Siemens sees sales growth returning after year of upheaval

Europe's biggest industrial group Siemens forecast a return to moderate sales growth in 2016 after a year of transition in which it axed thousands of jobs and sold its last remaining consumer businesses, boosting profits.
The German trains-to-turbines group reported strong orders for its financial fourth quarter to end-September. Better than expected profit from its industrial business helped it to hit its full-year industrial margin target, which came in at 10.1 percent.
Siemens announced a new share buyback of up to 3 billion euros ($3.2 billion) over three years and raised its dividend to 3.50 euros from 3.30 euros per share for 2015.
"We delivered what we promised, and are well positioned to deliver on our plans for the year ahead," said Chief Executive Joe Kaeser, warning however that the company's forecast depended on a pickup in markets for some of its main profit drivers.
Kaeser has boasted that Siemens is the only one of its peers not to have cut its outlook over the course of the past year.
Swiss engineering group ABB cut its sales target in September on low energy prices and a slowdown in China, and US industrial group Honeywell also warned on weak demand from oil and gas customers.
"Post today's guidance, we believe there could be room for consensus upgrades over the course of the next 12 months if macro would be stable," wrote DZ Bank analyst Alexander Hauenstein, who rates Siemens "buy".
Siemens' quarterly industrial profit rose 9 percent to 2.46 billion euros, helped by improvements in energy management, wind power and renewables, healthcare and transportation, beating the average forecast of 2.31 billion in a Reuters poll.
US oil and gas equipment specialist Dresser-Rand, a $7.8 billion acquisition Siemens completed in June, made a profit margin of 6.5 percent in the quarter. Siemens said orders at the business were stabilising but would still come in below sales for its 2016 financial year.
Global oil prices have more than halved since late September 2014, when Siemens announced the deal, the most expensive in its history, and typically cash-rich oil and gas producing customers have slashed around $200 billion worth of projects.
Siemens said basic earnings per share should rise by at least 14 percent on a comparable basis to 5.90 to 6.20 euros. EPS for the year to end-September was boosted by the disposals of Siemens' hearing aids and household appliance businesses.
It renewed its industrial margin target of 10-11 percent for the current year.