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Letter from the Chairman & the CEO

Forty years of progress, challenges, and opportunities
In 1979, Vestas delivered and installed its very first wind turbine for a customer in Jutland, Denmark. Around the same time, at the first World Climate Conference in Geneva, Switzerland, 50 scientists gathered to discuss climate change. Unaware of what was being installed just over 1,000 km away to the north, the scientists agreed that urgent action was needed to counter the alarming climate change trends they could observe around the world.

Today, 40 years on, wind energy and renewables have evolved tremendously, multiplying turbine output significantly to the benefit of Vestas’ customers and the global environment. In fact, the technological leaps witnessed in the last ten years, along with the sharp decline in the Levelised Cost of Energy, have made renewables the cheapest electricity source in two-thirds of the world’s countries. As a result, the technology required to make the transition to renewable energy is available here and now; and this availability, combined with climate targets, will continue to drive global demand for renewables long into the future. 

Manifesting our leadership in a tough market
In this environment, in 2019, Vestas continued to push itself and the industry to higher levels, including breaking our order record again, launching a new modular platform, achieving record high profitability in Service, expanding our footprint and scaling up manufacturing. With a record order intake of 17.9 GW, continued growth in Service, the highest order backlog of EUR 34bn and an unprecedented volume of deliveries, 2019 was our busiest year to date. Compared to 2015, we doubled our order intake and, once again, delivered market-leading profitability. This performance enabled us to create value for our shareholders, as demonstrated by our dividend pay-out and completion of a share buy-back program.

However, alongside Vestas’ results in 2019 and the technological and competitive milestones, the industry still faces major challenges and impediments caused by trade wars and tariffs. In 2019, industry rules changed, the cost of raw materials and transport went up, and capacity became limited. Combined with the industry’s continued competitiveness, these factors led to an increase in the profitability required to sustain technological development, causing many competitors to struggle and, in some cases, close down and leave the industry. 

Leading the industry, building new partnerships 
For Vestas, the reality of the climate crisis shapes, informs and motivates our business at every level. Every day, we go to work knowing that what we do supports the global transition from traditional energy sources to renewables, helping to make the world a better and more sustainable place. First and foremost, this entails designing, delivering and servicing sustainable energy solutions that help our customers’ businesses thrive, while reducing CO2 emissions from their energy mix. And we are pleased to say that Vestas is doing well; so well, that in 2019 we sold, delivered, and serviced record amounts of wind energy solutions, consolidating our leadership position and, most importantly, working to ensure a healthy planet for future generations. We embrace our leadership role within the industry, and we are inspired to continue driving our solutions to provide excellence for our customers. 

To exploit present and future growth, we must constantly consider how to leverage our size, scale, and volumes. Advantages of scale will underpin our future success, from designing and building turbines, to expanding our digital and multi-brand capacities, to establishing partnerships with suppliers willing to take on larger volumes. Such efforts will enable us to serve a truly global and growing marketplace for sustainable energy solutions. 

Our commitment to help address the climate crisis also means taking on more responsibility. To this end, with this annual report we are launching our new sustainability strategy, called “Sustainability in everything we do”. This strategy sets out a range of commitments, such as achieving carbon neutrality by 2030 and producing zero-waste turbines by 2040. As an example, we started converting our benefit and service cars to electric vehicles on 1 January 2020. In combination, these initiatives will have a significant positive impact on Vestas’ sustainability performance, while driving improvements across the entire wind energy value chain to the benefit of our global customers and wider stakeholders. 

To engage more actively in global conversations on the electrification of the energy system, in 2019 we entered a partnership with Mercedes-Benz EQ Formula E team. Through this partnership, we will raise awareness of Vestas and the need for electrification, with the aim of bringing sustainable energy into the mainstream. As energy-based sectors such as mobility and heating become electric, increased demand for electricity will drive wind energy’s penetration of the energy system.  

Maintaining our strategic focus
The backbone of our expansion remains our winning strategy, which is based on our three core business areas: onshore wind, offshore wind, and service solutions. To sustain our success, we continue to leverage our technology leadership, scale and reach, while also working even more closely with our customers and partners. And through our passion and accountability, we aim to deliver what we promise – or speak up early to address challenges and avoid unexpected costs. 

In 2019, Vestas once again pushed the boundaries of technology further, having invested EUR 729m, more than any other company across the industry. We introduced the EnVentusTM platform architecture, taking a big leap into modular product development. We also invested heavily in localisation and scale in order to meet growing demand for our sustainable energy solutions. At the same time, we continued to invest in the technology that will be essential to achieving full decarbonisation, such as hybrids, grid integration and Power-2-X.

