Siemens 2013 Annual Report Download - page 207

253 D. Consolidated Financial Statements
357 E. Additional Information
245 C. Compensation Report, Corporate Governance
statement pursuant to Section a of the
German Commercial Code, Takeover-relevant
information and explanatory report
246 C. Siemens AG ( Discussion on basis of
German Commercial Code)
250 C. Notes and forward-looking statements

In fiscal  our revenue came in % below the prior fiscal
year. A slight increase at Infrastructure & Cities was more than
offset by lower revenue at Industry and Energy. Revenue at
Healthcare was stable year-over-year. On an organic basis, ex-
cluding currency translation and portfolio effects, revenue was
% down year-over-year, within our forecast given in our Annual
Report for fiscal . We increased orders by % year-over-
year. This increase was driven by our Infrastructure & Cities
Sector and the Energy Sector. Both Sectors won a sharply high-
er volume from major contracts – Infrastructure & Cities within
its Transportation & Logistics Business and Energy within its
Wind Power Division.
In fiscal , we achieved income from continuing opera-
tions of €. billion. This was lower than income from con-
tinuing operations of €. billion a year earlier and also be-
low our expectation of €. to €. billion as presented in our
Annual Report for . A condition of that forecast was an
expected recovery in the markets for our short-cycle busi-
nesses in the second half of fiscal . This did not mate-
rialize. Additionally, that forecast assumed “Siemens ”
charges for fiscal  of €. billion (pretax). In fact the
amount came in €. billion higher. Other factors largely
offset each other. While profit in the Energy Sector was
burdened by portfolio topics related to the solar business,
this impact was more than offset by positive effects related to
the sale of our stake in NSN. Due mainly to these factors, we
adjusted our forecast for Income from continuing operations
to €. billion in the Interim Report for the third quarter of
fiscal .
Lower Income from continuing operations year-over-year was
due mainly to sharply lower profit in Infrastructure & Cites and
Industry. These Sectors took the two largest shares in the
above-mentioned “Siemens ” charges. Profit at Infrastruc-
ture & Cities was also burdened by sharply higher project
charges while profit development at Industry was also held
back by challenging market conditions, particularly in the Sec-
tor’s short-cycle businesses as mentioned above. In contrast,
Healthcare significantly improved profit year-over-year due
mainly to successful execution of its “Agenda ” and lower
charges associated with the initiative compared to the prior
year. Profit at Energy rose moderately year-over-year. In both
fiscal years the Sector’s profit development was heavily bur-
dened by charges. While profit in the current period was par-
ticularly impacted by “Siemens ” charges, charges related
to projects and Iran were substantially higher in the prior-year
period. While Total Sectors profit fell year-over-year, this was
partly offset by a strong improvement outside the Sectors. In
particular, Equity Investments posted a profit in fiscal 
following a loss a year earlier, as it benefited from a positive
effect stemming from a partial reversal of an impairment of
our stake in NSN and a gain related to the sale of this stake
during the fourth quarter of fiscal . In the prior fiscal year,
results at Equity Investments were burdened by substantial
restructuring charges at NSN.
Net income in fiscal  increased to €. billion, up from
€. billion a year earlier, as results related to discontinued
operations swung to a positive € million in fiscal  from
a negative € million a year earlier. The improvement in
discontinued operations year-over-year was due mainly to
OSRAM, which we successfully spun off in the fourth quarter
of fiscal . Due to higher Net income and a lower number
of shares outstanding year-over-year following the share buy-
back program which we initiated in the fourth quarter of fiscal
, basic EPS rose to €. in the current period, up from
€. a year earlier.
In fiscal , Healthcare reached the upper end of its adjusted
EBITDA margin target range. Adjusted EBITDA margin at Indus-
try fell year-over-year, but the Sector remained in its target
range. Despite burdens from the solar business, Energy nearly
reached the lower end of its adjusted EBITDA target range,
while Infrastructure & Cities clearly missed its range.
As a result of a combination of lower than expected Income
from continuing operations and a higher average capital em-
ployed, ROCE (adjusted) for continuing operations declined to
.% in fiscal . This was below the lower end of our target
range of % to %, which we expected to reach. ROCE (adjust-
ed) for continuing operations a year earlier was .%.
C. Overall assessment of the economic position