When presenting the nine-month figures (as of the end of June), Group CEO Christian Bruch confirmed the forecast, according to which the adjusted operating margin (based on the adjusted EBITA) in the group should be positive at around plus 2 percent.
The bottom line, however, will be a higher deficit than the 560 million euros from the previous year, which Bruch recently announced for the current year. Charges for a restructuring of Gas and Power’s Russia business, which the company has initiated, will now add to the net loss, the release said. So far, around 200 million euros have been booked. According to the company, however, no significant additional burdens are to be expected.
In the past third quarter, Siemens Energy therefore posted a net loss of 533 million euros after a minus of 307 million in the previous year. The adjusted EBITA adjusted for special effects – the company’s main operational control parameter – slipped in view of the poor figures from Siemens Gamesa, which had been announced last week, from plus 54 million euros in the previous year into the red and amounted to minus 131 million Euro.
Gas and Power managed to keep the operating result adjusted for the Russia restructuring at EUR 212 (previous year: 225) million almost at the previous year’s level. “Our gas and power business delivered again in the past quarter and thus demonstrated its resilience,” said CEO Christian Bruch. A new organizational structure aims to shorten decision-making processes and simplify structures. The course for this was recently set.
At EUR 7.28 billion, group sales were slightly up on the previous year thanks to momentum from the currency side. On a comparable basis, however, revenue fell by 4.7 percent. For the year as a whole, they are expected to continue to decline by around 2 percent on a comparable basis.
In new business, the Group benefited from major orders in both areas. The order backlog reached a new record level of EUR 93.4 billion.
Siemens Energy sees itself on schedule with the Gamesa takeover
In the process of completely taking over the wind power subsidiary Siemens Gamesa, the parent company Siemens Energy sees itself on schedule. CFO Maria Ferraro said in a telephone press conference that the Spanish stock market regulator CNMV had received cash collateral amounting to 1.15 billion euros. This sum corresponds to the cash share that Siemens Energy will provide for the outstanding 33 percent in Siemens Gamesa as part of the takeover, which is worth a maximum of EUR 4 billion. The remainder is to be financed by new treasury shares or other equity instruments.
Ferraro said approval from the CNMV is expected within a few weeks. The approximately one-month period for tendering the Gamesa shares then begins. With an acceptance rate of at least 75 percent, an extraordinary general meeting of the Spanish subsidiary in November is to decide on the delisting in Madrid. Ferraro wants the entire transaction to be completed by the end of December. At EUR 18.05 per Siemens Gamesa share, the takeover offer is above the current price of EUR 17.93.
Jefferies leaves Siemens Energy on ‘buy’ – target 22 euros
According to the quarterly figures, the analysis firm Jefferies has left Siemens Energy on “buy” with a target price of EUR 22. The energy group can show a surprisingly strong order development and a high cash inflow (FCF), wrote analyst Simon Toennessen in a study available on Monday. Although the operating result (Ebita) suffered from considerable restructuring costs in connection with Russia, adjusted for this it is also above expectations.
Turbine for Nord Stream 1 still in Germany
The gas turbine expected by Russia for the Nord Stream 1 gas pipeline has not yet been delivered to Russia, according to Siemens Energy, the group responsible for maintenance.
“The discussions with the Russian customer are ongoing,” said CEO Christian Bruch in a conference call with journalists on Monday. “The turbine is still in Germany. There are still discussions as to whether it can be shipped.” Russia has cut back its gas supplies to Germany through the Nord Stream 1 pipeline, citing the lack of a turbine as the reason. The Federal Government considers this to be a pretense.
This is how the Siemens Energy Akite reacts
According to detailed quarterly figures, Siemens Energy shares temporarily increased on Monday, but then gave back their gains. Despite praise from numerous analysts, the papers in XETRA trading closed 1.03 percent weaker at EUR 16.37.
Analysts such as those from JPMorgan, Deutsche Bank or Berenberg unanimously praised the energy group’s strong gas and electricity business and the overall operational fiscal year targets for 2021/22 that were maintained.
In view of the effects of the Ukraine war and the profit warning from the subsidiary Siemens Gamesa last week, Siemens Energy’s third quarter was somewhat bumpy, wrote Berenberg analyst Philip Buller. In contrast, the development of the Gas & Electricity division, which accounts for two-thirds of sales, was fundamentally solid. Buller emphasized that it was also a positive surprise that, despite the warning from Siemens Gamesa, the operating forecasts for the year as a whole remained unchanged. This indicates that the gas and electricity business is doing better than expected and the forecasts are conservative in some respects. He had therefore expected price gains for the share.
Analyst Gael de-Bray of Deutsche Bank also praised the strong gas & power business and the maintained operational outlook. The analysts put their main focus on these two details, since everything else was more or less already known because of the preliminary report and the profit warning from Siemens Gamesa. The expert considers it encouraging that Siemens Energy still intends to reach the lower end of the forecast range for comparable sales development and the adjusted operating profit margin before special items, despite the lowered forecast for the wind turbine subsidiary. In addition, the group assumes that the free cash flow before taxes will be in the range of a positive mid three-digit million amount.
Simon Toennessen from the analyst firm Jefferies also praised the free cash flow and also referred to the surprisingly strong order development. The operating result (EBITA), he added, had suffered from significant restructuring costs in connection with Russia – but adjusted for this it was also above expectations.
Last but not least, analyst Akash Gupta from JPMorgan was very positive. He also praised the development of the oil and gas segment in the third business quarter and that the group had exceeded the average analysts’ estimates in terms of orders and the operating result adjusted for special factors. He also remarked somewhat critically that the restructuring costs in connection with Russia and the disappointing figures from Siemens Gamesa had led to an unexpectedly significant consolidated quarterly loss.
FRANKFURT (Dow Jones) / NEW YORK (dpa-AFX Broker) / Düsseldorf (Reuters) / FRANKFURT (dpa-AFX)
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