Wind turbine maker Vestas' shares rose by the most since early 2024 after the company posted second-quarter profits of more than double expectations, announced a buy-back programme and said turnaround plans had succeeded.
The company has struggled with supply chain disruptions, high costs, inflation and the impact of US President Donald Trump's campaign against offshore wind since he returned to office at the start of last year.
Its CEO Henrik Andersen told Reuters on Wednesday, the company had restored momentum.
"The offshore ramp-up is working as we really wanted it to," Andersen said. He cited increased activity over the last year, including opening new factories.
Vestas' shares rose by 18 per cent shortly after the market opening, taking it to the top of the pan-European Stoxx 600 index. The increase was the most since January 2024.
Vestas said operating profit before special items for the April-June quarter rose to €446 million ($514.33 million) against a year-earlier €57 million and an average forecast of €205 million in a company-provided poll.
The company expects a full-year operating margin before special items of seven per cent to nine per cent, up from six per cent to eight per cent. It anticipated sales would be between €20 billion and €22 billion. In 2025, revenue was €18.8 billion.
It also said it would begin on Thursday a share buyback programme of €400 million that would run until the end of the calendar year.
Reflecting the strength of its recovery, the company said the value of its combined backlog of wind turbine orders and service agreements was €76.9 billion at the end of the second quarter, up from €9.6 billion a year ago.
Vestas said uncertainty remained over policies and geopolitical risk, but that it expected revenue growth, increased manufacturing and cost-cutting to drive profitability.
JP Morgan in a note to clients said Vestas' second-quarter performance was stellar.
"Overall, this may be the best print the company has had in several years and provides a clear confirmation in our view that the company is out of the woods," the broker said.
(Reporting by Louise Rasmussen; Editing by Terje Solsvik, Mrigank Dhaniwala and Barbara Lewis)