Siemens 2014 Annual Report Download - page 226

108 A. To our Shareholders 131 B. Corporate Governance 171 C. Combined Management Report
172 C. Business and economic environment
187 C. Financial performance system
193 C. Results of operations
205 C. Financial position
210 C. Net assets position
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fiscal year. In Europe, we expect the onshore market to see con-
tinuous moderate growth. In both cases, market development
strongly depends on the energy policy framework, including
tax incentives in the U.S. and regulatory frameworks in Ger-
many and the U.K. We expect these latter factors to have a sim-
ilar effect on growth in the offshore wind power market, which
is dominated by Europe. We expect the offshore wind power
markets in Asia, Australia and the Americas to remain largely
undeveloped in the short term.
For the markets served by our Energy Management Division,
we expect overall moderate growth in fiscal . Within the
Division’s utility markets, we expect a slight increase in fiscal
. On a regional basis, the strongest growth in the utility
markets is expected to come from the Europe, C.I.S., Africa,
Middle East region. Here we expect strong demand from the
Middle East and growth in transmission investments due to the
integration of renewable sources into existing power distribu-
tion networks. This growth may be partly offset by lower
demand from major European utility companies which have an-
nounced plans to reduce their capital expenditures. We expect
utility markets in the Americas to grow slightly in fiscal .
Markets in the Asia, Australia region are expected to grow
slightly, benefiting from demand from utility companies in the
emerging countries of the region. We expect the Division’s oil
and gas market to grow moderately, with the strongest growth
rates in the Americas. Production of unconventional oil and gas
is expected to be the main growth driver in the Americas, while
growth in the Asia, Australia region is driven by investments in
liquefied natural gas (LNG) infrastructure. The Division’s miner-
als markets are expected to grow slightly in fiscal  driven by
demand in the Asia, Australia region. Overcapacities burden the
Division’s metals markets, which are expected to grow even
more slowly than the minerals markets. We expect a more posi-
tive outlook in the Division’s chemicals and non-residential con-
struction markets. Both markets are forecast to grow moderately
in fiscal  year-over-year. In all regions the chemical industry
is contributing to growth. For the non-residential construction
markets, we expect growth to be driven by the recovery of U.S.
markets and by ongoing construction investments in Asia,
Australia, particularly in China.
For the markets served by our Building Technologies Division,
we expect moderate growth in fiscal . On a regional basis,
we expect growth in Europe, C.I.S., Africa, Middle East to pick
up in fiscal . Within the region, we expect growth rates in
Europe including Germany to increase slightly year-over-year.
For the Middle East we expect moderate growth rates year-
over-year. Within the Americas, we expect the Division to ben-
efit from a slow but continued recovery in U.S. construction
markets. We expect markets in the Asia, Australia region to
grow moderately as in fiscal .
We expect markets served by our Mobility Division to grow
slightly in fiscal . Within Europe and the Middle East we
expect decisions on large contract tenders in fiscal , stem-
ming from major public rail investments in the U.K. and the
Middle East. Liberalization of the Turkish rail industry is on-
going and large contract tenders are expected in the upcoming
years. Within the Americas, we expect a continued high level of
investments in mainline passenger and urban transport infra-
structures in the U.S. Within the Asia, Australia region, we ex-
pect growth in fiscal  to benefit from a recovery of China’s
high-speed rail infrastructure market. In Australia, we expect
demand to be held back by lower investments in infrastructure
industries.
In fiscal , we do not expect growth momentum to acceler-
ate in markets served by our Digital Factory and Process
Industries and Drives Divisions compared to fiscal . With
the exception of the oil and gas industry, we expect conserva-
tive investments in industries served by both Divisions over-
all, particularly in Europe. Furthermore, we expect demand
from emerging markets, which were growth drivers in the
past, to be weak in fiscal , with the exception of China.
Within the region Europe, C.I.S., Africa, Middle East, we expect
markets in Europe to continue to grow, albeit at a slow pace.
While we expect moderate growth rates in some central Euro-
pean countries, we expect growth to remain weak in the
industrial markets of some large economies, such as France
and Italy. While we expect currency-related headwinds for
export-oriented industries in the Euro-zone to recede in fiscal
 compared to fiscal , we expect weak demand from
emerging markets to limit growth opportunities for those
industries in fiscal . The latter development is expected to
be particularly evident in Germany’s export- oriented OEM
businesses, such as the machine building industry. Also, we
expect growth in Germany’s large automotive industry to slow
in fiscal  compared to fiscal , resulting in less expan-
sive investments year-over-year. Within the Americas, we
expect that growth will be driven mainly by the U.S., which
will also benefit manu facturing industries in Canada and Mex-
ico. We expect a less favorable development in Brazil and
other Latin American countries, where industrial growth is
largely dependent on mining industries. Within the Asia, Aus-
tralia region, we expect industrial markets in China to grow
moderately in fiscal , but below the growth rates in previ-
ous years, as development in the country’s export- oriented
industries is held back by a stronger currency, higher labor
costs and weakness in many other emerging economies which
are important for Chinese exports. Growth in Asia, Australia is
expected to benefit from a pick-up of industrial markets in
South Korea. Industrial markets in India are expected to im-
prove slightly. Overall, rising regional political uncertainties
may further limit investment behavior.