By Christoph Steitz and Alexander Hübner
FRANKFURT (Reuters) -Siemens on Thursday gave a more cautious sales outlook for 2024 after the trains to industrial software maker reported fourth-quarter industrial profit ahead of expectations.
The German group, whose products are used to automate factories and buildings, said it expected its revenue to grow 4-8% in the next 12 months.
The target marks a slowdown from the 11% revenue increase the German industrial heavyweight posted for its 2023 business year, which ran to the end of September.
That is mainly due to muted expectations at Siemens AG’s industrial automation division, where sales could grow up to 3% or stagnate.
“This is based on the assumption that following destocking by customers, global demand in the automation businesses, especially in China, will pick up again in the second half of the fiscal year,” the group said.
During its fourth quarter, Siemens sales rose 10% to 21.4 billion euros ($23.19 billion), beating the 20.99 billion euros forecast in a company-gathered poll of analysts. Industrial profit, too, grew 7% to a record level of 3.4 billion euros, higher than the 3.34 billion euros forecast.
Shares in the company were indicated to open 1.8%, with a trader pointing to the group’s solid outlook and results.
“Fiscal 2023 was a year of multiple records: In our Industrial Business, profit and profit margin reached their highest levels ever, and we nearly doubled our net income to a historic high,” CEO Roland Busch said.
Siemens has been seeing demand levels return to normal in recent months after enjoying a post-pandemic jump when customers ramped up production and pre-ordered in bulk to avoid shortages of key components.
The company has also been working through its massive order book, which stood at 111 billion euros at the end of September, up from 110 billion euros at the end of June.
($1 = 0.9228 euros)
(Reporting by Christoph Steitz and Alexander Huebner; Additional reporting by John Revill; Editing by Linda Pasquini and Christopher Cushing)
