Siemens Energy to review wind unit as group slumps to €4.6bn loss

Siemens Energy is reviewing its troubled wind turbine division, the German company confirmed on Wednesday, as it slumped to a near €5bn annual loss.

The clean energy specialist reported revenues in the year to 30 September of €31.1bn, up from €29bn in 2022, while orders rose 32% to €50.4bn.

But net losses widened significantly, to €4.6bn from €712m a year previously.

Siemens said that while 70% of its businesses had performed well during the year, its wind turbine business, Siemens Gamesa, remained a "major challenge".

"Charges for quality issues in the onshore business, increased product costs and ramp-up challenges in the offshore business severely impacted the results…and will continue to impact the group’s profitability in the near term," Siemens warned.

Breakeven in the division - which has been rocked by technical problems at core products as well as surging inflation - is now not expected until the 2026 fiscal year.

However, the firm added while the division was "making progress", to better support its turnaround the scope of its activities would now be reviewed.

Investors welcomed the update, and the Frankfurt-listed stock was trading 5% higher as at 1130 GMT.

Christian Bruch, chief executive, said: "In a year of unprecedented challenges, Siemens Energy showed that turnarounds are achievable, with the businesses excluding wind meeting or exceeding their full-year targets.

"We are also seeing progress in dealing with the issues at Siemens Gamesa, and I am encouraged that the data from the installed onshore turbines confirms our previous findings.

"Our strong balance sheet remains a top priority."

Siemens, which expects to return to group profitability next year, said it would give more updates on the review at its capital markets day later on 21 November.

Earlier this week the German government agreed to provide credit guarantees of €7.5bn to Siemens Energy, while banks lent it €12bn.

The firm had warned that without the extra lending and credit guarantees it would struggle to fulfil its vast order backlog of more than €110bn.

Siemens Energy was spun out of Siemens in 2020.