UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 6-K

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934

Siemens Aktiengesellschaft

(Translation of registrant’s name into English)

Wittelsbacherplatz 2
D-80333 Munich
Federal Republic of Germany
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.

Form 20-F þ Form 40-F o

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):

Yes o No þ

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):

Yes o No þ

Indicate by check mark whether by furnishing the information contained in this Form, the registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes o No þ

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82-

 

 

Table of contents

Key figures
Interim group management report
Condensed Interim Consolidated Financial Statements
Notes
Supervisory Board member and remunerations changes
Managing Board changes
Responsibility statement
Review report
Quarterly summary
Siemens financial calendar
Signatures

 

 

 

 

 

Introduction

Siemens AG’s Interim Report for the Siemens Group complies with the applicable legal requirements of the Securities Trading Act (Wertpapierhandelsgesetz — WpHG) regarding the half yearly financial report, and comprises Condensed Interim Consolidated Financial Statements, an Interim group management report and a responsibility statement in accordance with § 37w (2) WpHG. The Condensed Interim Consolidated Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRS) and its interpretations issued by the International Accounting Standards Board (IASB), as adopted by the European Union (EU). The Condensed Interim Consolidated Financial Statements also comply with IFRS as issued by the IASB. This Interim Report should be read in conjunction with our Annual Report of fiscal 2008, which includes detailed analysis of our operations and activities.

Due to rounding, numbers presented throughout this document may not add up precisely to the totals provided and percentages may not precisely reflect the absolute figures.

Key figures

Interim group management report

Overview of financial results for the second quarter of fiscal 2009
(Three months ended March 31, 2009)

	•		Revenue rose 5% to €18.955 billion on competitive strength at Energy and Healthcare.
	•		While orders of €20.864 billion came in 11% below the prior-year quarter, book-to-bill remained above 1. The order backlog of Siemens’ three Sectors increased to €87 billion, and included no material cancellations during the quarter.
	•		Total Sectors profit rose 43% from the prior-year level, to €1.844 billion, led by broad-based profit growth in Energy. A year earlier, Total Sectors profit included substantial charges stemming from reviews of large projects.
	•		Income from continuing operations climbed 69%, to €955 million, primarily on higher Total Sectors profit. SG&A expenses declined significantly compared to the prior-year quarter.
	•		Net income was €1.013 billion, up from €412 million in the second quarter a year earlier.
	•		Free cash flow from continuing operations was €1.138 billion including cash outflows relating to charges for the global SG&A program, project reviews and structural initiatives.

Headwinds from macroeconomics. During the first half of fiscal 2009, the macroeconomic environment has significantly turned down. Main indicators like gross domestic product, the Purchasing Managers Index in the U.S., the Euro-zone Manufacturing Purchasing Managers Index (PMI) and the development of order intake reported by the Verband Deutscher Maschinen- und Anlagenbau (VDMA) declined significantly. Leading economic research institutes continuously revised their economic estimates, e.g. Global Insight, Inc. revised the estimate for global GDP growth for 2009 since November 2008 from plus 1.1% to minus 0.5% in January 2009 to minus 2.5% as of April 14, 2009. The current macroeconomic and financing environment shows no evidence of near-term improvement.

Revenue rose and book-to-bill remained above 1. Revenue rose to €18.955 billion, up 5% from the second quarter a year earlier. Order intake was down 11% in a significantly weaker macroeconomic and financing environment, yet orders of €20.864 billion kept the book-to-bill ratio above 1 for the quarter and for the first half. On an organic basis, excluding currency translation effects and portfolio transactions, revenue rose 5% and orders came in 10% lower compared to the prior-year quarter. Customers slowed conversion of booked orders to revenue, and also postponed potential new orders.

The Energy and Healthcare Sectors took revenue higher. Energy delivered double-digit growth in Sector revenue and higher revenues at Healthcare benefited from positive currency translation effects. This more than offset a 4% decrease at Industry driven by lower demand in short-cycle businesses.

On a geographic basis, Siemens showed particular strength in the Americas and the region comprising Europe, the Commonwealth of Independent States (C.I.S.), Africa, Middle East. Energy and Healthcare led revenue higher in the Americas, which benefited from positive currency translation effects in the U.S. Fossil Power Generation and Mobility were the primary revenue drivers in Europe, C.I.S., Africa, Middle East.

Macroeconomic conditions held back order intake. Global macroeconomic and financing conditions continued to reduce consumer spending, business confidence and capital expenditures in the second quarter. This was particularly evident in such short-cycle industries as automotive, manufacturing and lighting. Longer-cycle energy and infrastructure customers postponed potential new business. Healthcare orders rose due mainly to positive currency translation effects, while Industry and Energy saw reduced order intake in most Divisions.

On a geographic basis, orders declined significantly in Europe, C.I.S., Africa, Middle East and the Americas. In contrast, Asia, Australia posted higher orders compared to the prior-year period on the strength of major contract wins for high-speed trains in China and energy infrastructure in Iraq.

Total Sectors profit climbed, led by Energy and Healthcare. Total Sectors profit for the second quarter climbed 43% year-over-year, to €1.844 billion. A year earlier, Total Sectors profit included charges of €768 million stemming from project reviews in the Fossil Power Generation Division and former Transportation Systems Group. Energy was again the primary driver of Total Sectors profit growth, with all Divisions generating increases year-over-year. A year earlier, Fossil Power Generation took €559 million of the charges mentioned above. Healthcare also increased its Sector profit despite challenging market conditions. Sector profit declined significantly at Industry primarily due to volume-driven margin pressure.

Income from continuing operations rose on higher Total Sectors profit and lower corporate expenses. Income from continuing operations was €955 million, up 69% compared to the second quarter a year earlier. Basic EPS on a continuing basis rose to €1.05 from €0.59 in the prior-year period. The primary factor in these increases was higher Total Sectors profit. Other contributors included lower expenses for Corporate items and higher profits from Cross-Sector businesses, due mainly to significantly lower project charges at Siemens IT Solutions and Services. In contrast, Equity Investments turned negative due to Nokia Siemens Networks B.V. (NSN) and the loss from Other Operations increased compared to the prior-year period.

SG&A expenses fell. Positive results from Siemens’ SG&A program were already evident in the quarter, with SG&A expenses coming in significantly below the second-quarter level a year earlier.

Net income increased strongly on higher income from continuing operations. Net income was €1.013 billion, up from €412 million in the second quarter a year earlier. Basic EPS rose to €1.11 from €0.42 in the prior-year period. Income from continuing operations was the dominant factor in net income. Discontinued operations benefited from settlement of legal matters related to the former Communications Group (Com). A year earlier, discontinued operations included severance charges in the enterprise networks business, which was divested between the periods under review.

Free cash flow from total Sectors level year-over-year. At the Sector level, Free cash flow was €1.901 billion, nearly level compared to the prior-year quarter despite cash outflows relating to charges for project reviews and structural initiatives. Free cash flow from continuing operations was lower than in the prior-year period. The current period included the cash outflows mentioned above as well as for charges for the SG&A program and payments related to settlements of financial derivatives.

