Stormy times at the Siemens Energy subsidiary – and no end in sight: The massive problems in the wind business continue at Siemens Energy. The Munich greentech specialist has been one of the leading manufacturers of wind turbines worldwide for years and develops and produces onshore and offshore wind farms. Siemens Energy is particularly well known for powerful wind turbines that offer high efficiency, reliability and innovative technologies. This also includes solutions for integrating offshore wind farms into the power grid.
However, there have been problems for a long time: The international greentech company is therefore now assuming an annual loss of several billion euros in the wind business.
Greentech company with annual loss of several billion euros
Both the costs for rectifying quality defects in land turbines and significantly higher expenses for the ramp-up of offshore turbines had a negative impact. The restructuring program of the wind subsidiary Siemens Gamesa, which is already running, is now to be reviewed. Siemens Energy plans to present details at a capital market day in November. Siemens Energy Greentech Zeiss
The deficiencies affect certain rotor blades and main bearings of both older and newer land turbines. Only part of the facilities are affected. Siemens Energy put the cost of the repair at 1.6 billion euros on Monday when it presented its quarterly figures, which were booked in the third quarter. In the offshore sector, the company expects higher product costs. This and “further problems” with the ramp-up of activities lead to further charges of 600 million euros.
Wind Energy Problems Rotor blades and main bearings defects
The bottom line is that the loss in the third quarter (as of the end of June) multiplied to 2.9 billion euros, after a minus of 564 million euros in the same quarter of the previous year. The result was additionally burdened by a write-down of 700 million euros on deferred taxes. For the 2022/23 fiscal year (as of the end of September), Siemens Energy now expects a loss after taxes of around 4.5 billion euros, after a minus of 712 million euros euros in the previous year. The operating profit margin should be between minus 8 and minus 10 percent. That’s significantly less than the company had promised before withdrawing its guidance in June. Greentech on the high seas: offshore wind turbines from Siemens Gamesa
Siemens Energy: Focus on renewable energy and green technology
The company also became more cautious when it came to sales. Here, the company is assuming a comparable increase in revenue of nine to eleven percent, after previously forecasting ten to 12 percent. This excludes currency and portfolio effects. At the end of June, the management around CEO Christian Bruch had withdrawn the earnings forecast, which had previously been lowered twice and already provided for a loss of hundreds of millions of euros, due to the problems in the wind business. The share then collapsed by 37 percent within a day. Bruch had to admit that he had not expected the extent of the problems.
Business with gas turbines, energy networks and “Transformation of Industry” is going well
In contrast, the rest of the energy technology business proved to be robust. The operating results increased both in the business with gas turbines, energy networks and in the area of transformation of industry. Sales in the group rose by eight percent to 7.5 billion euros. Incoming orders increased by more than half to 14.9 billion euros.
“Our results for the third quarter show the challenges in the turnaround of Siemens Gamesa,” Bruch commented on the figures. “The strong performance of the other business areas gives me confidence in our company’s ability to make businesses profitable again.”
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Greentech Siemens Energy: Focus on renewable energies
Siemens Energy is a company specialized in providing (green) technologies and solutions in the field of energy generation, transmission and distribution. It is an independent company that emerged from the spin-off of Siemens AG’s energy business.
The green tech specialist Siemens Energy has a wide range of products and services, including in the areas
Energy production: Siemens Energy offers solutions for generating energy from various sources, including fossil fuels such as gas and coal, renewable energies such as wind and solar power, and nuclear power plants.
energy transfer: The company develops technologies for the transmission of electrical energy over long distances. This includes high-voltage direct current (HVDC) transmission and other advanced transmission systems that help improve the efficiency and stability of power grids.
Power distribution: Siemens Energy offers solutions for the distribution of electrical energy in local grids and power supply systems. This includes switchgear, transformers and intelligent distribution systems.
Services and maintenance: The company also provides services for the maintenance, repair and modernization of power plants. This includes helping customers optimize the performance, efficiency and reliability of their assets.
Digitization and automation: Siemens Energy integrates advanced digital technologies into its energy solutions to increase efficiency, optimize energy consumption and reduce operating costs.