In a bid to reduce operational costs and optimize its cost
) reportedly announced that it will lay off approximately 1,100
employees in its energy division in Germany over the next two
years. The company has about 86000 employees worldwide and the
current headcount in Germany is 28000.
The lay off will primarily affect the fossil power and the oil
and service gas units of the company, which are facing sluggish
demand. To maintain its strong global growth momentum and
increase its market share, Siemens AG needs to refine its cost
structure. The restructuring action is expected to bring in
stability and steady earnings growth in the near future.
Earlier, in the fourth quarter 2012, total sectors profit of
Siemens AG declined 14.6% to €1.6 billion, down from €2.1 billion
a year earlier. The decline was primarily due to project charges
in Energy and Infrastructure & Cities.
Siemens AG is a German industrial conglomerate with interests
in information services, automation and controls, medical
equipment, power generation, transportation systems, automotive
electronics, lighting, and many other areas. Given its product
breadth and geographic diversity, the company is a major
beneficiary of increased spending as developing nations build up
their infrastructure. Its core businesses have seen a pickup in
demand and the company is well positioned and looking for further
growth primarily in the emerging markets.
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SIEMENS AG-ADR (SI): Free Stock Analysis
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Siemens AG currently has a Zacks #4 Rank, which implies a
short-term Sell rating. We also have a long-term Neutral
recommendation on the stock. One of its competitors,
) carries a Zacks #3 Rank, which translates into a short-term