Siemens Aktiengesellschaft · XETR:SIE
Siemens Aktiengesellschaft — Siemens — Q4 2014 Earnings Presentation
31 slides from Siemens Aktiengesellschaft's earnings presentation, Nov 6, 2014
Slide 1: Fiscal Year guidance achieved, Execution of Vision 2020 begun
Joe Kaeser, President and CEO Ralf P. Thomas, CFO Lisa Davis, Member of the Managing Board Fiscal Year guidance achieved Execution of Vision 2020 begun Q4 FY 2014, Analyst Call Berlin, November 6, 2014 © Siemens AG 2014. All rights reserved.
Slide 2: Notes and Forward Looking Statement
Notes and Forward Looking Statement This document contains statements related to our future business and financial performance and future events or developments involving Siemens that may constitute forward-looking statements. These statements may be identified by words such as “expect,” “look forwa
Slide 3: Our agenda for today
Our agenda for today Delivering on targets – key financials Q4 Fiscal 2014 Driving value for shareholders E Execution ti off “Siemens “Si – Vision Vi i 2020” started t t d Setting clear priorities to achieve targets in Fiscal 2015 and beyond © Siemens AG 2014. All rights reserved. Page 3 November 6,
Slide 4: We delivered on our FY 2014 targets
We delivered on our FY 2014 targets FY 2014 Outlook FY 2014 Actual Performance Orders (€bn) Revenue (€bn) • We expect revenue on an organic basis to comp. Book-to-bill comp. +1% remain level year-over-year, and orders to 1.09 +1% exceed revenue for a book-to-bill ratio above 1. 79.8 -1.4 78.4 73.4
Slide 5: Capital efficiency back in target range
One Siemens cockpit – FY 2014 Capital efficiency back in target range Financial target system Growth1) Margins compared to industry benchmarks Revenue growth (rolling 4 quarters FY 14) EBITDA Margins (FY 2014) Energy 8 1% 8.1% 10-15% Siemens -2.1% Healthcare 20.5% 15-20% -6.2Pp Industry 16.4% 11-17%
Slide 6: Large contract wins in US Rail and European Wind Power lift orders
Large contract wins in the US Rail and European Wind Power business lift orders Orders Q4 FY 14 y-o-y1) Revenues Europe/C.I.S./Africa/ME +11% -1% (therein Germany) +14% +9% Americas -9% +4% (therein U.S.) +3% +8% Asia/Australia +2% +5% (therein China) +1% +7% 7% 1) Change is adjusted for currency tr
Slide 7: Healthcare – Strong profit contribution continues
Healthcare – Strong profit contribution continues Key Figures Healthcare Main developments in Q4 €bn €m • Order growth in Europe/CAME3) and Americas Orders 1) Revenue 1) Profit 2) offset softness in China • Slightly lower profit margin on tough 20.2% 18.2% comparables and continued currency effect +
Slide 8: Industry – Better mix and effective growth conversion lift earnings and margins
Industry – Better mix and effective growth conversion lift earnings and margins Key Figures Industry Main developments in Q4 €bn €m • Lower volume of large orders in long cycle Orders 1) Revenue 1) Profit 2) business of Drive Technologies; broad based revenue growth 13.7% 15.1% -5% +4% • Industry Au
Slide 9: Infrastructure & Cities – Stringent execution drives excellent profit development
Infrastructure & Cities – Stringent execution drives excellent profit development Key Figures Infrastructure & Cities Main developments in Q4 €bn €m • Major orders in Transportation & Logistics Orders 1) Revenue 1) Profit 2) (U.S. and UK) drive bookings +21% 9.0% 9.1% • Transportation & Logistics –
Slide 10: Energy – Pressure on growth and profit
Energy – Pressure on growth and profit Key Figures Energy Main developments in Q4 €bn €m • Market environment remains competitive in all Orders 1) Revenue 1) Profit 2) areas -5% 5% -2% 2% • Lower orders driven by a decline in the 10.6% 9.0% 7.6 Americas 7.1 7.4 7.1 7.6% • Power Generation – Strong p
