Gamesa plans to increase sales to 3,500-3,800 MW of wind power

Gamesa unveiled its Outlook 2015-2017, with the goal of locking in the profitable growth that commenced under the preceding plan, offer sustainable and rising dividends, 25% of annual net profit, and accelerate shareholder value creation.

The company projects double-digit annual growth in sales and activity during the plan, to attain 3,500-3,800 MW in 2017 and a doubling in size with respect to the beginning of the 2013-2015 Plan. Sales in 2015 will be close to 3,100 MW.

Under the plan unveiled today, based on its high degree of geographical diversification in the main wind markets, Gamesa will retain its leading position in India, Mexico and Brazil, as well as China, where it is the largest foreign manufacturer in terms of market share. It will also increase its presence in mature markets such as the US and Europe, and expand into Asia-Pacific and Africa.

New products and services

Gamesa is working to develop its portfolio of products and services as a key means of gaining market share. Within the period of the plan, it will launch a new 3.3 MW platform to meet the needs of major markets such as Europe, Mexico, Canada, Australia, South Africa and others, and will extend its 2.5 MW platform to India and Brazil.

In the area of Operation and Maintenance, the company expects 20% growth in revenues through 2017, boosted by growth in MW under maintenance, new long-term contracts and an offer of value-added products.

Profitable growth and a sound balance sheet

Control of the structure and the balance sheet in a context of expanding activity is still a priority for the period 2015-2017, the goal being to maintain profitability regardless of demand performance.

Gamesa expects to improve profitability ratios through strict control of fixed expenses and the implementation of new continuous improvement programmes, in order to double EBIT by 2017 with respect to the 181 million reported in 2014, and attain an EBIT margin of over 8%.

Another priority is control of working capital and capex To this end, Gamesa is adopting a modular approach to investments, as a function of the pace of growth.

Gamesa also plans to generate net cash flow throughout the period, which, combined with a sound balance sheet, will enable it to maintain an attractive dividend policy (payout ?25%) in line with growth in net profit.

Gamesa beyond 2017

The plan also prepares the company to expand after 2017 in both the onshore wind business and in offshore, through Adwen, and in complementary areas, such as solar and offgrid.

Adwen, the joint venture with Areva for the offshore business, is working on the development of 8 MW wind turbines to strengthen its position in the European market, in which it aspires to a 20% share by 2020.

Gamesa is exploring opportunities in sectors that offer a high level of synergy with the wind business, such as solar and offgrid, particularly in India.

Financial Guidance 2015-2017

2015E 2017E
Volume (MWe) c. 3,100 3,500 – 3,800
EBIT margin 1 ?8% >8%
EBIT (MN) 1  x2 2
Working capital / revenues <5% <5%
Capex / revenues 4% – 5% <3,5%

1 Average exchange rate January-May 2015
2 Compared with 2014 EBIT