Healthcare giant Siemens (NYSE:SI) saw declines in its healthcare division during Q1, with sales and profits down on a shaky quarter.
The healthcare unit posted a 6.4% drop in profits and a 4.9% drop in sales, part of which Siemens attributed to unfavorable currency effects, which are expected to continue. Siemens also cited "weak economic conditions in Europe, uncertainty in the healthcare market and an excise tax on medical devices in the U.S., and slowing growth in China" as drivers of the slowdown.
The Munich-based company reported healthcare-related profits of $643.1 million (€471 million) on sales of $4.22 billion (€3.09 billion) during the 3 months ended Dec. 31, 2014. That compared with profits of $686.8 million (€503 million) on sales of $4.44 billion (€3.25 billion) during the same period the prior year.
Nevertheless, Siemens president & CEO Josef Kaeser described the healthcare numbers as "fine given the environment," saying that the U.S. medtech tax took 30 basis points out of profits and that currency impacts in U.S. dollars and Japanese yen both contributed to the decline.
Overall, Siemens reported a 20% boost in profits on a 3.4% decline in sales for its total business. Wall Street responded positively to the outcomes, with SI shares up 3.6% to $128.56 at the close of market last night.
Siemens has had some other wins recently, slipping a whistleblower lawsuit involving the U.S. Veterans Affairs Dept. and landing FDA clearance for a new MRI system since the start of this year.