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Siemens Energy reports strong second quarter results and raises outlook for fiscal year 2024

4C Offshore | Chloe Emanuel
By: Chloe Emanuel 08/05/2024 Siemens Energy

Siemens Energy has announced its earnings release for the second quarter of fiscal year 2024, show-casing robust performance amidst a positive market environment. The company's solid quarter was marked by significant growth and positive cash development, prompting an adjustment in its outlook for the year ahead.

During the second quarter, Siemens Energy saw strong development in its relevant markets, driven by continued demand for electricity. While orders decreased by 21.8% compared to the previous year, amounting to €9.5 billion, the company maintained a healthy book-to-bill ratio, driving the order backlog to a record high of €119 billion.

Revenue for the quarter grew by 3.7% to €8.3 billion, with notable growth in Grid Technologies and Transformation of Industry segments. Profit before special items surged to €170 million, benefitting in part from positive currency effects, while special items amounted to a positive €331 million. This resulted in a profit of €501 million for Siemens Energy, a significant increase compared to the same period last year.

Siemens Energy also reported a net income of €108 million, a stark improvement from the net loss of €189 million in the second quarter of fiscal year 2023. Basic earnings per share were recorded at positive €0.08, compared to negative €0.25 in the previous year.

Free cash flow before tax turned positive at €483 million, a notable improvement from the negative €294 million reported in the same quarter last year. This improvement was attributed to strong cash conversion across all business areas.

In light of its strong performance in the first half of the year, Siemens Energy raised its outlook for fiscal year 2024. The company now anticipates comparable revenue growth between 10% and 12%, up from the previous estimate of 3% to 7%. Similarly, the profit margin before special items is expected to range between negative 1% and positive 1%, with free cash flow before tax projected to be up to positive €1.0 billion.

Christian Bruch, President and CEO of Siemens Energy AG, expressed confidence in the company's trajectory, stating, "Our strong development in the second quarter underscores the continued strong demand for our technology to power the energy transition and our success in stabilizing the wind business."

Looking ahead, Siemens Energy aims to continue its focus on the turnaround of its wind business, taking steps to reduce complexity and create a more focused business model.

The revised outlook for fiscal year 2024 reflects adjusted revenue growth assumptions for all segments, with higher profit expectations for Grid Technologies. Despite challenges, Siemens Energy remains optimistic about its prospects for the remainder of the year.

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