Siemens Gamesa recovery plan

28 November 2023

At its third Capital Market Day in Hamburg, Germany, Siemens Energy presented a strategic outlook for the benefit of analysts and investors. The company’s executive board outlined a path designed to create shareholder value along three priorities: to deliver on profitable growth, to fix the wind business, and maintain a solid financial foundation.

"We are achieving consistent and impressive results in 70% of our businesses. Those results show that our underlying strategic north star to become a leader in the energy transition is right. Our portfolio is excellently positioned, and our record order backlog of €112 billion clearly demonstrates this. As a next step, we will accelerate profitable growth and execute our order backlog with improved margins and operational excellence. The turnaround of Siemens Gamesa remains our highest priority and we now have a defined path and action plan to reach break-even for the wind business in fiscal year 2026 and to return to profitability thereafter,” said Christian Bruch, president and CEO of Siemens Energy.

Siemens Energy’s CFO Maria Ferraro emphasised prudent resource allocation with focused investments geared towards growth or customer requirements. In addition, she re-emphasized the company’s commitment to maintain its investment grade credit profile.?The business areas Gas Services, Grid Technologies, and Transformation of Industry, which account for 70% of Siemens Energy’s revenue, are all said to be on track to achieve or exceed their mid-term targets.

Siemens Energy expects margins of 7-9% for Transformation of Industry (target upgraded), 9-11% for Grid Technologies (target upgraded) and 10-12% for Gas Services (target confirmed) by fiscal year 2026. Investment in the energy transition amounted to US $1.7 trillion in 2023 – highlighting the pace and scale at which clean energy technologies are being deployed. Demand for electricity is set to double between 2022 and 2050. By 2050 there will be six times more installed global capacity on the grid from renewable energy sources. The market is now starting to see traction from governmental decarbonisation investment programmes and supportive regulatory frameworks like the EU Wind Package.

Siemens Gamesa recovery

There is a defined action path and plan for the company’s wind business to break-even in fiscal year 2026, following serous setbacks for Siemens Gamesa, which, says Siemens, have overshadowed the solid performance of the other businesses. Following an action plan is based on simplifying the product portfolio, optimising footprint and operations, and strengthening processes and control, it is anticipated that the wind business will be fixed within 2 to 3 years.

Siemens Gamesa will be focusing its onshore business based on specific criteria, such as supportive regulations and policies and, sizeable profit pools resulting in an optimised footprint. In offshore, Siemens Gamesa is ramping up production capacity at existing factories to meet customer demand and work through the order backlog. It expects to achieve break-even by fiscal year 2026, followed by profitable growth.

Linkedin Linkedin   
Privacy Policy
We have updated our privacy policy. In the latest update it explains what cookies are and how we use them on our site. To learn more about cookies and their benefits, please view our privacy policy. Please be aware that parts of this site will not function correctly if you disable cookies. By continuing to use this site, you consent to our use of cookies in accordance with our privacy policy unless you have disabled them.