Siemens 2010 Annual Report Download - page 154

6 To our shareholders 21 Corporate Governance 49 Combined management’s discussion and analysis
50 Business and operating environment
78 Fiscal  – Financial summary
81 Results of operations
98 Financial position
110 Net assets position
113 Overall assessment of the economic position

Profit at Industry Automation increased % year-over-year on
an improved business mix, higher capacity utilization and
measures to improve profitability. The Division took € million
in charges for staff reduction measures, compared to net
charges of € million in the fourth quarter of fiscal .
Profit in the current period benefited from a € million gain
from the sale of a business. Both fiscal years under review in-
cluded purchase price allocation (PPA) effects from the acquisi-
tion of UGS Corp., acquired in fiscal . PPA effects were
€ million in fiscal  and € million a year earlier. Rev-
enue and orders both grew year-over-year, in part due to a
restoration of customer demand in the factory automation
markets, including short-term restocking effects. Orders grew
in all three regions, led by Asia, Australia. Revenue grew
strongly in Asia, Australia while revenue in other regions re-
mained stable year-over-year.
Profit at Drive Technologies improved quarter by quarter
throughout the fiscal year, and came in at € million for the
full year. Charges for staff reduction measures were € million
compared to charges of € million in the fourth quarter of
fiscal . The increase in profit year-over-year was driven by
the Division’s shorter-cycle businesses, which saw steady re-
covery of their markets during the year following a sharp
downturn in fiscal . This trend included strong demand
from the machine-building industry. In contrast, the Division’s
longer-cycle businesses did not see signs of more stable mar-
ket conditions until late in fiscal . Revenue was lower
year-over-year notably including a decline in Europe, C.I.S.,
Africa, Middle East. Orders increased % year-over-year, driven
by the improvement year-over-year in shorter-cycle businesses.
Building Technologies contributed € million to Sector
profit in fiscal . The sharp increase compared to fiscal 
included a strong performance in control products and sys-
tems and a turn-around in the low voltage distribution busi-
ness. Charges for staff reduction measures were € million in
the current fiscal year compared to € million in the fourth
quarter of fiscal . The provision for a supplier-related war-
ranty mentioned above was largely offset by the Division’s
portion of the pension curtailment gain, also mentioned
above. Revenue came in % lower than a year earlier, as higher
revenue in Asia, Australia was more than offset by lower rev-
enue in other regions. Orders rose % on higher demand in
Asia, Australia and the Americas.
Results at OSRAM improved more substantially year-over-year
than at other Divisions within Industry, as the successful im-
plementation of structural initiatives coincided with a signifi-
cant improvement in market conditions. As a result, profit
climbed to € million on higher revenues, increased capac-
ity utilization and an improved business mix as well as an im-
proved cost structure. Profit in the current period benefited
from € million of the pension gain mentioned above, while
profit in the prior fiscal year was burdened by € million in
charges for staff reduction measures as well as € million for
major impairments and inventory write-downs taken in the
fourth quarter. Double-digit volume growth included strong
demand for OSRAM’s LED and automotive solutions. The Divi-
sion intends to continue investing in market expansion and
production capacity in coming quarters.
Industry Solutions reported profit of € million in fiscal ,
well below the prior-year level. The Division took € million
in charges related to current cost estimates for a project en-
gagement with a local partner in the U.S. mentioned above.
Furthermore, charges for staff reduction measures were high-
er, totaling € million in the current period compared to €
million in fiscal . To a lesser extent, profit also fell on
lower capacity utilization. Revenue declined % year-over-
year, due primarily to a sharp drop year-over-year at the Divi-
sion’s large metal technologies business. A high double-digit
increase in order intake in the fourth quarter in the Americas
and Europe, C.I.S., Africa, Middle East lifted full-year orders
above the prior-year level.
Mobility contributed € million to Sector profit in fiscal ,
well above the prior-year level due in part to selective order
intake in prior periods as well as execution of programs to
improve performance in its project business. Profit benefited
from the € million gain from the sale of the Division’s airfield
lighting business and the Division’s portion of the pension
curtailment gain, both mentioned above. Revenue for Mobility
was stable year-over-year, as growth in Asia, Australia offset
declines in other regions. Orders came in lower compared to
the prior-year, when a higher volume from major orders in-
cluded a particularly large train order in China.