Denmark's Orsted's shares drop after it forecasts lower wind speeds

FILE PHOTO: General view of the Walney Extension offshore wind farm operated by Orsted off the coast of Blackpool, Britain September 5, 2018. REUTERS/Phil Noble

COPENHAGEN (Reuters) - Shares in offshore wind farm developer Orsted fell sharply in early trading on Wednesday after it said a return to more normal wind speeds this year would hit operating profit.

The Danish company on Tuesday lifted its operating profit guidance for 2020, but said it expected a lower figure this year due to reduced wind speeds and higher project costs.

“With the recent share price increases, expectations for future earnings growth and project wins are high,” Sydbank analyst Per Fogh said in a note, calling the 2021 outlook “disappointing”.

Orsted’s shares, which hit a record high last week, were down 8.6% by 0807 GMT.

Orsted said on Tuesday it expected last year’s operating profit to come in at 18 billion Danish crowns ($2.95 billion), falling to between 15 and 16 billion crowns this year, excluding new partnership agreements.

($1 = 6.0952 Danish crowns)

Reporting by Jacob Gronholt-Pedersen and Nikolaj Skydsgaard; editing by John Stonestreet