Spain

Spain

SGRE meets guidance for financial year - updated

Siemens Gamesa Renewable Energy (SGRE) recorded revenue of €10.23 billion across its full financial year, meeting its €10-11 billion target for 2019. But a new round of job cuts is on the way.

Siemens Gamesa's order intake for its 2019 financial year amounted to €10 billion
Siemens Gamesa's order intake for its 2019 financial year amounted to €10 billion

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SGRE, which runs its financial year October to September, saw revenues in all segments grow.

Its service division, particularly, witnessed a 17% growth in revenue compared to the previous year totalling €1.49 billion.

Its turbine business also saw an 11.3% rise in revenue, coming in at €8.73 billion.

Onshore wind turbine sales for the fourth quarter amounted to €2.24 billion (worth 3.15GW), 13% up year on year and 9% higher than its previous quarterly record set in the first quarter of 2014.

Overall onshore wind order intake was 9.4GW.

Meanwhile offshore wind turbines sales amounted to €3.1 billion up 11% year on year.

The OEM said this was boosted by "the successful move into new markets, and specifically Taiwan". SGRE won 1.5GW of orders in Taiwan during Q3.

Job cuts

SGRE said it plans to reduce its global workforce by around 600 in a series of "structural changes" it order to maintain its competitiveness.

The next round of job cuts, which could affect workers across the worldwide business, is in addition to the 600 jobs lost in Denmark that the company announced in late September.

SGRE CEO Markus Tacke explained the Danish job losses were the result of an adjustment in demand, affecting a number of blade manufacturing roles.

The latest round of redundancies will be to adjust structural costs, Tacke said, affecting roles in the "corporate" side of the business and to "streamline" its set up.

Consolidation

Tacke also said the company was in a position to be an "active" player in the ongoing market consolidation.

The company reported net cash of €863 million, which CFO David Mesonero said was high for the market.

Citing the recent example of acquiring selected European assets from defunct manufacturer Senvion, Tacke said the company was always on the look out for opportunities.

Within its financial report, SGRE predicted industry consolidation to result in four global manufacturers for the onshore industry (excluding the insular Chinese market and its players), and three in the offshore wind sector.

"This consolidation is essential to avoid the development of irrational pricing strategies," SGRE said.

Pricing

Globally, SGRE has seen the average selling price (ASP) of its onshore wind turbine to stabilise, since the dramatic fall in 2018 caused by the introduction of auction systems.

SGRE’s ASP for onshore wind turbines across the year was level with 2018 at €730,000/MW.

In Q4, ASP was lower at €712,000/MW. SGRE said the lower amount in the final quarter "reflects the impact of the geographical mix with a higher contribution from China, that excludes towers from the project scope".

SGRE said price decline was less than 5% "in line with the historical price decline associated with productivity improvements".

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