ROCE rose on higher income. On a continuing basis, return on capital employed (ROCE) for the second quarter increased to 9.2% from 5.5% in the prior-year period. This improvement was due primarily to higher income from continuing operations. For comparison, income from continuing operations in the second quarter a year ago was burdened by significant charges resulting from project reviews as mentioned above.

Liquidity increased with a successful bond issue. We enhanced our liquidity position with €4.0 billion in proceeds from a second-quarter bond issue, which was heavily oversubscribed.

Pension underfunding grew larger. The estimated underfunding of our principal pension plans as of March 31, 2009, amounted to €5.3 billion, compared to an underfunding of €4.3 billion at the end of the first quarter and €2.5 billion at the end of fiscal 2008. The decline in funding status since December 31, 2008 is due primarily to a negative return on plan assets. While the change in funding status in general does not affect earnings for the current fiscal year, it reduces equity on the balance sheet.

Electronics Assembly Systems (EA) was transferred to Other Operations. Following a strategic review during the current period, the EA business was classified as held for disposal and management responsibility was transferred from the Drive Technologies Division to Other Operations. This business had a loss of €86 million in the second quarter, contributing to the increased loss from Other Operations mentioned above. Financial information for EA is now presented within Other Operations on a retrospective basis. This transfer resulted in a change to Total Sectors profit for fiscal year 2008, which increased from €6.520 billion to €6.606 billion.

Results of Siemens

Results of Siemens — Three months ended March 31, 2009

The following discussion presents selected information for Siemens for the second quarter of fiscal 2009:

Revenue rose 5% year-over-year, to €18.955 billion. Order intake was down 11% from the prior-year period, as global macroeconomic and financing conditions continued to reduce consumer spending, business confidence and capital expenditures. New orders of €20.864 billion kept the book-to-bill ratio at 1.10. As a consequence, the total order backlog for the three Sectors grew to €87 billion, and included no material cancellations during the second quarter. On an organic basis, excluding the net effect of currency translation and portfolio transactions, revenue rose 5% year-over-year and orders decreased by 10%. Customers slowed conversion of booked orders to revenue, and also postponed potential new orders.

		New Orders (location of customer)
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Europe, C.I.S.**, Africa, Middle East			10,779				13,730				(21)	%			(16)	%			(3)	%			(2)	%
therein Germany			3,240				3,786				(14)	%			(12)	%			0	%			(2)	%
Americas			4,667				5,834				(20)	%			(26)	%			7	%			(1)	%
therein U.S.			3,452				4,487				(23)	%			(33)	%			11	%			(1)	%
Asia, Australia			5,418				3,807				42	%			38	%			4	%			0	%
therein China			1,937				1,355				43	%			30	%			13	%			0	%
therein India			560				551				2	%			7	%			(5)	%			0	%
Siemens			20,864				23,371				(11)	%			(10)	%			1	%			(2)	%

Orders related to external customers decreased in the second quarter of fiscal 2009 on substantial declines in Industry and Energy. The Industry Sector — Siemens’ largest Sector — saw orders decline by 12% compared to the prior-year period. All Divisions in the Sector except for Mobility reported lower order intake, particularly in such short-cycle industries as automotive, manufacturing and lighting. The order increase at Mobility included a major contract win for high-speed trains in China. In the Energy Sector, customer postponements of potential new business contributed to lower order intake. Orders slowed at nearly all Divisions, leading to a decline of 9% for the Sector compared to the strong prior-year period. Higher reported orders at Healthcare benefited significantly from positive currency translation effects related to the Sector’s substantial U.S. business. In addition, streamlining of Other Operations continued to reduce its contribution to order volume.

In the region comprising Europe, C.I.S., Africa and the Middle East — Siemens’ largest reporting region — orders declined 21% on decreases in all Sectors, led by Energy and Industry. The decline in Energy was driven primarily by lower volume from large orders compared to the prior-year quarter, despite a major contract win for offshore wind-farm turbines in Europe. A broad-based order decrease in Industry in the region was led by rapidly slowing demand in the Drive Technologies and Industry Automation Divisions. In the Americas, the order decline of 20% followed a similar pattern as in Europe, C.I.S., Africa, Middle East, with all Sectors posting lower orders. Reported order intake in this region benefited from positive currency translation effects from the U.S. On an organic basis, orders declined 26% in the Americas and 33% in the U.S. In Asia, Australia orders rose 42% year-over-year, with all three Sectors achieving double-digit increases as well as significant new contract wins. The largest among these were orders won by the Fossil Power Generation and Power Transmission Divisions for energy infrastructure in Iraq, totaling €1.5 billion, and the above-mentioned train order in China. The latter contract was the main factor in increasing order intake in China compared to the prior-year quarter.

		Revenue (location of customer)
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Europe, C.I.S.**, Africa, Middle East			10,381				10,069				3	%			9	%			(3)	%			(3)	%
therein Germany			2,811				2,918				(4)	%			(2)	%			0	%			(2)	%
Americas			5,362				4,921				9	%			0	%			10	%			(1)	%
therein U.S			4,139				3,674				13	%			(2)	%			16	%			(1)	%
Asia, Australia			3,212				3,104				3	%			0	%			3	%			0	%
therein China			1,215				1,121				8	%			(4)	%			12	%			0	%
therein India			402				416				(3)	%			6	%			(8)	%			(1)	%
Siemens			18,955				18,094				5	%			5	%			2	%			(2)	%

Revenue related to external customers rose 5% year-over-year in the second quarter, on broad-based, double-digit increase in Energy and a 10% rise in Healthcare. In the Industry Sector, revenue decreased 4% on double-digit declines at Industry Automation, OSRAM and Drive Technologies. These Divisions all experienced demand drops in their short-cycle businesses. At Industry Solutions and Building Technologies, customers began to postpone booked orders from prior periods. The Energy Sector recorded a revenue increase of 28% year-over-year, led by Fossil Power Generation and Renewable Energy. Revenue growth in Healthcare benefited from positive currency translation effects. Revenue from Other Operations declined significantly, due primarily to the continuing streamlining actions within its portfolio.

In Europe, C.I.S., Africa, Middle East, revenue rose 3% year-over-year. Energy and Healthcare delivered higher revenue compared to the prior-year period, while revenue declined in the Industry Sector on lower sales in the Divisions Industry Automation, Drive Technologies and OSRAM. Revenue in Germany decreased 4%, as revenue growth in Healthcare and Energy was more than offset by a decline in Other Operations, in part related to the divestment of Siemens Home and Office Communication Devices GmbH & Co. KG (SHC) between the periods under review. The Americas region posted a 9% increase in revenue, benefiting from positive currency translation effects from the U.S. In both the Americas and the U.S., revenue rose by double-digits in Energy and at a lower rate in Healthcare, and declined in Industry. Asia, Australia saw a 3% expansion in revenue, on growth in all Sectors. The revenue increase for Industry in this region was due primarily to strong growth in its Industry Solutions Division.

