Wind turbine maker Siemens Gamesa reports big Q1 loss and cuts guidance

Siemens Gamesa Renewable Energy (SGRE) has forecast a triple-figure million euro loss for the first quarter of its financial year and downgraded its guidance for the full fiscal year in its preliminary results.

It cited supply chain challenges, market volatility and difficulties in ramping up production for its 5.X onshore turbine platform.

The turbine maker reported a loss of €309 million (Ebit, excluding the effect of integration, restructuring and price purchase allocation) in the quarter, which ran from the start of October 2021 to the end of December 2021.

It also lowered its expectations for its 2022 financial year (1 October-30 September).

Siemens Gamesa expects revenue to be down by 2-9% from the previous financial year. It had previously forecast a 2-7% revenue decline.

The turbine manufacturer also forecast Ebit margin (excluding the effect of integration, restructuring and price purchase allocation) of between -4% and 1%. It had previously forecast a range of 1-4%.

Volatile market

Siemens Gamesa stated that it is facing supply chain-related disruptions that are now expected to last longer than previously anticipated. These will be exacerbated by the continued impact of the Covid-19 pandemic. These challenges have caused cost inflation, the manufacturer noted.

Market volatility has impacted some of its customers’ investment decisions and so caused delays to some projects, the turbine maker stated.

The European turbine giant is also facing ramp-up challenges with its onshore 5.X platform, including some “necessary design changes”, it added. These have affected its production and project execution schedule, exacerbated by the existing bottlenecks in the supply chain, the company stated.

Looking ahead, Siemens Gamesa expects stronger activity levels in its offshore and service businesses, while it continues to turn around its onshore business, it stated.

The company added that it will continue to work on cost optimisation schemes and mitigating increases in logistics and supply chain costs.

Siemens Gamesa is also considering selling its wind farm development pipeline in southern Europe.