Siemens profits down in Q2

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Siemens will take account of the write-off in its third-quarter results.
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  • Sanctions imposed on Russia following the invasion of Ukraine have cut Siemens' earnings by around 600 million euros
  • The Munich-based conglomerate confirmed its full-year outlook, targeting growth in revenue of between six and eight percent
German industrial conglomerate Siemens said Thursday its profits were cut nearly in half in the second quarter as the group announced it would wind down its operations in Russia.Siemens, which runs its business year from October to September, said in a statement that net profit fell to 1.2 billion euros ($1.3 billion) in the period from January to March, from 2.4 billion in the same period last year.Sanctions imposed on Russia following the invasion of Ukraine have cut Siemens’ earnings by around 600 million euros as the German giant which makes products ranging from trains to factory equipment wrote down the value of its business in the region.

Siemens said its transport division, including rail service and maintenance, was particularly hard hit.

The group said it had begun the wind-down of “all industrial business activities” in Russia.

As Siemens has been active in the market for nearly 170 years, “this was not an easy decision,” said chief executive Roland Busch.

Siemens had already halted its business in Russia at the beginning of March, following the start of the war.

Despite the conflict and the lingering impact of the coronavirus pandemic, the group said revenues increased to 17 billion euros from 14.7 billion euros in the same quarter last year.

Siemens’s “ongoing mitigation of supply chain challenges allow us to look confidently into the second half of our fiscal year,” said chief financial officer Ralf Thomas.

The Munich-based conglomerate confirmed its full-year outlook, targeting growth in revenue of between six and eight percent.

The projection was based on the expectation that disruptions from the coronavirus and strained supply chains “will not worsen”, it said.

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