Siemens 2011 Annual Report Download - page 223

153 D. Consolidated Financial Statements
273 E. Additional information
143 C. Additional information for supplemental
financial measures
145 C. Siemens AG (Discussion on basis of
German Commercial Code)
151 C. Notes and forward-looking statements
140 C. Information required pursuant to Section  ()
and Section  () no.  of the German Commer-
cial Code (HGB) and explanatory report
142 C. Compensation report and Corporate Governance
statement pursuant to Section a of the German
Commercial Code (HGB)

ties mentioned above for the worldwide economy and market
development, we kept our capital structure even more conser-
vative than this range as of the end of fiscal . As long as
macroeconomic uncertainties remain at a high level or in-
crease, we may maintain our capital structure below this
range in order to ensure financial, operational and strategic
flexibility.
C... SEGMENTS
As for the Group, our outlook for our segments is based on the
above-mentioned expectations regarding the overall econom-
ic situation and specific market conditions over the next two
fiscal years. Combined with our focus under One Siemens on
exceeding the performance of relevant competitors, we ex-
pect these factors to result in revenue growth in fiscal 
and . We anticipate continued strong earnings perfor-
mances in our Segments despite ongoing pricing pressure
and higher operating expenses. Furthermore we expect profit
at Healthcare in fiscal  to be burdened by profit impacts
related to measures aimed at improving the Sector’s competi-
tive position. As part of One Siemens, we have defined adjust-
ed EBITDA margin corridors for the respective industries of
our four Sectors throughout their complete business cycles.
For Energy the margin corridor is % to %, for Healthcare,
the margin corridor is % to %, for Industry the margin cor-
ridor is % to % and for Infrastructure & Cities the margin
corridor is % to %.
We expect that Equity Investments will result in substantially
higher losses in fiscal  compared to fiscal , due largely
to the repositioning measures at NSN mentioned above. We
expect continued volatility in results from Equity Investments
in fiscal , as the repositioning measures take effect.
In the next two fiscal years, SFS intends to expand its efforts
to meet the growing demand for financial solutions, particu-
larly with regard to the business-to-business area that in-
volves both Siemens and external customers. Within One
Siemens, the target range for return on equity or ROE (after
tax) for SFS is % to %. We expect that SFS will reach this
range for both fiscal  and .
Expenses for Corporate items and pensions are expected to
increase in fiscal  compared to fiscal  due in part to
reimbursements to AtoS for additional costs which arise in
the post-closing transition phase. Siemens will pay approxi-
mately € million over two years. Therein in the fourth
quarter of fiscal  is an amount of € million in charges
taken within continuing operations and reported in Corporate
items. For comparison, Corporate items in fiscal  benefit-
ed from the allocation of a substantial part of the € million
in special employee remuneration to the Sectors that was ac-
crued within Corporate items in fiscal . We also expect
higher pension expenses in fiscal  compared to fiscal
, primarily due to an expected increase in interest rates
and the corresponding effect on interest costs.
C... OVERALL ASSESSMENT
For fiscal  we expect moderate organic revenue growth
compared to fiscal , and orders again exceeding revenues
for a book-to-bill ratio well above . We anticipate continued
strong earnings performances in our businesses, despite on-
going pricing pressure and higher operating expenses. We set
our goal for fiscal  income from continuing operations
based on the high level we achieved in the prior year, exclud-
ing the net positive effect of €. billion related to Areva that
lifted income to €. billion in fiscal . Our expectation for
income includes anticipated profit impacts related to reposi-
tioning activities at NSN and in the Healthcare Sector and
higher pension expenses. Assuming a macroeconomic envi-
ronment that supports continued moderate revenue growth
in fiscal , we anticipate corresponding benefits for Total
Sectors profit and income from continuing operations. Based
on our expectation for capital-efficient growth in our busi-
nesses and continuous improvement relative to markets and
competitors, we expect ROCE (adjusted) to reach our target
range of % to % in fiscal  and fiscal .
This outlook excludes significant portfolio effects and impacts
related to legal and regulatory matters. It is also conditional
on continued revenue growth, particularly for businesses that
are sensitive to short-term changes in the economic environ-
ment. Overall, the actual development for Siemens and its
Segments may vary, positively or negatively from our expecta-
tions due to the risks and opportunities described below. See
C.. Risks as well as C.. Opportunities. This report on
expected developments should be read in conjunction with
C. Notes and forward-looking statements.