Siemens 2010 Annual Report Download - page 179

113 Report on post-balance sheet date events
114 Report on expected developments and associated
material opportunities and risks
128 Information required pursuant to § () and
§ () HGB and explanatory report
133 Information required pursuant to § () and
§ () no.  HGB and explanatory report
135 Compensation and declaration pursuant to §a HGB
135 Additional information for supplemental
financial measures
138 Siemens AG (Discussion on basis of HGB)
147 Consolidated Financial Statements
261 Additional information

Overall assessment
of the economic position
Siemens ended fiscal  as a more focused company with
strong operating momentum. Net income and Total Sectors
profit climbed above the prior-year levels, and all three Sectors
generated strong increases in free cash flow compared to the
prior year. We also restored order growth following the eco-
nomic downturn, particularly in our shorter-cycle businesses,
and kept revenue level with the prior year by steadily convert-
ing orders from our strong order backlog into current business.
Order development was clearly more robust in the second half
of fiscal  than in the first half, as our Sectors took advan-
tage of improving market conditions.
In fiscal , we completed our Fit program, which we
believe successfully transformed Siemens from a cultural, or-
ganizational and performance perspective. While we were
broadly successful in achieving the financial objectives of
Fit, we were not able to meet every quantitative target
included in the program in fiscal . We set these targets
based on normal business cycles, before global recessionary
conditions and adverse effects of the financial crisis material-
ly affected the growth of our business in fiscal  and fiscal
. As a result, organic revenue growth came in below
our target in fiscal  (see “Business and operating environ-
ment – Financial performance measures”). Yet during the years
in which we pursued Fit we achieved a compound an-
nual growth rate for organic revenue of %, which is two times
the level of real global GDP growth reported by IHS Global In-
sight for this period. Another major component of Fit
was optimizing our business portfolio, such as by divesting
% of our share in the enterprise networks business. During
fiscal , we substantially completed the streamlining of
Centrally managed portfolio activities by finding a buyer for
the electronics assembly systems business.
During the fourth quarter of fiscal  we completed a strate-
gic review that reassessed the medium-term growth prospects
and long-term market development of the laboratory diagnos-
tics business. Following completion of the annual impairment
test, we took a substantial goodwill impairment which reduced
profit for the Healthcare Sector compared to the prior year. We
also launched a strategic reorientation of Siemens IT Solutions
and Services, aimed at improving its competitive position in
part by reducing its workforce. Associated charges for staff re-
duction measures resulted in a loss for the business for the
fiscal year.
In light of these factors, we believe that we successfully
achieved the objectives of Fit.
Our commitment to a strong financial position remained
steady in , including a conservative capital structure,
strong cash position and healthy debt maturity profile. Our
equity ratio excluding non-controlling interests remained
steady at %. The Management Board and the Supervisory
Board propose a dividend of €. per share, up from €. per
share a year earlier.
Report on post-balance sheet
date events
Since September , , no events of special significance
have occurred that are expected to have a material impact on
the financial position or results of operations of Siemens.