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The world's largest offshore wind developer has announced a new write-down of its US business, in a blow to its efforts to move away from its problems in the country.
Ørsted announced impairments totaling DKK12.1bn (£1.36bn) on Monday evening, blaming interest rates, supply challenges and “market uncertainty” affecting offshore lease prices.
The announcement follows DKK28.4bn of disturbance against the Danish company's US portfolio by 2023, has also been blamed for rising interest rates and supply challenges, and is likely to raise more questions about its strategy in the country.
It comes hours after Donald Trump was inaugurated as US president, having promised during his election campaign to stop offshore wind projects on “day one” of his presidency.
In a press release on Monday, the White House said that Trump's energy policies “will end the leasing of large wind farms that degrade our landscape and fail to serve American energy consumers”.
He added that Trump would withdraw the US from the Paris climate agreement, which was signed in 2016 as part of a global effort to curb climate change.
Mads Nipper, the chief executive, said the disruption was “very disappointing”, but the company remained “committed to the American market for a long time”.
He added: “We continue to face the challenges and uncertainties we face in the emerging offshore industry in the emerging American market.”
Ørsted entered the US in 2018 as a pioneer in the offshore wind industry, but struggled, along with many of its peers, when interest rates rose and supply chains came under pressure following the Covid pandemic.
In November 2023, it said it was abandoning two projects on the coast of New Jersey, disturbing shareholders by writing down DKK28.4bn, which was higher than expected.
In an attempt to turn around the business, the company said last February it was suspending its division, cutting 800 jobs, and withdrawing from offshore wind markets in Norway, Spain and Portugal in an effort to focus on key areas.
In Monday's announcement, Ørsted said rising US interest rates had increased its capital value, accounting for DKK4.3bn of the DKK12.1bn total damage.
It booked another DKK3.5bn due to “market uncertainty” affecting the price of several offshore leases, while the final DKK4.3bn covered delays in its Sunrise Wind offshore wind project off the coast of New York. The project is now expected to be operational in the second half of 2027.
However, Ørsted said it would stick to its full-year operating guidance of DKK24.8bn in 2024. Its wind farms, both onshore and offshore, performed in line with expectations, it said. Revenue in 2023 totaled DKK79.3bn.
The company's shares have fallen nearly 20 percent over the past 12 months, and are about 77 percent below their peak in January 2021 at the height of interest in the environmental stock.