Despite well-filled order books, Siemens Energy is struggling with problems in its wind energy subsidiary, leading to a record loss in the young history of the energy technology group. The state has already stepped in and now the company is planning to sell shares.

On Tuesday, the federal government officially took over a guarantee for Siemens Energy, but just a day later, the struggling conglomerate announced a record loss of almost 4.6 billion euros for the past fiscal year. This is by far the biggest deficit since the establishment of the energy technology company. The cause of this development are the problems of the wind turbine subsidiary Siemens Gamesa, which has been struggling with quality defects in onshore wind turbines and start-up difficulties with offshore wind turbines.

Group CEO Christian Bruch emphasized, however, that with the exception of Siemens Gamesa, all business units contributed to solid revenue growth of 9.9 percent and a turnover of 31.1 billion euros. Two-thirds of the businesses are profitable and have met or exceeded their annual targets.

However, the wind energy business presents an exception, where all efforts are focused on cost reduction, selectivity in contracts, and productivity increase, while simultaneously working on problem-solving.

Due to these financial difficulties, the Federal Government plans to provide state support for Siemens Energy in the form of a guarantee line amounting to a total of 15 billion euros, of which 7.5 billion euros will be directly secured by the federal government. The former parent company Siemens, private banks and other stakeholders are also involved in this agreement. In addition, Siemens Energy will sell 18 percent of its shares in the Indian company Siemens Limited to Siemens, which is expected to generate revenue of 2.1 billion euros.

For the ongoing fiscal year 2024, Siemens Energy however, looks forward to more positive times. With planned sales of company shares, the company aims to achieve a profit of one billion euros. The wind power business, however, is expected to also record losses of around two billion euros this year. Only in the fiscal year 2025/26 is the break-even point for Siemens Gamesa supposed to be reached. To achieve this, the corporation relies on a focus on profitable markets and a slower introduction of new products.

Group CEO Bruch also emphasized that the demand for Siemens Energy's products remains high. In the last fiscal year, order intake was around 50 billion euros, representing a rise of one third compared to the previous year. The order backlog also grew by about a seventh to 112 billion euros. Despite current challenges, the company remains on a promising course in terms of its order situation.

It remains to be seen how the situation at Siemens Energy will develop in the future. However, CEO Bruch remains optimistic and is working hard to solve the problems in the wind power division and lead the company onto a profitable path.