Siemens Energy to cut 7,800 jobs in bid to raise margins

Credit: REUTERS/RALPH ORLOWSKI

Siemens Energy, which supplies turbines to the power sector, said on Tuesday it will cut 7,800 jobs, or 8.5% of its workforce, by 2025 to raise margins and competitiveness.

To cut 7,800 jobs by 2025

Sees up to triple-digit million euros restructuring costs

Q1 net profit 99 million euros

Adds details

FRANKFURT, Feb 2 (Reuters) - Siemens Energy ENR1n.DE, which supplies turbines to the power sector, said on Tuesday it will cut 7,800 jobs, or 8.5% of its workforce, by 2025 to raise margins and competitiveness.

"The energy market is significantly changing which offers us opportunities but at the same time (it) presents us with great challenges," Chief Executive Officer Christian Bruch said.

"We will undertake these measures in the most socially responsible way possible."

Most of the cuts will be implemented by 2023, Siemens Energy said, adding that they will incur estimated restructuring costs in a mid- to high-triple-digit million euro range for the fiscal years 2020 to 2023.

Cost cuts also helped Siemens Energy, spun off from Siemens AG SIEGn.DE last year, swing to a net profit of 99 million euros ($119.53 million) in the first quarter of its fiscal year, compared with a loss of 195 million a year ago.

By slashing costs, Siemens Energy, which owns 67% in Siemens Gamesa SGREN.MC, hopes to reach its 2023 profit target, which foresees a margin on adjusted earnings before interest, tax and amortisation of 6.5%-8.5%.

($1 = 0.8282 euros)

(Reporting by Christoph Steitz; editing by Thomas Seythal and Uttaresh.V)

((christoph.steitz@thomsonreuters.com; +49 30 220 133 647;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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