Siemens AG
(SI) reported third-quarter revenues of €18.3 billion, down 4% from the year-ago quarter, and earnings of $1.44 per ADR, lower than the Zacks Consensus Estimate. Order backlog had a stabilizing effect on revenue while new order intake was down 28% and the book-to-bill ratio fell below 1 to 0.94.
On a geographic basis, revenue grew 5% in Asia, Australia on the back of double-digit growth in China. In Europe, Commonwealth of Independent States, Africa and Middle East, revenue declined 9%, including sharply lower revenues in Germany. Order intake was influenced most strongly by Industry segment, which saw demand fall sharply in the Mobility division.
Total Sectors profit declined 21% year over year while income from continuing operations fell 17% year over year. The estimated under funding of Siemens’ principal pension plans as of Jun 30, 2009, was €5 billion, double the amount as on Sep 30, 2008.
Free cash flow declined to €1.7 billion due to substantial cash outflows related to charges arising from project reviews and structural initiatives in fiscal 2008. On a continuing basis, return on capital employed for the third quarter declined to 11.7% from 14.7% in the year-ago period.
Siemens continues to expect total Sectors profit for fiscal 2009 to exceed the prior-year level of €6.6 billion. Growth in income from continuing operations in 2009 is expected to exceed growth in Total Sectors profit.
Siemens is a German industrial conglomerate with interests in information services, automation and controls, medical equipment, power generation, transportation systems, automotive electronics, lighting, and many other areas. With a focus on electronics and electrical engineering, the company is a major multinational with over 430,000 employees in more than 190 countries.
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