Munich (dpa) – Siemens Energy nearly tripled its profit in the first quarter of its financial year, the German energy technology company said on Wednesday.
In the October-to-December period, Siemens Energy posted net income of €746 million ($889 million) – almost three times as much as in the same period a year earlier.
The result was achieved despite a negative one-off effect related to the sale of its wind-power business in India, which weighed significantly on earnings.
“We have made a very strong start to the financial year,” chief executive Christian Bruch said.
“Sustained high demand in our gas turbines and grid technologies businesses is making a significant contribution to overall performance,” he added. “Also in the wind business, there are early signs of a modest improvement.”
The wind segment, operating under the Siemens Gamesa brand, remains the group’s weakest division. While gas services and grid technologies significantly improved their results and each generated more than €500 million, Siemens Gamesa continued to report a loss.
However, the loss narrowed to €221 million, roughly half the level recorded a year earlier, largely due to the one-off effect. This marks an improvement compared with the heavy losses in previous quarters.
Order intake in the wind business fell by around a third to just under €1.6 billion, leading to a decline in the order backlog. If the trend continues, it could become a concern.
Chief executive Bruch stressed that he was not particularly concerned when asked about the development, however. He noted that order intake fluctuates due to large orders, and capacity utilization at the plants is already booked for the next few years.
At group level, demand remained strong. New orders rose by a third to €17.6 billion, well above revenue, which increased by about one-eighth to €9.7 billion. The order backlog reached another record level of €146 billion.
Bruch noted that new orders are leading to further increases in margins, particularly in the gas sector.
Siemens Energy aims to make its wind business profitable, at least when adjusted for special effects, in the second half of the year following years of woes.
By the end of the year, the company expects overall net profit of between €3 billion and €4 billion.
Source: dpa.com