		Three months
		ended March 31,
(€ in millions)		2009				2008				% Change
Gross profit on revenue			4,961				4,916				1	%
as percentage of revenue			26.2	%			27.2	%

Gross profit for the second quarter of fiscal 2009 increased 1% year-over-year, as Energy significantly improved its gross profit compared to the prior-year period which included substantial project charges at Fossil Power Generation. In contrast, gross profit decreased in Industry, mainly due to a volume-driven reduction in capacity utilization, resulting in a reversal of economies of scale. That was particularly evident at Industry Automation and Drive Technologies which generated peak level margins in the prior-year quarter. In Healthcare, gross profit rose year-over-year, but at a lower rate than revenue. In combination, these factors led to a decline in gross profit margin for Siemens, which came in at 26.2%, compared to 27.2% a year earlier.

		Three months
		ended March 31,
(€ in millions)		2009				2008				% Change
Research and development expenses			(972	)			(918	)			6	%
as percentage of revenue			5.1	%			5.1	%			—
Marketing, selling and general administrative expenses			(2,520	)			(3,243	)			(22	)%
as percentage of revenue			13.3	%			17.9	%			—
Other operating income			99				187				(47)	%
Other operating expense			(168	)			(257	)			(35)	%
Income from investments accounted for using the equity method, net			(49	)			101				—
Financial income (expense), net			(16	)			3				—

Research and development (R&D) expenses increased to €972 million, from €918 million in the second quarter of fiscal 2008, led by higher outlays in Industry and Energy. R&D expenses as a percentage of revenue remained stable at 5.1%. Marketing, selling and general administrative (SG&A) expenses declined to €2.520 billion, or 13.3% of revenues, from €3.243 billion or 17.9% of revenue in the prior-year period. Even though the prior-year period included a €32 million donation to the Siemens Foundation in the U.S. and €64 million, including an impairment, related to a regional sales organization in Germany, the improvement in SG&A expenses reflects positive results from our SG&A program.

Other operating income decreased to €99 million in the second quarter, compared to €187 million a year earlier. The prior-year period included a gain of €30 million on the sale of the hydrocarbon business at the Industry Solutions Division, as well as higher gains from sales of real estate. Other operating expense was €168 million, down from €257 million in the second quarter a year earlier. The difference was due primarily to substantially lower expenses for outside advisors engaged in connection with investigations into alleged violations of anti-corruption laws and related matters as well as remediation activities, amounting to €33 million in the current period, compared to €148 million a year earlier.

Income from investments accounted for using the equity method, net was a negative €49 million, down from a positive €101 million in the prior-year period. The change was due mainly to a higher equity investment loss related to NSN, which amounted to €136 million in the second quarter, compared to €45 million a year earlier.

Financial income (expense), net decreased slightly to a negative €16 million, down from a positive €3 million in the second quarter of the prior fiscal year. Within this change, Income (expense) from pension plans and similar commitments, net, swung from a positive €36 million in the prior-year period to a negative €58 million, due to higher interest cost and lower expected return on plan assets. This effect more than offset positive results of hedging activities not qualifying for hedge accounting.

		Three months
		ended March 31,
(€ in millions)		2009				2008				% Change
Income from continuing operations before income taxes			1,335				789				69	%
Income taxes			(380	)			(224	)			70	%
as percentage of income from continuing operations before income taxes			28	%			28	%			—
Income from continuing operations			955				565				69	%
Income (loss) from discontinued operations, net of income taxes			58				(153	)			—
Net income			1,013				412				146	%
Net income attributable to minority interest			51				28				—
Net income attributable to shareholders of Siemens AG			962				384				151	%

Income from continuing operations before income taxes was €1.335 billion in the second quarter of fiscal 2009, compared to €789 million a year earlier. The change year-over-year was due to the factors mentioned above, primarily to significant decline in SG&A expenses partly offset by a negative swing in equity investment income. The effective tax rate on income from continuing operations was 28% for both periods under review. As a result, income from continuing operations after taxes was €955 million, up from €565 million in the second quarter of fiscal 2008.

Discontinued operations include former Com activities as well as Siemens VDO Automotive (SV), which was sold to Continental AG in the first quarter of fiscal 2008. The former Com activities include the enterprise networks business, 51% of which were divested during the fourth quarter of fiscal 2008; telecommunications carrier activities transferred into NSN in the third quarter of fiscal 2007; and the mobile devices business sold to BenQ Corporation in fiscal 2005. Income from discontinued operations in the current quarter was a positive €58 million, compared to a negative €153 million a year earlier. In the current period, discontinued operations benefited from a positive effect from the settlement of legal matters related to the former Com activities. In comparison, the loss in the prior-year period included €109 million in severance charges and a €12 million asset impairment at the enterprise networks business. For additional information regarding discontinued operations, see “Notes to Interim Consolidated Financial Statements” within this Interim Report.

Net income for Siemens in the second quarter of fiscal 2009 was €1.013 billion, compared to €412 million in the same period a year earlier. Net income attributable to shareholders of Siemens AG was €962 million, up from €384 million in the second quarter of fiscal 2008.

Results of Siemens — Six months ended March 31, 2009

The following discussion presents selected information for Siemens for the first six months of fiscal 2009:

In the first six months of fiscal 2009, revenue rose 6% year-over-year, to €38.589 billion, while orders came in at €43.084 billion, down 10% from the prior-year period. This resulted in a book-to-bill ratio of 1.12. On an organic basis, excluding the net effect of currency translation and portfolio transactions, revenue rose 6% year-over-year and orders decreased by 9%.

		New Orders (location of customer)
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Europe, C.I.S.**, Africa, Middle East			23,855				27,601				(14)	%			(10)	%			(2)	%			(2)	%
therein Germany			7,170				7,291				(2)	%			0	%			0	%			(2)	%
Americas			10,165				11,936				(15)	%			(20)	%			6	%			(1)	%
therein U.S.			7,710				8,849				(13)	%			(22)	%			10	%			(1)	%
Asia, Australia			9,064				8,076				12	%			10	%			2	%			0	%
therein China			3,113				2,800				11	%			0	%			11	%			0	%
therein India			1,145				1,189				(4)	%			3	%			(7)	%			0	%
Siemens			43,084				47,613				(10)	%			(9)	%			1	%			(2)	%

Orders related to external customers decreased in the first half of fiscal 2009, driven by declines in Industry and Energy. In the Industry Sector, order intake decreased 12% compared to the prior-year period, as all Divisions in the Sector except for Mobility reported lower orders led by declines at Drive Technologies, Industry Solutions and Industry Automation. Experiencing the postponement of potential new business by customers, the Energy Sector saw orders fall 8% from the high level of the first half a year earlier, which included high order levels at Oil & Gas, Power Transmission and Power Distribution. Orders at Renewable Energy came in above the prior-year period, primarily due to major contract wins in the second quarter. Orders rose 5% at Healthcare, benefiting from positive currency translation effects from the U.S. Due to substantial dispositions and other streamlining actions, orders at Other Operations declined significantly in the current period.

