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New accounting policies for supply-and-installation projects and their effect on 2006-2011

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Summary: In company announcement No. 40/2010 of 26 October 2010, Vestas
informed about its considerations in relation to a potential change in
accounting policies, which could have a significant effect on previous as well
as future financial statements. As illustrated in this announcement, the
consequence of the new policy regarding recognition of revenue for
supply-and-installation projects is that historic revenue up until 30 September
2010 has been deferred by EUR 2.9bn, which will be recognised as revenue during
the coming periods. The deferral of revenue and related earnings has the effect
that equity as per 30 September 2010 has been reduced by EUR 739m. Production
and shipments related to this revenue have taken place, and prepayments and
down payments amounting to EUR 2.2bn have also been received. Cash flow is not
affected by the change in policy, which - other things being equal - means that
structurally, the order backlog in future will be larger than before as
supply-and-installation projects now only leave the order backlog at transfer
of risk to the customers. By introducing the new accounting policy and with
unchanged activity level in relation to the announcement of 26 October 2010,
Vestas now expects revenue in 2010 of EUR 6.8bn and an EBIT margin of around 7
per cent before one-off costs of EUR 140-160m for the announced close-downs and
lay-offs. For 2011, revenue and earnings are expected at the same level as 2010
before the above-mentioned one-off costs. 

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At vestas.com/investor, Vestas' Executive Vice President and CFO, Henrik
Nørremark provides a review, by video, of the new accounting policies' effect
on Vestas' submitted financial statements. The presentation which Henrik
Nørremark will go through will also be available for download from
vestas.com/investor. 
 
Today, on 22 November 2010, at 1 pm (London time)/2 pm CET, a conference call
will be held for analysts, investors and the press. The conference call will be
held in English, and the dial-in numbers are: +45 7026 5040 (DK), +44 208 817
9301 (UK), +1 718 354 1226 (USA). Vestas will be represented by among others
President and CEO, Ditlev Engel and Henrik Nørremark. 

Henrik Nørremark will, together with SVP of Group Treasury, Henrik Hald and SVP
of Group Communications, Peter Kruse, hold roadshow for analysts and investors
about the new policies in the following cities: 

23 November 2010: New York and Boston 
24 November 2010: London 
25 November 2010: Paris and Frankfurt 
26 November 2010: Stockholm and Copenhagen


Contact details:
Vestas Wind Systems A/S, Denmark 
Peter Kruse, Senior Vice President, Group Communications
Tel.: +45 9730 0000





                                            

                

            

        

    

    



    

        
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