Siemens Energy saw a 10.60% rise on Wednesday at the Frankfurt Stock Exchange after the German energy company released encouraging second-quarter results and announced a restructuring of its troubled wind subsidiary, Siemens Gamesa.
After taxes, Siemens Energy earned €108 million from January to March, compared to a loss of €189 million last year.
The second-quarter performance reflects “initial successes in stabilizing the wind sector,” said Christian Bruch, CEO of the company, which had to be rescued by the German government last year with a €15 billion bailout plan.
Revenue of approximately €8.3 billion increased by nearly 4% year-on-year.
However, order intake decreased by 22% on a comparable basis to €9.5 billion, mainly due to the lack of orders at Siemens Gamesa.
The priority is the turnaround of this still-loss-making subsidiary by the end of March, where numerous product failures proved to be very costly to repair and plunged the business into an unprecedented crisis.
For this entity, the loss of €448 million at the end of March is in line with expectations, contrasting with the series of warnings about last year’s results.
“No news is good news, which is a major positive,” noted Philip Buller, an analyst at Berenberg.
The plan announced on Wednesday to turn around Siemens Gamesa’s accounts by 2026 includes, among other things, capacity adjustments and job cuts in onshore wind turbines.
This sector, in crisis for years, will focus in the future on key markets in Europe and the United States.
Siemens Energy also surprised by announcing a change in leadership of its subsidiary: Jochen Eickholt, 62, who has been in place since March 2022, will hand over the reins to Vinod Philip in early August.
The group has also revised its annual targets upwards: sales are expected to increase by 10 to 12% compared to the previous range of 3 to 7%, and the operating margin before exceptional items is expected to range from -1% to +1%, with the previous base scenario being -2%.