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Germany

Germany

Senvion revenue falls in 'challenging market environment'

GERMANY: Senvion's revenue dropped 17% year-on-year to €480 million in the third quarter due to a lower intake in the global offshore and Canadian onshore markets.

During the third quarter Senvion installed the first prototype of its 3.6M140 turbine
During the third quarter Senvion installed the first prototype of its 3.6M140 turbine

The manufacturer also reported a 10% fall in revenue to €1.31 billion for the first nine months of 2017 year-on-year, due to a "challenging market environment".

Lower revenue drove down its earnings before interest and tax (EBIT) for the quarter by 31% year-on-year, while its EBIT margin of 7.9% was "in line with Senvion’s expectations", the company said.

Meanwhile, the manufacturer’s order book fell by 5.7% to €1.47 billion due to "realisation of projects" in the third quarter, the company said, while its nine-month intake was still up 51% year-on-year.

The company’s orders decreased in all markets during the quarter, except for in Chile, where it will provide turbines for the 170MW Sarco and 129MW Aurora projects.

Senvion’s operations and maintenance (O&M) services fared better, however, with its backlog inching up 1.1% in the quarter to €2.49 billion and service contracts averaging at 11.1 years, the company stated.

Senvion’s performance for the first nine months of the year was on par the company’s guidance, CEO Jürgen Geissinger said.

"Our year to date order intake has been strong despite worsening industry dynamics.

"As part of our stated strategy, we are working on powerful new product introductions and transforming our entire value chain with visible successes," he added.

Manav Sharma, Senvion’s CFO, said: "We are in the middle of tremendous changes in the wind industry.

"Readjusting electricity prices by up to 50% within the last nine months and the shift to auction systems worldwide can only be tackled with innovative products and further focus on cost outs and efficiency improvements.

"We are seeing the first positive results of our strategy and our efficiency program which we have implemented since the beginning of the year. Improved sourcing will help us to lower our variable costs, while the efficiency measures are contributing to decreasing our fixed costs."

During the third quarter, Senvion installed the first prototype of its 3.6M140, one of its largest onshore turbines, at a test field in northern Germany, and debuted the low-wind 3.7M144 and high-wind 3.6M118.

It also won a service contract for the 18.45MW White Pines project in Canada, a supply deal for the 97.2MW Los Hércules site in Argentina, and a contract to supply and service four Austrian wind farms with a total capacity of 62MW.

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