An earlier version of this story mistakenly stated that Siemens' automation unit lost money; the error has been corrected in the current version.
German automation and industrial giant Siemens AG reported a modest 7% rise in first-quarter revenue and a 17% gain in operating profit in the first quarter, but suffered a recessionary body blow as orders tumbled and its stalwart automation business slumped.
Group revenue for the period ended Dec. 31, 2008, was €19.6 billion and operating profit was €1.23. Meanwhile, orders declined 8% from a year earlier to €22.22 billion, and net income fell 81% from the same period a year ago, to €1.23 billion, largely due to a one-off gain in Q1 2008 from the sale of automotive assets. The company also spent €1.23 billion in the most recent quarter on fines and restructuring.
In a conference call with analysts Tuesday, CEO Peter Loescher called the quarter “very solid” and said the company is sticking to its 2009 profit target of €8 billion to €8.5 billion. But given the world’s economic quagmire, achieving those targets “has become more ambitious,” he allowed.