Siemens Aktiengesellschaft · XETR:SIE

Siemens Aktiengesellschaft — Siemens — Investor Day (September 2009)

31 slides from Siemens Aktiengesellschaft's investor day presentation, Sep 29, 2009

  1. Slide 1: Sharpening our Focus and Driving Efficiency

    Sharpening our Focus and Driving Efficiency Michael Sen CFO Healthcare Sector Capital Market Day Siemens Healthcare London, September 29, 2009 © Siemens AG 2009. All rights reserved.

  2. Slide 2: Safe Harbour Statement

    Safe Harbour Statement This document contains forward-looking statements and information – that is, statements related to future, not past, events. These statements may be identified by words such as “expects,” “looks forward to,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates,”

  3. Slide 3: Sharpening our focus and driving efficiency

    Sharpening our focus and driving efficiency Principles Key takeaways ƒ Strong fundamentals – quality asset in Increase the portfolio of Siemens TRANSPARENCY ƒ Aggressive cost management to deliver strong operating margins Enforce ƒ Focus on cash generation and liquidity – "cash is king" ACCOUNTABILI

  4. Slide 4: Strong financial performance on top and bottom line

    Strong financial performance on top and bottom line Orders Revenue €m +15% €m +13% +10% +20% 1) (-2%1)) (+4% ) (+6%1)) (+2%1)) 10,271 11,779 9,851 11,170 9,334 8,227 FY 2006 FY 2007 FY 2008 FY 2006 FY 2007 FY 2008 Profit Free Cash Flow €m +18% €m +55% -13% +47% Underlying Profit Profit 1,743 1,380 1

  5. Slide 5: Strong cash flow but softer orders in FY 2009

    Strong cash flow but softer orders in FY 2009 Orders Revenue €m +3% €m +9% (-3%1)) (+3%1)) 8,397 8,619 8,052 8,785 Q3 YTD FY 2008 Q3 YTD FY 2009 Q3 YTD FY 2008 Q3 YTD FY 2009 Profit Free Cash Flow €m +5% €m +48% 14.9% excl. Underlying Profit PT charges2) Profit 1,245 1,308 1,078 Underlying 15.5% 13.

  6. Slide 6: Recent order trends likely to impact revenue growth going forward

    Recent order trends likely to impact revenue growth going forward Orders growth1) Revenue growth1) FY 2008 Q3 YTD FY 2009 FY 2008 Q3 YTD FY 2009 Imaging & IT 3% -5% Imaging & IT 2% 3% Workflow Workflow 14% -5% 5% 1% & Solutions & Solutions Diagnostics 3% 1% Diagnostics 3% 2% Book-to-bill Underlying

  7. Slide 7: Significant charges affecting profit in FY 2008 and FY 2009

    Significant charges affecting profit in FY 2008 and FY 2009 Profit adjustments FY 2008 Profit adjustments Q3 YTD FY 2009 €m 344 1,743 €m 169 1,308 169 518 183 1,139 174 172 1,225 967 11 11.0% 15.6% 11.0% 13.0% 14.9% FY 2008 Trans- Dia- FY 2008 Q3 YTD Divestment Diag- Q3 YTD Particle Q3 YTD reported

  8. Slide 8: Reconciling charges with timing of cash outflows

    Reconciling charges with timing of cash outflows Cash outflows1) relating to profit adjustments €m 859 328 PT YTD 169 FY 2009 Q3 YTD 172 FY 2009 87 155 162 FY 2008 518 127 Adjustments No FCF impact FY 2008 FY 2009E FY 2010E FY 2011E to underlying and beyond profit 1) Cash outflows net of advanced pa

  9. Slide 9: Focus on capital efficiency is our top priority

    Focus on capital efficiency is our top priority M&A activities 2005-2008 Net Capital Employed June 30, 2009 €bn €bn Dade 13.2 10.3 5.2 11.5 1.8 Diagnostics PPA 2010 charges: €180m Bayer ~80% 4.2 8.5 Mainly Goodwill DPC 1.7 CTI 1.4 0.8 1.2 ~20% 2005 2006 2007 2008 Σ 2005- Net Goodwill & Invest- Net 2

