Industrial conglomerate Siemens AG has recently told the press that its third-quarter profit fell 31 percent from the same period a year ago, but was buoyed by better orders for power plants.
The company, which makes a wide range of products including trains, light bulbs, medical equipment and power generation turbines, earned 1.42 billion euros ($2.2 billion) in the April-June period, down from 2.07 billion euros a year ago.
Revenue was up 10 percent to 19.2 billion euros ($29.76 billion) compared with 17.5 billion euros a year earlier.
Siemens said its pretax profit — used as a barometer by analysts — rose 29 percent to 2.5 billion euros ($3.9 billion) from 1.95 billion euros a year ago.
“We shifted Siemens into a higher gear in the third quarter, reaching important milestones on our reorganization path,” chief executive Peter Loescher in a statement.
“We are becoming faster, more efficient and more focused as a company, with the timely entrepreneurial approach that is required to stay on this course.”
Siemens said its closely watched new orders for the quarter rose 21 percent to 23.7 billion euros ($36.97 billion) from 19.5 billion euros a year ago.
Shares of Siemens ended up 5.8 percent at 77.45 euros ($120.68) in Frankfurt.
Order growth was well-balanced with double-digit expansion in all sectors. Revenue growth included double-digit increases in energy and health care and 8 percent growth in the company’s largest sector, industry.
Munich-based Siemens said Europe, including Russia and the former Soviet Union, and Africa saw 40 percent order growth and 12 percent revenue growth in the third quarter. In the Americas, orders and revenue grew 10 percent and 5 percent respectively, despite the weakened dollar.
Asia, Australia and the Middle East saw 9 percent revenue growth, including double-digit increases in China and India, while third quarter orders in the region were steady.
On Tuesday Siemens said it plans to sue two former CEOs and nine other ex-executives for alleged supervisory failings in a corruption scandal that has cost the company millions in fines.
Siemens decided to seek damages from former CEOs Heinrich von Pierer and his successor, Klaus Kleinfeld, now the chief executive of U.S.-based Alcoa Inc., but the company did not specify how much money it would demand.
The charges relate to illegal business practices and payments between 2003 and 2006 that are placing a substantial financial burden on the company. Siemens has acknowledged dubious payments of up to 1.3 billion euros ($2 billion) to win contracts.
Despite the corruption scandal, Siemens affirmed its outlook for 2008, but expected 2009 to be more challenging.
“While we expect a less favorable macroeconomic situation in 2009, we still plan to grow at twice the rate of annual gross domestic product,” Loescher said.