Siemens Ag Spons Adr

Please stand by, we're about to begin. Good morning, ladies and gentlemen, and welcome to the Siemens 2025 first quarter conference call. As a reminder, this call has been recorded. Before we begin, I would like to draw your attention to the safe harbor statement on page two of the Siemens presentation. This conference call may include forward-looking statements. Statements are based on the company's current expectations and certain assumptions, and are therefore subject to certain risks and uncertainties. At this time, I would like to turn the conference over to your host today, Mr. Tobias Hafler, Head of Investor Relations. Please go ahead, sir.

Good morning, ladies and gentlemen, and welcome to our Q1 conference call. All Q1 documents were released this morning and can be found also on our IR website. I'm here today with our CEO, Roland Busch, and our CFO, Ralf Thomas, who will review the Q1 results. After the presentation, we will have time for Q&A. Please be aware that the virtual Siemens AGM starts right after this call. And therefore, we must limit the time of the call to 45 minutes. With that, over to you, Roland.

Yeah, thank you, Tobias. And good morning, everyone. And thank you for joining us to discuss our first quarter performance ahead of our virtual AGM. We delivered a promising start into fiscal year 2025, generating clear momentum for continued value creation for our stakeholders. And we are strategically well positioned in attractive markets with a balanced global footprint. This is a solid foundation to master ongoing macroeconomic uncertainties, also fueled by high volatility from political decisions around tariff regimes and potential countermeasures. In an environment of accelerating technological progress, our technologies enable our customers to combine the real and the digital worlds to improve competitiveness, resilience and sustainability. Our discussions with partners, customers and opinion leaders at the World Economic Forum were centered around accelerating implementation plans for AI. Moving on from more speculative discussions one year earlier. And we are right in the sweet spot. With our leading leadership in industrial AI, we see strong traction in bringing real world impact for our customers. Siemens provides the operating system for industry that will be supercharged by AI. I will share some examples in a moment, but now let me outline some key highlights of the first quarter. A solid top line performance highlights the confidence our customers place in us. PUC de Bill reached a healthy 1.09 lifting orders backlog to a record high of 118 billion euros. Group orders reached 20.1 billion euros, 8% below prior year. We saw ongoing momentum at smart infrastructure where orders were clearly up even from a high level. Mobility orders were solid but with sharply less volume from large contracts in prior year. As expected, orders in digital industries started to recover with a book-to-bill above one for the first time in two years. Our automation business was clearly up on prior year with plus 6%. Recovery was driven by China, where we expect destocking in the distribution chain to largely finish by the end of Q2. However, overall economic activity was still sluggish and investment sentiment soft in core industries such as automotive and machine building. Our key region Europe lacks momentum and in particular Germany is still in a crisis mode with companies and society urgently awaiting action and clarity from a new government. Overall revenue growth reached 3% with strong contribution from mobility and smart infrastructure. Smart infrastructure, again driven by double-digit growth in the electrification business. The revenue in our automation business of digital industries was, as expected, substantially lower due to continued destocking, partially compensated by 15% growth in our software business. Regional dynamics and sentiment are also reflected in our revenue growth numbers for the group. The Americas were up by 17%, fueled by strong momentum in the US, while EMEA was flattish and Asia, Australia was down 4% on softness in China. What really counts is value creating growth and we executed in a very stringent way, despite the well-known headwinds from the DI automation business. A solid profit of 2.5 billion euros in the industrial business topped market expectations. Earnings per share pre-PPA reached 2.22 euros, excluding the divestment gained for enumotics. And, as a clear highlight, our promising start delivered seasonally strong 1.6 billion euros of free cash flow all in. We are shaping the future and creating impact along a number of fronts. A key area is our strong progress and strength in our leaderships and sustainability. Siemens is a major contributor, particularly in terms of helping our customers to decarbonize. Our offerings sold to customers in fiscal 2024 will, over the course of their lifetime, avoid around 144 million tons of greenhouse gas emissions. This is much higher than the 121 million