Siemens Energy Ag

We are about to begin. Good morning, ladies and gentlemen, and welcome to the Siemens Energy's Q1 fiscal year 2026 analyst call. As a reminder, this call is being recorded. Before we begin, I would like to draw your attention to the safe harbor statement on page 2 of the Siemens Energy presentation. The conference call may include forward-looking statements. These statements are based on the company's current expectations and certain assumptions and are therefore subject to certain risks and uncertainties. At this time, I would like to turn the call over to your host today, Mr. Tobias Hang. Please go ahead, sir.

Thank you so much, Moritz. Good morning and a warm welcome to the Siemens Energy Q1 fiscal year 2026 results and analyst call. As always, all documents were released at 7 a.m. on our website. Our president and CEO Christian Bruch and our CFO Maria Ferraro are here with me. Christian Maria will take you through the major developments during Q1 fiscal year 2026. This will take approximately 30 minutes. Thereafter, Christian and Maria are available to answer your questions. For the entire conference call, we have allowed one hour. Christian, over to you.

Thank you very much, Tobias, and good morning, everyone, and welcome to our quarter one analyst call also from my side. Thank you for joining us today. I'm pleased to report that Siemens Energy had a very strong start into fiscal year 2026, capitalizing on the favorable market momentum and successful execution of the backlog. The global energy system continues to transform with increased pace, shaped by electrification and the increasing need for security of supply, and our portfolio is excellent aligned with these long-term needs. In the first quarter, we booked orders of nearly 18 billion euros, the strongest quarter in our company's history. This demand was broad-based across regions and business areas. The market momentum remains positive for our core portfolio. As a result, our order backlog has grown to a record of €146 billion, giving us strong visibility for this fiscal year and beyond. Our very strong free cash flow performance in this quarter was supported by significant order momentum and customer repayments, including reservation agreements, especially in gas services and grid technologies. These businesses continue to demonstrate strength, high market demand, disciplined execution, and particular in gas services, high service intensity, all of which contribute to high-quality cash generation. At Siemens Gamesa, we remain on the path toward break-even. The underlying operational measures show impact, in particular the improved productivity in offshore, increased service profitability, and reduction of structural costs in onshore. Please note that profitability in quarter one also benefited from some timing effects and was therefore less negative than expected, meaning the trajectory might not be strictly linear across the different quarters of the year. I'm also pleased to announce that we have received the first order for our SG7.0 wind turbine that is a successor to the 5X platform. We will supply fixed turbines for 42 megawatt wind park in Germany. Given the strength of our underlying markets, clear visibility from our order backlog, and a strong start into the year, we are fully on track to achieve our fiscal year 2026 guidance. While the first half of the year is historically stronger than the second half, this performance clearly demonstrates deeper operational momentum across the company, momentum built on backlog quality, disciplined execution, and exposure to markets with long-term trends. Demand remains strong and broad-based across all business areas and across all regions in the first quarter. Gas services delivered its strongest quarter ever in terms of order intake, booking 102 gas turbines. That means we matched more than 50% of last year's unit volume within just one quarter. The momentum was broad across all turbine frames. In total, we booked around 13 gigawatts of new gas turbine orders in quarter one. 12 gigawatts were converted from existing reservation agreements, and at the same time, we added 12 gigawatts of new reservations. This increased total commitments to a total of 80 gigawatts, even after delivering 3 gigawatts during the quarter. In the data center segment, we have commitments of 22 gigawatts, of which 15 gigawatts are reservation agreements. But I want to emphasize, our growth trajectory does not depend on data centers. Demand is driven by broad structural trends, electrification, industrial expansion, and the increasing need for resilient energy systems. And these fundamentals remain firmly intact. While demand for gas turbines is especially strong in the U.S., data centers still represent only one-fourth of our total global commitments. Roughly 60 percent continues to come from traditional applications, while the rest is related to peaking marine or FPSO applications. Bridge Technologies delivered another strong quarter driven by robust demand across both products and solutions. The U.S. contributed with several data center-related orders amounting to a high triple-digit million-euro volume. And just to remind you, last year we booked in that space around 2 billion euro. We also saw continued demand for grid stabilization in the U.S. reflected in large FACTS orders with a total amount of a low triple-digit million-euro value. Globally, customers are accelerating investments in transmission capacity to integrate renewables, meet rising demand, and strengthen stability. Recent events underline the importance of energy security and resilience. The sabotage of a cable bridge in Berlin, leaving more than 45,000 households, and over 2,000 businesses without power for days and the winter storms in the U.S. where around 1 million people lost electricity, both highlight how mission-critical modern grid infrastructure is. Such events raise awareness and