Siemens AG (fka SI)

[Enterprising Investor]

Siemens Expects Charges Due to Faulty Wind Turbines (6/18/13)

By Ursula Quass

MUNICH--German engineering and electronics company Siemens AG (SI) said Monday it is facing charges to its earnings due to technical problems with wind turbines in the U.S.

The charges will weigh on Siemens' earnings in the fiscal third quarter, which ends on June 30, said a spokeswoman. Last year, Siemens' net profit amounted to 923 million euros ($1.23 billion) in the April-to-June quarter.

Siemens didn't provide a specific figure, but J.P. Morgan estimates that the added costs amount to tens of millions of euros.

Siemens began inspecting all its wind turbines in the U.S. after rotor blades fell off turbines in two of its onshore wind parks several weeks ago.

However, Siemens Chief Executive Peter Loescher doesn't expect additional charges for delayed delivery of high-speed trains, according to J.P. Morgan. Mr. Loescher said at an investor conference he expects such charges neither this nor next year, the bank wrote in a note to clients.

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