Siemens Energy AG has received a EUR 7.5 billion (USD 8.04 billion) guarantee from the German government. This financial support comes in the wake of the company's recent announcement of a net annual loss of EUR 4.59 billion, overshadowed by underperformance in its wind sector.
The German government's commitment is part of a larger EUR 15 billion guarantee package, with private banks contributing EUR 12 billion and an additional EUR 3 billion sourced from other stakeholders. Siemens Energy's engagement with various stakeholders, including private banks, underscores a collective effort to address challenges and ensure sustained growth in key projects crucial to the energy transition.
Siemens Energy also revealed the sale of 18% of its stake in Siemens Limited, India (SIL) to Siemens AG for approximately EUR 2.1 billion. This move accelerates the ongoing unbundling of Siemens Energy and Siemens AG in the Indian market.
Despite positive performances in most business segments during the fiscal year through September 2023, Siemens Energy faced setbacks in its wind business. To navigate this, the company is actively reviewing the scope of Siemens Gamesa's activities. Further details on this strategic review will be unveiled during the Capital Market Day scheduled for November 21.
Siemens Gamesa, a key player in the wind energy sector, encountered challenges in the 2023 financial year, including quality issues in the onshore business, higher product costs, and ramp-up difficulties in the offshore business. The technical analysis of the quality issues is nearing completion and aligns with earlier findings, with no new provisions made after the third-quarter announcement.
Siemens Gamesa is now projected to achieve break-even in fiscal year 2026. In the fourth quarter, orders experienced slight growth, driven by offshore and service businesses, including a significant order in Taiwan. However, onshore orders declined due to a sales halt prompted by quality issues. The full-year financial report indicates Siemens Energy's profit before special items turning negative at EUR 2.78 billion, compared to a positive EUR 225 million the previous year, leading to a net loss of EUR 4.59 billion, up from EUR 712 million a year ago.
Siemens Energy's engagement with the German government and other stakeholders reflects a proactive approach to address challenges in the wind sector and position itself for future growth in the evolving energy landscape.
