Siemens Aktiengesellschaft · XETR:SIE

Siemens Aktiengesellschaft — Siemens — Q2 2010 Earnings Presentation

26 slides from Siemens Aktiengesellschaft's earnings presentation, Apr 29, 2010

1. Slide 1: Excellent performance in stabilizing markets

   Excellent performance in stabilizing markets Peter Löscher, President and CEO Joe Kaeser, CFO Q2 FY 2010, Analyst Meeting, London April 29, 2010 Page 1 Q2 FY 2010, Analyst Meeting, April 29, 2010 Copyright © Siemens AG 2010. 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: Excellent Q2 performance

   Excellent Q2 performance ƒ Order intake down due to contraction in long cycle businesses in Industry and Energy ƒ Revenue stabilized through recovery of short cycle businesses and healthy growth in emerging markets ƒ Higher Total Sector Profit1) based on strong execution and sustainable cost-managem

4. Slide 4: Strong profitability benefiting from stringent cost management

   Strong profitability benefiting from stringent cost management Siemens (continuing operations), in €m Q2 09 Q2 10 Change in % New orders 1) 20,864 17,844 (14) Revenue 1) 18,955 18,227 (4) Book-to-bill 1.10x 0.98x Profit Total Sectors 1,844 2,138 16 Net income 2) 1,013 1,498 48 Basic earnings per sha

5. Slide 5: Excellent backlog going into H2

   Excellent backlog going into H2 Strong order backlog 1) Major order wins in Q2 €bn Industry: 83 84 23 ƒ €450m agreement for supply of components 9 for Chinese intercity trains – first sub-order Industry 28 28 12 61 already received for 32 trainsets 2 19 ƒ Maintenance contract for baggage handling sy

6. Slide 6: Industry: Recovery of short cycle businesses

   Industry: Recovery of short cycle businesses Q2 Key Financials Q2 Highlights Orders Revenue Profit y-o-y1) y-o-y1) margin²) ƒ Short cycle businesses recovering, late cycle businesses operate in continued weak markets Industry - 8% - 4% 9.4% Industry Automation 14% 4% 14.2% ƒ Revenue stabilized by gr

7. Slide 7: Energy: Book-to-bill close to 1

   Energy: Book-to-bill close to 1 Q2 Key Financials Q2 Highlights Orders Revenue Profit ƒ B-t-B at 0.98 in contracting markets y-o-y1) y-o-y1) margin²) Energy - 26% -4% 14.0% ƒ Strong backlog and good execution in all Fossil -35% 4% 14.2% Divisions Renewable Energy -61% 2% 12.4% ƒ Fossil: Healthy marg

8. Slide 8: Healthcare: Orders pick up at Imaging & IT

   Healthcare: Orders pick up at Imaging & IT Q2 Key Financials Q2 Highlights Orders Revenue Profit ƒ Passage of US Healthcare Reform removes y-o-y1) y-o-y1) margin²) uncertainty – positive market development Healthcare 1% 0% 16.6% Imaging & IT 8% 1% 21.1% ƒ Tough comps due to large order at Workflow &

9. Slide 9: Our innovative solutions address key customer needs

   Our innovative solutions address key customer needs Audi A8 – first volume vehicle Renewable energy – Next generation MR – more with all-LED forward lighting new 3 MW gearless turbine productivity and applications Ostar Headlamp product family 3 MW gearless wind turbine MAGNETOM Aera* & Skyra* ƒ A8:

10. Slide 10: Financial Fit42010 targets well on track

    Financial Fit42010 targets well on track Profitability Cash Conversion (continuing ops.) Q2 10 1 – growth rate Industry 9.4% 9 – 13% 1.19 Energy 14.0% 11 – 15% 1.06 1.04 0.95 0.84 Healthcare1) 18.1% 14 – 17% 0.66 Total 12.3% Sectors Q2 09 Q2 10 H1 10 Fit42010 Target margin range 1) excl. PPA DX Capi

11. Slide 11: Continued tight working capital and capex management

    Continued tight working capital and capex management Working capital turns Capex2) spending reduced NWC1) Capex / Depreciation Turns Total Groups Total Sectors 10 150% Total Groups Total Sectors 127% 130% 8.8 113% 116% 115% 9 8.6 110% Target 8.2 96% Range 110% 8.0 8.1 8 90% 95% 7.2 70% 7 58% 50% Org

12. Slide 12: Free Cash Flow generation at exceptional high level

    Free Cash Flow generation at exceptional high level €m 4,903 ƒ Excellent working capital management with turns at 8.1 3,641 ƒ Stringent Capex management 1,929 2,138 697 696 519 -801 FCF – YTD 2010 -548 FCF – YTD 2009 FCF – YTD 2008 Payments of ~ €1bn for settlement with German and -1,651 US authorit

