It will be a very long time before Siemens AG is forgiven for the nasty shock it gave the German market on Wednesday, and analyst Hans Peter Wodniok at Credit Lyonnais in Frankfurt bluntly described the warning as a catastrophe. He told Reuter that Siemens management had been predicting years of double-digit profit growth but now, we see it was just one year – our confidence in them is gone, Peter Roe at Banque Paribas Capital Markets in London agreed – the share will be friendless for a while. The shares were hammered in heavy after-hours trading on Wednesday and lost about 7% so that after outperforming the Frankfurt DAX index in 1995, Siemens shares are now trading below December’s levels. Meanwhile, as part of the new round of cost- cutting measures needed, Siemens is dumping off its air traffic control interests into a joint venture with Thomson-CSF Airsys SA if talks are successful. Thomson-CSF SA would have a majority stake.
