Siemens Aktiengesellschaft · XETR:SIE
Siemens Aktiengesellschaft — Siemens — Investor Day (December 2014)
16 slides from Siemens Aktiengesellschaft's investor day presentation, Dec 9, 2014
Slide 1: Sustainable value generation based on solid financials
Ralf P. Thomas | Member of the Managing Board and CFO Sustainable value generation based on solid financials Siemens Capital Market Day | Berlin, December 9, 2014 © Siemens AG 2014
Slide 2: Notes and forward-looking statements
Notes and forward-looking statements 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 forw
Slide 3: Vision 2020 sets the course for capital efficient growth
Vision 2020 sets the course for capital efficient growth Successful completion Our path to sustainable of FY 2014 value generation ✓ We delivered the results we promised in our guidance Risk Manage- ment Efficient Cost Structure ✓ We made substantial progress strengthening Value Generation our portf
Slide 4: Profit Margin and ROCE increase in low growth environment
Profit Margin and ROCE increase in low growth environment Orders Revenue Net Income Total cost productivity in €bn +0.8% Comp. +0.5% Profit 8.8% 10.6% (-1.8%) (nom.) (-2.1%) Margin 3-5% (Industrial 79.1 77.7 72.8 71.2 Business) +1.1 in €bn 5.5 4.4 4.0% 4.1% B-t-B 1.09 1.09 FY 13 FY 14 FY 13 FY 14 FY
Slide 5: New structure along value chain of electrification provides further room for value generation
New structure along value chain of electrification provides further room for value generation Profit margins of businesses Power Wind Energy Building Mobility Digital Process Healthcare SFS1) and Gas Power Manage- Tech- Factory Industries & & Renew- ment nologies Drives ables 11-15% 5-8% 7-10% 8-11%
Slide 6: Another year with more than five billion FCF, despite lower advance payments
Another year with more than five billion FCF, despite continuing trend of lower advance payments Key drivers free cash flow FCF development (“all-in”) Operating Working Capital turns Total Sectors 5.328 FY 2013 9.0 FY 2014 5.201 7.6 7.2 in €bn FY 2012 FY 2013 FY 2014 Advance payments Orders & BiE in
Slide 7: Improved backlog quality from new orders; legacy projects phasing out
Improved backlog quality from new orders; legacy projects phasing out Risk Manage- ment Value Generation Efficient Cost Structure Risk Resource Allocation Management Order backlog portfolio (Sep 30, 2014) Order backlog revenue recognition in €bn 100 Order backlog Industrial Business: €100bn 36 Produ
Slide 8: Major milestones of legacy projects achieved; majority completed 2017
Major milestones of legacy projects achieved; majority will be completed 2017 Risk Manage- ment Value Generation Efficient Cost Structure Risk Resource Allocation Management Estimated project completion Offshore grid connections – North Sea PoC ca. 75%-90% 2015 HVDC links – Canada and UK ~2016/17 Po
Slide 9: Corporate Memory established for improving risk mitigation and reducing project charges
"Corporate Memory" established for improving risk mitigation and reducing project charges Risk Manage- ment Value Generation Efficient Cost Structure Risk Resource Allocation Management Lessons learned Intensification "Corporate & Implementation of … Memory" Typical risk … identification Extended ri
Slide 10: Efficient cost structure, consequently driving down cost
Efficient cost structure, consequently driving down cost Risk Manage- ment Value Generation Efficient Cost Structure Efficient Resource Allocation Cost Structure Stringent execution of organizational streamlining 2013 • Reduction of Managing Board members from 10 to 7 2014 • Dissolution of Clusters
Slide 11: Continuous productivity improvements serve as countermeasure for price change and cost inflation
Continuous productivity improvements serve as countermeasure for price change and cost inflation Risk Manage- ment Value Generation Efficient Cost Structure Efficient Resource Allocation Cost Structure Levers for productivity improvement Supply Chain • Global value sourcing • Second sourcing/multipl
Slide 12: Capital allocation with clear priorities
Capital allocation with clear priorities Risk Manage- ment Value Generation Efficient Cost Structure Resource Resource Allocation Allocation Criteria to strengthen core … … by continuous focus on portfolio … Investments Divestments 1| Areas of growth? • B/S/H/ 2| Potential profit pool? • Dresser-Ran
Slide 13: Sustainable value generation delivers attractive shareholder returns
Sustainable value generation delivers attractive shareholder returns Risk Manage- ment Value Generation Efficient Cost Structure Resource Resource Allocation Allocation Attractive dividend yield Share buyback • Dividend increase by 10% to €3.30 • Up to €4bn over 2 years • Payout ratio of 40-60% at h
Slide 14: Assumptions FY 2015
Assumptions FY 2015 • Complex market conditions impacted by geopolitical developments Macroeconomic environment • Modest growth for short cycle businesses expected • Significant gains from divestments cover restructuring charges and Execution of Vision 2020 drive EPS growth Pricing • Pricing pressur
Slide 15: Nearly all businesses expected to be in their target ranges in 2015
Nearly all businesses expected to be in their target ranges in 2015 Profit Margins Outlook1) FY 2015 FY 2014 Target ranges • Revenue flat on an organic basis • Book-to-bill ratio above 1 PG 17% 11-15% • Increase basic earnings per share at least 15% WP 0% 5-8% • Industrial Business profit margin of
Slide 16: We are fully committed to sustainable value generation
We are fully committed to sustainable value generation Delivering on our outlook Vision 2020 Significantly reducing Scale up project charges Strengthen core Streamlining our organization Drive performance Efficiently allocating capital Ownership culture Disciplined execution of Vision 2020! © Siemen