Testing times for big six wind industry manufacturers

WORLDWIDE: Revenues in the wind industry slumped by almost a quarter in the space of a year, according to earnings figures from six leading firms.

Analysis by Windpower Monthly of the latest results published by turbine suppliers Vestas, Nordex, Gamesa, Suzlon and Siemens, along with gearbox manufacturer Hansen, reveals a collective drop in revenues from EUR8.77 billion between January and June (H1) 2009 to EUR6.59 billion in the same period in 2010 - a decline of 23.9%.

To allow for the differences in fiscal years between companies, this analysis considers the calendar half-year January to June to be H1.

A survey of bottom-line results reveals a similar picture: in H1 2009, Vestas, Nordex, Gamesa, Suzlon and Siemens achieved an overall net profit of EUR348.4 million; in the first six months of this year the same firms reported a collective net loss of EUR124.4 million. Hansen declined to reveal its H1 2010 net profit/loss figure.

For more:
Vestas losses hit share price hard
Gamesa cuts sales forecast for 2010
Suzlon sees slump in order book
Nordex increases profitability
Siemens posts impressive results
Hansen sales fall by more than a quarter

The figures came in as the global economy struggled to ignite in the aftermath of the credit crisis. After rallying in the spring, equity markets fell back amid downgraded GDP growth forecasts for the US and the UK, renewed fear of deflation, persistent concerns over sovereign debt in the eurozone, and declining optimism for the prospects of China. Hopes for a sustained rally proved short-lived as most investors opted instead for a wait-and-see approach.

Major players such as Vestas, Gamesa and Suzlon bore the brunt of the losses, all reporting major declines in both revenues and profits. Vestas and Gamesa responded by revising their 2010 sales projections downward.

However, the gloom was not all-pervading. Siemens reported substantial increases in both profits and revenues on the back of a bumper increase in orders in Q2 2010. As a result, its share of the collective revenues of the six firms surveyed increased from 18% in H1 2009 to 27.5% in H1 2010 - catapulting it from the fourth-biggest revenue-taker in H1 2009 to the biggest revenue-taker in the first six months of this year.