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November 9, 1995


By CBR Staff Writer

German electronics and engineering giant Siemens AG said domestic business has gathered momentum again, following two years of decline, helping it meet its profit goal of $1,414m for 1994-95. Preliminary figures show group net profit in the year to September 30 was $1,471m, compared with $1.410m after extraordinaries in 1993-94. Final results for 1994-95 will be given at the annual press conference on December 14. Siemens reiterated its half year currency warnings (CI No 2,653) and said its business volume was reduced by $4,951m in 1994-95 due to currency shifts, rising costs and falling prices. Without these factors, sales would actually have risen 13%, it said. Domestic orders were up 8% to $2,685m, while domestic sales rose 6% to $2,678m. International business, on the other hand, was hurt by the strong mark and a dip in major contracts. Foreign orders were steady at $3,808m, while sales gained 4% at $3,596m. Performance throughout the various Siemens divisions varied. Siemens Nixdorf Informationssysteme AG was profitable for the first time in four years – first time since its creation indeed – with a pre-tax profit of $43.8m for the year ended September 30, compared with a $225.4m loss a year earlier. The components division, which includes semiconductors, was the biggest earner, boosted by surging sales and substantial productivity gains. It showed a pre-tax profit of $720m, nearly triple its $212m profit of a year earlier. Pre-tax profits in the Osram lighting division were up 16.5% at $240m, but earnings in the communications, energy and transport segments declined. The telecommunications division had a pre-tax profit of $455m, down from $787m a year earlier. Siemens said the power generation group had additional high expenditures for decommissioning its fuel-element production facility at Hanau, while profits from public communications networks were down due to lower sales. Staff cuts were lower than expected in the year, down 3% in Germany and actually up 2% internationally.

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