The energy technology specialist $ENR (+3,17%) Siemens Energy has prematurely released the state guarantee with which it had to secure its high order backlog in times of crisis. The company has developed well operationally over the past two years and strengthened its balance sheet, said CFO Maria Ferraro on Thursday. A consortium of 23 international banks is now providing the guarantees for a term of five years.
Such guarantees are common in the industry, for example to secure advance payments and warranty guarantees over the entire term of projects. They are normally issued by banks for a fee. According to Siemens Energy, they are rarely used in practice and the default rate is less than 0.5 percent.
Unlike the state aid for Commerzbank during the financial crisis and for Lufthansa during the coronavirus pandemic, however, the state did not have to provide Siemens Energy with any equity. On the contrary: Siemens Energy had to pay comparatively high fees. According to industry circles, the counter-guarantees cost around 100 million euros per year.
This was not the only reason why Siemens Energy was interested in a quick redemption. The company was also not allowed to pay out any dividends or bonuses during the period of state support.
Portfolio manager Maria Mihaylova from Union Investment said that the redemption of the state guarantees was "a positive signal to the capital market". From the perspective of the time, the guarantees were necessary to maintain confidence in the long-term viability of the company. Since the height of the crisis, Siemens Energy had clearly stabilized operationally and improved structurally.
In fiscal year 2023/24 (September 30), the Group generated a profit of €1.3 billion for the first time in its history - also with the help of special effects. Since then, the business situation has continued to improve. Demand is high, particularly for power transmission technology and gas-fired power plants, and Siemens Energy has been able to raise its forecasts for the current fiscal year.
The stock market had already celebrated Siemens Energy's recovery in recent quarters. Since the low in November 2023, the share price has increased more than tenfold.
Source (excerpt) and graphics: Handelsblatt, 05.06.25