Siemens Operations Ran to Expectations in April, Finance Chief Kaeser Says
Siemens AG, Europe’s largest engineering company, said business in April met management targets and efforts to curtail government spending in Europe won’t jeopardize its prospects.
“I don’t believe fiscal policy will have an effect on Siemens,” Chief Executive Officer Joe Kaeser told reporters at a business conference today. Nor will currency fluctuations such as the euro’s drop be detrimental as the company is hedged for 2010 and partly covered for 2011, he said.
The German company expects to meet margin targets for its three divisions -- industry, energy and health care -- as long as the market environment remains stable, the executive said.
Siemens has reached the “final yards” of its growth and efficiency drive known as Fit42010 and is “on track” to complete it on time, Kaeser said. There are no concrete plans yet for a successor, he said. The Munich-based maker of power plants, trains and scanners raised its outlook for full-year earnings on April 29 following increased demand for factory automation equipment and a purge on costs.
Siemens fell 1.3 percent to 70.88 euros as of 10:18 a.m. in Frankfurt, tracking a general decline in German and other European stocks.
Kaeser said Siemens will “definitely” not resume buying back shares this year.
“If we ever do it again depends on whether we’ll see a more reasonable relationship between business performance and the share price,” he said.
Siemens’s buyback strategy contrasts with that of General Electric Co., which expects to acquire shares as it approaches year-end with an estimated $25 billion in cash. GE, based in Connecticut, is scaling back some cash-saving steps adopted in 2008 as the financial crisis deepened.