Siemens Energy falls by 33%. The “Green Panic” begins
Shares of Siemens Energy in Germany fell on Thursday after the company warned that its wind turbine business is grappling with quality issues and offshore growth challenges. The company said it is evaluating various measures to strengthen its balance sheet and is discussing state guarantees with the German government. This comes as a financial crisis is brewing in the offshore wind energy sector.
Siemens Energy said wind company Siemens Gamesa “is working on quality issues and addressing offshore growth challenges as announced in its third quarter disclosure for fiscal 2023.” We have already written previously about the problems of Siemens Games.
“As Siemens Gamesa currently does not conclude new contracts for some onshore platforms and applies strict selectivity in the offshore business, orders received and revenues are expected to be lower than market expectations for fiscal 2024, as are net losses and cash outflows are expected to be higher than market forecasts,” the note continues.
The German company said: “The executive board is evaluating various measures to strengthen Siemens Energy's balance sheet and is in preliminary discussions with several interested parties, including banking partners and the German government, to ensure access to an increasing volume of necessary guarantees to facilitate the expected strong growth.”
Siemens Energy shares plunged as much as 37% in Germany before rebounding slightly
The offshore wind energy sector is under the joint fire of two intersecting phenomena: on the one hand the growth in production costs, linked to excessive demand compared to the availability of resources, and on the other the increase in interest rates which made obtaining financial resources more expensive.
Two months ago, Orsted A/S, the world's largest offshore wind farm developer, saw shares plummet in Copenhagen after warning: "The situation in offshore wind in the United States is serious." The stress revolves around inflation, high interest rates and supply chain issues, which have led the company to consider abandoning offshore projects in the United States:
“We are still advocating a real option to leave,” Orsted CEO Mads Nipper told Bloomberg in an interview in London in early September.
It's not just the wind that's in trouble. Last week, solar equipment maker SolarEdge Technologies saw its shares plunge as much as 30% due to falling European demand.
The “Green Bubble” is bursting, and now the period of “Green Panic” begins…
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The article Siemens Energy collapses by 33%. Inziia the “Green Panic” comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/siemens-energy-crolla-del-33-inziia-il-panico-verde/ on Fri, 27 Oct 2023 06:00:18 +0000.