Siemens Energy is set to shake up its struggling wind business Siemens Gamesa, which has contributed to the group’s €4.6bn annual net loss, with the goal of making the division profitable.
Frankfurt-listed shares in Siemens Energy were up 5.50% and are trading at €10.73 at the time of writing.
Revenue for the fourth quarter declined 2.5% to €8.5bn due to problems at Siemens Gamesa.
The group has a €112bn backlog in orders, although new orders declined in the fourth quarter.
“In a year of unprecedented challenges for Siemens Energy, two-thirds of our businesses are on a profitable growth trajectory, meeting or exceeding their full-year targets. For our underperforming wind business all eyes must be on cost-out, selectivity and acceleration of productivity while continuously working on the remediation,” says Christian Bruch, President and CEO of Siemens Energy AG.
“The current high demand for our products also brings challenges. We are therefore very glad that after very constructive discussions, we have now found a good solution with all parties to secure our energy transition-accelerated growth.”
Wind power businesses have come under increased scrutiny in recent times after Orsted scrapped major plans for offshore US wind facilities.
Siemens Energy had to set aside €1.6bn in provisions for faulty wind plants earlier this year but made no further provisions in today’s release.