June 4, 2023

Brighton Journal

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Siemens raises its full-year forecast after second-quarter sales beat expectations

Siemens logo in Germany. The industrial giant says its newly commissioned green hydrogen plant in the country will use wind and solar power from the Wunsiedel Energy Park.

Daniel Carman | Image Alliance | Getty Images

Siemens raised its full-year sales and earnings guidance on Wednesday after the German engineering and technology group beat sales forecasts for the second quarter.

The maker of products ranging from trains to industrial software now expects similar revenue growth of 9% to 11% in the 12 months to the end of September, up from its previous forecast of a 7% to 10% increase.

Siemens also expects to increase its underlying underlying earnings per share to a range of €9.60 to €9.90, up from the €8.90 to €9.40 it said it expected in February.

With gains from the partial reversal of an earlier shipment, total EPS is expected to rise to the €11.61-€11.91 range.

The company had already raised its full-year forecast in February, citing strong demand and a huge order backlog, which increased to 105 billion euros ($115.58 billion) in the second quarter.

The guidance came after Siemens reported that its second-quarter revenue jumped 14% to 19.42 billion euros ($21.38 billion). Analysts polled by the company expected 18.59 billion euros.

Industrial profits in the three months to the end of March rose 47% to €2.61 billion, missing expectations of €2.70 billion.

“Siemens continues its outstanding performance, delivering many records, including massive margin increases and all-time profits for the digital and smart infrastructure industries, as well as another record in order backlog,” CEO Roland Bosch said in a statement.

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The results from Siemens, whose sensors, controllers and software are used in factories, transportation systems and buildings, are seen as indicators of the health of the broader industrial economy.

The group’s industrial profits include gains in the digital, smart infrastructure, mobility and healthcare industries, which form the core of its operations.

The results confirm the recent upward trend in the global industry as it overcomes the supply chain bottlenecks that plagued it until last year.

Swiss peer ABB recently raised its full-year guidance for sales and earnings on the back of a strong first quarter, while French rail company Alstom said last week that market momentum remained very positive.

Siemens’ net income nearly tripled to $3.55 billion, helped by the company booking a non-cash gain of €1.59 billion from reversing impairment charges related to its investment in energy company Siemens.