Siemens continued its growth trajectory in the past fiscal year 2023 (September 30, 2023) and - as it says - "achieved numerous records". Revenue in the operating business increased by 11% on a comparable basis (excluding currency translation and portfolio effects) for the full year. Both the result and profitability of the Industrial Business and profit after tax reached record levels. The Supervisory Board and Management Board therefore propose to increase the dividend from EUR 4.25 in the previous year to EUR 4.70 per share.

Roland Busch, President and CEO of Siemens: "Fiscal year 2023 was a year of numerous records: In our Industrial Business, we achieved our highest earnings and profitability figures ever. We almost doubled our profit after tax and thus reached an all-time high. I would like to thank all our colleagues around the world for their great commitment in contributing to these outstanding results. Our strategy is paying off and we continue to accelerate the digital and sustainable transformation of our customers."

Free cash flow of more than ten billion euros

Ralf P. Thomas, Chief Financial Officer, added: "Siemens continued its value-enhancing growth in fiscal 2023 and generated free cash flow of more than ten billion euros for the first time. Our shareholders will also benefit from this success with a proposed dividend increase to €4.70, a corresponding dividend yield of 3.5 percent and our expanded share buyback."

Records in industrial business

In the past fiscal year, Siemens increased revenue on a comparable basis by 11% to €77.8 billion (FY 2022: €72.0 billion). Order intake recorded an increase of 7% on a comparable basis to €92.3 billion (FY 2022: €89.0 billion). At 1.19, the ratio of incoming orders to sales ("book-to-bill ratio") is at an excellent level (FY 2022: 1.24). At EUR 111 billion, the order backlog once again reached a record high quality level.

The digital business continues to grow rapidly and recorded an increase of around 12% to €7.3 billion (FY 2022: €6.5 billion). Siemens has thus significantly exceeded its targeted growth rate of average annual growth of 10% in this fiscal year. Industrial Business earnings increased by 11% to €11.4 billion (FY 2022: €10.3 billion). The earnings margin of the Industrial Business improved to 15.4% (FY 2022: 15.1%). Profit after tax reached 8.5 billion euros after a profit after tax of 4.4 billion euros in financial year 2022. All three figures are record figures in the company's history. Basic earnings per share before the effects of purchase price allocation (EPS pre PPA) amounted to EUR 10.77 (FY 2022: EUR 5.47); excluding the Siemens Energy investment, which contributed EUR 0.84 to EPS pre PPA, EPS pre PPA amounted to EUR 9.93 and exceeded the forecast (EUR 9.60 to EUR 9.90). Free cash flow "all-in" from continuing and discontinued operations reached a record level at Group level and amounted to EUR 10.0 billion for the first time (FY 2022: EUR 8.2 billion). The Industrial Business also recorded a new high for free cash flow of EUR 10.4 billion (FY 2022: EUR 9.7 billion).

The fourth quarter

In the fourth quarter, order intake rose by 6% on a comparable basis to €21.8 billion with higher volumes from major orders at Mobility and growth at Siemens Healthineers and Smart Infrastructure. Sales also increased by 10% on a comparable basis to €21.4 billion (Q4 2022: €20.6 billion). Revenue was at record levels in all Industrial Businesses, with the largest contribution to growth coming from Smart Infrastructure. Earnings in the Industrial Business increased by 7% to EUR 3.4 billion and recorded the highest quarterly figure ever due to significant growth in Digital Industries and Smart Infrastructure. The profit margin reached 16.5%. Profit after tax amounted to 1.9 billion euros after 2.9 billion euros in the prior-year quarter, which benefited from a profit of 1.1 billion euros (before tax) from the sale of the mail and parcel processing business.

Outlook for the 2024 financial year

The forecast for the Siemens Group in fiscal year 2024 is based on the assumption that geopolitical tensions will not increase further. Under this condition, the Industrial Business is expected to continue to grow profitably. For the Siemens Group, revenue growth on a comparable basis (adjusted for currency translation and portfolio effects) is expected to be in the range of 4% to 8% and the ratio of order intake to revenue (book-to-bill ratio) is expected to be above 1.

