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Press Release08 August 2024Siemens AGMunich
Profitable growth in third quarter – outlook confirmed
As a result, the Siemens Group confirms its outlook
for fiscal 2024, whereby comparable revenue growth – that is, excluding currency
translation and portfolio effects – at Group level (in the range of 4 percent
to 8 percent) and the profit margin at Digital Industries (18 percent to 21
percent) will be at the lower end of their respective target ranges. The profit
margin at Smart Infrastructure is expected to be at the upper end of its target
range (16 percent to 17 percent).
“We grew
profitably in the third quarter, continuing to benefit from the high demand in
electrification. Another growth driver was our particularly strong industrial
software business, which won several large license contracts. The industrial
automation business remains challenging. We confirm our company’s full-year
outlook,” said Roland Busch, President and Chief Executive Officer of Siemens
AG.
“Overall, we achieved clear increases in both net
income and profit margin in the third quarter. We again generated strong free
cash flow, and we will re-emphasize our clear focus on cash with a strong
fourth quarter,” said Ralf P. Thomas,
Chief Financial Officer of Siemens AG.
Clear increase in net income and profit margin
Revenue
in Q3 2024 rose 5 percent on a comparable basis – that is, excluding currency
translation and portfolio effects – to €18.9 billion compared to the prior-year
period (Q3 2023: €18.1 billion). Orders declined 15 percent on a comparable basis to €19.8 billion (Q3
2023: €23.5 billion), with higher order volumes at most industrial
businesses, including double-digit percentage increases at Digital Industries
and Smart Infrastructure. In contrast, the volume of major orders at Mobility was
lower compared to Mobility’s record-high order intake in Q3 2023. With an
order backlog that remained at the high level of €113 billion and a
book-to-bill ratio of 1.05, Siemens again delivered strong results.
Profit Industrial Business grew 11 percent to €3.0 billion (Q3 2023:
€2.7 billion) with contributions from all industrial businesses. The
profit margin increased to 16.5 percent (Q3 2023: 15.4 percent).
Net income rose to €2.1 billion (Q3 2023: €1.4 billion), whereby
the prior-year quarter had been impacted by a loss of €0.6 billion relating
to the stake in Siemens Energy AG. Corresponding
basic earnings per share before purchase price allocation accounting (EPS pre PPA)
were €2.66 (Q3 2023: €1.78).
Free cash flow
all-in at Group level from continuing and discontinued operations reached €2.1 billion (Q3 2023: €3.0 billion). The decline in
free cash flow was due first to the Industrial Business, which generated solid
free cash flow of €2.5 billion compared to €3.1 billion in Q3 2023. The prior-year quarter had included significant advance
payments from Mobility customers. Second, cash outflows for tax payments were
€0.5 billion higher in Q3 2024 than in the prior-year quarter.
Increase in profit margin at all industrial businesses
Orders at Digital
Industries climbed 21 percent on a comparable basis to €4.5 billion,
with exceptionally high order growth in the software business primarily driven by
a number of large contract wins for licensed software. On the other hand,
orders in the automation businesses came in moderately lower in a challenging
market due to ongoing elevated stock levels at customers. At €4.9 billion,
revenue was nearly at the level of Q3 2023, whereby higher revenue in the software
business was offset by declines at the automation businesses and negative
portfolio and currency translation effects. Profit rose 3 percent to €1.1 billion,
while the profit margin improved one percentage point to 22.9 percent.
At Smart
Infrastructure, orders rose 11 percent on a comparable basis to €6.0 billion
with all businesses contributing to growth. Order intake included a number of
larger contract wins for data centers and from customers in the energy sector. Revenue
also rose at all businesses by 10 percent on a comparable basis to €5.4 billion,
including substantial growth at the electrification business, which continued to execute rigorously on its large
order backlog. On a geographic basis, the largest growth contribution came from
the United States. Smart Infrastructure continued to increase profit and
profitability year-over-year on higher revenue, increased capacity utilization
and ongoing productivity improvements. Profit rose 20 percent to €923 million.
The profit margin reached 17.0 percent compared to 15.6 percent in Q3 2023.
At Mobility,
revenue rose slightly by 2 percent on a comparable basis to €2.6 billion.
Orders, on the other hand, declined 71 percent on a comparable basis to €2.4 billion
compared to Q3 2023, in which Mobility had reported a record order intake,
including a €2.5 billion order for a turnkey rail system in Egypt and a
€2.1 billion order for suburban trains in Germany. Profit totaled €227 million.
The profit margin was 8.7 percent compared to 8.1 percent in
Q3 2023.
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Siemens AG (Berlin and Munich) is a leading technology company focused on industry, infrastructure, mobility, and healthcare. The company’s purpose is to create technology to transform the everyday, for everyone. By combining the real and the digital worlds, Siemens empowers customers to accelerate their digital and sustainability transformations, making factories more efficient, cities more livable, and transportation more sustainable. Siemens also owns a majority stake in the publicly listed company, Siemens Healthineers, a leading global medical technology provider shaping the future of healthcare. In fiscal 2023, which ended on September 30, 2023, the Siemens Group generated revenue of €74.9 billion and net income of €8.5 billion. As of September 30, 2023, the company employed around 305,000 people worldwide on the basis of continuing operations. Further information is available on the Internet at
www.siemens.com.
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