Siemens (NYSE:SI) beat expectations for its fiscal 2nd quarter as all of its operations – except the Healthineers business it plans to spin off – exceeded profit forecasts.
The German industrial giant today posted profits of , or €1.79 ($1.64) per share, on sales of €20.22 billion ($18.56 billion) for the 3 months ended March 31, for flat bottom-line growth on sales growth of 6.4%.
The results met the consensus earnings forecast and topped the $19.80 billion sales expectation, but the Healthineers business missed the consensus €620 million bottom-line forecast with profits growth of 6% to €588 million ($539.8 million).
CFO Ralf Thomas told Bloomberg TV that Siemens is “now following 3 very interesting alternatives” for the Healthineers business but did not give any specifics. The company is mulling an initial public offering or a spin-out for the healthcare unit.
Thomas said Siemens would consider merging Healthineers with a competitor, but stressed that the company would not be rushed into a decision.
“Of course we’re looking at all the options that are theoretically possible,” Thomas said. “I wouldn’t really exclude anything.”
Two bankers familiar with Siemens cited Varian Medical (NYSE:VAR) as a company Siemens has considered as a potential partner. Varian did not immediately respond to a request for comment, Reuters reported.
Thomas said the Healthineers business faced a tough comp after posting a 15% gain during the 1st quarter.
“It’s obvious that after a really strong quarter you cannot necessarily keep that level of pace,” he told analysts during a conference call today. “I believe the momentum is going to pick up again.”
“We delivered another strong team performance and continue to outperform the markets. In the 2nd half of the fiscal year, we will focus on duly integrating Mentor Graphics and on a successful start of Siemens Gamesa Renewable Energy, while keeping a close eye on our operational performance. And there is more work to do,” added president & CEO Joe Kaeser in prepared remarks.
Siemens affirmed its outlook for the full fiscal year, saying it still expects to post EPS of €7.20 to €7.70 on “modest growth in revenue.”
SIE.F shares were up slightly at €132.62 apiece today as of about noon in Frankfurt.
($1 = €0.9180)
Material from Reuters was used in this report.
