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Siemens posts billion euro loss

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Siemens posts billion euro loss
Photo: DPA
13:33 CET+01:00
German industrial giant Siemens said Thursday it suffered a net loss of €1 billion in the last quarter of its 2008/09 fiscal year, and expected the current year to be worse.

Earnings from the year that ended on September 30 were slammed by €1.962 billion in charges stemming from the group's Nokia Siemens Networks unit which Siemens owns with the Finnish telecommunications equipment maker Nokia.

In the fourth quarter of its 2007/08 fiscal year, Siemens had reported an even bigger net loss of €2.4 billion owing to one-off restructuring costs and provisions for settling an alleged bribery case.

This time around, several divisions suffered from the economic crisis, which put the brakes on demand for its industrial goods.

The group is a good gauge for activity in the global manufacturing sector, with more than 400,000 workers in 190 countries making everything from light bulbs to medical equipment, power generators and high-speed trains.

Siemens' full year net profit plunged by 58 percent to €2.5 billion, but the previous year's result had been boosted by the sale of the auto parts company VDO.

Sales in 2008/09 slipped by just one percent to €76.7 billion, while orders were down by 16 percent at €79 billion.

Operating profit at the group's energy, industry and health divisions rose by 25 percent meanwhile to €1.9 billion in the last three months of its fiscal year, and by 13 percent to €7.5 billion for the year as a whole.

Siemens chief executive Peter Löscher hailed the "stable revenue development and our robust profit on an operational basis," and the group said it would propose an unchanged dividend of €1.60 per share.

Fourth quarter sales lost nine percent to €19.7 billion, while orders were also off by 16 percent at €18.75 billion.

Analysts polled by Dow Jones Newswires had expected fourth quarter orders to fall by 23 percent however, and sales to be off by 11.4 percent.

Looking ahead, Siemens forecast a five percent drop in sales for the 2009/10 fiscal year, and an operating profit of between €6 billion and €6.5 billion.

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