XVME-420 Siemens delivered a solid second quarter and confirmed guidance on annual performance targets
Revenue was essentially flat on a comparable basis at €19.2 billion (2QFY2023: €19.4 billion)
XVME-420 New orders decreased by 12% on a comparable basis to €20.5 billion (2QFY2023: €23.6 billion)
Profits from the Industrial Businesses totaled €2.5 billion (2QFY2023: €2.6 billion), close to the level of the previous year
Net income totaled €2.2 billion (Q2 FY2023: €3.6 billion, mainly due to a €1.6 billion tax-free gain from the reversal of the impairment of the Company’s stake in Siemens Energy AG)
Group-level free cash flow of €1.3 billion (Q2 FY2023: €2.3 billion)
Confirmed fiscal year 2024 performance target guidance
XVME-420 Siemens delivered solid business in the second quarter, effectively meeting the strong demand for digital and sustainable technologies. Among them, the industrial software business performed well, especially in the semiconductor industry. Customer demand for data center construction is also showing strong momentum. At present, the digital Industrial Group’s short-cycle automation business has relatively flat demand in China and Europe, but this is largely offset by significant revenue growth in the intelligent infrastructure and transportation business. In addition, Siemens took a key step in focusing its business portfolio with the sale of Innomotics to KPS Capital Partners for €3.5 billion.
Roland Busch, Chairman, President and CEO of Siemens AG, said: “In the second quarter, Siemens continued to benefit from strong market demand driven by digitalisation and sustainability, particularly in the data centre and semiconductor industries. The excellent revenue performance of Siemens Intelligent Infrastructure, Siemens Transportation and Industrial Software not only fully demonstrates the resilience of the Siemens business, but also alleviates the current market demand pressure faced by the digital industrial group. We have the right strategy, advanced technology and a great team, which is laying a good foundation for profitable growth in the future.”
XVME-420″The sale of Imonda is an important step in optimising our portfolio.” Ralf P. Thomas, Chief Financial Officer of Siemens AG, said: “Based on the solid performance of the first half of the fiscal year, an excellent balance sheet and a record order backlog, Siemens is confident about the future as a technology company that drives innovation. At this time, we have confirmed our guidance for fiscal year 2024.”
Reserve orders hit a new high
Siemens’ revenues for the second quarter of fiscal 2024 were €19.2 billion (Q2 fiscal 2023: €19.4 billion), essentially flat on a comparable basis compared to the same period last year (i.e. excluding the impact of currency movements and business mix). New orders decreased by 12% on a comparable basis to €20.5 billion (Q2 FY2023: €23.6 billion, mainly due to large orders from Siemens Transportation). The book-to-bill ratio was strong at 1.07. With an order backlog of 114 billion euros, Siemens once again set a new record and continues on a steady path of growth.
TXVME-420 otal profit from physical operations was €2.5 billion, close to the level of the same period last year (Q2 FY2023: €2.6 billion). Physical business margin was 14.0% (second quarter fiscal 2023:14.2%). Net income declined to €2.2 billion from €3.6 billion in the second quarter of fiscal 2023, which had benefited from a €1.6 billion tax-free gain from the reversal of the impairment of the company’s stake in Siemens Energy AG. Based on net income before the acquisition price, basic earnings per share amounted to €2.73 (Q2 FY2023: €4.57, of which €2.01 basic earnings per share was due to the reversal of impairments).
Siemens Group level free cash flow from continuing and non-continuing operations was €1.3 billion (Q2 FY2023: €2.3 billion). The decrease in free cash flow was primarily due to the decrease in free cash flow generated by physical operations. Eur 2.1 billion in the second quarter of fiscal 2024 (Q2 fiscal 2023: EUR 2.7 billion).
XVME-420 Smart Infrastructure and Siemens Transportation revenue grew significantly
In a challenging market environment, the Digital Industries Group’s new orders fell by 12% on a like-for-like basis to €4.3 billion, mainly due to continued high customer and distributor inventory levels, notably in China. On the other hand, Siemens’ software business saw a significant increase in orders due to significant growth in its electronic design automation (EDA) software business in the US market. Digital Industries Group revenue declined 11% on a comparable basis to €4.5 billion, with lower automation revenue partially offset by higher software revenue, particularly in the high-margin product-related business, primarily in the EDA segment. Profits fell 41 per cent to €741m, with a margin of 16.5 per cent. The decrease in profit and profitability was mainly due to lower capacity utilization due to lower revenue and the product mix to be optimized in the automation business.