  10. Slide 10: Swift actions taken to increase focus and efficiency

    Swift actions taken to increase focus and efficiency Ahead of the curve on our SG&A commitments Cost Relentless drive to reduce complexity and cost Aggressively driving down cost of global supply chain Balance Tapping the cheapest sources of cash sheet Tight grip on capex and working capital Decisiv

  11. Slide 11: Decisive actions to combat tough U.S. market

    Decisive actions to combat tough U.S. market Total U.S. equipment market1) Resizing of U.S. sales force2) US$bn -26% -26% Total change 6.2 FY 2007- 5.5 FY 2009E -30% ~ 4.6 -17% -42% +1% -15% -14% FY 2007 FY 2008 FY 2009E FY 2007 FY 2008 FY 2009E Back Office/Support "Feet on the street" 1) Equipment

  12. Slide 12: Ahead of the curve on our SG&A commitments

    Ahead of the curve on our SG&A commitments SG&A cost reduction target SG&A cost development €bn €bn +5% -13% -4% -9% 2.3 2.3 2.2 2.0 2.0 2.1 ~2.0 In % of ~€150m revenue 19.5% 19.3% y-o-y cost savings FY 2007 FY 2007 FY 2010 FY 2010 FY 2007 FY 2008 FY 2009E actual actual target target actual (reporte

  13. Slide 13: Relentless drive to reduce complexity and cost

    Relentless drive to reduce complexity and cost Consultancy costs in €m IT costs in €m -39% -11% External 73 74 Information 384 395 378 consul- 65 350 45 Technology tants FY 2007 FY 2008 FY 2009E FY 2010E FY 2007 FY 2008 FY 2009E FY 2010E Number of legal entities Number of suppliers (tsd.)1) -35% -27

  14. Slide 14: Aggressively driving down cost of global supply chain

    Aggressively driving down cost of global supply chain LCC purchasing LCC purchasing R&D in LCC (total Healthcare) (excluding Diagnostics) (total Healthcare) LCC purchasing in % LCC purchasing R&D headcount of total purchasing volume in % of direct material1) in LCC (in %) 100% 30%2) +4% p.a. +10% p.

  15. Slide 15: Tapping the cheapest sources of cash

    Tapping the cheapest sources of cash Key priorities and targets Free Cash Flow €m ƒ Reduction of cycle times Supply chain +48% through better installation management management Customer 349 1,078 ƒ Rigorous customer credit relationship checks management 729 Procurement ƒ Improved settlement terms Ma

  16. Slide 16: Tight grip on capex and working capital

    Tight grip on capex and working capital Working Capital turns back on track Investment spending tightly managed OWC1) Investment Turns Total Healthcare ratio (%) Total Healthcare 105 5.4 FY 2008 FY 2009 100 FY 2008 FY 2009 93% 5.2 95 90 85% 84% 5.0 85 4.8 4.8 79% 78% 80 76% 4.8 4.7 74% 4.6 75 4.6 70

  17. Slide 17: Taking Diagnostics integration to the next level

    Taking Diagnostics integration to the next level Integrating three acquired IVD companies into one Diagnostics Division Accelerating & leveraging the integration of Diagnostics into Healthcare Committed savings ƒ Additional savings of ~ €45m in FY 2010 increasing Results to ~ €100m by FY 2011 ƒ Merg

  18. Slide 18: Clear priority on capital allocation

    Clear priority on capital allocation EVA spread (RO CE – W ACC) Capital Portfolio of capital allocations efficiency ROCE target (schematic) ROCE over capital High employed Profi- teers Top divisions Net capital em ployed ROCE 93% Capex Average management 84% 85% 2009-2011 Sub- High growth 79% stance

  19. Slide 19: Healthcare – underlying strengths drive performance

    Healthcare – underlying strengths drive performance Resilience through recurring revenue streams Business model Order backlog contributes to revenue streams Installed base – a powerful growth platform Increased resilience against soft U.S. equipment market Geography Increasing exposure to high-growt

  20. Slide 20: Resilience through recurring revenue streams

    Resilience through recurring revenue streams Imaging and Therapy Healthcare IT Laboratory Diagnostics Industry Business Service Consumables Licenses & Service & Service model Equipment Instruments Revenue split Total Healthcare Profit split1) Recurring revenue ~40% ~50% ~50% significantly accretive

  21. Slide 21: Order backlog contributes to revenue streams

    Order backlog contributes to revenue streams Order backlog1) €bn 6.8 3.5 3.3 0.3 3.0 Total backlog Healthcare IT and Equipment backlog Equipment backlog Sept. 30, 2008 other backlog Sept. 30, 2008 June 30, 2009 1) Excludes Service and Diagnostics © Siemens AG 2009. All rights reserved. Page 21 Sept.