     In Europe, C.I.S., Africa, Middle East, orders declined 14% on double-digit decreases in Energy and Industry, while Healthcare came in almost level with the first half a year earlier. A lower volume from large orders in Fossil Power Generation and Power Transmission was an important factor for the decline in the Energy Sector, while the order drop in Industry was more broad-based. In Germany, major contract wins at Mobility and Renewable Energy brought orders near the prior-year level. In the Americas, orders decreased 15% despite positive currency translation effects, primarily from the U.S. Within the region, the contraction of order intake was strongest in Energy, mainly due to a lower volume from major orders compared to the prior-year period. Orders in Industry also declined by double digits in the Americas, while currency translation effects resulted in slightly increased orders at Healthcare. In Asia, Australia, orders rose 12% on substantial increases in Energy and Healthcare, including the above-mentioned contracts for energy infrastructure in Iraq. Orders at Industry declined in the region, due primarily to lower demand at Industry Solutions and Drive Technologies. Within the region, order intake increased in China, due mainly to the large order for high-speed trains at Mobility.

		Revenue (location of customer)
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Europe, C.I.S.**, Africa, Middle East			21,470				20,955				2	%			8	%			(3)	%			(3)	%
therein Germany			5,976				6,073				(2)	%			0	%			0	%			(2)	%
Americas			10,732				9,584				12	%			4	%			8	%			0	%
therein U.S.			8,202				7,185				14	%			1	%			13	%			0	%
Asia, Australia			6,387				5,955				7	%			5	%			2	%			0	%
therein China			2,415				2,216				9	%			(1)	%			10	%			0	%
therein India			763				796				(4)	%			5	%			(9)	%			0	%
Siemens			38,589				36,494				6	%			6	%			1	%			(1)	%

First-half revenue related to external customers rose 6% year-over-year, as all Divisions in Energy and Healthcare reported higher revenue. Fossil Power Generation and Renewable Energy were the primary drivers for a 26% revenue increase in Energy, while a 10% rise in Healthcare included more balanced growth rates among Divisions. The Industry Sector came in just below the level of the first half a year earlier, as increases at Mobility, Industry Solutions and Building Technologies were offset by declines at Industry Automation, OSRAM and Drive Technologies. As with orders, streamlining of Other Operations continued to significantly reduce revenue year-over-year.

In Europe, C.I.S., Africa, Middle East, revenue rose 2% year-over-year, held back by negative currency translation and portfolio effects, the latter mainly in Other Operations. Revenue rose at Energy and Healthcare and decreased slightly at Industry in this region. Revenue in Germany for the first half came in below the level of the prior-year period, primarily due to portfolio transactions including the divestment of SHC within Other Operations. In the Americas, revenue rose 12%, benefiting from positive currency translation effects from the U.S. Revenue growth in the region was strongest in the Energy Sector, on the basis of at least double-digit increases in all Divisions. Healthcare also delivered double-digit growth in the Americas, while revenue in Industry fell primarily on declines at OSRAM and Industry Automation. Asia, Australia saw a 7% expansion in revenue on growth in all Sectors, led by Energy and Healthcare.

		Six months
		ended March 31,
(€ in millions)		2009				2008				% Change
Gross profit on revenue			10,601				10,221				4	%
as percentage of revenue			27.5	%			28.0	%

Gross profit for the first six months of fiscal 2009 increased 4% year over year, slightly less than the growth in revenue. As a result, the gross profit margin decreased to 27.5%, from 28.0% in the prior-year. The Energy Sector significantly increased its gross profit in total and as a percentage of revenue compared to the first six months of fiscal 2008, which included the substantial second-quarter project charges mentioned above. In contrast, Industry posted lower gross profit, primarily due to declines at Industry Automation and OSRAM. Gross profit also decreased in Healthcare, which took charges in its particle therapy business in the first quarter of the current fiscal year.

		Six months
		ended March 31,
(€ in millions)		2009				2008				% Change
Research and development expenses			(1,886	)			(1,765	)			7	%
as percentage of revenue			4.9	%			4.8	%			—
Marketing, selling and general administrative expenses			(5,388	)			(6,298	)			(14)	%
as percentage of revenue			14.0	%			17.3	%			—
Other operating income			284				377				(25)	%
Other operating expense			(285	)			(463	)			(38)	%
Income from investments accounted for using the equity method, net			68				209				(67)	%
Financial income (expense), net			(324	)			25				—

R&D expenses increased to €1.886 billion, or 4.9% of revenue, from €1.765 billion, or 4.8% of revenue a year earlier, led by higher outlays in Industry and Energy. SG&A expenses declined considerably to €5.388 billion, or 14.0% of revenue, from 6.298 billion, or 17.3% of revenue in the prior-year period, with Siemens’ global SG&A program showing first results.

Other operating income for the first half was lower than in the prior-year period, which included higher gains from sales of real estate and businesses. Other operating expense came in below the level in the first six months a year earlier. This was due primarily to substantially lower expenses for outside advisors engaged in connection with investigations into alleged violations of anti-corruption laws and related matters as well as remediation activities, which totaled €82 million in the current period compared to €241 million a year earlier. In addition, the prior-year period included a goodwill impairment of €70 million related to a building and infrastructure business, 50% of which was divested between the periods under review.

Income from investments accounted for using the equity method, net was a positive €68 million, down from a positive €209 million in the prior-year period. Within this change, the equity investment loss related to NSN increased to €143 million from a loss of €82 million in the first half a year earlier. In addition, the prior-year period included equity investment income related to Fujitsu Siemens Computers B.V. (FSC). At the end of September 2008, Siemens classified its investment in FSC as assets held for disposal.

Financial income (expense), net decreased to a negative €324 million in the first six months of fiscal 2009, down from a positive €25 million a year earlier. This change is due mainly to Income (expense) from pension plans and similar commitments, net, which swung from a positive €71 million in the prior-year period to a negative €116 million, due to higher interest cost and lower expected return on plan assets. The current period also includes negative effects from hedging not qualifying for hedge accounting as well as higher interest-related expenses associated with asset retirement obligations.

		Six months
		ended March 31,
(€ in millions)		2009				2008				% Change
Income from continuing operations before income taxes			3,070				2,306				33	%
Income taxes			(855	)			(663	)			29	%
as percentage of income from continuing operations before income taxes			28	%			29	%			—
Income from continuing operations			2,215				1,643				35	%
Income from discontinued operations, net of income taxes			28				5,244				(99)	%
Net income			2,243				6,887				(67)	%
Net income attributable to minority interest			78				71				—
Net income attributable to shareholders of Siemens AG			2,165				6,816				(68)	%

Income from continuing operations before income taxes was €3.070 billion for the first half of fiscal 2009, compared to €2.306 billion a year earlier. The change year-over-year was due to the factors mentioned above, primarily increased gross profit in the Energy Sector and a significant, broad-based decline in SG&A expenses, partly offset by a negative swing in Financial income. The effective tax rate on income from continuing operations was 28%, down from 29% in the prior-year period. As a result, income from continuing operations after taxes was €2.215 billion, up from €1.643 billion in the first six months of fiscal 2008.