For the 2024 financial year, Digital Industries is forecasting revenue growth on a like-for-like basis in a range of 0% to 3%. This is based on the assumption that global demand in the automation business, particularly in China, will pick up again in the second half of the financial year following a reduction in customer inventories. The earnings margin is expected to be between 20% and 23%.

Smart Infrastructure expects revenue growth on a comparable basis of between 7% and 10% and an earnings margin in the range of 15% to 17% in the 2024 financial year.

Mobility intends to achieve like-for-like revenue growth of between 8% and 11% in the 2024 financial year. The earnings margin is expected to be between 8% and 10%.

It is assumed that the profitable growth of the Industrial Business will result in higher basic earnings per share (for earnings after tax) before the effects of purchase price allocation (EPS pre PPA), excluding the Siemens Energy investment, in a range of EUR 10.40 to EUR 11.00 in the 2024 financial year, compared to EPS pre PPA, excluding the Siemens Energy investment, of EUR 9.93 in the 2023 financial year. This outlook excludes charges from legal and regulatory issues.

Key financial figures Q4

The results briefly summarized:

• Sales revenue and incoming orders increased by 10% and 6% respectively in the fourth quarter on a comparable basis (excluding currency translation and portfolio effects)
• Nominal sales increased by 4% to € 21.4 billion with record figures in all industrial businesses; order intake of € 21.8 billion was at the previous year's level; book-to-bill ratio amounted to 1.02
• Earnings Industrial Business increased by 7% to € 3.4 billion, the highest quarterly figure ever achieved; earnings margin reached 16.5%
• Profit after tax amounted to € 1.9 billion; in comparison, profit after tax of € 2.9 billion in Q4 FY 2022 was boosted by a gain of € 1.1 billion (before tax) from the sale of the mail and parcel processing business; corresponding basic earnings per share (EPS) amounted to € 2.17 and EPS before purchase price allocation effects (EPS pre PPA) was € 2.34
• Another outstanding performance in cash generation led to Siemens Group free cash flow of €4.6 billion
• Historic full-year operating performance drove comparable revenue up 11% to the upper end of the raised guidance and comparable order intake up 7%; nominal revenue up 8% to €77.8 billion and order intake up 4% to €92.3 billion; book-to-bill ratio at 1.19
• FY 2023 Industrial Business earnings grew 11% year-on-year to record €11.4bn; net income nearly doubled to all-time high of €8.5bn, corresponding basic EPS more than doubled to €10.04, EPS pre PPA reached €10.77; excluding Siemens Energy stake, which contributed €0.84, EPS pre PPA was €9.93, exceeding our guidance; Siemens Group free cash flow reached record €10.0bn
• Siemens proposes to increase dividend to €4.70 per share from €4.25 last year

- Order intake with higher volume from major orders at Mobility and growth at Siemens Healthineers and Smart Infrastructure; decline in order intake in the short-cycle automation businesses of Digital Industries.

- Sales revenue at record level in all industrial businesses; largest growth contribution from Smart Infrastructure.

- Volume development heavily impacted by negative currency translation effects, which reduced growth in incoming orders and sales revenue by six percentage points each; portfolio effects had a marginal impact.

- Earnings Industrial Business rose to highest quarterly figure ever due to considerable growth in Digital Industries and Smart Infrastructure, which achieved a record quarterly result.

- Reconciliation Consolidated Financial Statements included a loss of €0.2 billion related to Siemens Energy investment, while Q4 FY 2022 included Russia-related charges of €0.3 billion; also in Q4 FY 2022, Portfolio Companies benefited from €1.1 billion gain (pre-tax) from the sale of the mail and parcel handling business.

- Outstanding free cash flow primarily due to Industrial Business, with free cash flow of € 4.1 billion (Q4 FY 2022: € 3.9 billion) with strong cash inflows in all Industrial Businesses; high cash conversion rate and free cash flow also supported by contributions from outside Industrial Businesses, including cash inflows at Group Treasury mainly due to the settlement of hedging instruments

- Provisions for pensions and similar obligations fell to a new historic low of € 1.4 billion as at September 30, 2023 (June 30, 2023: € 1.7 billion), mainly due to higher discount rates

- ROCE was clearly within the target range; in Q4 FY 2022, ROCE included the aforementioned gain on disposal