Siemens 2008 Annual Report Download - page 109

Fiscal 2008 – Achieving solid success
Despite market turbulence, our growth did not slow in scal 2008. We again achieved our goal of grow-
ing at least twice as fast as world GDP. New orders rose 11 percent to €93.5 billion, and revenue climbed
seven percent to €77.3 billion. Our strongest revenue growth was in Russia, where orders soared 84 per-
cent compared to scal 2007. Revenue in China and India also developed exceptionally well, increasing
18 percent and 12 percent, respectively. And we’re particularly gratied to report new order growth of
six percent in Germany, our home market.
As anticipated, total Sectors prot reached a high level, climbing to €6.5 billion. When the transformation
costs for the Mobility Division and the Healthcare Sector are excluded, the total for scal 2008 is even
well above the prior-year gure. Net income, at €5.9 billion, also includes a number of one-time items –
in particular, the measures associated with the spinoff of Siemens Enterprise Communications (SEN)
and Siemens Home and Ofce Communication Devices (SHC) as well as the provisions for our program
to reduce sales, general and administrative (SG&A) costs. Also included in this reporting period is our
€390 million endowment for the Siemens Stiftung, the new foundation we’ve established under German
civil law to support national and international projects in the areas of technology, education, charitable
giving, culture and the arts.
Share buyback program – Striking a balance between equity and debt
Particularly in view of the factors just mentioned, it’s very important to achieve a healthy balance
between equity and debt. That’s why, as part of our Fit42010 program, we’re working to optimize
Siemens’ capital structure. Our target is to achieve a ratio of adjusted industrial net debt to EBITDA of
0.8-1.0. With this in mind, we’ve launched the most extensive share buyback program in the history of
Siemens. Under this program, we intend to repurchase Company shares with a total volume of up to
€10 billion by scal 2010. The rst key steps have already been taken. On January 28, 2008, we launched
the rst tranche of €2 billion. By April 8, 2008, we had repurchased a total of 24.9 million shares primar-
ily for the purpose of cancelling and reducing capital stock. On June 6, we announced a second tranche
of €2 billion. By July 22, 2008, 27.9 million shares had been repurchased, bringing the total number of
shares acquired so far as part of the buyback program to 52.8 million.
Letter to our Shareholders 13