Financial Drop Leads Senvion to Transformation Scheme
Senvion has started to implement a transformation program to eliminate operational inefficiencies which led to a loss of revenue and profit in the 2018 financial year.
Senvion stated that the immediate measure is focusing on disciplined execution throughout the installation chain with a target to recover lost revenues and profits in the new financial year.
This comes as the guidance for the financial year 2018 had been adjusted to reflect lower than expected revenues and profits, mainly as a result of delayed installations, the company said.
"We have taken swift action to fix execution weaknesses both in terms of our project management as well as strengthening of regional teams in order to recover the lost revenues and profits as quickly as possible," said Yves Rannou, the company's new CEO.
"We have a strong firm order book of almost 5 billion euros, a great market position and excellent products which our customers like. But we made operational mistakes in a challenging market environment and now need to focus on execution and on strengthening our customer focus."
With the transformation program, Senvion said it aims to refocus on most attractive markets, streamline its product portfolio and increase modularization to reduce costs.
The program is also expected to increase competitiveness by saving measures through special efforts on localization and sourcing improvement, as well as strengthen the financial basis in cooperation with lenders to stabilize the company through the transition period.
According to the company, initial conversations with customers and suppliers have been positive.
"We have a clear roadmap to get the company back on track in the medium-term. Our business is fundamentally solid, and we can build on competitive products, a committed workforce, and an installed basis of 18 GW that gives us a strong and profitable service business with reliable and sustainable revenue flows," said Rannou.
Senvion will now continue talks with its lenders to establish a sound financial basis for the transition period. The release of the annual financial statements for 2018 has also been postponed.