By John Revill
ZURICH (Reuters) -Siemens saw a boom in first-quarter orders, the German engineering and technology group said on Thursday, sending its shares sharply higher.
Orders surged 52%, the maker of trains and factory software said, as customers stocked up to make sure they got enough equipment and demand increased after the pandemic slowdown.
“We’ve seen an unprecedented boom,” CEO Roland Busch told reporters. The company‘s shares gained 6.4% in early trading.
As one of the largest capital goods manufacturers, supplying equipment to factories, Siemens’ results reflect the health of the broader economy.
Industry has been hampered in its post-pandemic upturn by a shortage of components, particularly semiconductor chips, as well as congested logistic chains which has delayed production of cars, computers and other products.
This had led to massive pre-ordering by customers desperate to get their hands on electrical and automation products.
Siemens was overcoming many of the problems, Busch said, although some customers were seeing longer delivery times.
The company now has an order backlog of 93 billion euros, its highest ever level, which would lead to delays, Busch said.
“It will take several quarters for this backlog to be processed,” Busch said. “We’re optimising manufacturing… leveraging our global footprint and our broad base of suppliers and partners.
“However, we’re currently unable to meet our high standards for delivery times for all our products.”
Revenue and profit both benefited from the orders surge which was particularly strong in China, Germany and Italy.
Big contracts for new trains were signed and there was high demand for software used to make integrated circuits and printed circuit boards, Siemens said.
Industrial profit rose 12% to 2.46 billion euros during its first quarter which ended December 31, beating analyst forecasts for 2.27 billion euros.
Net profit rose 20% to 1.8 billion euros on revenue up 17% to 16.50 billion euros, beating forecasts for 15.95 billion.
Jefferies analyst Simon Toennessen described the results as “excellent.”
Siemens confirmed its guidance for 2022, saying it expected mid-single-digit percentage revenue growth and earnings per share of 8.70 to 9.10 euros.
It would also continue trimming its portfolio of companies as it seeks to become a more focused technology company. It said it expect to raise around 1.5 billion euros towards net income from sales of underperforming units this year.
Late on Wednesday it said it was selling the mail and parcels part of its logistics business and its 50% stake in the Valeo Siemens e-Automotive joint venture..
($1 = 0.8754 euros)
(Editing by Maria Sheahan and Jason Neely)