Siemens Gamesa has revealed a record order intake after completing a “challenging” 2020, with Ƶ-led offshore wind energy momentum growing.
The Hull blade plant owner and turbine supplier to huge Orsted projects off the Humber revealed a total of £13.2 billion of new orders have been received, while it works through a £27.2 billion backlog, with a 9.3GW pipeline ahead.
Global revenues were down 7.3 per cent from £9.2 billion to £8.5 billion, with Covid-19’s impact assessed at 2 per cent, in the results to September 30.
It has reported a loss of £829 million, with integration and restructuring costs of £417m hitting the bottom line.
A slowdown in the Indian onshore market and overruns of project execution in Northern Europe have also contributed.
However, the strong liquidity position has been stressed with a £4.2 billion pot outlined and the increasing commitment to Net Zero in 2050 swelling the opportunity.
New chief executive Andreas Nauen, who was appointed in June, aims to turn the onshore business around, while maintaining profitable growth in the offshore and service businesses. He said: “Siemens Gamesa has started the new fiscal year with strong foundations to return the company to sustainable profitability,” he said. “Measures underway will improve performance and enhance our strengths, positioning us for leadership in a wind energy industry that has a very bright future leading the fight against climate change.”
He told how despite the impact of the pandemic, the transition towards less-polluting energy remains on the agenda and there are growing calls for the post-Covid-19 recovery to be underpinned by actions driving a “green economy”.
It has been witnessed most in the Ƶ, where installation targets were lifted by Prime Minister Boris Johnson as a recovery aid to “build back better”. This, and a £160 million funding pot for ports and factories was welcomed by Andy Sykes, plant director in Hull, last month.
The Humber was flagged as an area to benefit most, with Siemens Gamesa the only at-scale manufacturer in the world-leading generation cluster. It is also the only location outside of its Spanish, German and Danish heritage nations in Europe.
Attaining the Net Zero objective worldwide will require wind installations to rise from 60 GW to 280 GW per year by 2030, according to the International Energy Agency.
Mr Nauen said Siemens Gamesa’s results “show a resilient company with solid foundations for achieving growth and capturing the full potential of wind power”.
“The company remains the undisputed leader in the offshore segment, having doubled order intake year-on-year to 4.1 GW,” he said, adding “good performance is supported by technology leadership”.
Service, another key feature in the Humber, with technicians attached to wind farm owners Orsted’s world-leading arrays, now accounts for one-half of the company’s total backlog.
Siemens Gamesa has a 70 per cent retention rate and the average contract duration is eight to nine years.
Looking ahead, Mr Nauen said the company expects to be on par or ahead of 2019’s £9.2 billion revenues in 2021, with “faster-than-market growth” through to 2023. Operational earnings are anticipated at between 3 per cent and 5 per cent in 2021, reaching a margin of between 8 per cent and 10 per cent in 2023.
- All financial figures converted from Euros using the latest Morningstar exchange rates.
