Siemens Gamesa Wins Contract To Supply An Offshore Wind Farm In The UK (4.9% Of The Order Book)

Siemens Gamesa has recently changed its CEO after the third profit warning of the year

Through one of its subsidiaries, Siemens Gamesa has received a conditional order from Innogy SE for the supply of 100 units of the SG 14-222 DD offshore wind turbine. The order, with a total potential of 1.4 GW, is for the Sofia wind farm, located 195 km off the UK’s northeast coast. The deal also includes a service and maintenance contract. The order represents 4.9% of Siemens Gamesa’s portfolio at end-March.

The order is subject to Innogy’s final investment decision scheduled for Q1 2021. Installation is expected to start in 2024.

Despite the good performance of its order book, last week Siemens Gamesa announced a change in its CEO after the third profit warning of the year, and ahead of the presentation of its results (in this case Q3’20) in July. In this regard, the company flagged three factors which have affected its margins: firstly, the execution of the Northern European Onshore projects; secondly, the deterioration of the Indian market and lastly the impact of Covid-19.

These doubts are reflected in rating agency Moody’s’ decision to revise its outlook downwards (from stable). However it has reiterated its Baa3 rating for the time being. In the short term, this review could lead to rating downgrade as a result of the various challenges facing the group.