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Press Release11 August 2022Siemens AGMunich
Strong top line momentum and solid execution – outstanding Free cash flow
Siemens
continues to expect profitable growth of its Industrial Business to drive basic
earnings per share from net income before purchase price allocation accounting
(EPS pre PPA). Following the €2.7 billion non-cash impairment of the
company’s stake in Siemens Energy AG in the third quarter of the
fiscal year, the guidance is adjusted to include the corresponding earnings
impact of €3.37 per share, resulting in a range for EPS pre PPA
of €5.33 to €5.73. This range represents Siemens’ original guidance for EPS pre PPA
of €8.70 to €9.10, excluding this impairment.
“We captured
significant opportunities in a market environment with ongoing high demand. Our
strong top line momentum continued, with a comparable order growth of 20 percent
since the beginning of fiscal 2022. This shows: Our business is attractive
and grew once again. We have the right offerings and the right strategy to be
successful even in uncertain times,” said Roland Busch, President and
Chief Executive Officer of Siemens AG. “We made significant progress as a
focused technology company in the third quarter with the launch of our open
digital business platform, Siemens Xcelerator, accelerating the digital
transformation of our customers. We also acquired Brightly Software, an
outstanding software-as-a-service player in the building space, which perfectly
complements our leading position in smart buildings.”
“Our continued top
line momentum translated into a record, high-quality and high-quantity order
backlog of €99 billion. We again achieved outstanding Free cash flow of
€2.3 billion, which further underscored our financial strength. In
addition, we consistently and successfully implemented our portfolio
optimization and sharply accelerated our share buyback program,” said Ralf P. Thomas,
Chief Financial Officer of Siemens AG.
Solid execution – outstanding Free cash flow
In
Q3, Siemens increased revenue 4 percent on a comparable basis – that is,
excluding currency translation and portfolio effects – to €17.9 billion (Q3 2021: €16.1 billion). Orders
grew 1 percent on a comparable basis to €22.0 billion (Q3 2021: €20.5 billion)
and 20 percent on a comparable basis since the start of the fiscal year to
€67.2 billion (Q1-Q3 2021: €52.3 billion). At 1.23, the
book-to-bill ratio was again at a high level. The order
backlog totaled €99 billion – a new record and of a high quality.
Profit Industrial Business climbed 27 percent to €2.9 billion (Q3 2021:
€2.3 billion), including a gain of €739 million from the sale of
Yunex Traffic. The profit margin at the Industrial Business improved to 17.0 percent
(Q3 2021: 14.9 percent). The net loss totaled €1.5 billion (net
income in Q3 2021: a positive €1.5 billion). This decline was due to
a €2.7 billion nontax-deductible impairment of the stake in Siemens Energy
and Russia-related impacts totaling €0.6 billion. Corresponding basic earnings per share before
the effects of purchase price allocation accounting were a negative €1.85 (Q3 2021:
a positive €1.89). Excluding the burden relating to the impairment of the stake
in Siemens Energy, they totaled a positive €1.52.
At €2.3 billion,
Free cash flow all-in from continuing and discontinued operations for the Siemens
Group again reached an excellent level (Q3 2021: €2.3 billion), with the
Industrial Business posting strong Free cash flow of €2.5 billion (Q3
2021: €2.4 billion). As a result, the strength of Siemens’ internal
financing was also demonstrated once again in Q3.
Strong growth at Digital Industries and Smart Infrastructure
At
Digital Industries, orders increased by a total of 32 percent
on a comparable basis across all businesses and regions to €6.5 billion
due to ongoing growth momentum in key market segments. Revenue also rose by a total of 12 percent
on a comparable basis in all business areas and regions to €4.9 billion, with
the strongest growth contributions coming from the motion control and factory
automation businesses. At €901 million, profit was 6 percent above
the figure for the prior-year quarter, while the profit margin was 18.3 percent.
Profitability was held back primarily by shortages for high-margin electronics
products and by lower revenue in the product lifecycle management business and
higher expenses related to cloud-based activities, including the impact of the
transition of parts of the business to software-as-a-service.
At
Smart
Infrastructure, orders increased 26 percent on a comparable basis to
€5.5 billion. Growth was generated across all businesses and in all three
reporting regions, with a particularly strong contribution from the U.S.,
driven primarily by continuing strong demand for data centers. Revenue
increased 10 percent on a comparable basis to €4.4 billion across all
businesses, with the largest contribution from the electrical products business.
On a geographic basis, growth was driven by the Americas and Europe, while
revenue in China declined on a comparable basis due to COVID-19-related lockdowns.
Profit surged 31 percent to €562 million (Q3 2021: €428 million). All businesses contributed to this strong performance, which was mainly
due to higher revenue and greater capacity utilization as well as cost reductions
achieved through the execution of the previously announced competitiveness
program. The profit margin increased to 12.9 percent (Q3 2021: 11.4 percent).
