Siemens – Earnings Release Q4 FY 2024 July 1 to September 30, 2024

Strong fourth quarter completes successful fiscal 2024

 

“In another successful fiscal year, we delivered record profit and stringently executed our strategy. In particular, we benefited from continuing strong demand for electrification, transportation and our industrial software offerings while our automation business remained challenging,” said Roland Busch, President and Chief Executive Officer of Siemens AG. “Starting in fiscal 2025, we will take Siemens to the next level of value creation. We will continue to invest in R&D and M&A to secure faster growth based on our technological strengths and ability to scale across industries. Our planned acquisition of Altair reinforces our leadership in industrial software and AI. Our ability to combine the real and digital worlds is unmatched.”

 

“At €9.5 billion, we again achieved excellent Free cash flow in fiscal 2024. In addition, we are sticking to our path of stringent capital allocation by using our strong balance sheet as the basis for continuing our focused investments in profitable growth while generating attractive returns for the owners of our company. Our shareholders will benefit from the proposed increase of our dividend to €5.20 and from a corresponding dividend yield of 2.9 percent,” said Ralf P. Thomas, Chief Financial Officer of Siemens AG.

 

• Orders rose 10% and revenue increased 2% in the fourth quarter on a comparable basis, excluding currency translation and portfolio effects 
• On a nominal basis, orders grew 8%, to €22.9 billion, and revenue was up 1%, at €20.8 billion, for a book-to-bill ratio of 1.10 
• Profit Industrial Business was strong at €3.1 billion, on a profit margin of 15.5% 
• Net income increased to €2.1 billion; corresponding basic earnings per share (EPS) were €2.42 and EPS before purchase price allocation accounting (EPS pre PPA) were €2.57 
• Excellent cash generation resulted in €5.0 billion of Free cash flow for the Siemens Group 

 

• For the full fiscal year, comparable revenue grew 3% and comparable orders declined 4%; on a nominal basis, revenue increased 1%, to €75.9 billion, and orders decreased 6%, to €84.1 billion, for a strong book-to-bill-ratio of 1.11 
• Fiscal 2024 Profit Industrial Business was up slightly at €11.4 billion 
• Net income rose 5% to a historic high of €9.0 billion; corresponding basic EPS increased to €10.53, and EPS pre PPA reached €11.15; we achieved our guidance with EPS pre PPA of €10.54 excluding Siemens Energy Investment, which contributed €0.61 to EPS pre PPA 
• Strong Free cash flow of €9.5 billion for the Siemens Group 
• Siemens proposes to increase the dividend from €4.70 a year earlier to €5.20 per share 

 

• After the close of FY 2024 Siemens completed the sale of Innomotics, resulting in a preliminary gain after tax of €2.0 billion in fiscal 2025, which will be disclosed in income from discontinued operations, net of income taxes

 

• “ONE Tech Company” program launched to drive the next level of performance and value creation

 

 

Siemens

• Strong order intake with sharp growth at Mobility on higher volume from large orders including maintenance contracts for locomotives and intercity trains in the U.S., and significantly higher order intake at Smart Infrastructure which recorded a higher volume from larger contract wins; Digital Industries with a decline 
• Revenue growth for Smart Infrastructure, Mobility and Siemens Healthineers was mostly offset by a decline in the automation business at Digital Industries 
• Currency translation effects took one percentage point each from order and revenue growth; portfolio effects took one percentage point from order growth and had a minimal impact on revenue growth 
• Profit Industrial Business: sharp decline for Digital Industries due predominately to the automation business; the other industrial businesses all delivered higher profit, led by Smart Infrastructure with its highest-ever quarterly profit 
• Significant growth in net income; in Q4 FY 2023, net income was impacted by a €0.2 billion loss related to Siemens Energy Investment and also by a higher tax rate 
• Outstanding Free cash flow driven by Free cash flow from Industrial Business of €5.0 billion, above the high level of €4.1 billion in Q4 FY 2023; all industrial businesses recorded significant cash inflows with strong cash conversion rates, particularly at Mobility from stringent working capital management 
• Provisions for pensions and similar obligations as of September 30, 2024 decreased to another historic low of €0.9 billion (June 30, 2024: €1.3 billion) 
• ROCE was in the target range and increased due to higher net income, which was only partly offset by higher average capital employed

 

 

Digital Industries

• Orders in the automation business rose slightly; the software business again won a number of larger contracts, but orders came in below the high level of Q4 FY 2023, which included large volumes from renewed contracts in the electronic design automation business 
• Revenue in the automation business came in substantially lower, most notably in the factory automation business where customers were still reducing elevated stock levels due to weak global demand for manufactured goods 
• On a geographic basis, orders and revenue rose in the Americas region, while volume in the regions Europe, C.I.S., Africa, Middle East (Europe/CAME) and Asia, Australia came in lower 
• The decline in profit and profitability was due predominately to the automation business, which continued to be impacted by reduced capacity utilization on lower revenue

 

 

Smart Infrastructure

• Orders and revenue up in all businesses and all reporting regions 
• Double-digit order growth driven mainly by substantially higher order intake in the electrification business, which won a number of larger contracts from data center and energy customers; on a geographic basis, the highest growth rates came from the regions Europe/CAME and Asia, Australia; solid growth in the U.S. on continued strong demand for data centers 
• Revenue grew most notably in the electrification and the electrical products businesses, which executed strongly on their large order backlogs; on a geographic basis, the highest growth contribution came from the U.S. 
• Smart Infrastructure increased profit and profitability in all its businesses on higher revenue, increased capacity utilization and ongoing productivity improvements

 

 