tons of emissions Siemens generates along our entire value chain from scope one, two and three in fiscal year 2024. In our own operations, we continue to make great progress with 60% less CO2 equivalent emissions compared to fiscal year 2019, surpassing our 55% target for 2025 ahead of time. This is also reflected in the recognition of our location in Third as a sustainability lighthouse by the World Economic Forum. And as all good things come in threes, our Erlangen site has become a WEF digital lighthouse factory next to Amberg and Chengdu. With their green digital approach, the team increased productivity by 69% and reduced energy consumption by 42% in four years. This is a living example for deploying AI successfully with more than 100 use cases and intensively using the power of digital twins. With additional investments, we will further develop it into a showcase for the industrial metaverse. We have defined our long-term direction for Siemens as one tech company, a company with stronger customer focus, faster innovations, and higher profitable growth. A cornerstone of our one tech company program is the acquisition of Altair to enhance our strong industrial software business. The regulatory clearance process is advancing very well. We obtained the Altair shareholder approval a few weeks ago. And considering the progress made and depending on further progress of the regulatory approval process, a closing already in the first half of calendar year 2025 could be possible. However, Our current planning is still based on a closing in the second half of the calendar year. We will continue to provide updates on the One Tech Company program over the coming month and give you a strategy update at the Capital Market Day on December 9th. There's a debate going on among many stakeholders whether AI is overhyped. For our industrial world in automation, mobility, infrastructure, and healthcare, certainly not. The intense application of AI in all industries we serve will supercharge the transformation towards better and faster decision-making and productivity improvements based on data-driven knowledge. It will boost productivity by simplifying tasks, speed up time to market, and use resources more efficiently. And whatever innovation makes the development and training of large language models more efficient will drive the faster adoption of industrial AI. Siemens is the ideal partner to empower our customers since we can apply our domain know-how and have access to a vast amount of operational data to adopt AI for the real world at scale. We already integrate the best foundation models from world-class partners and make applications accessible via our Siemens accelerator platform. At this year's Consumer Electronics Show in Las Vegas, we launched a series of new industrial AI products and a photorealism-enhanced digital twin. Jet Zero. A startup led and backed by aviation specialists will collaborate with Siemens on the development and production of a revolutionary blended wing aircraft with the aim to improve fuel efficiency by 50%. They will use the full suite of our latest industrial AI-powered software and automation technologies to achieve their ambitious schedule. At CES, their CEO explained that their ambitions would not be achievable without our technology partnership and the power of industrial AI. Here you can see some examples for long-term partnerships where we bring Siemens Accelerator and Domaino home together for lasting customer success. From day one, Siemens has been the technology partner for multi-champion winning Red Bull Racing now for 20 years. Together we have always been pushing the boundaries of latest digital twin technologies for design engineering testing and manufacturing we signed a multi-year agreement with us-based compass data centers to support aggressive scaling targets for data centers construction Smart infrastructure will supply up to 1,500 prefabricated units of a customized modular medium-budget kit solution. Key benefits of the standardized design are easy deployment, low maintenance, and cost efficiency. And finally, a great example from our mobility business. HS2 in the UK awarded Siemens with several key infrastructure and long-term maintenance contracts for up to 15 years worth in total 560 million pounds. For the first time, automatic train operation over ETCS will be applied in the UK national high-speed rail system for improved capacity, punctuality and energy efficiency. I'm very pleased with the continuing successful transition of a majority of our DI software business towards software as a service. ARR growth reached again a very healthy level of 14% over prior year. The cloud portion stands at 1.9 billion euros, equal to 42% of ARR, with a team targeting to approach the 50% mark by the end of fiscal 2025. All indicators. Numbers of total customers, share of small and medium enterprises, and customer transformation rates continue to head in the right direction. And with these positive perspectives, over to you, Rolf.