Siemens Ag Spons Adr

We are here to talk about growth, sustainable, profitable growth. And this is important, accelerated growth. Just look at what we have done in the last five years since we have become a focused technology company. This was our growth trajectory for the period starting fiscal year 2021 until fiscal year 2025. Average revenue growth, 8% per year in this period, up from 2% in the previous decade. Average profit margin of our industrial business, 15% up from 10%. And average free cash flow margin, 13% up from 7%. The total shareholder return of 151%. We outperformed the DAX and other indices. Higher growth, higher margins, higher free cash flows. This successful performance continues. So let's take a look at our most recent past, fiscal year 2025. And it was another record year for Siemens. Our orders reached 88 billion euros, 6% above prior year's level. Revenue grew by 5%, a total of 78.9 billion euros. And book-to-bill ratio of 1.1, a high quality backlog of 117 billion euros. We move with confidence in our fiscal year 2026. Our industrial business showed a strong performance, a record profit of 11.8 billion euros. Our free cash flow at a new historic high, 10.8 billion euros. This means we turned 14% of sales straight into cash. with 10.4 billion euros record in net income for the third consecutive year. And finally, we achieved earnings per share, pre-PPA, of 10 euro, 71 euro cents, and we adjusted this, as you know, for effects from dotmatics, Altair, and Enermotics. And we achieved this in spite of substantial uncertainties all around the world, geopolitics, new tariffs and protectionism, slow consumer spending. We created substantial value for all our stakeholders. Now, let's take a look at the performance of our industrial businesses. Let's start with digital industries. We met the guidance as we did with all our businesses. Revenue declined by 4% as we had predicted because of difficult market environment for our automation business and against a very, very strong base of comparison for our software business. Profit margin 15.9%. This, by the way, excludes effects related to alternative medics, which were not part of our guidance. Smart infrastructure, 9% revenue growth. They delivered at the upper end of the guided range and profit margin was even more impressive with 18.3%. That's an all-time record and above guidance. Congratulations to the team. Mobility, strong revenue growth, again, 10%. And that's the upper end of the guided range. Excellent execution. There is a huge backlog of orders, and the team is just producing and delivering. At the same time, they successfully balance risk and opportunities. The result, industry-leading profitability and free cash flow. Siemens today is stronger than ever. Our strategy works. We grow by combining the real and the digital worlds. And our ambition keeps growing too. With our One Tech Company program, we are making changes to the fabric of our company and unlock even higher growth in the future. Now, when we talk about our fabric, there are two important aspects. One is the portfolio, and the other one is our operating model. Our operating model, this is how we support and strengthen our businesses with world-class technologies and services, with higher efficiency and a huge set of high-quality industrial data. so that our businesses can innovate faster and serve our customers even better. Now, let's take these two aspects one by one. Our portfolio. In the last five years, we have put particular focus on streamlining it, preparing ourselves for the transformation both through divestments and high growth acquisitions. In 2020, we spun off Siemens Energy. In the following years, we divested our so-called portfolio companies, companies for which Siemens was no longer the better owner. Six years ago, the total evaluation was estimated to 1.5 billion euros. In the end, our proceeds from these divestments totaled 7 billion euros. Focus on where we can create the most value, also through disciplined acquisitions. And of course, always along our strategy to combine the real and the digital worlds. We acquired intelligent hardware companies, for example, industrial drive technologies for EBM Babst, Traya Switchgear, Danfoss Fire Safety, CNS Electric in India for electrical and electronic equipment. On top, we strengthened our digital business with three SaaS acquisitions, all cloud-native. a provider for inventory management, reservation, and ticketing software for our rail customers. a platform that connects design and sourcing of electronic parts. a provider for asset and maintenance solutions for buildings. And in 2025, we closed the acquisitions of Altair and Automatics. With Altair, Siemens has now the world's most complete portfolio for AI-powered design, engineering, and simulation. Our customers can now build the most comprehensive physics-based digital twins. And with Somatics, we are adding more than 5 billion to our address markets. Our customers can now build a digital thread all the way