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Siemens Q2 net profit up 146%

Industrial conglomerate Siemens AG said Wednesday that net profit soared by 146% in its fiscal second quarter on higher sales and lower one-time charges. However, order intake dropped.

The Munich-based company said net profit in the January-March period rose to €1.01 billion ($1.3 billion) from €412 million in the Q1 of 2008. Siemens’ fiscal year starts in October.

The company noted that it took substantial charges in last year’s Q2 stemming from reviews of large projects. Sales were up 5% from a year earlier, rising to €19 billion from €18.1 billion.

However, Siemens said it saw order intake decline by 11%. The company bases its outlooks on order intakes because orders for the large products Siemens makes, like turbines and trains, are often placed years in advance.

Looking ahead, Siemens said there is no evidence of near-term improvement in the current economic and financing environment.

“Despite these conditions, total sectors profit for fiscal 2009 is expected to exceed the prior-year level of €6.6 billion,” it said in a statement. “We expect growth in income from continuing operations in fiscal 2009 to exceed growth in total sectors profit”.

“For fiscal 2009 Siemens targeted revenue growth at least twice the rate of actual global gross domestic product growth. If GDP growth is negative, this means that a percentage decline in revenue for Siemens would be targeted at less than half the rate of decline in global GDP.” (Economic Times)