Discontinued operations include former Com activities as well as SV, which was sold to Continental AG in the first quarter of fiscal 2008. The former Com activities include the enterprise networks business, 51% of which were divested during the fourth quarter of fiscal 2008; telecommunications carrier activities transferred into NSN in the third quarter of fiscal 2007; and the mobile devices business sold to BenQ Corporation in fiscal 2005. Income from discontinued operations in the current period was €28 million, compared to €5.244 billion a year earlier. The difference is due mainly to €5.4 billion in the prior-year period related to SV, including operating results along with a substantial gain on the sale of the business. Discontinued operations in the first half a year earlier also included severance charges and an impairment of long-lived assets at the enterprise networks business. For additional information regarding discontinued operations, see “Notes to Interim Consolidated Financial Statements” within this Interim Report.

Net income for Siemens in the first six months was €2.243 billion, compared to €6.887 billion in the same period a year earlier, primarily due to the development in discontinued operations discussed above. Net income attributable to shareholders of Siemens AG was €2.165 billion, down from €6.816 billion in the prior-year period.

Portfolio activities

At the beginning of October 2008, Siemens completed the transfer of an 80.2% stake in SHC, reported in Other Operations, to ARQUES Industries AG. The transaction resulted in a preliminary net loss of €123 million (including an impairment loss of €78 million) and additional costs of €21 million related mainly to carve-out activities, of which the majority has been accrued in fiscal 2008.

We completed certain other portfolio transactions during the first six months of fiscal 2009 which did not have a significant effect on our Interim Consolidated Financial Statements. For further information on acquisitions and dispositions, see “Notes to Interim Consolidated Financial Statements.”

Segment information analysis

Sectors

Industry — Three months ended March 31, 2009

Sector*		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted**				Currency				Portfolio
Profit			671				941				(29	)%
Profit margin			7.8	%			10.5	%
New orders			8,801				9,928				(11	)%			(12	)%			2	%			(1	)%
Revenue			8,645				8,980				(4	)%			(6	)%			2	%			0	%

     As expected, the Industry Sector experienced significant impact from the macroeconomic environment. This was particularly evident at Industry Automation, Drive Technologies and OSRAM, where cost-reduction measures are still ramping up. Revenue declines in these Divisions reversed economies of scale that produced peak margins in prior periods, and Sector profit fell to €671 million. While revenue increased at Industry Solutions and Building Technologies, customers at both Divisions began to postpone booked orders from prior periods. With improved execution and lower exposure to macroeconomic conditions, the Mobility Division delivered profitable growth in the second quarter.

     On a geographic basis, revenue and orders declined in the Europe, C.I.S., Africa, Middle East region and the Americas. Order growth in Asia, Australia included a particularly large train order in China, which kept the Sector’s book-to-bill ratio above 1 and its order backlog at €32 billion. Industry expects continued impacts from the macroeconomic environment, especially in its short-cycle activities.

Divisions		New Orders
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Industry Automation			1,618				2,237				(28	)%			(26	)%			1	%			(3	)%
Drive Technologies**			1,627				2,571				(37	)%			(38	)%			1	%			0	%
Building Technologies			1,379				1,559				(12	)%			(15	)%			2	%			1	%
OSRAM			971				1,188				(18	)%			(19	)%			4	%			(3	)%
Industry Solutions			1,737				1,994				(13	)%			(15	)%			1	%			1	%
Mobility			2,208				1,306				69	%			67	%			2	%			0	%

Divisions		Revenue
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Industry Automation			1,685				2,122				(21	)%			(19	)%			1	%			(3	)%
Drive Technologies**			1,954				2,106				(7	)%			(10	)%			2	%			1	%
Building Technologies			1,443				1,432				1	%			(3	)%			3	%			1	%
OSRAM			971				1,188				(18	)%			(19	)%			4	%			(3	)%
Industry Solutions			1,759				1,586				11	%			7	%			2	%			2	%
Mobility			1,542				1,351				14	%			15	%			(1	)%			0	%

Divisions		Profit												Profit Margin
		Three months												Three months
		ended March 31,												ended March 31,
(€ in millions)		2009				2008				%Change				2009				2008
Industry Automation			97				371				(74	)%			5.8	%			17.5	%
Drive Technologies*			244				332				(27	)%			12.5	%			15.8	%
Building Technologies			97				109				(11	)%			6.7	%			7.6	%
OSRAM			8				122				(93	)%			0.8	%			10.3	%
Industry Solutions			118				121				(2	)%			6.7	%			7.6	%
Mobility			106				(116	)			—				6.9	%			(8.6	)%

     The factors discussed above for the Sector were most pronounced at Industry Automation, producing substantially reduced results compared to both the prior-year period and the preceding quarter. Destocking continued among the Division’s manufacturing customers. Revenues declined 21% and orders fell 28%, led by Europe, C.I.S., Africa, Middle East, the Division’s largest regional market. With smaller business volumes and lower capacity utilization, Industry Automation saw profit margins fall in all business units. As a result, profit came in at €97 million, well below the prior-year quarter. Both periods included margin impacts from the Division’s acquisition of UGS in fiscal 2007. Purchase price accounting (PPA) effects were €36 million in the current quarter. In the prior-year period, PPA effects were €26 million along with integration costs of €2 million.

     Continuing deterioration in market conditions took revenue down 7% at Drive Technologies. Lower capacity utilization in turn pressured profit margins in all business units. Profit declined compared to the second quarter a year earlier, and also fell for the third consecutive quarter. The current and prior-year periods both included €9 million in PPA effects from the acquisition of Flender Holding GmbH (Flender) in 2005. PPA effects are expected to continue at this level in coming quarters. Orders fell sharply in all regions compared to the prior-year quarter, with the sharpest declines in the Europe, C.I.S., Africa, Middle East region and the Americas. Following a strategic review during the second quarter, the EA business, for which Siemens initiated a carve-out during fiscal 2008, was classified as held for disposal and management responsibility was transferred from Drive Technologies to Other Operations. The presentation of prior-year financial information has been reclassified accordingly.

     The slowdown in the global construction industry began reaching Building Technologies in the second quarter. Orders fell throughout the division, including customer postponement of projects. As a result, the Division’s book-to-bill ratio came in below 1 for the quarter. On a geographic basis, orders declined in all regions, most notably in Europe, C.I.S., Africa, Middle East. While revenue remained stable compared to the same period a year earlier, customers began to delay execution of booked orders. Profit fell to €97 million due to a less favorable business mix.

