Siemens Gamesa thwart Siemens Energy's profit plans

Again problems with the Spanish wind power subsidiary Siemens Gamesa thwart Siemens Energy's profit plans. Because the wind turbine manufacturer has to reckon with operating red numbers in the current 2020/21 financial year (end of September), the parent company will not achieve its return target. The operating return on sales before special items will probably be below the targeted range of three to five percent in 2020/21, admitted the energy technology group. As planned, sales should increase by three to eight percent; Siemens Energy had already made cuts in this area three months ago. Siemens Gamesa is plagued by high raw material prices and difficulties in ramping up the new generation of onshore wind turbines, 5.X. In Brazil in particular, the corona pandemic is causing supply and execution problems that are driving up costs. The subsidiary of Siemens Energy therefore had to lower the expectations for the return on sales before taxes and interest (EBIT) - already adjusted for special effects - to zero to minus one percent. So far, Siemens Gamesa had assumed a positive EBIT margin of three to five percent. Siemens Gamesa is writing off 229 million euros on unprofitable projects such as in Brazil. In the previous year, the Siemens Energy subsidiary had also been in the red with a return of minus 2.5 percent. Siemens Gamesa's sales will be at the lower end of the forecast range of 10.2 to 10.5 billion euros in 2020/21. Siemens Gamesa had already revised its sales expectations downwards three months ago. In the third quarter, sales were 2.7 billion euros and the adjusted EBIT was minus 150 million euros. In view of these figures, Siemens Energy will not meet the analysts' expectations in the third quarter, the German mother warned.