Siemens Gamesa in another spin
LONDON, July 15 (Reuters Breakingviews) – Another year, another profit warning from Siemens Gamesa Renewable Energy (SGREN.MC). Shares in the wind-turbine maker plunged 17% on Thursday morning, wiping nearly 3 billion euros off its market value, after it admitted soaring raw material costs might propel it to an operating loss this financial year read more . After a similar goof in 2019, investors can be forgiven for questioning its ability to hit a 10% operating margin target.
Chief Executive Andreas Nauen’s admission is particularly striking given the money pouring into renewable energy and – until recently at least – the sector’s rapidly shrinking costs. His recent complaints about competitive pressures also invite unflattering comparisons. Shares in rival Vestas Wind Systems (VWS.CO), which suffers the same cost pressures, fell 6% on Thursday morning. Yet over the last two years, the Danish company’s shares have outperformed Siemens Gamesa by 23% and at $36 billion, it is now twice as big. Nauen needs to turn things around in more ways than one. (By Ed Cropley)
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Editing by Peter Thal Larsen and Karen Kwok
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