Siemens Energy shares slumped as much as 36% on Thursday after the company said it was seeking German government guarantees, as the company’s wind turbine business is still grappling with quality issues.
Siemens Energy said the wind business Siemens Gamesa “is working through the quality issues and is addressing the offshore ramp up challenges as announced in the third quarter communication for fiscal year 2023. As Siemens Gamesa is for the time being not concluding new contracts for certain onshore platforms and is applying strict selectivity in the offshore business, order intake and revenue are expected to be lower than market expectations for fiscal year 2024, and net losses and cash outflow are expected to be higher than market forecasts.”
It confirmed reports it was seeking government guarantees. “The strong growth in order intake, particularly in the former gas and bower business areas, leads to a rising need of guarantees for long-term projects. Considering this requirement, the executive board is evaluating various measures to strengthen the balance sheet of Siemens Energy and is in preliminary talks with different stakeholders, including banking partners and the German government, to ensure access to an increasing volume of guarantees necessary to facilitate the anticipated strong growth.”
German magazine Spiegel first reported on the talks.