After rescue deal, Siemens Energy unveils massive loss

Siemens Energy reported a 4.59-billion-euro ($5-billion) annual loss Wednesday, dragged down by a crisis in its wind power unit, a day after a government-backed rescue package was unveiled for the German group.

The huge loss in the 2022-2023 financial year for the company, whose operations range from building wind turbines to power grids, was far larger than a loss of several hundred million euros the year before.

While large parts of its business, such as those related to gas and power grids, were healthy, the results were hit by the crisis in its Gamesa wind power subsidiary.

Gamesa has faced long-running technical problems with its onshore wind turbines, which have cost huge sums to fix.

"The wind business remains a major challenge and has led to the net loss in 2023," said the company, admitting it had suffered a "serious setback" in the previous year.

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The group's performance in the "near to mid-term" would continue to be impacted, and Gamesa is only expected to break even in financial year 2026.

Siemens Energy runs its financial year from October to September, and the annual results were announced a day after a 15-billion-euro, state-backed rescue deal was unveiled after weeks of talks.

The deal involves providing "guarantees" to Siemens Energy to allow it continue financing major long-term projects.

The economy ministry announced it would grant the company 7.5 billion euros worth of guarantees, and others involved included private banks as well as the larger Siemens conglomerate, which is a major shareholder in Siemens Energy.

Siemens Energy was spun out of Siemens in 2020.

Source: AFP