The message from Siemens AG about its deeply troubled Siemens Nixdorf Informationssysteme AG is that the deeply troubled computer business is on track for profits in 1996, but the picture is still a dire one. Its losses fell to the equivalent of $240m in the fiscal year to September from $295m, and should fall by at least another $55m or so this year – but sales are falling too, and the company is to bear some 5,000of the 15,000 job losses planned for the Siemens AG group as a whole this year, creating a new charge against the profit and loss account. The company is bugeting for a further fall in turnover from the $6,838m recorded last fiscal, because of continuing weakness in the market and continued price attrition. The company confirmed that Gerhard Schulmeyer, a manager at ABB Asea Brown Boveri in the US, will become a management board member of Siemens Nixdorf on July 1 and take over as chairman on October 1, replacing Hans-Dieter Wiedig, who wants to step down as Siemens Nixdorf chief before his contract expires in 1995. Group chairman Heinrich von Pierer will become chairman of the computer arm’s supervisory board from October. In the US, Siemens Nixdorf made a first time contribution of $65m sales in the first quarter of fiscal 1994, and overall, Siemens’ US business units saw a 41% increase in sales to $1,590m for the quarter. Worldwide, first quarter group sales rose 2% to $9,950m, but only because of strong growth in foreign sales; foreign incoming orders soared 33%, but again, Siemens Nixdorf was a let-down, with first quarter orders down 4% at $1,380m. Another cause for concern for the Munchener is that public telecommunications has gone emphatically off the boil: while first quarter PABX and other private communications equipment orders were up 7% at $862m, orders for digital exchanges and other public telecommunications equipment slumped 10.3% to $1,490m. On the sales front, the fall was even greater in the first quarter, down 17.2% at $1,380m. Sales at Siemens Nixdorf in the quarter were down 11% at $1,380m, and private phone systems were flat at $805m. The one bright spot among the electronics businesses was chips, with first quarter orders up 50% at $515m and sales up 40% at $402m. The company is now looking for the semiconductor division to make a profit in the 1994-95 year ending September 30 1995. The losses for the semiconductor division were not reported.