During the year, as wind energy became increasingly competitive, new markets opened and others re-opened, which meant that all regions contributed to our overall results. Once again, the USA was our largest market, and while traditionally strong markets such as Germany and India remained in a state of temporary uncertainty, others such as Brazil, Poland, and Australia showed great progress in order intake, localisation and execution. 

Preparing for the future
Unlike 40 years ago, it is clear today that renewable energy is the future. To ensure Vestas can maximise the opportunities and benefits arising from the growth of renewables, in 2019 the Board and Executive Management made changes to the company’s leadership. These changes were designed to support strategic continuity, value-based leadership and long-term succession planning. Underlining our Service business’ importance, the Head of Service was appoined to Executive Management, while our emphasis on value-based leadership was highlighted when People and Culture were elevated to fall under the remit of Executive Management as well.

The year ahead will be even busier than 2019. It is therefore vital that we live by our values of simplicity, accountability, collaboration, and passion. Only in this way will we find efficiencies across the value chain that support our success; efficiencies that will help us further lower the Levelised Cost of Energy for the benefit of our customers, while ensuring our profitability and future investments in technology.

Almost everything in wind energy and renewables has changed since 1979, but one thing remains the same: urgent action is still required to divert our climate trajectory. Whether the scale of this challenge is articulated by 50 scientist in 1979 or 11,000 scientists, who in 2019 endorsed the “World Scientists’ Warning of Climate Emergency”, we continue to work as relentlessly today as we did 40 years ago to develop solutions for a carbon-free energy system. By doing so, we provide decision makers with one of the strongest tools to address the climate crisis, and the opportunity to access one of the world’s most efficient energy sources. 

We want to thank Vestas’ employees for all their ongoing passion, hard work and dedication. We also want to thank our customers, partners, and other stakeholders who continue to help us overcome challenges and achieve impressive results. Through our collaboration in 2019, we created strong foundations that will enable us to execute our demands and responsibilities in an even busier 2020.

Bert Nordberg
Chairman of the Board of Directors        

Henrik Andersen
Group President & CEO

Quick links to annual report 2018 (pdf)

Corporate strategy

Leadership through unprecedented change
Energy is the cornerstone of modern society and the key to a better quality of life for those living in less developed areas. At the same time, energy today accounts for two-thirds of total global greenhouse gas emissions, making it the main contributor to the climate crisis.1) Moreover, burning of fossil fuels results in millions of deaths per year caused by air pollution.2) Unless the world fundamentally changes the way it produces, distributes, and uses energy, these figures will continue to rise as energy demand increases.

For the last 40 years, Vestas has worked passionately to develop solutions to address both the climate crisis and the world’s growing need for energy. Along the way, Vestas has installed more than 113 GW of sustainable energy solutions, preventing the release of 1.3 billion tonnes of CO2 into the atmosphere. Today, as Vestas works towards becoming the global leader in sustainable energy solutions, with wind at its core, Vestas remains as committed to protecting the environment as Vestas was in 1979, when it installed the very first wind turbine. Ensuring a healthy planet for future generations is a key part of what Vestas does – it is Vestas’ purpose as a company and as individuals.

The greatest challenge and opportunity of our time
Without doubt, the climate crisis is the greatest challenge facing humankind today. But it also presents a unique opportunity. Put simply, the world needs more sustainable and affordable energy. Efforts to generate and distribute this energy have resulted in the largest humanmade transition in history: the global energy transition. As this transition accelerates, with demand increasing and technology advancing, the growth potential for renewables is huge.

With renewables being the cheapest source of electricity in two-thirds of the world today, and set to beat coal and gas on cost almost everywhere by 2030, it is expected that wind and solar will be providing 50 percent of the world’s electricity in 2050.

Strategic focus areas
Vestas is driving the energy transition forward by focusing on three core business areas: onshore wind power, service solutions and offshore wind power. Vestas is present in all key markets globally and offer the most compelling and sustainable wind power plant and service solutions, thereby expanding the global reach of renewable energy. 

Through its operational scope and efficiency, as well as its investments and innovations, Vestas is able to keep pushing the technology and economics of wind power. Because of its stable leadership position, it is possible for Vestas to re-invest more of its profit into new technology than any other player in the renewables sector. In this way, Vestas can maintain and expand its leadership for the benefit of the planet, Vestas’ customers and shareholders. 

