Recently, Siemens released the financial report for the third quarter of fiscal year 2017 (October 1, 2016 – September 30, 2017). Revenue in the third quarter reached 21.4 billion euros, an increase of 8% compared to the same period last year, with short-cycle businesses performing well.
New orders were 19.8 billion euros, down 6 percent year-on-year. This was due to a significant reduction in significant orders from Siemens Power & Gas and Siemens Gamesa Renewable Energy (a new company after the merger of Siemens Wind and Gamesa, which started operations in the third quarter of fiscal 2017); the bill-to-bill ratio was 0.93. On a comparable basis, excluding the impact of changes in business mix and foreign exchange rates, revenue increased by 3% and new orders decreased by 9%. Physical business profit rose 3% to 2.3 billion euros; in line with expectations, physical business profit margin fell to 10.4% due to the impact of the Gamesa merger and acquisition of Mentor Graphics. Net income rose 7% year-on-year to EUR 1.5 billion; despite the impact of mergers and acquisitions, the company’s basic earnings per share (EPS) amounted to EUR 1.74, up from EUR 1.64 in the third quarter of fiscal 2016.
The Siemens global team had a solid third quarter with 8% revenue growth and 7% net income growth. The digital enterprise business performed well, cementing its market leadership. Steady progress towards achieving the Company Vision 2020 goal is expected to bring fiscal 2017 to a strong end.
Siemens confirmed that it maintained its overall forecast for the current fiscal year in the second quarter of fiscal 2017. The company forecasts steady revenue growth, with new orders outpacing revenue (bill more than 1), excluding the impact of currency changes and business mix changes. The company expects the entity business to achieve a profit margin of 11%-12%, with basic earnings per share in the range of 7.2 euros to 7.7 euros.
This forecast includes business mix adjustments completed through the first nine months of fiscal 2017, notably the acquisition of Mentor Graphics and the merger with Gamesa. These adjustments have an impact on physical business margins and underlying earnings per share from net income in fiscal 2017. This forecast excludes the impact of laws and regulations and pending business portfolios.
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