Wind OEM Siemens Gamesa said a record €23.2bn ($27bn) order backlog shows the strong momentum behind its global business, as revenue fell 24% in the latest quarter on lower sales volume and pricing.
The Spanish-German group’s backlog, which rose 14% year on year, was boosted by €3.3bn of orders in the April-June period, its financial third quarter, thanks to 1.7GW of onshore wind bookings and the blockbuster offshore deal for the 1.368GW Hornsea 2 off the UK, the offshore industry’s largest ever.
But the company saw a 21% decline in revenues in the quarter compared with the same period in 2017, pulling in €2.135bn, impacted by lower sales volume and pricing.
For the nine months ending June, revenues were 25% lower at €6.5bn.
The group's pre-tax profit fell 26% to €156m. Third quarter net profit came in at €44m, up from €12m at the same stage a year ago.
CEO Markus Tacke said: “Our financial performance in the past quarter has been solid, and fully in line with our guidance.
“Our commercial activity was strong, and the backlog demonstrates the confidence of our customers.”
The company said onshore turbine pricing had remained relatively stable for another quarter at €0.7m/MW.
Brazil, Spain and South Africa between them accounted for about two-thirds of onshore orders in the third quarter – which Siemens Gamesa said showed the recovery of three important wind markets.
The company also hailed the strong margins being delivered by its service operation, which is helping to compensate for lower turbine prices.
Tacke said its €2bn cost-reduction programme is beginning to show results and remains essential to its future success.
Siemens Gamesa is expecting a strong end to its financial year in Q4, “driven by project execution timing and cost optimisation programs and expected synergy delivery”.
Tacke said India, where the former Gamesa held a market-leading position before the policy-induced 'freeze' that paralysed the sector last year, remains a key opportunity for the OEM.
Tacke said he expects government auctions to deliver an annual market of 4-6GW. He said Siemens Gamesa has optimised its product offering to reflect the lower PPA prices seen in the auction environment, which have shown signs of levelling out.
A recent auction under-subscription caused by transmission issues was likely a one-off, due to a specific problem that was quickly resolved, he added.
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