German industrial behemoth Siemens on Thursday reported a drop in annual net profits but said it had met its targets, and warned that geopolitical risks and a cooling economy would weigh on its performance in 2020.
The group - which makes products from wind turbines to trains and medical scanners - booked a net profit of 5.6 billion euros ($6.2 billion) in its 2018/2019 fiscal year, down nearly eight percent on the previous year. The group mainly blamed accounting effects, noting that it had benefited last year from selling its shares in IT services firm Atos and lightbulb maker Osram.
Operating profit climbed slightly to 8.9 billion euros, thanks to a jump in large orders.
Revenues added 5.0 percent to hit 86.8 billion euros.
"The weakening of the global economy accelerated clearly during fiscal 2019," CEO Joe Kaeser said in a statement. Nevertheless, "we fully achieved our fiscal-year guidance in all aspects", he added.
The company said it had seen an uptick in orders across most of its divisions, including an order for a large gas power plant in France and strong demand for its medical imagery machines.
Siemens' factory automation division, however, suffered a drop in demand in the final months of the year, as it felt the pinch from the global slowdown in the car and machine-building industries.
Looking ahead to its 2019/2020 fiscal year, Siemens said it expected "to again achieve moderate growth" in revenues despite a "subdued" global economic outlook.
Given the "risks particularly related to geopolitical and geoeconomic uncertainties", Siemens added that it was bracing for "a moderate decline" in market volume in the auto and factory equipment industry.
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