08 August 2024
If you are covering Siemens' latest results, please see the following comment from Jarek Pominkiewicz, equity research analyst at Quilter Cheviot:
“The latest results from Siemens this morning came in slightly ahead of consensus. Given the negative read from some of its automation peers, management somewhat surprisingly reiterated its previous guidance at both group level and for its Digital Industries segment, though it steered towards the bottom of its indicative ranges.
“Siemens’ industrial order intake declined by -17% organically, primarily due to a record intake in Mobility in Q3 2023, though this was still 1% ahead of consensus. Meanwhile, industrial business sales were up +4% organically and in line with consensus, led by a double-digit increase in Smart Infrastructure, as well as contributions from Healthineers and Mobility. Industrial business profit, excluding severance, increased by +11% year on year, roughly 7% ahead of consensus and demonstrating margin expansion across all industrial businesses.
“Smart Infrastructure continues to trade well, with growing order numbers and sales in double-digits, putting it in line with the top-end of its peers. Digital Industries also performed well with orders up +21% year on year as a result of strong software contribution which benefited from large license contracts and the transition to the subscription fee model. Automation continued to show weakness, but the absence of incremental negatives was positive and suggests we may be nearing the end of the downgrade cycle, should the soft landing scenario not deteriorate significantly.
“Looking ahead, Siemens continues to have the strongest strategic positioning in industrial automation and software, as well as relatively solid exposure to electrification. As its automation business recovers, we would expect Siemens’ relative discount to peers to gradually narrow.”