13. Slide 13: Prepayments – reversal of down-trend or just a deep breath?

    Prepayments – reversal of down-trend or just a deep breath? €bn Advance payments New orders & BiE 1) 50 16 ? 14 40 12 10 30 8 20 6 4 10 2 0 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09 10 10 New orders Operations Grou

14. Slide 14: 'Below Total Sector' impacted by one time effects

    ‘Below Total Sector’ impacted by one time effects Q2 FY 10 ‘Below Total Sectors’ What to expect going forward €m 107 2,138 97 ƒ Equity Investments to be significantly impacted by further NSN restructuring -25 -87 -10 -187 ƒ SIS carve out on track incl. significant resource adjustments – restructurin

15. Slide 15: Recovering economic indicators – capacity utilization well below peak levels

    Recovering economic indicators – capacity utilization well below peak levels ISM Purchasing Manager Index Capacity Utilization Rates Index 65 Expanding economy Germany Euro Area US 59.6 In % 60 90 55 85 50 80 45 75 40 ~72 35 70 Contracting economy 30 65 97 98 99 00 01 02 03 04 05 06 07 08 09 Q1 97 9

16. Slide 16: Our revised expectations for 2010

    Our revised expectations for 2010 ƒ We continue to expect a mid- single-digit percentage decline in organic revenue in FY 10 due in part to the stabilizing effect of our strong order backlog ƒ Total Sectors profit will be above the prior year level of €7.466bn ƒ This increase from our earlier guidan

17. Slide 17: Consistent execution against plan

    Consistent execution against plan Reporting dates Milestones (deliverables) January 2008 ƒ New target margins for Energy and Industry Sector Q1 call and AGM ƒ Target margins for Divisions April 2008 ƒ Update on SG&A project Q2 analyst conference ƒ Start reporting in new structure July 2008 ƒ Outline

18. Slide 18: Financial calendar

    Financial calendar April April 29 – 30, 2010 Q2 financial report and analyst conference (London) UK Roadshow (London) May May 18, 2010 EPG Conference (Florida) May 21, 2010 Deutsche Bank German and Austrian Corporate Conference (Frankfurt) June June 2, 2010 UBS Nordic Conference (Stockholm) June 10,

19. Slide 19: Siemens investor relations contact data

    Siemens investor relations contact data Mariel von Drathen +49-89-636-33780 Munich Office +49-89-636-32474 Internet: http://www.siemens.com/investorrelations Email: investorrelations@siemens.com Fax: +49-89-636-32830 Page 19 Q2 FY 2010, Analyst Meeting, April 29, 2010 Copyright © Siemens AG 2010. Al

20. Slide 20: Appendix

    Appendix Page 20 Q2 FY 2010, Analyst Meeting, April 29, 2010 Copyright © Siemens AG 2010. All rights reserved.

21. Slide 21: Low financial leverage and strong cash position provide buffer for coming quarters

    Low financial leverage and strong cash position provide buffer for coming quarters €bn Adj. ind. Adj. ind. ND/EBITDA ND/EBITDA 0.28x 0.35x Therein e.g. -3.0 • Interest paid -89m • ∆ fair value of debt in hedge accounting -0.2 -3.9 • Dividend paid -1.4 5.5 ƒ Pension deficit -4.6 5.6 ƒ OPEB -0.7 -0.6

22. Slide 22: 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 and order backlog ƒ Adjust

23. Slide 23: Reconciliation and Definitions for Non-GAAP Measures (II)

    Reconciliation and Definitions for Non-GAAP Measures (II) New orders and order backlog (continued) New orders are generally recognized immediately when the relevant contract becomes legally effective and binding. The only exception are orders with short overall contract terms. In this case, a separa

24. Slide 24: Reconciliation and Definitions for Non-GAAP Measures (III)

    Reconciliation and Definitions for Non-GAAP Measures (III) Return on equity, or ROE In line with common practice in the financial services industry, Siemens Financial Services (SFS) uses return on equity, or ROE, as one of its key profitability measures. Siemens defines ROE as annualized Income befo

25. Slide 25: Reconciliation and Definitions for Non-GAAP Measures (IV)

    Reconciliation and Definitions for Non-GAAP Measures (IV) EBITDA (adjusted) and EBIT (adjusted) Siemens defines EBITDA (adjusted) as EBIT (adjusted) before amortization (which in turn is defined as Amortization and impairments of intangible assets other than goodwill) and Depreciation and impairment

26. Slide 26: Reconciliation and Definitions for Non-GAAP Measures (V)

    Reconciliation and Definitions for Non-GAAP Measures (V) Limitations Associated with Siemens’ Supplemental Financial Measures The supplemental financial measures reported by Siemens may be subject to limitations as analytical tools. In particular: ƒ With respect to adjusted or organic growth rates o

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