MUNICH: Outgoing CEO of German industrial conglomerate Siemens Joe Kaeser (left) and his successor Roland Busch react after his speech during the virtual annual shareholders’ meeting in Munich, southern Germany, yesterday. – AFP

BERLIN: German industrial giant Siemens prepared to turn a page yesterday with a new CEO following a restructuring drive, after a year marked by falling sales due to the coronavirus pandemic. Chief executive Joe Kaeser was to hand the baton to his deputy, Roland Busch, after a seven-year tenure marked by slimming down and spinning off assets to refocus as a technology company. Due to shutdown measures, the annual shareholder’s meeting was taking place online, with the handover to Busch to come at the end of the event around 1600 GMT.

“Our company has a decade of opportunities before it,” Busch said as the gathering kicked off, paying tribute to Kaeser’s run. After reporting full-year to September earnings down by a quarter as the coronavirus battered the global economy, Siemens said it had turned a corner in the first quarter of its financial year. The Munich-based company, which makes products ranging from trains to factory equipment, saw a 38-percent surge in net profit to 1.5 billion euros ($1.8 billion) in the three months to December. “We made Siemens robust these last years,” Kaeser told the meeting.

‘Better position’
Kaeser announced in March that he would not be pursuing a contract extension and would pass the reins to Busch, 56, who has been a Siemens director since 2011 and served as Kaeser’s number two since October 2019. “Siemens is in a better position today than a few years ago,” Busch told the daily Sueddeutsche Zeitung in December, defending Kaeser’s stewardship.

At the end of September, Siemens spun off its Energy division, which includes oil-and-gas operations, and in October sold components subsidiary Flender to US-based Carlyle for 2.0 billion euros. Siemens Energy, in which the group still holds a 35.1-percent stake, this week announced it would slash 7,800 jobs over the next four years to cut costs in a rapidly changing market. Despite the ongoing impact of the virus, the group yesterday lifted its growth forecast for the year to “average or higher”, with strong prospects for its software and industrial automation activities.

‘Consolidating’ progress
Kaeser’s tenure was marked by turmoil rarely seen since the group’s founding in 1847. Like many sprawling industrial conglomerates with diverse activities, Siemens has been forced to adapt to an economy in which specialization is king. Kaeser’s increasing attention to software, automation and “industry 4.0” meant that the group’s footprint shrank on his watch.

Annual turnover, still hovering at around 76 billion euros in 2013, came in at 57.1 billion euros last year. The listing in recent years of the Energy and Healthineers divisions came alongside major downsizing operations, shedding tens of thousands of jobs. The moves came in for sharp criticism from trade unions which accused the company of putting the interests of shareholders ahead of staff.

“We hope that Roland Busch will distance Siemens from a strategy directed toward the stock market,” said IG Metall, which represents the group’s employees. However an analyst with Comdirect, Andreas Lipkow, said “more of the same” could be expected under Busch, who has been intimately involved in strategic planning at the company for a decade. Business daily Handelsblatt said Busch’s challenge would be “promoting synergies” while “consolidating” the progress Kaeser made in shifting the group to more profit-making businesses. – AFP