MUNICH, Germany-Siemens AG reported third-quarter net profits of $1.01 billion, more than double the $$495.5 million it posted for the same period last year. Revenues for the quarter rose to $27 billion from last year’s $23.6 billion.
“It was a particularly successful quarter in terms of reshaping our business portfolio,” stated Klaus Kleinfeld, chief executive officer of Siemens.
Much of the company’s reshaping took place in its Communications division as Siemens struck an agreement to merge its Carrier and Enterprise networks groups into a joint venture with Nokia Corp. The deal is set to close in the second quarter of 2007.
Also during the third quarter, Siemens turned its Home and Office communications products unit into a separate business that is now included in “Other Operations” on a retroactive basis with results no longer included with Communications. In addition, the Wireless Modules division is set to become part of Automation and Drives at the beginning of 2007.
The Communications division reported $3.785 billion in third-quarter sales, up just 1 percent year over year, while orders rose 5 percent to $4.149 billion. Third-quarter profits fell from $103.1 million last year to $3.82 million this year.
Despite continued downsizing, Siemens said it maintained a steady year-over-year severance payout of about $34 million, though the company said it expects the severance payout figure to rise in the fourth quarter.