from R&D to production. This helps them bringing medicines and biochemicals to the market more quickly and at lower cost. Now... Now we make another important step towards a highly synergistic Siemens portfolio. We plan to deconsolidate Siemens Healthineers. This will unlock long-term value for all our shareholders because it will allow both companies to tap fully into their respective growth potentials. Siemens Healthineers is a success story. Since its IPO, the company has grown from 13 billion euros in revenue in 2018 to 23 billion euro in 2025. And the variant acquisition contributed approximately 4 billion to this. Industry-leading margins, a best-in-class product offering, reliable cash flow, high free cash flow conversion. A strong, attractive business, but One, with increasingly less and less synergies. Siemens Health India serves markets which are increasingly different. They are different from the core markets of Siemens. For example, regulation in healthcare is comprehensive and increasing. Digitalization in the way that we do it at Siemens today doesn't really scale into the healthcare sector. Through the plant, deconsolidation Siemens Healthineers will benefit from a significantly higher free float. Our leading pure play MedTech champion, more attractive for the capital market. So what happens now? We intend to transfer 30% of shares to Siemens AG shareholders. by a direct spin-off. And as a minority shareholder, we will continue to participate in the attractive business of Siemens Healthineers. In the medium term, we intend to reduce our shareholding to a financial asset. The transaction still needs regulatory clarification and a green light from both shareholder meetings. and more details will follow in early Q2 calendar year 2026. Let me assure you, Siemens is committed to managing its investments in Siemens Healthineers in a responsible and shareholder-focused manner. A new Siemens has taken shape, a company with less complexity and with simplified governance, with a fast-growing digital business, with an unmatched portfolio of industrial software and digital services, and with a strong portfolio in hardware, connected hardware that will be increasingly softer defined and enhanced with AI. In short, a Siemens with a highly synergistic portfolio ready to scale. Portfolio matters, but there's more to our fabric than the mix of our businesses. When we say we are changing our fabric, then we also mean we are improving our operating model. Remember, stronger customer focus, faster innovations, higher profitable growth. Siemens is a strong company with a rich history, but this means legacy too. Too many systems, for example, ERP systems. Still, many silos, for example, data silos. Every single bit of this legacy made sense at a certain point in time, but times have changed. The world has become more competitive. Companies need to be more resilient. Scale matters more and more. Speed matters more and more. We are giving our business an efficient, optimal environment so they can focus, so they can innovate faster, they can serve our customers better. And that's how our new operating model is all about. We are building and rolling out services for all of our businesses. Highly standardized, delivered in highly efficient ways, always up to date with the latest technology, and at world-class quality for everyone and at Siemens to scale. We do that because the world is squeezing out small. Digital tools allow us to use economies of scale in every possible way. Scale matters for data. Scale matters for AI. Scale matters when you want to be a powerful partner in a global ecosystem. And that's why we're creating one data fabric One technology fabric and one sales fabric for whole Siemens. Let's look at these fabrics one by one to see how they can help our businesses grow faster. Let's start with one data fabric for all of Siemens. We are tearing down walls and bring data where it belongs, together. One ERP system, one CRM system, one data layer for internal data, for customer data, for external data, all connected, available real time. Today, our customers can already use 250 data products, and with our data, we are feeding our AI models. And because scale matters, our customers and partners want to connect into our data fabric. We started with machine tool industry. Seven companies joined an alliance to pool data. And here is what our partners have to say.

For Void, we believe that only secure and scalable data collaboration unlocking the full potential, especially for industrial AI in manufacturing and production. By joining forces with industry leaders, we aim to accelerate innovation, improve efficiency, and shape the future towards a data-driven production.

But for that, you need to come to a joint model, to a joint sharing of data between the different processes. And this is the reason why we said we need to join that alliance to bring together all that data, enhance the data with AI to come up with the next big jump in productivity for our customers.