Read more (pdf)

1) Source: International Energy Agency (IEA): Global Energy & CO2 Status Report 2019. March 2019.
2) Source: World Health Organization: COP24 Special Report, Health & Climate Change. 2018.


Outlook 2020
Revenue is expected to range between EUR 14bn and 15bn, including service revenue, which is expected to grow approx. 7 percent. Vestas expects to achieve an EBIT margin before special items of 7-9 percent with a service EBIT margin of approx. 25 percent. 

Total investments* are expected to amount to approx. EUR 700m in 2020. 

It should be emphasised that Vestas’ accounting policies only allow the recognition of revenue when the control has passed to the customer, either at a point in time or over time. Disruptions in production and challenges in relation to shipment of wind turbines and installation hereof, for example bad weather, lack of grid connections, and similar matters, may thus cause delays that could affect Vestas’ financial results for 2020. Further, movements in exchange rates from current tlevels may also impact Vestas’ financial results for 2020.

Outlook 2020
EUR 14bn-15bn
EBIT margin before special items
Total investments* 
 approx. EUR 700m
*Excl. any investments in marketable securities and short-term financial investments.

Long-term financial ambitions
The wind power industry is maturing into a commercially viable, unsubsidised industry. On the global agenda is now an acute call for renewable energy to replace fossil fuels in the energy mix, and hence the growth potential is immense. There is furthermore a strong demand for technology that can improve energy efficiency and displace CO2 emissions created by conventional sources of electricity. With its global reach, scale, and leading technology, Vestas is well positioned to explore the unprecedented opportunities that the great growth poten-tial and demand for innovation create. 

The company observes an industry that despite moving towards the end of the transition period is still highly competitive and impacted from current trade restrictions. 

Vestas’ long-term financial ambitions reflect the projected market con-ditions as well as the company’s strategy and priorities. 

 In the coming years, revenue in the Service segment is expected to grow faster than the market with an EBIT margin of approx. 24 percent.

Long-term financial ambitions
Grow faster than the market and be the market leader in revenue 
 EBIT margin
At least 10 percent
 Free cash flow
Positive each year
Minimum 20 percent over the cycle

Read more (pdf)

Financial performance

Realised 2019 Guidance 2019 
EUR 12.1bn
EUR 11.0bn-12.25bn Revenue
8.3% 8-9% EBIT margin before special items
EUR 729m
approx. EUR 800m Total investments*

* Excl. the acquisition of SoWiTec Group GmbH, any investments in marketable securities, and short-term financial investments.

Read more (pdf)

  • Highlights
  • Group performance
  • Risk management
  • Consolidated financial statements
  • Financial statements for Vestas Wind Systems A/S

Activities in Power solutions

Order intake and financial performance
Vestas achieved in 2019 yet another record-high order intake of a total of 17,877 MW. This also resulted in a wind turbine order backlog of 20,974 MW, equivalent to EUR 16.0 bn. Activity levels increased further, as 12,618 MW of turbines produced and shipped (2018: 10,676 MW), and roughly the same capacity delivered to customers. 

Revenue from Power Solutions was EUR 10,276m in 2019, which is an increase of 20 percent compared to 2018. EBIT before special items was EUR 741m, at the same level as in 2018. 

Developments during the year
In 2019, Vestas saw the market for onshore wind energy maturing even further, unlocking growth opportunities in new markets and customer segments. To grasp these opportunities, the company acquired a stake in SoWiTec Group, a leading sustainable energy developer, strengthening Vestas’ co-development competencies. During the year, Vestas took a leap within technological advancements with the introduction of a new modular platform, the EnVentusTM. Lastly, Vestas’ global, lean and scalable manufacturing and supply chain setup proved to be of utmost importance as the world faced further trade tariffs, in addition to ramping up to cater for higher activity levels.

Read more (pdf)

Highlights 2019
Europe, Middle
East and Africa
Asia Pacific
EUR 4,626m
EUR 4,397m
EUR 1,253m
Order intake - firm and unconditional orders
10,269 MW
6,001 MW
1,607 MW
5,839 MW
 5,319 MW
1,726 MW
Order backlog – firm and unconditional orders
10,593 MW
 7,891 MW
2,490 MW
Installed wind turbines in
 9 countries  25 countries  8 countries

Activities in Service

Order intake and financial performance
Vestas’ service business continued to grow its activities with an increased profitability. In the year, revenue for the service business reached EUR 1,871m with an EBIT margin of 25.8 percent. 