Slide 11: Power Generation: Ensuring competitiveness
Power Generation: Ensuring competitiveness Current market environment Siemens response • Increase in R&D investment Slow demand • Shift focus to address key yggrowth areas Drive D i • Improve time to market and time to Innovation Resultant overcapacity impact for supply • Use data analytics to incre
Slide 12: Wind Power: Growth and operational excellence
Wind Power: Growth and operational excellence Performance and challenges Current activities • Clear #1 in Offshore – the • Focus on Engineering and SCM strongest growing segment processes to drive corrective and preventive i actions i • Cost-out focus driving to grid Engineering + parity in Onshore
Slide 13: Significant structural changes for FY 2015
Below Total Sectors Significant structural changes for FY 2015 Q4 FY 2014 'Below Total Sectors' What to expect p in FY 2015? €m Execution of Vision 2020 will have significant positive influence on Net income due to portfolio 72 26 120 optimization; realization and quantification of 65 effects depend
Slide 14: Seasonal strong finish in Fiscal Q4
Free cash flow Seasonal strong finish in Fiscal Q4 Key drivers free cash flow Free cash flow development ("all-in") ( all in ) (Total Sectors) €m Operating Working Capital turns Total Sector 5,328 5,201 9.0 7.6 7.2 4,336 3,450 FY 2012 FY 2013 FY 2014 Advance p payments y & BiE Orders in €bn 1,048 (i
Slide 15: Attractive shareholder return driven by stable dividend policy
Attractive shareholder return driven by stable dividend policy € 4,00 Payout ratio policy Dividend per share Dividend payout ratio3) 3,00 2,00 46% 48% 49% 60% 42% 57% 40% 1,00 € 2.70 2 70 € 3.00 3 00 € 3.00 3 00 € 3.00 3 00 € 3.30 3 30 0,00 2010 2011 2012 2013 2014 Dividend 2,356 2,629 2,528 2,533 2
Slide 16: … and through consistent execution of share buyback
… and through consistent execution of share buyback Current status of share buyback Shares issued and shares outstanding Share price and weekly repurchase volume May 12 – Oct 31, 2014 Number of shares in million (rounded) 881 38 Average price: €92.71 1.600.000 100 843 12 1.400.000 831 Treasury share
Slide 17: Clear milestones until 2016
Siemens – Vision 2020 Clear milestones until 2016 Until Execution steps p Q4 2014 Execution of ‘Siemens 2014’ measures Implementation p of new organization, g , start in new structure on Oct 1 Introduction of Incentive System 2015 Sharpening p g brand message g starting g in Oct 2014 Q2 2015
Slide 18: Value creation & Cultural change
Siemens – Vision 2020 Value creation & Cultural change "Siemens Vision 2020" Value Scale up p Strengthen core Drive performance Foster ownership culture and leadership based on common values 2015 2016 2017 2018 2019 2020 Strategic Operational Optimi- Accelerated Growth and direction consolidation za
Slide 19: Executing Siemens – Vision 2020 by strengthening the strategic core
Executing Siemens – Vision 2020 by strengthening the strategic core E Expected t d closing l i Q1 CY 15 Dec 2014 Healthcare IT Aero-derivative gas turbines Divestment to Cerner for US$1.3bn announced & compressors • £785m purchase price + £200m exclusive Microbiology Q1 CY 15 Divestment to Beckman C
Slide 20: Divestment of Audiology Solutions for €2.15bn
Executing Siemens – Vision 2020 Divestment of Audiology Solutions for €2.15bn €2 15bn Vision 2020 Strategic rationale Key y transaction facts A leading global player; Divestment to EQT and family Area of growth? strong in emerging markets Struengmann – growth investors Market growth ~3-4% p.