  22. Slide 22: Installed base – a powerful growth platform

    Installed base – a powerful growth platform Diagnostic instruments1) Imaging & therapeutic equipment Units Units +5% p.a. +7% p.a. FY 2006 FY 2007 FY 2008 FY 2009E FY 2006 FY 2007 FY 2008 FY 2009E 1) Pro-forma © Siemens AG 2009. All rights reserved. Page 22 Sept. 29, 2009 Capital Market Day Healthca

  23. Slide 23: Strong financial profile is a competitive edge

    Strong financial profile is a competitive edge Consistent source of capital for customers in a down market ƒ Partnered with in-house Financial Service unit SFS to offer customer financing William Beaumont Hospital, Detroit, ƒ Provided US$14.4m Michigan lease commitments in FY 2009 to +290% ƒ 3 acute

  24. Slide 24: Increased resilience against soft U.S. equipment market

    Increased resilience against soft U.S. equipment market Share of U.S. equipment FY 2006 Share of U.S. equipment FY 2009 Revenue €bn Revenue €bn 9% share 8.8 0.8 2.6 20% share 5.9 1.2 5.3 4.6 +5% CAGR 06-09 Q3 YTD U.S. Rest of Q3 YTD U.S. Dia- Rest of FY 2006 equipment Healthcare FY 2009 equipment gn

  25. Slide 25: Increasing exposure to high-growth geographies

    Increasing exposure to high-growth geographies Revenue split by customer location Revenue share in emerging markets FY 2008 Emerging markets 19% +7% p.a. 19% Western Europe 15% 32% Other 13% developed 10% markets 39% North America FY 2002 FY 2005 FY 2008 © Siemens AG 2009. All rights reserved. Page

  26. Slide 26: Committed to reaching our margin targets

    Committed to reaching our margin targets Our challenges Our opportunities ƒ Changing regulatory environment in ƒ €150m sustainable SG&A reduction in the U.S. FY 2009 ƒ Increased LCC sourcing – annual ƒ Softness in orders in imaging purchasing volume ~€900m equipment ƒ €100m further cost savings ƒ De

  27. Slide 27: Reconciliation and Definitions for Non-GAAP Measures (I)

    Reconciliation and Definitions for Non-GAAP Measures (I) To supplement Siemens’ Consolidated Financial Statements presented in accordance with International Financial Reporting Standards, or IFRS, Siemens presents the following supplemental financial measures: ƒ New orders; ƒ Adjusted or organic gro

  28. Slide 28: Reconciliation and Definitions for Non-GAAP Measures (II)

    Reconciliation and Definitions for Non-GAAP Measures (II) Adjusted or organic growth rates of Revenue and new orders In its financial reports, Siemens presents, on a worldwide basis and for each Sector and Cross-Sector Business, the percentage change from period to period in Revenue and new orders a

  29. Slide 29: Reconciliation and Definitions for Non-GAAP Measures (III)

    Reconciliation and Definitions for Non-GAAP Measures (III) ROCE at the Siemens group level, on a continuing operations basis Siemens also presents group ROCE on a continuing operations basis. For this purpose, the numerator is Income from continuing operations and the denominator is CE, less Assets

  30. Slide 30: Reconciliation and Definitions for Non-GAAP Measures (IV)

    Reconciliation and Definitions for Non-GAAP Measures (IV) Adjusted industrial net debt Siemens defines adjusted industrial net debt as net debt less (1) SFS debt excluding SFS internally purchased receivables; less (2) 50% of the nominal amount of our hybrid bond; plus (3) the funded status of pensi

  31. Slide 31: Siemens investor relations contact data

    Siemens investor relations contact data Mariel von Drathen +49-89-636-33780 Munich Office +49-89-636-32474 US Office +1-408-464-2004 Internet: http://www.siemens.com/investorrelations Email: investorrelations@siemens.com Fax: +49-89-636-32830 © Siemens AG 2009. All rights reserved. Page 31 Sept. 29,

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