Result April to June 2023: strong momentum

The ratio of new orders to revenue ("book-to-bill ratio") reached a strong level of 1.28, while the order backlog reached a new record of €110 billion. Siemens confirms its outlook for fiscal 2023 and continues to expect revenue growth of nine to eleven percent and basic earnings per share before the effects of purchase price allocation (EPS pre PPA) of €9.60 to €9.90, excluding the investment in Siemens Energy.

Proven competitive strength

"We have once again grown profitably and demonstrated our competitive strength in all our businesses. We are seeing a normalization of demand, especially in China and in the short-cycle business. I am particularly pleased with our resilient and strong financial performance once again. We are consistently executing on our strategy to create value-enhancing growth and accelerate our customers' digital transformation and sustainability journey," said Roland Busch, CEO of Siemens.

"The high performance of our business is once again reflected in our excellent free cash flow in the third quarter. Our financial strength is further underlined by an upgraded rating from Moody's. We are well positioned to continue creating value for our shareholders, customers and employees," said Ralf P. Thomas, Chief Financial Officer of Siemens.

Industrial business with significant sales revenue growth

In the third quarter of the fiscal year, Siemens increased revenue on a comparable basis by ten percent to €18.9 billion (Q3 2022: €17.9 billion). Order intake also grew, by 15 percent on a comparable basis to €24.2 billion (Q3 2022: €22.0 billion). The Industrial Business result included strong earnings growth in Smart Infrastructure and Digital Industries and amounted to EUR 2.8 billion (Q3 2022: EUR 2.9 billion), whereby the previous year's quarterly figure included a gain of EUR 739 million from the sale of Yunex. The earnings margin amounted to 15.3% (Q3 2022: 17.0%).

Profit after tax rose to EUR 1.4 billion, following a loss after tax of EUR 1.5 billion in the same quarter of the previous year due to an impairment loss on the investment in Siemens Energy and Russia-related effects. In this quarter, the investment in Siemens Energy recorded a pro rata loss of €0.6 billion. Basic earnings per share before the effects of the purchase price allocation (EPS pre PPA) amounted to EUR 1.78 (Q3 2022: minus EUR 1.85); excluding the loss from the Siemens Energy investment, EPS pre PPA amounted to EUR 2.60. Free cash flow "all-in" from continuing and discontinued operations reached an outstanding figure of EUR3.0 billion at Group level (Q3 2022: EUR2.3 billion).

The significant improvement was mainly due to the very strong free cash flow of the Industrial Business of EUR 3.1 billion (Q3 2022: EUR 2.5 billion) with strong cash inflows in all industrial businesses.

Strong earnings growth in Smart Infrastructure and Digital Industries

Digital Industries' sales revenue increased by a total of 11% on a comparable basis to 5.3 billion euros. This growth was mainly driven by the automation businesses, in particular Factory Automation and Process Automation. On a comparable basis, incoming orders fell by 35% to 4.1 billion euros. The main reason for the decline was the development of order intake in the automation businesses, which benefited from customer orders brought forward in previous periods, with orders falling in all regions, but particularly in China.

Software business on the upswing

In the software business, on the other hand, incoming orders increased due to several larger orders. Earnings grew by 24% to 1.1 billion euros, while the earnings margin amounted to 21.1%. Higher capacity utilization and a more favourable product mix with improved availability of components for high-margin products contributed to the increase in both figures.

At EUR 5.4 billion, incoming orders in Smart Infrastructure almost reached the high level of the same quarter of the previous year, which had benefited from customers bringing forward orders, particularly in short-cycle business. Order intake recorded considerable growth in the Electrification business due to a number of larger orders for data centers as well as orders from battery manufacturers and customers in the electricity distribution sector. Sales revenue grew on a comparable basis in all businesses and increased by a total of 15% to EUR 4.9 billion. Growth was particularly strong in the Electrical Products and Electrification businesses. Earnings rose by 37 percent to 769 million euros. The profit margin reached 15.6 percent compared to 12.9 percent in the same quarter of the previous year.

Order for S-Bahn trains in Germany

Mobility once again recorded a record quarterly order intake of 8.3 billion euros. The strong increase is due to a number of major orders. Among other things, the recognition of an order for the first line of a turnkey rail system in Egypt worth EUR 2.5 billion and an order for S-Bahn trains in Germany worth EUR 2.1 billion contributed to this. On a comparable basis, sales revenue grew by twelve percent to EUR 2.6 billion. All businesses contributed to growth as a result of increased order backlog processing due to improved availability of components.

Earnings and profitability increased in all businesses, but overall did not reach the exceptionally high level of the same quarter in the previous year, which was due to a profit of EUR 739 million from the sale of Yunex.

Outlook confirmed at Group level

The Siemens Group continues to expect revenue growth on a comparable basis (adjusted for currency translation and portfolio effects) in a range of 9% to 11% and a book-to-bill ratio of more than 1. Digital Industries now expects to achieve revenue growth on a comparable basis of between 13% and 15% in the 2023 financial year (previously between 17% and 20%). The earnings margin is now expected to be between 22% and 23% (previously between 22.5% and 23.5%). Smart Infrastructure continues to expect like-for-like revenue growth of between 14% and 16% and an earnings margin in the range of 14.5% to 15.5% in the 2023 financial year.

Mobility continues to expect to achieve revenue growth on a comparable basis of between ten percent and twelve percent and an earnings margin of between eight and ten percent in fiscal 2023. Siemens is still expected to achieve higher EPS pre PPA in the range of €9.60 to €9.90 in fiscal 2023 due to the profitable growth of the industrial businesses, excluding the Siemens Energy investment, which contributed €902 million to profit after tax and €1.14 to the corresponding EPS pre PPA in the first nine months of fiscal 2023. This outlook excludes charges from legal and regulatory issues.