     Macroeconomic conditions remained challenging for OSRAM throughout the Division. Revenue fell 18%, including substantial demand declines in the automotive, construction and semiconductor markets. Lower capacity utilization took profits and profit margins down in all business units. OSRAM posted a profit of €8 million compared to €122 million in the prior-year period.

     Industry Solutions delivered profit of €118 million. For comparison, the prior-year quarter benefited from a €30 million gain on the sale of a business. Revenue was up 11% due to peak orders in metals technologies in prior periods. In contrast, new orders for metals technologies fell sharply in the current quarter. Orders overall declined 13% year-over-year, including customer postponement of projects. During the quarter, customers began to delay execution of booked orders.

     Mobility contributed another strong quarter, including order growth of 69%, revenue growth of 14%, and €106 million in profit. The Division’s profit margin improved on execution of higher-margin orders compared to the second quarter a year earlier. In addition, the prior-year period included €209 million in charges related to extensive project reviews. Orders in the rolling stock business rose substantially from a low base in the prior-year period. The increase year-over-year includes a particularly large contract for high-speed trains in China.

Industry — Six months ended March 31, 2009

Sector		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Profit			1,605				1,944				(17	)%
Profit margin			8.9	%			10.8	%
New orders			18,577				20,801				(11	)%			(12	)%			1	%			0	%
Revenue			17,933				18,052				(1	)%			(2	)%			1	%			0	%

     While Industry remained the top profit contributor for Siemens in the first six months of fiscal 2009, the profit and profitability of the Sector were severely affected by increasingly deteriorating macroeconomic conditions in the course of the first half of fiscal 2009. This development was particularly evident at Industry Automation and OSRAM and to a lesser but increasing extent at Drive Technologies.

     Orders for Industry in the first six months came in 11% lower compared to the first half of fiscal 2008, while revenue remained nearly level with the prior-year period. Orders declined in all Divisions except for Mobility, which won a significantly higher order volume from major contracts in the current period compared to the first six months a year earlier. Revenue declined at Industry Automation and OSRAM, whereas the other Divisions increased revenue or kept it stable year-over-year. On a geographic basis, declines in orders were spread nearly evenly over the regions. Revenue was slightly down in the regions Europe, C.I.S., Africa, Middle East and the Americas, whereas it increased 4% in Asia, Australia.

Divisions		New Orders
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Industry Automation			3,571				4,518				(21	)%			(19	)%			1	%			(3	)%
Drive Technologies**			3,713				4,948				(25	)%			(26	)%			1	%			0	%
Building Technologies			2,924				3,098				(6	)%			(9	)%			1	%			2	%
OSRAM			2,068				2,381				(13	)%			(13	)%			3	%			(3	)%
Industry Solutions			3,653				4,561				(20	)%			(20	)%			0	%			0	%
Mobility			4,132				3,081				34	%			34	%			0	%			0	%

Divisions		Revenue
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Industry Automation			3,662				4,211				(13	)%			(12	)%			1	%			(2	)%
Drive Technologies**			4,014				3,978				1	%			(1	)%			1	%			1	%
Building Technologies			2,974				2,866				4	%			0	%			2	%			2	%
OSRAM			2,068				2,381				(13	)%			(13	)%			3	%			(3	)%
Industry Solutions			3,555				3,294				8	%			5	%			1	%			2	%
Mobility			3,106				2,791				11	%			12	%			(1	)%			0	%

Divisions		Profit												Profit Margin
		Six months												Six months
		ended March 31,												ended March 31,
(€ in millions)		2009				2008				%Change				2009				2008
Industry Automation			352				786				(55	)%			9.6	%			18.7	%
Drive Technologies*			504				566				(11	)%			12.6	%			14.2	%
Building Technologies			221				202				9	%			7.4	%			7.0	%
OSRAM			100				248				(60	)%			4.8	%			10.4	%
Industry Solutions			237				212				12	%			6.7	%			6.4	%
Mobility			191				(72	)			—				6.1	%			(2.6	)%

     Orders and revenue at Industry Automation decreased sharply in the first six months compared to the prior-year period, with the decline in demand accelerating in the second quarter of the current period. Both orders and revenue contracted most strongly in Europe, C.I.S., Africa, Middle East, the Division’s largest regional market. Profit declined by more than half compared to the first six months a year earlier, mainly due to lower capacity utilization and a less favorable business mix. In the prior-year period, profit benefited from a €36 million gain on the sale of a business in the first quarter. In the current period, PPA effects associated with the acquisition of UGS were €71 million, equivalent to 1.9 percentage points of profit margin. In the same period a year ago, PPA effects of €74 million and integration costs of €7 million related to UGS were also equivalent to 1.9 percentage points of profit margin.

     Orders at Drive Technologies for the first six months of fiscal 2009 were down 25%, with double-digit decreases in all three regions and the biggest decline in Europe, C.I.S., Africa, Middle East, the Division’s largest region. First-half revenue was level year-over-year, on strong conversion of prior-period orders in the first quarter. In contrast, capacity utilization declined on lower revenue in the second quarter, and first-half profit came in 11% below the same period a year ago. The Division recorded PPA effects of €18 million in the current period and €19 million in the first half of fiscal 2008 related to the acquisition of Flender.

     Order intake at Building Technologies for the first six months contracted by 6% compared to the prior-year period due to the general slowdown in commercial construction particularly in the region Europe, C.I.S., Africa, Middle East and the U.S. market, while revenue increased slightly year-over-year. First-half profit for Building Technologies rose 9%, to €221 million, on strong first-quarter results.

     Challenging market conditions led to a 13% decline in first-half revenue at OSRAM, with the sharpest decreases coming in the automotive and semiconductor businesses. Due to the resulting decrease in capacity utilization, OSRAM’s profit fell to €100 million for the first six months despite a positive effect from currency hedging activities not qualifying for hedge accounting.

     Orders at Industry Solutions contracted sharply year-over-year, as the Division’s large metals technologies business experienced a significant reversal of demand compared to recent quarters. In contrast, conversion of prior-period orders in metals technologies led first-half revenue 8% higher, with the strongest regional contribution coming from Asia, Australia. This in turn improved the Division’s profit compared to the first six months a year earlier. Profit in the prior-year period benefited from a €30 million gain on the sale of a business mentioned above.

     Orders at Mobility surged by 34% in the first six months compared to the prior-year period, including a significantly higher volume from major contracts. In the current period these included the large train order in China mentioned above as well as several major contract wins in Germany. Revenue in the current period was up 11% compared to the first six months a year earlier. On a geographic basis, revenue increased by 19% in the Europe, C.I.S., Africa, Middle East region, with particular strength in Germany, while the Americas and Asia, Australia were near the level of the prior-year period. First-half profit was €191 million compared to a loss of €72 million a year earlier. While the current period benefited from a €10 million positive effect related to the settlement of a claim in the rolling stock business and the execution of higher-margin orders compared to the first half a year ago, that prior-year period was burdened by charges of €209 million related to the project review mentioned above as well as an additional €32 million in charges related to Combino.

