Siemens Gamesa, the troubled wind turbine manufacturer, announced preliminary first quarter results on Thursday evening, revealing a €472 million charge to cover unexpected costs associated with turbine component failures. This pushed the company's losses for the quarter to a staggering €760 million.
According to the company, the charges were a result of an evaluation of its installed fleet, during which it “detected a negative development of failure rates in specific components resulting in expected higher warranty and service maintenance costs than previously estimated.” CEO Jochen Eickholt stated that the issue affects both offshore and onshore turbines and a range of components.
The charge resulted in an EBIT loss pre PPA and I&R costs of €760 million for the last three months, adding to several quarters of losses. Siemens Gamesa's majority shareholder, Siemens Energy, also reported a €384 million loss as a result of the charges. Management at the turbine company no longer expect profitability for fiscal year 2023 to be in line with their business plan.
Despite the losses, the company reported revenue of around €2 billion for the quarter and new orders of €1.6 billion. Additionally, the company stated that its “Mistral turnaround program is making progress towards the stabilization of the business and return to profitability.” Specifically, it highlighted progress made on the Siemens Gamesa 5X platform with manufacturing and installation levels ahead of plan in the first quarter, as well as improved terms and conditions on new order intake.