Mobility

• Orders rose sharply on higher volume from large orders, including maintenance contracts for locomotives and intercity trains totaling €0.8 billion in the U.S. and orders for projects to modernize the rail infrastructure totaling €0.4 billion in Germany 
• Revenue rose in all businesses, including substantial growth in the higher-margin customer services business; the rolling stock business reported significantly higher revenue 
• Profit and profitability rose in nearly all businesses, led by the customer service business

 

 

Siemens Healthineers

• Overall volume growth, with the largest contributions to higher revenue coming from the imaging and Varian businesses; volume declined in the diagnostics business compared to Q4 FY 2023 which included revenue from rapid coronavirus antigen tests 
• Higher profit year-over-year, most notably at the imaging business driven by higher revenue with a more favorable business mix; profitability in the Varian business was held back by a less favorable business mix, negative currency effects and increased research and development expenses

 

 

Siemens Financial Services

• Solid earnings performance in the equity business; positive results included gains on sales, partly offset by an impairment of an equity investment 
• Reduced earnings contribution from the debt business due mainly to higher expenses for credit risk provisions

 

 

Reconciliation to Consolidated Financial Statements

• In Q1 FY 2024 Siemens ceased accounting for Siemens Energy under the equity method; the remaining stake is reported as a financial asset measured at fair value through other comprehensive income

 

 

“ONE Tech Company” program to drive next level value creation

Building on its position of strength as a leading technology company, Siemens has launched the ONE Tech Company program to achieve the next level of performance and value creation. The program aims to ensure that the company leverages the opportunities arising from the historic market shifts that mark a turning point and from technological disruptions. The goal is to achieve stronger customer focus, faster innovation and higher profitable growth. Siemens will implement the ONE Tech Company program to accelerate the execution of the existing strategy, which is summarized as “to combine the real and digital worlds.” Elements of the program include the planned inorganic investment in Altair Engineering to strengthen Siemens’ leadership position in industrial software and the creation of Foundational Technologies as the unit to scale core technologies across the company.

 

 

Outlook 

We anticipate moderate macroeconomic growth in fiscal 2025, due in part to continuing geopolitical uncertainty including trade conflicts, and also to ongoing challenges for the manufacturing sector due to overcapacity and weak consumer demand. At the same time, infrastructure markets, particularly in electrification and mobility, remain strong.

Digital Industries expects for fiscal 2025 a change in comparable revenue, net of currency translation and portfolio effects, in a range of (6)% to 1% and a profit margin of 15% to 19%.

Smart Infrastructure expects for fiscal 2025 comparable revenue growth of 6% to 9% and a profit margin of 17% to 18%.

Mobility expects for fiscal 2025 comparable revenue growth of 8% to 10% and a profit margin of 8% to 10%.

For the Siemens Group we expect comparable revenue growth in the range of 3% to 7% and a book-to-bill ratio above 1.

We expect basic EPS from net income before purchase price allocation accounting (EPS pre PPA) for fiscal 2025 in a range of €10.40 to €11.00, excluding the gain from the sale of Innomotics; the preliminary gain of €2.0 billion after tax will be recorded in the first quarter of fiscal 2025. For comparison, EPS pre PPA in fiscal 2024 was €10.54 excluding a positive €0.61 per share from Siemens Energy Investment.

This outlook excludes burdens from legal and regulatory matters.

 

 

Notes and forward-looking statements 

Starting today at 08:00 a.m. CET, the press conference on Siemens’ fourth-quarter results and the preliminary figures for fiscal 2024 will be broadcast live at www.siemens.com/pressconference.

Starting today at 10:00 a.m. CET, you can also follow the conference call for analysts and investors live at www.siemens.com/analystcall.

Recordings of the press conference and the conference call for analysts and investors will be made available afterwards.

The financial publications can be downloaded at: www.siemens.com/ir.

 

 

This document contains statements related to our future business and financial performance and future events or developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forward to,” “anticipate,” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. We may also make forwardlooking statements in other reports, in prospectuses, in presentations, in material delivered to shareholders and in press releases. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of Siemens’ management, of which many are beyond Siemens’ control. These are subject to a number of risks, uncertainties and factors, including, but not limited to those described in disclosures, in particular in the chapter Report on expected developments and associated material opportunities and risks in the Combined Management Report of the Siemens Report (siemens.com/siemensreport), and in the Interim Group Management Report of the Half-year Financial Report (provided that it is already available for the current reporting year), which should be read in conjunction with the Combined Management Report. Should one or more of these risks or uncertainties materialize, should decisions, assessments or requirements of regulatory authorities deviate from our expectations, should events of force majeure, such as pandemics, unrest or acts of war, occur or should underlying expectations including future events occur at a later date or not at all or assumptions prove incorrect, actual results, performance or achievements of Siemens may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. Siemens neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated.

This document includes – in the applicable financial reporting framework not clearly defined – supplemental financial measures that are or may be alternative performance measures (non-GAAP-measures). These supplemental financial measures should not be viewed in isolation or as alternatives to measures of Siemens’ net assets and financial positions or results of operations as presented in accordance with the applicable financial reporting framework in its Consolidated Financial Statements. Other companies that report or describe similarly titled alternative performance measures may calculate them differently.

Due to rounding, numbers presented throughout this and other documents may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures. 

All information is preliminary.

 

 

Financial Results 

Fourth Quarter and Fiscal 2024

Key figures (in millions of €, except where otherwise stated)

 

 

Consolidated Statements of Income

 

 

Consolidated Statements of Comprehensive Income

 

 

Consolidated Statements of Financial Position

 

 

Consolidated Statements of Cash Flows

 

 

Overview of Segment figures

 

 

EBITDA Reconciliation

 

 

Orders & Revenue by region