Siemens Gamesa cuts full-year guidance, flags weak Q3

Wind turbine maker Siemens Gamesa Renewable Energy SA (BME:SGRE) has lowered the guidance for the 2020/2021 fiscal year, citing a sharp increase of raw material prices and high ramp-up costs for the 5.X onshore platform that tainted its third-quarter results.

The company is looking at a EUR-229-million (USD 270.4m) hit in the third quarter, but said the impact is mainly concentrated in the first Siemens Gamesa 5.X projects in Brazil that are due to be delivered in 2022 and 2023.

The rising costs were worsened by the pandemic, especially in countries such as Brazil, where Siemens Gamesa is grappling with supply chain shortfalls and execution related bottlenecks, the turbine maker explained.

Siemens Gamesa warned of a EUR-150-million loss in EBIT before purchase price allocation (PPA) and integration and restructuring (I&R) costs in the third quarter, an item that was very much in the black in the previous quarter.

The preliminary estimate of revenues is around EUR 2.7 billion, which would be up from EUR 2.33 billion in the second quarter ended March 31.

Siemens Gamesa now expects annual revenues to be at the lower end of the EUR-10.2-10.5-billion range, which it announced with the second quarter results. At the time, the upper end of the revenues range was narrowed from EUR 11.2 billion.

Expectations for the EBIT margin pre-PPA and I&R are now adjusted to between -1% and 0% from 3%-5%, communicated previously.

(EUR 1.0 = USD 1.181)

Choose your newsletter by Renewables Now. Join for free!