Tuesday, April 28, 2009

WIND FARM FIRM CUTTING 1,900 JOBS

Wind farm at twilight
Vestas said there was now oversupply in the turbine market

Wind turbine-maker Vestas Wind Systems is to cut 1,900 jobs - mainly in the UK and Denmark - despite reporting a 70% rise in quarterly profits.

It will be closing its UK turbine plant on the Isle of Wight, cutting 450 jobs.

The Danish firm blamed the headcount reduction, which represents 9% of its workforce, on market oversupply.

It came as Vestas reported a net profit of 56m euros ($73m; £50m) for the first three months of 2009, up from 33m euros for the same period last year.

The company also said it planned to raise funds through a share issue.

Vestas said that supply of wind turbines exceeded demand in Northern Europe, despite the drive of governments including Germany and the UK to increase the amount of electricity generated by green energy alternatives.

Quarterly sales at the company, which is the world's largest manufacturer of wind turbines, rose 59% to 1.11bn euros.

It also said it was sticking to its full-year sales targets.

Analysts broadly welcomed the results.

"It's a strong set of numbers and good operational performances - better than the street had expected," said Rupesh Madlani, analyst at Barclays Capital.

"Raising capital in this environment makes good strategic sense, so we're pretty positive."

Vestas has yet to indicate how much it hopes to raise from the share issue.

BBC NEWS REPORT.

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