore construction portfolio and during the first quarter, we continued to deliver on this with successful commissioning of Gode Wind 3. This also marks that we now have installed more than 10 gigawatts of offshore wind capacity.

On the back of the short-term challenged offshore wind industry and the adverse development experienced in recent years, we will employ an even more focused approach to our capital allocation, and we do see that we have ample opportunities in our core offshore wind markets to leverage our distinct capabilities....

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