Siemens(US:SIEGY)2023-02-09 10:41Financial Data and Key Metrics Changes - Orders increased to EUR 22.6 billion, with a book-to-bill ratio of 1.25, exceeding revenue in all industrial businesses [7][10] - Revenue grew by 8% to over EUR 18 billion, driven by Digital Industries and Smart Infrastructure, each contributing 15% growth [8][10] - Industrial Business profit reached EUR 2.7 billion, marking the highest first-quarter level ever, with a profit margin of 15.6% [10][15] Business Line Data and Key Metrics Changes - Digital Industries saw a 23% revenue increase, gaining market share due to improved component availability [9][10] - Smart Infrastructure achieved a 15% revenue growth, with electrification business up by 20% and electrical products up by 24% [36][37] - Mobility's revenue increased by 7%, with a significant order for the Sydney Metro project valued at EUR 900 million [42][19] Market Data and Key Metrics Changes - Orders in China rebounded with a 17% revenue growth despite a recent infection wave [33] - Strong order momentum was observed across Europe, with Germany up by 16% and Italy by 23% [33][40] - The U.S. was a major growth engine for Smart Infrastructure, with a remarkable 25% revenue growth [41] Company Strategy and Development Direction - The company is focused on sustainability, with initiatives aimed at reducing CO2 emissions by 55% by 2025 and 90% by 2030 [20][21] - Continued progress in executing strategy, including the divestment of Commercial Vehicles and the formation of an integrated motors and large drive champion [11][12] - The company raised its guidance for fiscal year 2023, anticipating revenue growth of 7% to 10% and EPS in the range of EUR 8.90 to EUR 9.40 [13][48] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in operational strength despite a volatile economic environment, citing robust investment demand [6][14] - The company expects substantial cash flow recovery in the second quarter, driven by backlog execution and improved working capital management [46][70] - Management remains vigilant regarding macroeconomic conditions but sees positive trends in customer demand and investment sentiment [31][64] Other Important Information - Free cash flow was around EUR 100 million, expected to rebound strongly throughout fiscal 2023 [15][46] - The company reported a negative impact of EUR 187 million from its Siemens Energy stake, which lowered profit expectations for the fiscal year [45] Q&A Session Summary Question: Situation in Digital Industries in China - Management noted robust demand across various sectors, including automotive and process industries, contributing to strong order growth despite a slight year-over-year decline [50][52] Question: Electrical Products Segment - The book-to-bill ratio for electrical products was reported at 1.14, with expectations of normalization in the second half of the fiscal year [56][57] Question: Pricing Developments - Management indicated a net positive economic equation, with expectations of 4% to 6% pricing growth for the fiscal year, driven by demand for sustainability offerings [61][64] Question: Cash Flow and Receivables - Management confirmed no concerns regarding customer creditworthiness and expects significant cash flow improvements in the second quarter [66][70] Question: Portfolio and Siemens Energy Stake - Management reiterated a cautious approach to selling its stake in Siemens Energy, emphasizing the long-term value of the asset [75][76]