Siemens Energy has revised its fiscal 2023 outlook due to significant challenges faced by its wind-turbine business, which will result in a cost of €2.2 billion ($2.4 billion). The German energy company now anticipates a net loss of approximately €4.5 billion for the fiscal year, with a profit margin before special items expected to range between -10% and -8%. Despite this setback, comparable revenue growth is projected to be between 9% and 11%. Additionally, free cash flow before tax is estimated to reach a negative low triple-digit million amount.
Challenges at Siemens Gamesa
Siemens Gamesa attributes a majority of the challenges faced by its wind-turbine business to quality issues within the 4.X and 5.X onshore platforms, resulting in expenses amounting to €1.6 billion. Furthermore, increased product costs and difficulties in the offshore business have led to additional charges of €600 million. These obstacles have contributed to Siemens Energy’s quarterly net loss of €2.93 billion in the period ending June 30, compared to a loss of €564 million in the previous year. The loss before special items during this period was €2.05 billion, primarily driven by charges incurred at Siemens Gamesa.
Positive Revenue and Order Growth
In spite of the setbacks, Siemens Energy experienced a rise in revenue from €7.28 billion to €7.51 billion in the third quarter. Moreover, the company witnessed a significant increase in orders, which climbed from €9.84 billion to €14.89 billion, primarily due to higher volumes stemming from large orders.
