October 25, 2020

Siemens Gamesa enters negative in the first quarter and loses 174 million



Siemens Gamesa lost in its first fiscal quarter (October to December 2019) 174 million euros, compared to the 18 million it earned in the same period of 2018, mainly due to material and unpredictable costs of an exceptional nature of 150 million euros. Euros in projects in Europe.

Specifically, these costs correspond to a portfolio of five “onshore” projects (on land), totaling 1.1 gigawatts and located in Northern Europe (mainly in Norway), the company said, which it has revised downwards its forecasts of net operating profit.

The poor state of the routes and the anticipated arrival of the winter weather “have substantially delayed the execution of the projects and negatively impacted the installation window”, according to the preliminary accounts sent by the wind turbine manufacturer to the National Stock Market Commission (CNMV).

“The company is implementing actions to remedy the path of execution of the project portfolio in Northern Europe and does not foresee additional impacts in the execution of said portfolio in future quarters,” the same source added.

The impact of these projects, attributable only to the “onshore” activity, “has put Siemens Gamesa’s preliminary results for the first quarter of 2020 below market expectations. The performance of the activity on” offshore “(sea) and services is in line with the expectations of the company, “according to the company.

Siemens Gamesa closed the quarter with sales of 2,001 million, 12% lower than a year earlier, and with an order entry valued at 4,628 million, 82% higher, reflecting that the commercial activity remains “very solid. “

CHECK YOUR EBIT FORECASTS LOW

On the other hand, due to the aforementioned exceptional costs, Siemens Gamesa has revised downwards its growth forecasts for the year 2020 of the net operating result (EBIT) before PPA -process of purchase price allocation- and integration costs and restructuring.

Thus, if it initially announced an increase of between 5.5 and 7%, it has now lowered it to between 4.5 and 6%.

As for the sales forecast for the year 2020, set at between 10,200 and 10,600 million, the manufacturer emphasizes that the order book covers 98% of the middle part of the guide, 8 percentage points more than at November 5, 2019.

“The guidelines for fiscal year 2020 reflect a year of transition in terms of profitability, but ensuring growth in income, with concentration of activity at the end of the year,” according to the same source.

A document signed by CEO Markus Tacke ensures that, although the financial performance of the first quarter on “onshore” has been lower than expected, “the company’s long-term vision remains intact and Siemens Gamesa continues to demonstrate a solid commercial performance in the three activities that demonstrate the strength of its competitive positioning. “

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