Siemens got off to a very successful start in fiscal 2022 and continues to rigorously execute its strategy as a focused technology company. In Q1 (ended December 31, 2021), the company leveraged growth opportunities in many key markets to achieve increases across all industrial businesses. The outlook for the current fiscal year 2022 was also confirmed. At the same time, Siemens further focused its portfolio: in addition to the previously announced divestment of its road traffic business Yunex Traffic, new owners have been found for the post and parcel business of Siemens Logistics and for Siemens’ stake in the joint venture Valeo Siemens eAutomotive.
“We had a very successful start into fiscal 2022. All our businesses continued their high-value growth. We delivered strong results and increased our earnings per share before purchase price allocation by 20 percent. At the same time, we continue to sharpen our portfolio as a focused technology company,” said Roland Busch, President and Chief Executive Officer of Siemens AG. “Our results impressively demonstrate that we are a leader in accelerating digitalization and sustainability.”
“Siemens continued its very strong financial performance across all key metrics in the first quarter of fiscal 2022. We took significant advantage of growth opportunities in many key markets while achieving excellent free cash flow of more than €1 billion all-in,” added Ralf P. Thomas, Chief Financial Officer of Siemens AG.
Despite a continuing complex macroeconomic environment influenced by the COVID-19 pandemic and ongoing supply chain risks, major disruptions have been avoided, although deliveries of some products to customers have been delayed. Siemens continues to work relentlessly to optimize deliveries and master these challenges together with its customers.
Rigorous sharpening of portfolio
As part of the rigorous sharpening of its portfolio as a focused technology company, Siemens today announced that an agreement had been reached to sell the post and parcel business of Siemens Logistics to Körber AG. In addition, Siemens’ stake in the joint venture Valeo Siemens eAutomotive will be sold to Valeo. The sale of Siemens’ road traffic unit Yunex Traffic to Atlantia was already announced in January.
Net income significantly higher – Outlook confirmed
Siemens increased revenue in Q1 on a comparable basis – that is, excluding currency translation and portfolio effects – by 9 percent to €16.5 billion (Q1 2021: €14.1 billion). Orders saw particularly strong growth, rising 42 percent on a comparable basis to €24.2 billion (Q1 2021: €15.9 billion). At 1.47, the book-to-bill ratio was at an extraordinarily high level. At €93 billion, the order backlog set a new record.
Profit Industrial Business climbed 12 percent to €2.5 billion (Q1 2021: €2.2 billion) while the profit margin of the Industrial Business came in at 15.7 percent (Q1 2021: 16.5 percent). Net income rose 20 percent to €1.8 billion, a significant increase over the prior-year quarter (Q1 2021: €1.5 billion). Basic earnings per share before purchase price allocation were €2.24 and thus 20 percent more than in Q1 2021 (Q1 2021: €1.86). The outlook for fiscal 2022 was confirmed.
At €1.1 billion, free cash flow all-in – that is, from continuing and discontinued operations – reached an outstanding level (Q1 2021: €1.0 billion), while the Industrial Business generated free cash flow of €1.4 billion, nearly unchanged from the prior-year quarter (Q1 2021: €1.5 billion).
Strong development at all industrial businesses
At Digital Industries, orders grew a total of 67 percent across all businesses and regions on a comparable basis to €7.1 billion, led by factory automation and the motion control business. Revenue also rose in all businesses and reporting regions, climbing a total of 11 percent on a comparable basis to €4.3 billion. Profit totaled €947 million, exceeding the prior-year figure by 12 percent, while the profit margin was 21.8 percent. As expected, profitability was impacted by higher expenses related to cloud-based activities – including effects from the initiative, launched as planned, to transition parts of the business to Software-as-a-Service (SaaS).
At Smart Infrastructure, orders climbed 26 percent on a comparable basis to €4.9 billion. Order growth was driven primarily by the electrical products and electrification businesses, which won larger orders from, among others, the semiconductor industry in the U.S. In addition, demand from industrial customers and the operators of data centers continued to be strong. Revenue increased 6 percent on a comparable basis to €3.8 billion. Profit was up nearly a quarter to €480 million (Q1 2021: €391 million). All businesses contributed to this strong performance due mainly to higher capacity utilization and cost reductions under previously announced initiatives. The profit margin increased to 12.6 percent compared to 11.2 percent in Q1 2021.
At Mobility, revenue rose 7 percent on a comparable basis to €2.4 billion, while orders nearly doubled to €5.4 billion. This was the highest-ever quarterly order intake in Mobility’s history. While profit increased 3 percent to €224 million, the profit margin was 9.3 percent, slightly below the prior-year figure of 9.9 percent. This result is attributable to a less favorable project mix in the rail infrastructure business compared to Q1 2021.
Virtual Annual Shareholders’ Meeting to decide on dividend proposal
The ordinary Annual Shareholders’ Meeting of Siemens AG will take place today following the publication of the quarterly figures. Due to the ongoing COVID-19 pandemic, the event will be held in a virtual format. Shareholders will decide on the proposal by the Managing and Supervisory Boards to distribute a dividend of €4.00 per share for fiscal 2021. This dividend proposal is 50 cents above that of the previous fiscal year, reflecting Siemens’ progressive dividend policy.