Monday, August 7, 2023

"Siemens Energy Sees €4.5 Billion Hit, Wind Losses Prompt Review"

The numbers get much larger but fortunately for the sector this is over and above the problems hitting the whole industry from manufacturers to wind farm operators:
"There Is A Financial Crisis Brewing In Offshore Wind Energy"

From Bloomberg via Yahoo Finance, August 7:

Siemens Energy AG launched a strategic review of its wind power business as problems with its turbines are expected to cause a €4.5 billion ($5 billion) net loss in one of industrial Germany’s biggest debacles.

The worsening outlook, which compares with a previous roughly €1 billion net loss prediction, marks the latest setback for the German manufacturer in getting to grips with quality flaws and unprofitable contracts weighing on its wind unit. Siemens Energy’s other businesses are performing well and the company has strong cash reserves.

The quality issues, which can occur in onshore turbines at some rotor blades and main bearings across two platforms, are unlikely to happen again in the same magnitude, Jochen Eickholt, who heads the Siemens Gamesa Renewable Energy wind unit, said Monday on a call.

The problems center on the discovery that a main piece on the frame of a wind turbine can move or twist over time, potentially damaging other critical components, people familiar with the matter have said.

Shares in the company, where former parent Siemens AG still holds a 32% stake, were volatile Monday, falling 4.5% at 1:30 p.m. in Frankfurt following earlier gains and losses. The moves may indicate some short covering with the company one of the most shorted stocks in Europe.

The manufacturer has been lurching from one crisis to the next in a long line of attempts to get a grip on its Spanish unit that’s been loss-making for years with few comparable missteps in Germany’s industrial sector. Steelmaker Thyssenkrupp AG in 2013 sold steel operations in the US that caused several consecutive annual losses, while Daimler AG dumped Chrysler at a fraction of its original $35 billion price tag....


It is very charitable on Bloomberg's part to not mention Bayer - Monsanto.