Siemens Energy AG (SMEGF) Q4 2024 Earnings Call Highlights: Record Order Backlog and Strong ...
In This Article:
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Free Cash Flow: Over EUR900 million in the quarter.
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Orders: EUR50 billion booked, with a record order backlog.
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Revenue Growth: 12.8% for fiscal year 2024, exceeding guidance.
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Profit Margin Before Special Items: 1%, in line with guidance.
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Net Income: EUR1.3 billion, exceeding expectations.
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Cash Flow Before Interest and Tax: Expected up to EUR1 billion.
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Order Backlog: EUR123 billion, a record high.
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Revenue: EUR34.5 billion, up by 13% year-over-year.
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Profit Before Special Items: EUR345 million, with a 1% margin.
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Special Items: EUR2 billion due to disposal gains.
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Free Cash Flow Increase: EUR1.9 billion, doubling from prior year.
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Gas Services Revenue Growth: 1.4% for the full year.
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Grid Technologies Revenue Growth: Over 32% year-over-year.
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Transformation of Industry Revenue Growth: 16.3% year-over-year.
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Siemens Gamesa Loss: EUR1.8 billion for the full year.
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Book-to-Bill Ratio: 1.46 overall, with strong performance across segments.
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Cash Position: Record net cash balance at year-end.
Release Date: November 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Siemens Energy AG (SMEGF) delivered strong growth and significant margin expansion, reaching the top end of its guidance for fiscal year 2024.
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The company generated more than EUR900 million of free cash flow in the quarter, with a record order backlog of EUR123 billion.
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Revenue growth is expected to be between 8% and 10% for fiscal year 2025, driven by grid technologies and transformation of industry.
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Siemens Energy AG (SMEGF) is targeting group margins between 10% and 12% by fiscal year 2028, reflecting improved operational performance and a better order backlog.
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The company is investing in capacity expansion, including a 30% increase in large gas turbine production and significant investments in grid technologies, to capture future growth opportunities.
Negative Points
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Siemens Gamesa reported a loss of EUR1.8 billion, indicating ongoing challenges and the need for a turnaround.
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The company expects Siemens Gamesa to remain cash flow negative for the next couple of years, with significant cash outflows anticipated in 2025 and 2026.
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There are concerns about potential overcapacity in the gas turbine market, as all major players are expanding their production capabilities.
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The onshore wind segment is expected to experience a slow revenue ramp-up, impacting overall growth in the wind business.
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The company is still working through a EUR3 billion onerous backlog at Siemens Gamesa, which could affect future profitability.