S&P ends watch on Siemens Energy

S&P said it affirmed its BBB- ratings on Siemens Energy AG, its subsidiaries, and its unsecured debt, and removed all ratings from CreditWatch, where they were placed with negative implications on Nov. 6.

The outlook is now negative.

Siemens Energy AG announced asset sales of about €2.5 billion and indicated potential added sales to boost its balance sheet to offset higher losses in fiscals 2024 and 2025 (ending September). “We estimate that cumulative free operating cash flow (FOCF) generation for fiscal 2024 and 2025 will weaken by up to €3.0 billion compared to our previous estimate,” S&P said in a press release.

The agency said it could lower the rating if the restructuring of Siemens Gamesa is delayed again, more deficiencies appear, or there is a material delay in remarketing its 4x and 5x turbines, causing further earnings outlook revisions and higher cash flow losses. “We could also lower the rating if the company reports a material S&P Global Ratings-adjusted net debt position in fiscal 2024.”

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