LM Wind Power Holding A/S, a maker of turbine blades for companies including Vestas Wind Systems A/S (VWS), said profit fell 41 percent last year when it cut 180 jobs making 3 percent of its staff and that it expects demand to weaken.
Earnings before interest, taxes, depreciation and amortization fell to 73.9 million euros ($98 million) in 2011 from 125.1 million euros a year earlier. Sales declined 2.7 percent to 707.5 million euros. The Kolding, Denmark-based company cut the staff after orders fell and employed 5,803 at the end of the year.
The European financial crisis damped turbine demand as Chinese competition drove down prices, causing excess capacity in the industry that eroded from manufacturers including Vestas to Gamesa Corp. Tecnologica SA. (GAM) Turbine prices fell 4 percent in the second half of last year to the lowest since at least 2008, according to Bloomberg New Energy Finance.
“We will continue to face difficult market circumstances with overcapacity, slower demand and price pressure,” Roland Sunden, chief executive officer at LM Wind Power, said in a statement.
The company cut the jobs in North America and in Europe, according to Ann-Katrine Fredenslund, a spokeswoman for the company, which is owned by Doughty Hanson & Co. Managers Ltd., a fund manager.
LM Wind also temporarily halted manufacturing at a plant in Urumqi, China and scaled back its largest plant at Ponferrada in Spain. It maintained a 14 percent share in the global turbine- blade market and in 2011 supplied blades to companies including Vestas, Alstom SA (ALO), Suzlon Energy Ltd. (SUEL), Siemens AG (SIE) and Sinovel Wind Group (SINOVZ) Co. LM Wind was formed when LM Glasfiber, also owned by Doughty Hanson, merged with Svendborg Brakes in 2009.
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