2017-11-19
http://w3.windfair.net/wind-energy/news/15870-juwi-keeps-focusing-on-core-business-and-starts-comprehensive-cost-cutting-program

News Release from juwi AG

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juwi Keeps Focusing on Core Business and Starts Comprehensive Cost Cutting Program

Aim: Positioning the company solidly for the future / Comprehensive reduction of the number of employees inevitable / Executive Board aligned to new structure

In light of the upcoming changes on the energy markets, the executive board of the juwi group is going to prepare and to position the company for the future with a comprehensive restructuring and cost cutting program. “We have to become aware of the fact that the commitment towards and the understanding for the need of climate protection measures has decreased considerably in many of our core markets,” explain Fred Jung and Matthias Willenbacher, founders and CEOs of juwi. Over the past 18 years, the juwi group has developed into a successful company within the branch of renewable energies with approximately 1,500 employees. In future, the company will focus its activities on the two business areas: project development and EPC as well as Operations and Maintenance and thus expands its strategic realignment which already started in 2012.

“A business model, which is robust and fit for the future, is currently only to be accomplished by drastic changes. As painful as these current measures are: In light of the circumstances, there is no alternative,” Willenbacher and Jung say. The amendment of the German Renewable Energy Act (EEG) thus for instance showed that the expansion of renewable energies is indeed not going to be accelerated despite the urgent necessity. What is more, the expansion of bioenergy will virtually come to a close. And the deadline for the approval of wind energy projects (“Stichtagsregelung”) has temporarily withdrawn investors’ and stakeholders’ confidence in the market.

Together with Roland Berger Strategy Consultants, the juwi management has now developed a package of measures including the following aspects:

  • Reduction of approximately 250 jobs in Germany and about 150 abroad.
  • Validation and possibly short-term closure or reduction of some activities abroad, especially in Europe but also in the Americas.
  • Further short-term outsourcing of non-core business activities, including wind energy towers, racking systems as well as the sales of electricity.
  • Strengthening of the equity ratio by adding an external investor as well as adaptation of existing credit contracts according to the new business planning.

In accordance with the Supervisory Board, the two juwi-founders have furthermore decided on reorganizing th company’s Executive Board. There is going to be a new chairman focusing on restructuring and financing. Dr. Stefan Gros (50) will take on the position as CFO and CRO. The banker and economist Dr. Stefan Gros is experienced in management and restructuring since he has been working for a long time as CFO and CRO for many German and international companies of different sizes and different branches. Among them are many companies from the branch of renewable energies and plant construction, which are thus comparable to juwi. Both sides, juwi and Dr. Gros, aim at a long-term cooperation.

Moreover, Stephan Hansen (47) is going to become Chief Operational Officer (COO) shortly. Hansen has been working as Managing Director for the juwi International GmbH since January 2014. He brings with him almost twenty years of experience in the area of international project business. He was, among others, working for the solar business of the German companies Schott and First Solar and has been working for more than five years in the US. Accordingly, his area of responsibility will, among other aspects, focus on internationalization and purchasing; two key topics which are of great significance for the future development of the juwi group.

The former CFO Martin Winter and the former COO Jochen Magerfleisch left the company at 30 June.

“We know that these measures signify a caesura in the history of the juwi group,” Matthias Willenbacher and Fred Jung explain. “Yet if we want to secure juwi’s future we do not see any alternative to these severe and painful measures for many employees and for friends of our company.”

The employees at the company’s headquarters in Wörrstadt were informed about the upcoming measures at an extraordinary employee meeting this morning. The redundancies will be implemented as socially compatible as possible. Shortly, an interim employment society for the affected employees will be established.

The management of the juwi group is confident that the more focused company profile will help juwi to adopt a sound course in the long run. In Germany, for instance, the juwi group has a well-filled project pipeline, which will lead to new installations of about 200 to 300 megawatt of wind energy. juwi is thus operating on the same level as in the past two years.

The pipeline abroad is also well-filled concerning wind energy but also in respect to solar energy. Several large-scale projects are shortly being realized, for instance in Uruguay, South Africa, the US and Australia. In these countries alone we are planning with an installed capacity of more than 200 megawatt. Moreover, there are numerous additional projects in Chile, Japan, Great Britain and in many other countries.

In 2013, juwi was, however, not able to repeat the sales volume of the year before since the collapse of the German solar market concerning large PV plants could not be completely consolidated through the expansion of wind energy and the business abroad. With a slightly positive operative result before taking special effects into account, 2013’s revenue lay at around 710 million Euros. Compared to 2012, this is a decline of roughly 30 percent.

“We are currently in very promising and constructive discussions with our financing partners, who have all been informed about the planned changes. Together, we want to put our financing on a new foundation according to our new alignment,” emphasize Jung and Willenbacher. This also includes taking on a new investor to strengthen the equity. “We are negotiating with several potential partners. The discussions with strategic partners are further developed than the ones with financial investors,” explain the founders of juwi.

Finally Jung and Willenbacher stress: “We are convinced that we will be able to continue creating the worldwide energy transition with our new structure as well as our experience in planning, constructing and operating renewable energy plants.” Experts mostly agree on the fact that measures for climate protection and the expansion of renewable energies have to be accelerated on a global scale.

Background Info

  • In 2012, the former German government’s policies led to a decline in the solar market. This is why we adapt our business according to these continuously changing policies regarding renewable energies ever since then. This has been done with the support of external experts and in discussion with our business and financing partners.
  • Our current plans thus mirror the results of the German “Energiewende”: The parameters have drastically changed, especially in one of the (former) core segments of the juwi group, the construction of large-scale solar plants in Germany. Since last year, the segment “large-scale PV plants” has virtually ceased to exist. According to experts, the PV market in Germany is going to collapse on the whole: Installation numbers are expected to decline to one fourth compared to 2012.
  • We came to the conclusion that the measures thus far have not sufficed to be able to operate economically and to be able to react flexibly to the shifts of the market. For a long time, we kept believing that the parameters for renewable energies in Germany and Europe would improve. But ever since the beginning of 2014, with the first documents that German Secretary of Commerce Sigmar Gabriel presented, we had to recognize that the expansion of renewable energies in Germany is not going to be accelerated. This is why a further restructuring of the juwi group is inevitable.

 

Source:
juwi
Email:
info@juwi.de
Link:
www.juwi.de





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