Slide 21: Simplified and fully integrated compensation system
Executing Siemens – Vision 2020 Simplified and fully integrated compensation system Compensation system for Managing Board as of FY 2015 1/3 1/3 1/3 Variable Variable V i bl stock-based t kb d compensation compensation Fixed + (Cash Bonus) + (Siemens Stock Awards) base cash 1/3 1/3 1/3 compensation
Slide 22: Leadership priorities 2015
Leadership priorities 2015 Capture growth opportunities through market driven organization Simplification of processes and rigorous implementation of business excellence & risk management Successful execution of portfolio priorities and integration of acquisitions Stringent capital allocation for bu
Slide 23: Assumptions Fiscal 2015
Assumptions Fiscal 2015 Macroeconomic • Complex market conditions impacted by geopolitical developments environment • Modest growth for short cycle businesses expected Volume V l and d • Book-to-bill B k t bill >11 mainly i l driven di by b Energy E Management M t and d Power P & Gas G pricing • Pri
Slide 24: Outlook Fiscal 2015
Outlook Fiscal 2015 Basic earnings per share (Net income) In € At least 15% • We believe that our business environment will growth be complex in fiscal 2015, among other things due to g geopolitical p tensions. • We expect revenue on an organic basis to 6.55 6.37 remain flat year-over-year, and orde
Slide 25: Appendix
Appendix © Siemens AG 2014. All rights reserved. Page 25 November 6, 2014 Q4 FY 2014, Analyst Call
Slide 26: Q4 FY 2014 – Key figures
Q4 FY 2014 – Key figures Siemens (in €m) Q4 FY 13 Q4 FY 14 Change Orders 20,298 20,733 2%1) Revenue 20,559 20,621 1%1) Book-to-bill ratio 0.99x 1.01x Total Sectors profit 1,711 2,195 28% Net income 1,068 1,498 40% Basic earnings per share net income (in €) 1.19 1.72 44% Free cash flow (continuing op
Slide 27: North Sea offshore grid connection projects reach completion >80%
North Sea offshore grid connection projects reach average percentage of completion >80% Order Con- Construc- Equipping Installation Installation Commis- Commer- entry struction tion land platform baseframe platform sioning cial platform station operation HelWin1 2010 2014 BorWin2 2010 2015 SylWin1 2
Slide 28: Net Debt Bridge as of Q4 FY14
Net Debt Bridge as of Q4 FY14 €bn Q4 ∆Q3 • SFS Debt +18.7 +1.6 • Pensions -9.3 9 3 +1 +1.1 1 Operating Activities • Credit guarantees -0.8 +0.1 Adj. ind. Net Debt/ • Hybrid adjustments +0.9 +0.0 EBITDA • Fair value adj. +1.1 +0.0 0.15x (hedge accounting) (Q3 FY14: 0.63x) therein: • ∆ Inventories net
Slide 29: One Siemens Financial Framework sets the aspiration
One Siemens Financial Framework sets the aspiration One Siemens Financial Framework Siemens Capital efficiency Capital structure Growth: (ROCE2)) (Industrial net debt/EBITDA) Siemens > most 15-20% up to 1.0x relevant competitors1) (Comparable revenue growth) Total cost productivity3) Dividend payout
Slide 30: Financial calendar
Financial calendar November November 6, 2014 Q4 Earnings Release / Analyst Call, Roadshow Germany (Frankfurt) November 7, 2014 Roadshow UK (London) November 10, 2014 Roadshow France (Paris) N November b 1313, 2014 Goldman Sachs Conference, Roadshow U.S. (Boston) December December 8 - 9, 9 2014 Capit
Slide 31: Siemens Investor Relations contacts
Siemens Investor Relations contacts Investor Relations Internet: www.siemens.com/investorrelations Email: investorrelations@siemens.com IR- +49 89 636 636-32474 32474 Hotline: Fax: +49 89 636-32830 © Siemens AG 2014. All rights reserved. Page 31 November 6, 2014 Q4 FY 2014, Analyst Call