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« Sep 13
Chairman's Speech (Siemens) Year : Sep '14
Dear Shareholders,
 
 Financial year 2013-14 was yet another challenging year for the Indian
 economy.  In addition to being an election year, the investment
 scenario continued to be affected by factors such as delays in
 approvals for large infrastructure projects, higher capital costs and
 non-availability of raw material. While business sentiment improved as
 a result of a stable Government coming to power at the Centre, it is
 yet to materialize into new orders.
 
 Siemens Ltd. operates in the business segments of Infrastructure,
 Power, Manufacturing and Healthcare. Along with the rest of the
 industry, the Company''s performance too was impacted by the uncertain
 macro-economic conditions | prevailing in the country. While New Orders
 and Sales were lower in financial year 2013-14 compared with the
 previous financial year, the Company considerably improved its
 profitability. This was largely due to its sustained focus on
 optimizing internal cost and productivity measures.
 
 Performance highlights
 
 For the financial year ended 30th September, 2014, the Company received
 New Orders valued at Rs. 103,238 million, a 6 per cent decrease over
 Rs. 109,573 million in the financial year ended 30th September, 2013.
 Sales (excluding Other Operating Revenues) were down by 6 per cent to
 Rs. 104,483 million, compared with Rs. 111,452 million in the previous
 year.
 
 The Order Backlog as of 30th September, 2014 stood at Rs. 121,022
 million - a decline of 6 per cent compared with Rs. 129,264 million in
 the previous year. Profits from Operations stood at Rs. 3,652 million,
 significantly higher by 114% compared with Rs. 1,705 million in
 financial year 2012-13.
 
 For the year ended 30th September, 2014, the Company''s Profit Before
 Tax (including Exceptional Income) stood at Rs. 8,436 million, up by
 286 per cent compared with Rs. 2,186 million in the previous year. The
 Profit After Tax for the year was Rs. 6,032 million, up by 211 per cent
 compared with Rs. 1,940 million in the previous year.
 
 The Board of Directors has recommended a Dividend of Rs. 6 per equity
 share of face value of Rs. 2 per share for the financial year ended
 30th September, 2014. The Company had paid a Dividend of Rs. 5 per
 equity share during the previous financial year.
 
 Performance analysis
 
 The Company''s performance during the financial year 2013-14 was at par
 with the market, considering the challenging macro-economic
 environment.
 
 Among the highlights of the financial year 2013-14, the Energy Sector
 received orders for approximately Rs. 2280 million from Reliance
 Industries Limited for supply of four SST 600 Steam Turbogenerator
 units for its Jamnagar Refinery.  The Sector also received a crucial
 turnkey order from Power Grid Corporation of India Limited worth
 approximately Rs. 4110 million.
 
 The Healthcare Sector, which witnessed growth in Sales of 28 per cent,
 won the Imaging Company of the Year Award at the 2014 Frost & Sullivan
 India Healthcare Awards. The Sector installed the world''s longest lab
 automation track at Thyrocare, Mumbai, and also installed modern
 healthcare equipment such as ultrasound system with wireless
 transducers and 128 slice CT scanners in Tier II cities - Coimbatore
 and Surat.
 
 As part of its continuous initiative to enhance the technical skills of
 the industry''s work force, the Industry Sector signed Memoranda of
 Understanding with Rashtriya Ispat Nigam Ltd. and Government Tool Room
 & Training Centre. It also launched a first-of-its-kind Technology and
 Application Center, which allows machine tool manufacturers and users
 to get a hands-on experience of the latest CNC technologies and
 solutions from Siemens and its partners. The Sector, which was the
 first India-based manufacturer to launch motors certified for
 International Efficiency rating IE3, won global recognition for its
 1LA2 series of Low Voltage IE3 induction motors - the Super-Efficient
 Equipment Appliance Deployment (SEAD) Global Efficiency Medal.
 
 The Infrastructure & Cities Sector continued its contribution to the
 nation''s urban infrastructure as the Siemens- powered Rapid Metro Rail
 Gurgaon began its passenger operations. The six-kilometre metro line
 connects Gurgaon to the Delhi Metro rail network through an
 inter-change station at Sikandarpur. The Sector also received repeat
 orders worth around Rs. 743 million from Diesel Locomotive Works,
 Varanasi, for Traction Motors. The Company has been a
 
 preferred supplier of equipment for the Indian Railways for over six
 decades now. The Sector further enhanced the installation base for its
 Smart Grid solutions after winning orders from power distribution
 companies in Uttar Pradesh.  These projects are part of the
 Government''s Restructured Accelerated Power Development and Reforms
 (R-APDRP) programme.
 
 Corporate Citizenship
 
 Skilled workforce is a crucial factor in the development of India as a
 manufacturing hub and this aspect has been reinforced recently by the
 Government through the ''Make in India'' programme. As a responsible
 Corporate Citizen, Siemens Ltd. has endeavored to support and promote
 technical education through its Scholarship programme.
 
 As part of this programme, the first batch of meritorious Scholars from
 Engineering Colleges in Maharashtra, Goa and Gujarat were provided a
 holistic development plan in addition to financial support. In
 financial year 2013-14, the programme was launched in over 100
 Government Engineering Colleges across India.
 
 In addition, with an aim to produce skilled, employable technicians,
 the Company has also initiated measures to upgrade Government
 Industrial Training Institutes (ITIs).
 
 The Company already has two other ongoing Corporate Citizenship
 projects in the form of Siemens Sanjeevan Mobile Clinics and Project
 Asha. These projects have contributed to the creation of sustainable
 communities, enhancing living conditions and providing primary
 healthcare support.
 
 People excellence
 
 To remain competitive in compensation and rewards offered, continual
 efforts were made to make compensation and benefits flexible,
 tax-friendly and market-linked. New and enhanced policies and employee
 schemes were launched. In addition, the Company sustained its growth
 and development initiatives, while also focusing on recruiting the
 right talent.
 
 As of 30th September, 2014, the Company''s employee strength was 10,933
 as compared to 11,469 as of 30th September, 2013.
 
 During the financial year 2013-14, the Company initiated measures to
 optimize capacity and resource utilization across locations to counter
 the lack of market demand.
 
 The Company continues to have a cordial relationship with its unions.
 
 The road ahead - the outlook for Siemens Ltd.
 
 During the financial year 2013-14, the Company realigned itself as part
 of the global Vision 2020 strategy. As of 1st October, 2014, the
 Company has eliminated Sectors and has bundled business into eight
 Divisions: Power and Gas, Power Generation Services, Energy Management,
 Mobility, Building Technologies, Digital Factory, Process Industries &
 Drives and Healthcare. The new organization with a flatter structure is
 aimed at increasing proximity to customers.
 
 Overall, the macro-economic situation is still challenging and concrete
 policy measures announced during the financial year 2013-14 will take
 time to reflect in business. The Company has taken measures to increase
 its competitiveness and strengthen its capabilities.
 
 On the basis of these strengths, the Company expects profitable and
 sustainable growth in the future. It is however important that
 financial and regulatory reforms continue to take effect. Concrete
 measures must be taken to facilitate the completion of large
 infrastructure projects that have been stalled, while encouraging new
 projects.
 
 In conclusion, I would like to sincerely thank our customers, the
 Board, Management, Unions and most importantly, the dedicated employees
 for their consistent support and commitment to Siemens Ltd. during
 another challenging year.
 
 Deepak Parekh 
 Chairman
Source : Dion Global Solutions Limited
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