Gamesa profit up 63% to €206 million; improved guidance for 2016
Gamesa’s results in the first nine months of 2016 reflect strong commercial performance and profitable growth, with record order intake, sales and profitability. The company reported €206 million in net profit in the first nine months of the year (+63%), on €3,339 million in revenues, while order intake reached a record 3,301 MW. EBIT amounted to €340 million, and the EBIT margin was 10.2%1.
This good performance, outstripping the projections made at the beginning of the year and in June, supports an upgrade — the second this year — in Gamesa’s guidance for 2016 in terms of volume (sales ≥4,300 MWe) and operating profit (underlying EBIT of €450-470 million), i.e. the best figures in Gamesa’s history. Gamesa expects to maintain the profitable growth trend in 2017, to be specified in guidance that will be released early next year.
Key figures 9M 2016 (vs. 9M 2015):
New 2016 objectives
§ Revenues: €3,339 million (+31.8%)
§ Sales: 3,256 MWe (+41.5%)
§ Underlying EBIT pre-Adwen1: €340 million (+64.9%) ≥4,300 MWe
€450-470 million
§ EBIT margin1: 10.2% (vs. 8.1%, 2.0 p.p)c.10%
§ Net profit1: €206 million (+63%)
§ Net cash: €167 million (vs. -€70 million)
Management focused on growth
Revenues increased by 32%, to €3,339 million, in the first nine months of 2016, boosted by a sharp increase in wind turbine manufacturing and sales (+37%).
This was due to the sizeable growth in activity, to 3,256 MWe, 42% more than in the same period of 2015, with all regions contributing: India (34%), followed by Latin America (27%), Europe (20%), United States (12%) and Asia Pacific (8%).
Operation and maintenance services were stable, with revenues amounting to €343 million, while EBIT amounted to €44 million (+7.5%). The fleet under maintenance continued to grow during the quarter, reaching 22,954 MW worldwide (+11.4%).
Gamesa also continues to step up commercial efforts, having booked its largest-ever order intake: 1,090 MW in the third quarter (+8%), raising total order intake in the first nine months to 3,301 MW.The order book stood at 3,242 MWe at the end of September, assuring 100% coverage2 of the new sales guidance for 2016 (≥4,300 MWe).
The G114-2.0 MW and 2.5 MW models made a strong contribution to new business, accounting for 59% of order intake in the period.
Profitability and a sound balance sheet
In this context of rising activity, Gamesa remains focused on controlling fixed expenses, optimising variable expenses, and implementing excellence and quality programmes, with the result that EBIT increased to €340 million (+65%), i.e. an underlying EBIT margin of 10.2%1.
Net profit amounted to €206 million, including the impact of consolidating Adwen. Otherwise, net profit would have amounted to €225 million (+84%).
Gamesa also continued to strengthen its balance sheet and ended the quarter with a net cash position of €167 million, contrasting with €70 million net debt a year earlier.
Shareholders approve the merger with Siemens Wind Power
Gamesa not only made progress during the quarter towards achieving its objectives for the full year but also advanced further with its strategy to create long-term value by ratifying the merger with Siemens Wind Power, which was supported by 99.75% of the shareholders at the Extraordinary Shareholders’ Meeting held in Zamudio, Spain, on 25 October.
1 Net profit includes a negative impact of €18 million in M9 2016 due to consolidating Adwen, compared with a negative impact of €4 million in M9 2015. Underlying EBIT pre-Adwen excludes €29million in capital gains in M9 2015 from creating Adwen but no impact in M9 2016.
2 Coverage based on total order intake through 30 September 2016 for activity in 2016 with respect to volume guidance for 2016.
