Germany's Siemens AG (SIE.XE) on Thursday said fourth-quarter net profit rose at the group level, citing good results from most of its operations, despite sharply lower earnings at its industrial business.
Net profit for the July-September period was 1.29 billion euros ($1.50 billion), up from EUR1.15 billion a year earlier, and exceeding a consensus provided by FactSet of EUR1.27 billion.
Continue Reading Below
However, profit at Siemens's industrial business--which encompasses all of the group's operations apart from its financial arm--fell 10% on year, weighed down by a 40% decline in earnings at its gas-and-power unit and a net loss at its wind turbine business.
Chief Executive Joe Kaeser said Siemens had to tackle structural issues at individual businesses and that the company has a lot of work to do in fiscal 2018.
Speaking at a press conference, Mr. Kaeser said the company will seek to adapt its gas-and-power business to focus on Latin America, Asia and Africa, as demand for large gas and coal turbines continues to dwindle in Europe and North America.
The company also said that later in November it would begin negotiations with unions over potential job cuts within the division, which currently employs around 30,000 people.
Revenue for the quarter was up slightly at EUR22.30 billion from EUR21.95 billion a year earlier, though it fell short of a consensus estimate for EUR23.44 billion compiled by FactSet.
Orders for the quarter climbed 16% to EUR23.66 billion, outstripping sales and ensuring a quarterly book-to-bill ratio of 1.06.
The company proposed to raise its dividend by EUR0.10 a share to EUR3.70 a share.
Siemens also said it expects modest organic revenue growth for fiscal 2018, and basic earnings of EUR7.20 to EUR7.70 a share. The company predicts a profit margin at its industrial business of between 11% to 12% excluding severance charges, which are likely to be substantial given looming job cuts.
Write to Nathan Allen at firstname.lastname@example.org
(END) Dow Jones Newswires
November 09, 2017 04:58 ET (09:58 GMT)