Siemens Q4 Profit Falls, Lifts Dividend; Sees Growth In FY24; Stock Up

German conglomerate Siemens AG reported Thursday sharply lower profit in its fourth quarter, while revenue was benefited by strong performance in all industrial businesses. The firm also announced higher dividend, and said it projects comparable sales growth in fiscal 2024, however, slower than last year. The shares were gaining around 6 percent in the morning trading in Germany.

Roland Busch, President and Chief Executive Officer, said, “Fiscal 2023 was a year of multiple records: In our Industrial Business, profit and profit margin reached their highest levels ever, and we nearly doubled our net income to a historic high… Our strategy is paying off, and we continue to accelerate the digital and sustainability transformations of our customers.”

For the first time ever, the company exceeded 10 billion euros in free cash flow, it said.

For fiscal 2024, Siemens Group expects comparable revenue growth in the range of 4 percent to 8 percent. In fiscal 2023, comparable revenue grew 11 percent.

Further, the company expects profitable growth of Industrial Business to drive an increase in basic earnings per share from net income before purchase price allocation accounting excluding Siemens Energy Investment to a range of 10.40 euros to 11.00 euros in fiscal 2024 from last year’s 9.93 euros.

Digital Industries expects comparable revenue development of 0 percent to 3 percent, and profit margin to be 20 percent to 23 percent.

Smart Infrastructure expects comparable revenue growth of 7 percent to 10 percent. The profit margin is expected to be 15 percent to 17 percent.

Further, Siemens proposed to increase the dividend to 4.70 euros per share from 4.25 euros a year earlier.

In its fourth quarter, Siemens’ net income fell 35 percent to 1.90 billion euros from last year’s 2.91 billion euros.

Basic earnings per share were 2.17 euros, 36 percent lower than prior year’s 3.39 billion euros. The prior year result included a 1.1 billion euros pretax gain on the sale of the mail and parcel-handling business.

Earnings per share before purchase price allocation accounting were 2.34 euros, compared to 3.59 euros in the prior year.

Revenue grew 4 percent to 21.39 billion euros from last year’s 20.57 billion euros, on record-high revenues in all industrial businesses. Orders were 21.80 billion euros, slightly lower than 21.82 billion euros last year.

On a comparable basis, excluding currency translation and portfolio effects, revenue rose 10 percent and orders grew 6 percent in the fourth quarter

In Germany, Siemens shares were trading at 147.24 euros, up 6 percent.

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