Siemens’ third-quarter net profit drops

28 Jul 2011

Unexpected charges sank industrial giant Siemens’ third-quarter net profit down 65pc from €1.4bn in the same period last year to €501m.

The charges stem from the company leaving its nuclear joint venture with Areva SA.

Siemens’ revenue rose 2.4pc to €17.844bn, just shy of market expectations for €18.2bn.

The company, a maker of trains, streetcars, power generation and transmission equipment, and medical diagnostic machinery, took more than €1bn in one-time charges. An arbitration award cut earnings by €682m after Siemens ended its nuclear co-operation with Areva SA and opted to seek another partner.

Siemens also took a €382m writeoff after re-evaluating the commercial feasibility of using its particle therapy machines for general patient treatment.

“We continued to grow in the third quarter and are on track to reach our targets for fiscal 2011. New orders rose again sharply, driven by a large order at Mobility,” said Siemens president and CEO Peter Löscher.

“We’re vigorously tackling operating challenges. Our markets are still robust, although the risks are increasing somewhat in the global economic environment.”

New orders at Siemens climbed 20pc year-over-year, to €22.9bn.