Mobility won orders of €2.8 billion (Q3
2021: €5.1 billion), whereby order intake in the prior-year quarter had
been extraordinarily high due to a major order of €2.8 billion in the
Americas. In Q3 2022, revenue rose 4 percent on a comparable basis to
€2.5 billion (Q3 2021: €2.3 billion), while profit of €704 million
benefited primarily from a €739 million gain from the sale of Yunex. The
profit margin climbed to 28.7 percent.
Outlook adjusted
For
the Siemens Group, growth in comparable revenue of 6 percent to 8 percent,
net of currency translation and portfolio effects, and a book-to-bill ratio
above 1 are still expected.
Siemens
continues to expect profitable growth of its Industrial Business to drive basic
EPS from net income before purchase price allocation accounting (EPS pre PPA).
Following the €2.7 billion non-cash impairment of the company’s stake in
Siemens Energy AG in the third quarter of the fiscal year, the guidance is
adjusted to include the corresponding earnings impact of €3.37 per share,
resulting in a range for EPS pre PPA of €5.33 to €5.73. This range represents Siemens’
original guidance for EPS pre PPA of €8.70 to €9.10, excluding this impairment.
Digital
Industries continues to expect to achieve comparable
revenue growth of 9 percent to 12 percent for fiscal 2022 and a
profit margin of 19 percent to 21 percent.
Smart
Infrastructure continues to expect comparable revenue
growth of 6 percent to 9 percent for fiscal 2022 and a profit
margin of 12 percent to 13 percent.
Mobility
continues to expect revenue for fiscal 2022 on the prior-year level. The
profit margin is now expected to be 7.5 percent to 8.5 percent
(previously 10 percent to 10.5 percent).
This outlook excludes burdens from
legal and regulatory matters.
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Siemens AG (Berlin and Munich) is a technology company focused on industry, infrastructure, transport, and healthcare. From more resource-efficient factories, resilient supply chains, and smarter buildings and grids, to cleaner and more comfortable transportation as well as advanced healthcare, the company creates technology with purpose adding real value for customers. By combining the real and the digital worlds, Siemens empowers its customers to transform their industries and markets, helping them to transform the everyday for billions of people. Siemens also owns a majority stake in the publicly listed company Siemens Healthineers, a globally leading medical technology provider shaping the future of healthcare. In addition, Siemens holds a minority stake in Siemens Energy, a global leader in the transmission and generation of electrical power.
In fiscal 2021, which ended on September 30, 2021, the Siemens Group generated revenue of €62.3 billion and net income of €6.7 billion. As of September 30, 2021, the company had around 303,000 employees worldwide. Further information is available on the Internet at www.siemens.com.
In fiscal 2021, which ended on September 30, 2021, the Siemens Group generated revenue of €62.3 billion and net income of €6.7 billion. As of September 30, 2021, the company had around 303,000 employees worldwide. Further information is available on the Internet at www.siemens.com.
Notes and forward-looking statements
This document contains statements related to our future business and financial performance and future events or developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forward to,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. We may also make forward-looking statements in other reports, in prospectuses, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of Siemens’ management, of which many are beyond Siemens’ control. These are subject to a number of risks, uncertainties and factors, including, but not limited to those described in disclosures, in particular in the chapter Report on expected developments and associated material opportunities and risks in the Combined Management Report of the Siemens Report ( siemens.com/siemensreport), and in the Interim Group Management Report of the Half-year Financial Report (provided that it is already available for the current reporting year), which should be read in conjunction with the Combined Management Report. Should one or more of these risks or uncertainties materialize, should decisions, assessments or requirements of regulatory authorities deviate from our expectations, should events of force majeure, such as pandemics, unrest or acts of war, occur or should underlying expectations including future events occur at a later date or not at all or assumptions prove incorrect, actual results, performance or achievements of Siemens may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Siemens neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated.
This document includes – in the applicable financial reporting framework not clearly defined – supplemental financial measures that are or may be alternative performance measures (non-GAAP-measures). These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Siemens’ net assets and financial positions or results of operations as presented in accordance with the applicable financial reporting framework in its Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently.
Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.
This document contains statements related to our future business and financial performance and future events or developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forward to,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. We may also make forward-looking statements in other reports, in prospectuses, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of Siemens’ management, of which many are beyond Siemens’ control. These are subject to a number of risks, uncertainties and factors, including, but not limited to those described in disclosures, in particular in the chapter Report on expected developments and associated material opportunities and risks in the Combined Management Report of the Siemens Report ( siemens.com/siemensreport), and in the Interim Group Management Report of the Half-year Financial Report (provided that it is already available for the current reporting year), which should be read in conjunction with the Combined Management Report. Should one or more of these risks or uncertainties materialize, should decisions, assessments or requirements of regulatory authorities deviate from our expectations, should events of force majeure, such as pandemics, unrest or acts of war, occur or should underlying expectations including future events occur at a later date or not at all or assumptions prove incorrect, actual results, performance or achievements of Siemens may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Siemens neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated.
This document includes – in the applicable financial reporting framework not clearly defined – supplemental financial measures that are or may be alternative performance measures (non-GAAP-measures). These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Siemens’ net assets and financial positions or results of operations as presented in accordance with the applicable financial reporting framework in its Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently.
Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.