FRANKFURT, Germany (AP) — Industrial machinery maker Siemens AG says net profit fell 25 percent in its most recent quarter as revalued financial derivatives and lower earnings at its key power and gas business weighed on the bottom line.
Net income fell to 1.095 billion ($2.184 billion) in the October-December quarter, the company's fiscal first. That was down from 1.457 billion euros a year previously. The earnings figure fell short of the 1.218 billion euros expected by analysts surveyed by financial information provider FactSet.
Revenues were up 5 percent to 17.415 billion euros, boosted by favorable currency exchange rates.
CEO Joe Kaeser said Tuesday net profit was hurt by reassessment of financial derivatives due to the low interest-rate environment. That came on top of a 39 percent drop in profits at its business making power generating turbines. Another pillar of the company's business, its health care business that specializes in diagnostic machines, saw a 13 percent fall in profits.
Orders — a key determiner of future earnings — declined 11 percent to 18.01 billion euros. That was partly due to a large, 1.6 billion euro order in the year-earlier quarter for a subway in Riyadh, Saudi Arabia.