Thursday, January 27, 2011

Clean tech at heart of Siemens' record results

Siemens has beat analysts' predictions, with a record set of quarterly results that appear to, once again, vindicate the company's focus on emerging clean technologies.

The German engineering giant today said its income from continuing operations reached a record level of €1.79bn (£1.54bn) in the last three months of 2010, increasing 17 per cent on the previous year.

Net income increased 15 per cent on the previous year to €1.75bn, exceeding analyst predictions that had averaged €1.47bn in a Reuters poll.

Commenting on the announcement, an analyst at Cheuvreux told Bloomberg: "Siemens is on the right track strategically. It is executing well and capturing market share."

In particular, Siemens' order book was boosted by its focus on public transport, including orders for 10 new high-speed Eurostar trains and an order to upgrade Munich's subway system.

New orders for the Siemens Energy division also climbed 27 per cent, bolstered mainly by its fossil fuel business. But the company's renewable energy activities were also credited with driving a 14 per cent increase in the division's revenue.

The company's renewable energy business posted a strong rise in revenue – to €868m on conversion of a number of large orders. As a result, first-quarter profit increased year-on-year, despite significantly higher expenses for research and development, marketing and selling linked to the expansion of its wind business and integration of its solar thermal business.

Chief executive Peter Löscher reiterated a forecast of "moderate" sales growth for the year, despite the company's success. "Capital-efficient growth is our aspiration. We have lived up to it," he said.

He added that success of the company was also driven by its focus on green innovation. The company now has 80,000 patents in clean technology, he said, adding that the number of inventions registered by employees doubled in the last decade.

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