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Earnings Release and Financial Results Q3 FY 2022: Strong top line momentum and solid execution – outstanding Free cash flow

“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.
  •  Orders for the third quarter climbed 7% year-over-year, reaching €22.0 billion despite substantially lower volume from large orders in Mobility, while revenue rose 11% year-over-year, to €17.9 billion, for a book-to-bill ratio of 1.23
  • Orders rose 1% and revenue grew 4% on a comparable basis, excluding currency translation and portfolio effects
  • Profit Industrial Business was €2.9 billion with a profit margin of 17.0%, both benefitting substantially from a €0.7 billion divestment gain in Mobility
  • The Net loss of €1.5 billion for the quarter was due primarily to a previously disclosed nontax-deductible impairment of the stake in Siemens Energy recorded in the amount of €2.7 billion; corresponding basic earnings per share (EPS) were a negative €2.06 and EPS before purchase price allocation accounting (EPS pre PPA) were a negative €1.85 each including a negative €3.37 per share related to the impairment
  • Again excellent Free cash flow from continuing and discontinued operations, reaching €2.3 billion for the quarter
  • At the beginning of Q4 FY 2022, Siemens closed the sales of its stake in Valeo Siemens eAutomotive GmbH (Valeo Siemens) and the mail and parcel-handling business of Siemens Logistics, respectively, which subsequently resulted in cash inflows totaling €1.5 billion; such inflows are not included in Free cash flow
Third quarter of fiscal year 2022
  • Growth opportunities in many key markets for Siemens despite a continuing complex macroeconomic environment influenced by sanctions on Russia, high inflation and effects associated with the coronavirus pandemic (COVID-19). Continued avoidance of major disruptions from supply chain risks associated with electronics components, raw materials and logistics
  • Substantial order growth at Digital Industries and Smart Infrastructure; sharply lower volume from large orders in Mobility which in Q3 FY 2021 won a €2.8 billion order in the U.S
  • Revenue up in all industrial businesses, led by significant growth in Digital Industries and Smart Infrastructure
  • Currency translation effects added five percentage points to order and six percentage points to revenue growth; portfolio effects added one percentage point each to order and revenue growth 
  • Profit Industrial Business rose due to a €0.7 billion gain from the sale of Yunex Traffic at Mobility and improvements at Smart Infrastructure and Digital Industries on continued growth momentum in their major market segments; impairments and other charges related to winding down business activities in Russia within Industrial Business were €0.1 billion, mostly burdening Mobility
  • Reconciliation to Consolidated Financial Statements included a €2.7 billion impairment of the stake in Siemens Energy AG and €0.4 billion in Russia-related impacts; Siemens Financial Services also recorded Russia-related impacts, amounting to €0.1 billion
  • The Net loss was due to the nontax-deductible impairment of the stake in Siemens Energy AG and the €0.6 billion in Russia-related impacts mentioned above
  • Again excellent Free cash flow for the Siemens Group; Free cash flow from Industrial Business was €2.5 billion, slightly above the level in Q3 FY 2021; in addition, the sale of Yunex Traffic resulted in cash inflows of €0.9 billion which were not part of Free cash flow
  • ROCE turned negative due to the Net loss
Outlook
For the Siemens Group we continue to expect 6% to 8% growth in comparable revenue, net of currency translation and portfolio effects, and a book-to-bill ratio above 1.

Digital Industries continues to expect to achieve comparable revenue growth of 9% to 12% for fiscal 2022 and a profit margin of 19% to 21%.

Smart Infrastructure continues to expect comparable revenue growth of 6% to 9% for fiscal 2022 and a profit margin of 12% to 13%.

Mobility continues to expect revenue for fiscal 2022 on the prior-year level. The profit margin is now expected to be 7.5% to 8.5% (previously 10% to 10.5%).

We continue to expect profitable growth of our 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 our stake in Siemens Energy AG in the third quarter of the fiscal year, the guidance must be 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 our original guidance for EPS pre PPA of €8.70 to €9.10, excluding the impairment.

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.
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Elisavet-Vasiliki Sachinidou

Siemens S.A.

6-8 Agisilaou Str.
151 23 Μarousi
Greece

(+30) 210-6864267