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Siemens Energy warns no quick fix for Siemens Gamesa wind turbines

Reuters|Christoph Steitz and Tom Käckenhoff|February 9, 2022
GermanyEuropeGeneral
  • Turnaround will be more than months -Siemens Energy CEO
  • Siemens Energy reports Q1 net loss of 240 million euros
  • Full integration of Siemens Gamesa must create value -CEO
  • Siemens Energy CEO: will keep supporting Siemens Gamesa
  • Siemens Energy shares up 2.5%, Siemens Gamesa up 4.1%

FRANKFURT/DUESSELDORF, Germany - Turning around Siemens Gamesa (SGREN.MC) will take time, the CEO of its majority shareholder Siemens Energy (ENR1n.DE) said on Wednesday, adding that the latest profit warning from the wind turbine maker was "frustrating".

Siemens Gamesa, the world's largest maker of offshore wind turbines, is suffering from supply chain issues that have hit several industries as well as problems with its new 5X onshore turbine, prompting three profit warnings in nine months.

"In the current market environment the solution to the problem cannot be achieved in a few months," Chief Executive Christian Bruch told reporters after Siemens Energy reported a 240 million euro ($274 million) first-quarter net loss, compared with a ... more [truncated due to possible copyright]

     
  • Turnaround will be more than months -Siemens Energy CEO
  • Siemens Energy reports Q1 net loss of 240 million euros
  • Full integration of Siemens Gamesa must create value -CEO
  • Siemens Energy CEO: will keep supporting Siemens Gamesa
  • Siemens Energy shares up 2.5%, Siemens Gamesa up 4.1%

FRANKFURT/DUESSELDORF, Germany - Turning around Siemens Gamesa (SGREN.MC) will take time, the CEO of its majority shareholder Siemens Energy (ENR1n.DE) said on Wednesday, adding that the latest profit warning from the wind turbine maker was "frustrating".

Siemens Gamesa, the world's largest maker of offshore wind turbines, is suffering from supply chain issues that have hit several industries as well as problems with its new 5X onshore turbine, prompting three profit warnings in nine months.

"In the current market environment the solution to the problem cannot be achieved in a few months," Chief Executive Christian Bruch told reporters after Siemens Energy reported a 240 million euro ($274 million) first-quarter net loss, compared with a profit of 99 million euros in the year-earlier period.

Bruch's comments highlight the ongoing challenges posed by Siemens Gamesa, in which Siemens Energy owns 67% after a spin-off from former parent Siemens (SIEGn.DE), an ownership structure that has raised concerns due to limited influence.

"What I want to see above all is a steady improvement," Bruch said, adding that successfully introducing the new generation of turbine would take several quarters.

Sources told Reuters last month that Siemens Energy was stepping up efforts to buy the remainder of Siemens Gamesa, which analysts say would give the level of control it needs to speed up the turnaround.

Bruch side-stepped questions on whether a full integration was on the cards, saying that while such a step would have to create value for shareholders it would make sense addressing the needs of customers who demand a full range of products.

He declined to comment when asked whether Siemens Energy was currently planning to buy out Siemens Gamesa's minority shareholders.

Shares in Siemens Energy rose as much as 2.5% after the comments, while Siemens Gamesa's stock gained up to 4.1%.

The 33% of Siemens Gamesa which Siemens Energy does not own is currently worth about 3.8 billion euros.

CEO CHANGE

Siemens Energy released most of its quarterly results last month when it was forced to cut its guidance shortly after Siemens Gamesa slashed its targets, triggering the replacement of its CEO after 18 months in the job. read more

Bruch said Siemens Energy would continue to support turnaround efforts at Siemens Gamesa despite "a difficult market environment".

To accelerate the turnaround, Siemens Energy board member Jochen Eickholt will take over as Siemens Gamesa's CEO next month, in the latest sign that the German parent group aims to exert more influence. read more

Eickholt, a Siemens veteran who will leave Siemens Energy's management board as a result of the move, will be replaced by Karim Amin, who is executive vice president of Siemens Energy's generation division.


Source:https://www.reuters.com/busin…

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