At the end of 2019, Vestas had service agreements in the order backlog with expected future contractual revenue of EUR 17.8bn, an increase of EUR 3.5bn compared to 2018.  

Developments in Service during the year
The continued growth in the base of installed onshore wind power offers both promising opportunities and challenges as the market becomes more mature but at the same time requires greater stability and predictability for wind power as an energy source, as it penetrates a larger part of the overall energy mix. Within this context, service solutions play a crucial role, and with its unmatched scale and advanced digital solutions, Vestas can offer wind park owners everywhere the sought after stable and predictable output. 

In 2019, Vestas reached a digital milestone in its service business, as it introduced the advanced energy analytics platform Scipher, together with Utopus Insights. Scipher secures customers high standards in the accuracy of production forecasting, output optimisation and orchestration of energy portfolios in a cost-effective manner. The most comprehensive types of Vestas’ service contracts (AOM 4000 and 5000) are more popular than ever, and the average length of the full-scope contracts signed in 2019 was 18 years. Besides maintenance partnering, Vestas continues to develop its fleet optimisation and upgrade solutions and help customers get the full potential out of an existing wind turbine portfolio.

Read more (pdf)

Highlights 2019
Europe, Middle
East and Africa
Asia Pacific
EUR 633m
 EUR 1,045m EUR 193m
Share of region’s total revenue
12%  19% 13%
Under service
37,223 MW
48,425 MW
10,663 MW
Order backlog – future expected
contractual revenue
EUR 6,660m
 EUR 9,447m
EUR 1,657m
Provides service in
 18 countries  40 countries  11 countries

Activities in Offshore

Financial performance and order backlog
Compared to 2018, the joint venture’s revenue in 2019 increased by 29 percent to EUR 1.4bn. Net profit in the joint venture amounted to EUR 6m (2018: EUR 26m), which entails a contribution of EUR 3m in Vestas’ “Income from investments in joint ventures and associates.” Compared to 2018, the EBIT performance improvied, but this was more than offset by additional non-operational costs. 

As at 31 December 2019, the offshore wind turbine order backlog amounted to 2,870 MW (2018: 3,838 MW). 

Expectations for the future offshore market
During the year, the global installed base of offshore wind energy is expected to have increased to 29 GW (2018: 22 GW) – an increase of 30 percent. Traditional markets such as the UK, Germany, and the Netherlands, are increasing their commitment to the offshore wind power industry to reach ambitious climate targets, and new markets embrace the affordability and scale of offshore wind power. 

Well positioned to benefit from future growth
MHI Vestas Offshore Wind A/S continues to increase the performance of the V164 platform with the introduction in 2019 of a 174 meter rotor and increased nominal power up to 10 MW. Since its inception, the V164 platform has become a reliable workhorse for the offshore wind power industry and remains the most powerful commercially installed wind turbine on the market.  

The joint venture provides and will also in the future provide a leading product platform and a global footprint, and its aim is to become a market leader in offshore wind power.

Read more (pdf)
Read more at MHI Vestas Offshore Wind's website

Highlights 2019  Global
EUR 1,435m
Order intake – firm and unconditional orders
48 MW
Order backlog - firm and unconditional orders 2,870 MW
Order backlog – conditional orders and preferred supplier agreements
3,786 MW
Total installations
 1,004 MW


Sustainability at Vestas
By the end of 2019, Vestas has installed more than 113 GW of sustainable energy solutions across 81 countries on six continents, enough capacity to spare the planet 151 million tonnes of CO2 every year, and the company has a responsibility to keep growing and expanding energy access. 

Customers should only have and require sustainable energy solutions from a partner, for whom sustainability is an integrated part of the manufacturing, sourcing, and whole life cycle of the product. Only by ramping up its efforts on sustainability can Vestas truly become the global leader in sustainable energy solutions. The new Vestas Sustainability Strategy – Sustainability in everything we do – has four key goals that contributes to the achievement of Vestas’ corporate strategy:  

  • To become a carbon-neutral company by 2030 – without using any carbon offsets 
  • To produce zero-waste wind turbines by 2040 
  • To become the safest, most inclusive and socially responsible workplace in the energy industry 
  • To lead the transition towards a world entirely powered by sustainable energy

Read more (pdf)

Highlights 2019 Global
Total recordable injuries (No.) 
Direct emissions of CO2 (1,000 tonnes)  
Share of renewable electricity for own activities (%)