increase demand for grid stabilization technologies like our synchronous condensers. Regionally, the Americas, but particularly the United States, showed excellent performance. Orders grew nearly 60% on a comparable basis, and revenue increased by around 25%. This means the Americas are now nearly at parity with EMEA in order intake, a remarkable milestone that reflects the rising importance for the global energy transition. That said, EMEA also remained very strong with almost 20% growth in both orders and revenue. Significant wins in Poland and Turkey further demonstrate customers' trust in our technology and long-term reliability. In Asia and Australia, we also recorded more than 20% order growth. Revenue moderated due to a very strong prior year comparison from large offshore wind projects in Taiwan, but the underlying demand picture remains solid. Regional diversification continues to be a priority. A good example is the well-balanced gas services order backlog. The U.S., Middle East, and Europe account for roughly 80%, almost evenly split among the three. Water One orders and gas services were 40% from the U.S., 35% from Europe, and 15% from Middle East and China. Across gas services and grid technologies, the pricing environment remained favorable and supported high-quality, profitable growth as it is accretive to our backlog margins. In gas services, favorable pricing momentum continues with current reservation agreements being signed with higher pricing versus current orders. Let me now give you a progress update on our Elevate program, which we introduced in detail at our Capital Market Day in November. We are fully on track with our capacity additions, and last week we communicated more details around our U.S. investment program, which we already indicated at our Capital Market Day. I will provide more details on this on the next slide. In Europe, our grid technologies expansion is also progressing strongly. We have triple production for wind transformers in Austria, and together with our partner Conchar, opened a new transformer tank manufacturing facility in Croatia in January. We continue to strengthen our supply chain resilience through long-term partnerships. Our investment in Asta Energy, a company which listed publicly on January 30th, ensure secure access to critical copper components for our grid infrastructure portfolio. And both S&P and Moody's upgraded our credit ratings, reflecting the improved balance sheet, improved cash performance, and stronger resilience of the company. We also drive forward the implementation of our new operating model, simplifying structures, reducing overhead, and increasing accountability across the organization. As part of that transformation, we also increase AI capabilities in our workforce to work more efficiently and unlock new productivity improvements across the company. Across all three pillars, Elevate is continuously making a meaningful contribution to our performance. Progress can be seen in our margin development, cash conversion, and operational stability. Let me provide you more details on our U.S. investment program. We currently execute investment projects for around $1 billion to expand manufacturing in the United States and expand our workforce as part of this effort. This includes also strengthening of the supply chain and establishing two training centers for qualification of workforce. Across six states, we are particularly strengthening the grid technologies and gas service business. In Mississippi, we are building a new high-voltage switchgear plant and expand the transformer capacity. In North Carolina, we are resuming gas turbine manufacturing, as already indicated at the CMD, and increasing large transformer capabilities while expanding also research and development. In Florida, we are boosting our blade and vane production and upgrading our innovation center, including an AI grid lab together with NVIDIA. In Alabama, we are scaling production of key generator components. And in New York and Texas, we are also upgrading compression equipment facilities. This expansion will add 1,500 new jobs on top of our 12,000 excellent employees in the U.S., and last year the U.S. accounted for 29% of our global order volume, underlining its strategic importance. We are fully committed to supporting the growth of electricity in the U.S. market by driving local capacity exactly where the market needs it. Let me briefly focus on grid technologies, where we are scaling at an impressive speed. I am proud of the progress we made with our new production sites in Austria and Croatia. In Austria, Siemens Energy has opened a new wind transformer plant in Volstov, following an investment of more than €100 million, creating around 100 new jobs and at the same time tripling our wind transformer production. The facility was completed in just 13 months and has more than 25,000 square meters of production space, enabling an annual output of up to 2,000 offshore wind transformers for customers in 70 countries. Combined with our long-established right side, Siemens Energy now supplies transformers for 80% of the world's offshore wind parks, solidifying our leadership in this critical segment of the energy transition. Moving to Croatia, the opening of our new transformer tank factory near Zagreb, our joint venture with Concha, adds more than 400 manufacturing jobs and provides capacity for approximately 160 custom large power transformer tanks per year, strengthening our global supply chain. And this is part of a broader €260 million expansion program aimed at doubling regional transformer capacity to 45,000 MVA by 2031. The new factory also bolsters Europe's manufacturing resilience by supplying heavy-duty tanks for HVDC, generator step-up transformer, and auto transformers up to 550 kV, supporting the accelerated grid build-out required to integrate renewables at scale. And with this, I would like to hand over to Maria.