February 15, 2018 / 11:35 AM / 10 months ago

Siemens Gamesa to cut costs by 2 billion euros by 2020

FILE PHOTO: A model of a wind turbine with the Siemens Gamesa logo is displayed outside the annual general shareholders meeting in Zamudio, Spain, June 20, 2017. REUTERS/Vincent West/File Photo

MADRID (Reuters) - Siemens Gamesa (SGREN.MC), the world’s No.2 maker of wind turbines, said on Thursday it would reduce costs by about 2 billion euros ($2.50 billion) by 2020 to boost margins following two profit warnings.

Siemens’s (SIEGn.DE) wind power business completed a merger with Spanish renewable firm Gamesa in April of last year.

In a presentation of its new strategic business plan, Siemens Gamesa said it expected to obtain an EBIT margin of between 8 and 10 percent in 2020 from between 7 and 8 percent in 2018 and its capex would be below 5 percent of sales.

On Jan. 30, Siemens Gamesa reported a strong increase in new orders in the first quarter, helped by a pickup in demand in key markets such as India and the United States.

Reporting by Andres Gonzalez and Gdynia newsroom; Writing by Angus Berwick; Editing by Julien Toyer

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