Siemens Energy reports preliminary Q1 results, adjusts FY23 outlook

Siemens Energy announces preliminary first quarter results of fiscal year 2023, including order intake of EUR 12.727B (consensus EUR 9.453B); revenue of EUR 7.064B (consensus: EUR 6.644B); Profit: neg. EUR 384M (consensus: neg. EUR 32M, reflecting a margin of neg.5.4% (consensus: neg. 0.5%); Profit before Special Items: neg. EUR 282M (consensus: EUR 53M), reflecting a margin of neg. 4.0% (consensus: 0.8%); Free cash flow pre tax: neg. EUR 58M. The company stated: "During the first quarter of fiscal year 2023 Siemens Energy delivered strong order and revenue growth and better than expected cash flow. However, a strong underlying operational profit improvement at Gas Services, Grid Technologies, and Transformation of Industry was more than offset by charges at Siemens Gamesa Renewable Energy, S.A. These charges were triggered by an evaluation of the failure rate of the installed fleet, during which Siemens Gamesa detected a negative development of failure rates in specific components resulting in higher warranty and service maintenance costs than previously estimated… Siemens Energy management continues to expect for Siemens Energy comparable revenue growth (excluding currency translation and portfolio effects) in fiscal year 2023 in a range of 3% to 7% (unchanged). Siemens Gamesa management no longer expects Siemens Gamesa’s profitability to be in line with its business plan for fiscal year 2023, due to the charges mentioned above. Therefore, Siemens Energy management now expects Siemens Energy’s profit margin before special items in a range of 1% to 3% (before 2% to 4%). Because of the reasons mentioned above Siemens Energy management expects a Net loss on prior year’s reported level (compared to a sharp reduction before). Siemens Energy management now expects free cash flow pre tax to be positive. This compares with a previous expectation of free cash flow pre tax to be in a negative range of low- to mid-triple-digit million. The outlook for Siemens Energy assumes no major negative financial impacts from COVID-19 or other pandemic related events, no further deterioration in the supply chain and raw material cost environment, and excludes charges related to legal and regulatory matters." Reference Link