Siemens Gamesa described the third quarter of the 2021 financial year as “challenging”, as the company made a reported operating loss of €238m.
However, the loss was not as great as the €472m posted between April and June last year.
Reported net loss attributable to shareholders was €314m, compared with a deficit of €446m in the same period of 2020.
The company said its performance in the third quarter reflected the impact on backlog profitability of rising commodity prices and higher-than-expected ramp-up costs for the 5.X platform.
“That impact – exacerbated by the pandemic, especially in Brazil – resulted in a provision for onerous contracts related to projects to be executed in FY22 and FY23,” it added.
Siemens Gamesa said that it started to introduce clauses into its onshore contracts to protect against commodity price volatility, mainly in steel towers.
In addition to such mechanisms, the company said it continues to incorporate cost inflation into contract pricing and to ensure the necessary procurements to execute its backlog in FY22.
Siemens Gamesa chief executive Andreas Nauen (pictured) said: “We are operating in what is currently a very difficult environment and have taken additional steps to balance our risk profile as we focus on delivering long-term sustainable profitability.
“Despite current challenges, the company is soundly placed to take advantage of the huge potential of wind energy, which is reflected in our strong order backlog.
“Our industry has bright prospects ahead, supported by a growing political and public commitment to fighting climate change by moving to a zero carbon emission future.”
Revenue rose in the quarter to over €2.70bn, up from €2.41bn and the company said its backlog was worth €32.6bn, up 3% on last year.
“This order book evidences the company is well placed to capture the potential of the wind industry, driven by an increase in decarbonization commitments and the role of renewable energy in economic recovery programmes,” Siemens Gamesa said.
The company confirmed its adjusted its guidance for financial year 2021 with an EBIT margin pre-PPA and before integration and restructuring costs in the range of -1% to 0%, and group revenue expected to be at the low end of the €10.2bn to €10.5bn range announced during the presentation of results for the second quarter.
Siemens Gamesa order intake amounted to €1520m in the third quarter, reflecting the volatility of the offshore market, as orders for both offshore turbines and service were heavily concentrated in the second quarter of the year, it said.
The onshore business unit ended the quarter with €840m in new orders, down 4% on last year.
However, in volume terms onshore orders were up 13% at 1352MW.
The company said this reflected the strong impact of the pandemic the previous year.
Onshore order intake in the last 12 months amounted to 8538MW, worth €5538m.
Even though commercial activity for the Siemens Gamesa 5.X platform was stepped down in the quarter, new platforms with a capacity of 4MW or higher accounted for 67% of new orders.
Siemens Gamesa has signed 2.7GW for the Siemens Gamesa 5.X platform since its launch.
Offshore order intake in the quarter stood at €146m, reflecting standard volatile offshore market dynamics.
Offshore order intake in the last 12 months amounted to €3259m.
The order backlog in the offshore market is 7.3GW, with a pipeline of 7.8GW.
The offshore market’s volatility also affected order intake in service, which achieved orders worth €534m in the quarter.
Service order intake in the last 12 months amounted to €3068m.
At the end of June 2021, Service, accounted for 50% of the backlog (€16,238m), having increased by 7% year-on-year.