Energy — Three months ended March 31, 2009

Sector		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Profit			818				6				>200	%
Profit margin			12.9	%			0.1	%
New orders			8,206				9,026				(9	)%			(8	)%			(1	)%			0	%
Revenue			6,364				4,964				28	%			28	%			0	%			0	%

     With a strong performance across all Divisions, the Energy Sector was the top contributor to Total Sectors profit in the second quarter. Sector profit rose to €818 million, as Energy combined economies of scale with improvements in project execution compared to the prior-year quarter. For comparison, that period included charges of €559 million stemming from a review of projects in the fossil power generation business. All Divisions within the Sector posted at least double-digit increases in profit year-over-year, and profit margins remained in their target ranges at all Divisions.

     Revenue for Energy climbed 28% compared to the prior-year period, including growth in all regions. Due to deterioration in the macroeconomic and financing environment, customers postponed potential new business. Order intake slowed at nearly all Divisions, and orders for the Sector overall came in 9% below the high level of the prior-year period. Nevertheless, the book-to-bill ratio was 1.29 and there were no material order cancellations during the quarter, so Energy’s order back-log grew to €48 billion, including €1.5 billion in new contracts for power generation and transmission in Iraq. The Sector expects continued pressure on order intake through fiscal 2009.

Divisions		New Orders
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Fossil Power Generation			3,475				4,192				(17	)%			(19	)%			2	%			0	%
Renewable Energy			1,587				961				65	%			75	%			(10	)%			0	%
Oil & Gas			920				1,096				(16	)%			(12	)%			(3	)%			(1	)%
Power Transmission			1,594				1,993				(20	)%			(19	)%			(1	)%			0	%
Power Distribution			757				917				(17	)%			(15	)%			(2	)%			0	%

Divisions		Revenue
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Fossil Power Generation			2,377				1,732				37	%			35	%			2	%			0	%
Renewable Energy			800				417				92	%			88	%			3	%			1	%
Oil & Gas			1,040				981				6	%			12	%			(5	)%			(1	)%
Power Transmission			1,503				1,256				20	%			21	%			(1	)%			0	%
Power Distribution			846				699				21	%			23	%			(2	)%			0	%

Divisions		Profit												Profit Margin
		Three months												Three months
		ended March 31,												ended March 31,
(€ in millions)		2009				2008				%Change				2009				2008
Fossil Power Generation			312				(328	)			—				13.1	%			(18.9	)%
Renewable Energy			105				35				200	%			13.1	%			8.4	%
Oil & Gas			121				78				55	%			11.6	%			8.0	%
Power Transmission			168				144				17	%			11.2	%			11.5	%
Power Distribution			106				77				38	%			12.5	%			11.0	%

     The Fossil Power Generation Division was the top profit contributor among all Siemens Divisions, producing €312 million in profit in the second quarter, including a strong contribution from the service business. In the same period a year earlier, the Division took the € 559 million in charges mentioned above following a review of turnkey projects, and subsequently focused on improving its margin quality and project execution. The project review also resulted in a €200 million revenue reduction in the prior-year period, lowering the basis of comparison for the Division’s 37% increase in revenue in the current quarter. While orders included €1.1 billion from the contracts in Iraq mentioned above, customers postponed potential new projects. This reduced the volume from major orders year-over-year. As a result, second-quarter orders for Fossil Power Generation came in 17% lower compared to a peak level in the prior-year quarter. Siemens announced that it would exit its Areva NP joint venture, and its equity stake is now accounted for as held for disposal. These changes are expected to substantially reduce volatility in the Division’s equity investment income.

     The Renewable Energy Division delivered sharp increases in profit, revenue and orders in the second quarter. Profit climbed to €105 million from €35 million, driven by a combination of improved business mix and economies of scale. Orders surged to €1.587 billion after two quarters at relatively reduced levels, driven by a large order for turbines for offshore wind-farms in Europe. This and other major contract wins have weighted the Division’s backlog toward long-lead-time offshore projects.

     The Oil & Gas Division produced €121 million in profit in the second quarter, and all business units increased their profit margins compared to the same quarter a year earlier. Macroeconomic and financing conditions slowed order intake compared to the same quarter a year earlier.

     Power Transmission brought in €168 million in profit on a 20% increase in revenue. Orders fell 20% from the prior-year level, as the macroeconomic and financing environment led customers to postpone a significant volume of planned projects. This trend had a similar effect on orders at Power Distribution, and is expected to have an impact on revenue in coming quarters because the Division’s business mix includes a significant proportion of industrial customers whose postponements affect near-term order conversion into revenue. In the current quarter Power Distribution generated €106 million in profit and revenue rose 21% in part due to a low basis of comparison in the prior-year period.

Energy — Six months ended March 31, 2009

Sector		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Profit			1,574				353				>200	%
Profit margin			12.5	%			3.5	%
New orders			16,740				18,105				(8	)%			(8	)%			0	%			0	%
Revenue			12,596				9,999				26	%			26	%			0	%			0	%

     With all Divisions delivering higher profits compared to the prior-year period, the Energy Sector turned in a strong first half in fiscal 2009, improving six-month Sector profit to €1.574 billion from €353 million a year earlier. Profit growth year-over-year was driven by Fossil Power Generation, as its prior-year results were burdened by the €559 million in second-quarter project charges mentioned above as well as charges of more than €200 million taken in the first quarter of fiscal 2008.

     Revenue for Energy rose 26% in the first six months of fiscal 2009, on double-digit increases in all Divisions and regions, led by strong growth at Fossil Power Generation and Renewable Energy. Orders decreased 8% compared to the strong first half a year earlier, which included peak order levels at Oil & Gas, Power Transmission and Power Distribution. On a geographic basis, revenue grew strongest in the regions Europe, C.I.S., Africa, Middle East and the Americas, while orders climbed in Asia, Australia due mainly to the above-mentioned energy infrastructure orders from Iraq.

