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Siemens Gamesa Renewable Energy has outlined its path to long-term sustainable profitable growth. SGRE said that a refreshed corporate strategy would unleash the full potential of the company by capturing growth opportunities in its profitable offshore and services businesses and driving a turnaround in onshore. The strategy prioritises profitability over volume, cash generation, as well as efficiency and productivity in all operations. 
 
With the goal of achieving long-term success, the company presented the LEAP acceleration program it has launched, which is based on three pillars:
  • Innovation: both in terms of product portfolio and business offering,
  • Productivity: through cost optimization and strict cash management,
  • Operational excellence: in project execution quality and in health and safety in our operations.
Onshore, the company will focus on delivering competitive technology, including the 5X platform, reducing the complexity of its supply chain and rightsizing the structure. Some of the measures are already under way, such as the initiation of restructuring measures in India and the adaptation of the manufacturing footprint to demand in EMEA.
 
The offshore segment is expected to achieve strong growth in current European markets but also in new emerging markets globally such as Taiwan or the United States. SGRE will globalise its offshore operations in close collaboration with its customers and will focus on execution excellence as a key pillar to maintain its profitability.
 
The service segment is projected to achieve 8% CAGR through 2025. The company plans to develop new business models including digital solutions. Siemens Gamesa intends to address its own as well as multi-brand fleet opportunities leveraging on the recent acquisition of selected Senvion assets.
 
This corporate strategy includes financial objectives that pursue profitable growth by prioritising profitability over volume and focusing on continuous cash flow and capital efficiency, among others:
  • EBIT margin pre-PPA and I&R costs in the range of 8%-10%
  • Grow faster than the market
  • Cash conversion rate greater than 1 minus growth
  • Net financial debt/EBITDA <1.0x and maintain investment grade rating
  • Distribute at least 25% of net profit in dividends
SGRE expects to achieve these objectives as financial framework by 2023. For fiscal year 2021, a transition year, SGRE expects revenues of €10.2-11.2bn and EBIT margin pre-ppa and I&R costs in the range of 3-5%.
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