SIEGY Siemens AG (PK)

   By Kim Richters 
 

Siemens AG (SIE.XE) on Wednesday reported a slight rise in first-quarter net profit but a sharp drop in adjusted earnings, and it backed its guidance for the full year.

Net profit at the German engineering conglomerate rose slightly to 1.08 billion euros ($1.19 billion) from EUR1.01 billion a year earlier.

The company's adjusted earnings before interest, taxes and amortization for the quarter dropped 30% to EUR1.43 billion, while its industrial profit margin declined to 7.3% from 10.5%. The sharp decline was mainly due to a loss at its subsidiary Siemens Gamesa Renewable Energy (SGRE.MC) and market weakness for its short-cycle businesses, Siemens said.

Revenue for the quarter increased to EUR20.32 billion from EUR20.12 billion, the company said, adding, however, that revenue on a comparable basis fell 1%.

Orders fell to EUR24.76 billion from EUR25.17 billion due to a lower volume of large orders in its mobility business, according to the company.

"After a powerful finish in fiscal 2019, the first quarter started slowly as expected," Siemens CEO Joe Kaeser said. "The weak performance across our energy businesses reinforces our priorities."

Analysts had expected quarterly net profit of EUR912 million on revenue of EUR22.64 billion, according to a consensus provided by the company.

The company backed its guidance for the full fiscal year 2020, which includes moderate growth in comparable revenue and earnings per share from net income to be between EUR6.30 to EUR7.00, compared with EUR6.41 in the comparable period.

Siemens said late Monday that it will acquire Iberdrola SA's (IBE.MC) stake in the Siemens Gamesa Renewable Energy for EUR1.1 billion.

Write to Kim Richters at kim.richters@wsj.com

(END) Dow Jones Newswires

February 05, 2020 01:52 ET (06:52 GMT)

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