Divisions		New Orders
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Fossil Power Generation			7,472				7,623				(2	)%			(4	)%			2	%			0	%
Renewable Energy			2,235				1,993				12	%			17	%			(5	)%			0	%
Oil & Gas			2,280				2,943				(23	)%			(20	)%			(2	)%			(1	)%
Power Transmission			3,509				3,917				(10	)%			(9	)%			(1	)%			0	%
Power Distribution			1,614				1,837				(12	)%			(11	)%			(1	)%			0	%

Divisions		Revenue
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Fossil Power Generation			4,750				3,633				31	%			29	%			2	%			0	%
Renewable Energy			1,513				834				81	%			80	%			1	%			0	%
Oil & Gas			2,088				1,808				15	%			21	%			(5	)%			(1	)%
Power Transmission			3,003				2,500				20	%			20	%			0	%			0	%
Power Distribution			1,651				1,431				15	%			17	%			(2	)%			0	%

Divisions		Profit												Profit Margin
		Six months												Six months
		ended March 31,												ended March 31,
(€ in millions)		2009				2008				%Change				2009				2008
Fossil Power Generation			601				(303	)			—				12.7	%			(8.3	)%
Renewable Energy			206				87				137	%			13.6	%			10.4	%
Oil & Gas			227				144				58	%			10.9	%			8.0	%
Power Transmission			320				269				19	%			10.7	%			10.8	%
Power Distribution			213				155				37	%			12.9	%			10.8	%

     Fossil Power Generation led all Siemens Divisions with €601 million in profit for the first six months of fiscal 2009. For comparsion, the first-half loss of €303 million a year earlier included the substantial project charges mentioned above. The Division’s revenue rose 31% on higher sales in Europe, C.I.S., Africa, Middle East and the Americas. In contrast, strong order growth in Asia, Australia was the main factor in bringing the Division’s orders near to the prior-year level, including Fossil Power Generation’s portion of the large second-quarter energy infrastructure orders from Iraq.

     Profit of €206 million at Renewable Energy more than doubled compared to €87 million in the first half of fiscal 2008, driven by an 81% increase in revenue on strong growth in all regions. The Division’s order increase of 12% includes high volume from major orders in both periods under review.

     Oil & Gas brought in €227 million in profits in the first half, compared to €144 million in the same period a year earlier. Orders declined 23% compared to the first six months of the prior fiscal year, as the Division took in a lower volume of large orders in all regions.

     The Power Transmission Division posted first-half profit of €320 million, up 19% from the prior-year period on double-digit revenue increases in all regions. Power Distribution grew profit by 37% to €213 million, on a 15% increase in revenue. Both power grid infrastructure Divisions reported a decline in order intake compared to the first half of fiscal 2008.

Healthcare — Three months ended March 31, 2009

Sector		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Profit			355				341				4	%
Profit margin			11.9	%			12.5	%
New orders			2,951				2,790				6	%			1	%			5	%			0	%
Revenue			2,984				2,722				10	%			4	%			6	%			0	%

     The Healthcare Sector again showed its strength under tough market conditions, as the financing and macroeconomic environment continued to depress demand and increase competitive pressure. Sector profit increased 4%, to €355 million. The Diagnostics Division recorded a total of €64 million in PPA effects and integration costs associated with acquisitions. PPA effects and integration costs reduced Sector profit margin by 2.1 percentage points in the second quarter, compared to 3.7 percentage points in the prior-year period.

     Healthcare posted a 10% increase in revenue and 6% rise in orders. Excluding the benefit of positive currency translation effects, revenue was up 4% and orders were up 1%. The book-to-bill ratio came in just below 1 and the backlog remained at €7 billion. Healthcare expects continued deterioration in market conditions.

Divisions		New Orders
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Imaging & IT			1,661				1,594				4	%			(1	)%			5	%			0	%
Workflow & Solutions			489				459				7	%			4	%			3	%			0	%
Diagnostics			867				822				5	%			0	%			5	%			0	%

Divisions		Revenue
		Three months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Imaging & IT			1,774				1,629				9	%			3	%			6	%			0	%
Workflow & Solutions			412				376				10	%			7	%			3	%			0	%
Diagnostics			867				816				6	%			0	%			6	%			0	%

Divisions		Profit												Profit Margin
		Three months												Three months
		ended March 31,												ended March 31,
(€ in millions)		2009				2008				%Change				2009				2008
Imaging & IT			265				236				12	%			14.9	%			14.5	%
Workflow & Solutions			30				63				(52	)%			7.3	%			16.8	%
Diagnostics			54				49				10	%			6.2	%			6.0	%

     Imaging & IT was again a top earnings performer for Siemens, with second-quarter profit rising to €265 million on an increase in profit margin year-over-year. Tight credit and the economic downturn continued to constrain market growth, particularly in the U.S. and Japan. Growth in the region Asia, Australia excluding Japan and in Europe, C.I.S., Africa, Middle East offset this weakness. On an organic basis, revenue for the Division was up 3% and orders declined 1%. The book-to-bill ratio was below 1.

     Challenges related to the macroeconomic and financing environment intensified at Workflow & Solutions. While the Division posted higher revenue overall, key solutions businesses experienced revenue declines that reduced their profitability compared to the prior-year period. Combined with pricing pressure, this reduced profit and profit margin for the Division overall.

     Profit at Diagnostics rose to €54 million for the second quarter, up 10% from the prior-year quarter. The Division’s profit margin was reduced by PPA effects of €47 million and integration costs of €17 million associated with acquisitions. These factors together amounted to 7.5 percentage points. A year earlier, second-quarter PPA and integration costs at Diagnostics were €50 million and €52 million, respectively, and cut 12.4 percentage points from profit margin. Profit margin was influenced by effects related to new product introduction and write-downs of receivables. Second-quarter revenue was up 6% year-over-year and orders rose 5%. On an organic basis, primarily excluding currency translation effects, both revenue and orders were level with the prior-year period, as growth in Asia, Australia excluding Japan offset weakness in the Division’s large U.S. market.

Healthcare — Six months ended March 31, 2009

Sector		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Profit			697				673				4	%
Profit margin			11.8	%			12.5	%
New orders			5,847				5,596				4	%			(2	)%			4	%			2	%
Revenue			5,920				5,375				10	%			3	%			5	%			2	%

     For the first six months of fiscal 2009, Healthcare posted Sector profit of €697 million, up 4% compared to €673 million in the first six months a year earlier. The Imaging & IT Division again was one of Siemens’ top profit contributors in the period. Profit in both periods was negatively influenced by PPA effects and integration costs arising from acquisitions in fiscals 2007 and 2008 relating to the Diagnostics Division. Diagnostics recorded a total of €130 million in PPA effects and integration costs associated with acquisitions, including Dade Behring. PPA effects and integration costs were equivalent to 2.2 percentage points of Sector profit margin in the first half, compared to 3.5 percentage points in the prior-year period. Furthermore charges related to a major project at Workflow & Solutions held back profit growth year-over-year.

     First-half revenue for Healthcare rose 10% and new orders increased 4%. Within order development, Asia, Australia posted a double-digit increase, while orders in the Americas were up 2% and orders in Europe, C.I.S., Africa, Middle East came in slightly below the prior-year period. On an organic basis, revenue rose 3% and orders decreased 2%. In the first half the book-to-bill ratio for the Sector was just below 1, compared to 1.04 in the prior-year period.

Divisions		New Orders
		Six months
		ended March 31,								% Change								therein
(€ in millions)		2009				2008				Actual				Adjusted*				Currency				Portfolio
Imaging & IT			3,430				3,349				2	%			(2	)%			4	%			0	%
Workflow & Solutions			824				855				(4	)%			(6	)%			2	%			0	%
Diagnostics			1,731				1,535				13	%			0	%			5	%			8	%