In the first quarter of its new fiscal year 2012, Siemens achieved increased revenue and laid the cornerstone for future growth, despite the difficult economic environment. Thanks to a strong order backlog, revenue for the first quarter rose by 2% as compared to the same period a year earlier, while new orders declined 5% YoY. Profit was below the prior year level due to project delays and increased investments.
Financial highlights:
Revenue for the first quarter rose 2% to EUR 17.902 billion, including increases in all reporting regions and 8% growth in emerging markets. Organic revenue, excluding currency translation and portfolio effects, grew 3%
Orders came in at EUR 19.809 billion, 5% below the prior year period which included a significantly higher volume from large orders. The book to bill ratio for the quarter was 1.11, and the order backlog reached a new high at EUR 102 billion
Total Sectors Profit declined 23%, to EUR 1.601 billion, including lower profit in all Sectors
Income from continuing operations was down 27%, at EUR 1.356 billion and corresponding basic EPS was EUR 1.53. Net income declined 17%, to EUR 1.457 billion and corresponding basic EPS of EUR 1.64
Mr Peter Löscher president & CEO of Siemens said that "The uncertainties of the ongoing debt crisis have left their mark on the real economy. Our revenue increased again, while certain project delays burdened profits. Although a recovery is expected in the second half of the year, we must work hard to achieve our goals. With a backlog of more than EUR 100 billion, a strong portfolio and a solid financial position, we are a trusted partner."
In the first quarter of fiscal 2012, which ended on December 31st 2011, new orders declined 5% YoY to EUR 19.8 billion. In the prior year period, Siemens booked several major orders. Revenue, on the other hand, increased 2% YoY to EUR 17.9 billion. The book to bill ratio for the first quarter was 1.11. The order backlog reached EUR 102 billion. Siemens also invested in innovation and growth: the number of employees worldwide rose in the first quarter by about 3,000, roughly a third of whom work in research and development.
For the four Sectors Energy, Healthcare, Industry and Infrastructure & Cities, the picture was mixed. In the Energy Sector, new orders were down 11% to EUR 7.2 billion and revenue increased 8% to EUR 6.2 billion. While new orders in the area of renewable energies rose by nearly two thirds, orders in the Fossil Power Generation Division declined 30% after the major orders of the prior year period. The Healthcare Sector reported new orders of EUR 3.3 billion, a 4%YoY increase. Revenue development at the Sector was stable. In the Industry Sector, new orders totaled EUR 4.9 billion, a slight decline of 2%. However, the Sector had profited from major orders in the comparable prior year period above all, at the Drive Technologies Division. Industry Sector revenue climbed 5% YoY to EUR 4.7 billion. In the new Infrastructure & Cities Sector, new orders and revenue were below the comparable prior year figures. Here, too, there had been major orders in the prior year, for example, the Eurostar contract.
Profits were impacted by delays related to the approval process for connecting offshore wind turbines to power grids, mainly in Germany. Due to this factor, the Energy Sector's Power Transmission Division incurred project charges of EUR 203 million. The Renewable Energy businesses posted a loss of EUR 48 million due primarily to higher R&D expenses, costs related to the expansion of the business in a highly competitive environment, increased price pressure and a less favorable revenue mix. In the Healthcare Sector, profit was slightly below the comparable prior year figure. In the Industry Sector, profit declined due to a less favorable product mix and higher operating costs resulting from growth related investments. In the new Infrastructure & Cities Sector, delays related to the approval of Siemens' Velaro D trains had a negative impact on profit. The cause here was the previously reported difficulty of a foreign supplier to deliver key components for the multi system capability that will enable the trains to operate between Germany and France. Total Sectors profit declined 23% YoY to EUR 1.6 billion. Income from Siemens' continuing operations was down 27% overall to roughly EUR 1.4 billion.
